Exhibit 10.2
(J.P. MORGAN LOGO) [c19902c1990201.gif]
$200,000,000
SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION CREDIT AGREEMENT
among
NBC HOLDINGS CORP. and
NBC ACQUISITION CORP.,
each a Debtor and Debtor-in-Possession, as Guarantors,
NEBRASKA BOOK COMPANY, INC.,
a Debtor and Debtor-in-Possession, as Borrower,
The Several Lenders
from Time to Time Parties Hereto,
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent and
Collateral Agent,
Dated as of June ___, 2011
J.P. MORGAN SECURITIES LLC
as Sole Arranger and Sole Bookrunner

 

 

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TABLE OF CONTENTS

              Page  
 
       
 
       
SECTION 1. DEFINITIONS
    2  
 
       
1.1 Defined Terms
    2  
1.2 Other Definitional Provisions
    37  
1.3 Accounting Terms; GAAP
    37  
 
       
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
    37  
 
       
2.1 Commitments
    37  
2.2 Procedure for Borrowing
    38  
2.3 Base Rate Loans Prior to Second Availability Date
    39  
2.4 RESERVED
    39  
2.5 Repayment of Loans; Evidence of Debt
    39  
2.6 Commitment Fees, etc
    40  
2.7 Termination or Reduction of Revolving Credit Commitments
    40  
2.8 Optional Prepayments
    41  
2.9 Mandatory Prepayments
    41  
2.10 Conversion and Continuation Options
    42  
2.11 Minimum Amounts and Maximum Number of Eurodollar Tranches
    43  
2.12 Interest Rates and Payment Dates
    43  
2.13 Computation of Interest and Fees
    44  
2.14 Inability to Determine Interest Rate
    44  
2.15 Pro Rata Treatment and Payments
    45  
2.16 Requirements of Law
    46  
2.17 Taxes
    48  
2.18 Indemnity
    51  
2.19 Illegality
    51  
2.20 Change of Lending Office
    51  
2.21 Replacement of Lenders under Certain Circumstances
    52  
2.22 Defaulting Lenders
    52  
2.23 Protective Advances
    54  
2.24 Priority and Liens
    55  
2.25 Payment of Obligations
    56  
2.26 No Discharge; Survival of Claims
    56  
2.27 Conflicts
    56  
 
       
SECTION 3. LETTERS OF CREDIT
    56  
 
       
3.1 L/C Commitment
    56  
3.2 Procedure for Issuance of Letter of Credit
    57  
3.3 Commissions, Fees and Other Charges
    57  
3.4 L/C Participations
    57  
3.5 Reimbursement Obligation of the Borrower
    58  

 

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              Page  
 
       
3.6 Obligations Absolute
    60  
3.7 Letter of Credit Payments
    59  
3.8 Applications
    59  
 
       
SECTION 4. REPRESENTATIONS AND WARRANTIES
    60  
 
       
4.1 Financial Condition
    60  
4.2 No Change
    61  
4.3 Corporate Existence; Compliance with Law
    61  
4.4 Corporate Power; Authorization; Enforceable Obligations
    61  
4.5 No Legal Bar
    62  
4.6 No Material Litigation
    62  
4.7 No Default
    62  
4.8 Ownership of Property; Liens
    62  
4.9 Intellectual Property
    62  
4.10 Taxes
    63  
4.11 Federal Regulations
    63  
4.12 Labor Matters
    63  
4.13 ERISA; Employee Benefits Plans
    63  
4.14 Investment Company Act; Other Regulations
    64  
4.15 Capitalization and Subsidiaries
    64  
4.16 Use of Proceeds
    65  
4.17 Environmental Matters
    65  
4.18 Accuracy of Information, etc
    66  
4.19 Security Documents
    66  
4.20 Insurance
    67  
4.21 Material Contracts
    67  
 
       
SECTION 5. CONDITIONS PRECEDENT
    67  
 
       
5.1 Conditions to First Availability Date
    67  
5.2 Conditions to Second Availability Date
    71  
5.3 Conditions to Each Extension of Credit
    71  
 
       
SECTION 6. AFFIRMATIVE COVENANTS
    72  
 
       
6.1 Financial Statements
    72  
6.2 Certificates; Other Information
    73  
6.3 Payment of Obligations
    76  
6.4 Conduct of Business and Maintenance of Existence, etc
    76  
6.5 Maintenance of Property; Insurance
    76  
6.6 Inspection of Property; Books and Records; Discussions; Appraisals; Field
Examinations
    76  
6.7 Notices
    77  
6.8 Environmental Laws
    78  
6.9 Additional Collateral, etc
    79  
6.10 Control Agreements
    81  

 

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              Page  
 
       
6.11 Update Calls
    81  
6.12 Ratings
    82  
6.13 Post Closing Covenants
    82  
 
       
SECTION 7. NEGATIVE COVENANTS
    83  
 
       
7.1 Financial Condition Covenants
    83  
7.2 Limitation on Indebtedness
    84  
7.3 Limitation on Liens
    85  
7.4 Limitation on Fundamental Changes
    87  
7.5 Limitation on Sale of Assets
    87  
7.6 Limitation on Restricted Payments
    88  
7.7 Limitation on Investments, Loans and Advances
    88  
7.8 Limitation on Modifications of Material Documents
    89  
7.9 Limitation on Transactions with Affiliates
    89  
7.10 Limitation on Sales and Leasebacks
    90  
7.11 Limitation on Changes in Fiscal Periods
    90  
7.12 Limitation on Negative Pledge Clauses
    90  
7.13 Limitation on Restrictions on Subsidiary Distributions
    90  
7.14 Limitation on Lines of Business
    90  
7.15 Limitation on Activities of Holdings and SuperHoldings
    90  
7.16 Swap Agreements
    91  
7.17 No Non-Debtors
    91  
7.18 Chapter 11 Claims
    91  
 
       
SECTION 8. EVENTS OF DEFAULT; APPLICATION OF PROCEEDS
    91  
 
       
8.1 Events of Default
    91  
8.2 Application of Proceeds
    96  
 
       
SECTION 9. THE AGENTS
    97  
 
       
9.1 Appointment
    97  
9.2 Delegation of Duties
    98  
9.3 Exculpatory Provisions
    98  
9.4 Reliance by Administrative Agent
    98  
9.5 Notice of Default
    99  
9.6 Non-Reliance on Administrative Agent and Other Lenders
    99  
9.7 Indemnification
    99  
9.8 Administrative Agent in Its Individual Capacity
    100  
9.9 Successor Administrative Agent
    100  
9.10 Authorization to Release Liens
    100  
9.11 Reports
    101  
9.12 Arranger
    101  

 

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              Page  
 
       
SECTION 10. MISCELLANEOUS
    101  
 
       
10.1 Amendments and Waivers
    101  
10.2 Notices
    102  
10.3 No Waiver; Cumulative Remedies
    103  
10.4 Survival of Representations and Warranties
    104  
10.5 Payment of Expenses
    104  
10.6 Successors and Assigns; Participations and Assignments
    106  
10.7 Adjustments; Set-off
    109  
10.8 Counterparts
    110  
10.9 Severability
    110  
10.10 Integration
    110  
10.11 GOVERNING LAW
    110  
10.12 Submission To Jurisdiction; Waivers
    111  
10.13 Acknowledgements
    111  
10.14 WAIVERS OF JURY TRIAL
    112  
10.15 Confidentiality
    112  
10.16 USA PATRIOT Act
    113  
10.17 Appointment for Perfection
    113  
10.18 Reserved
    113  
10.19 Release of Liens
    113  
10.20 Disclosure
    113  
 
       
SECTION 11. REMEDIES; APPLICATION OF PROCEEDS
    114  
 
       
11.1 Remedies; Obtaining the Collateral Upon Default
    114  
11.2 Remedies; Disposition of the Collateral
    115  
11.3 Application of Proceeds
    115  
11.4 WAIVER OF CLAIMS
    117  
11.5 Remedies Cumulative
    117  
11.6 Discontinuance of Proceeding
    117  

 

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SCHEDULES:

     
1.1A
  Revolving Credit Commitments
1.1B
  Mortgaged Property
1.1C
  Priming Jurisdictions
3.1
  Rollover Letters of Credit
4.4
  Consents, Authorizations, Filings and Notices
4.9
  Intellectual Property
4.15
  Subsidiaries
4.19(b)
  UCC Filing Jurisdictions
4.19(c)
  Mortgage Filing Jurisdictions
4.20
  Insurance
4.21
  Material Contracts
5.1(s)
  Prepetition Letters of Credit
7.2(e)
  Existing Indebtedness
7.3(f)
  Existing Liens
7.5
  Permitted Asset Sales
7.7
  Existing Investments

EXHIBITS:

     
 
   
A
  Form of Guarantee and Collateral Agreement
B-1
  Form of Borrower Compliance Certificate
B-2
  Form of Holdings Compliance Certificate
B-3
  Form of SuperHoldings Compliance Certificate
C-1
  Form of Borrower Closing Certificate
C-2
  Form of Holdings Closing Certificate
C-3
  Form of Subsidiary Closing Certificate
C-4
  Form of SuperHoldings Closing Certificate
D
  [Reserved]
E
  Form of Assignment and Assumption
F
  Form of Legal Opinion of Kirkland & Ellis LLP
G-1
  Form of Revolving Credit Note
G-2
  Form of Term Loan Note
H
  Form of U.S. Tax Certificate
I
  Form of Borrowing Base Certificate
F
  Form of Interim Order

 

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This SECURED SUPERPRIORITY DEBTOR-IN-POSSESSION CREDIT AGREEMENT (this
“Agreement”), dated as of [                                         ,] 2011,
among NBC Holdings Corp., a Delaware corporation (“SuperHoldings”), NBC
Acquisition Corp., a Delaware corporation (“Holdings”), Nebraska Book Company,
Inc., a Kansas corporation (the “Borrower”), each of which is a debtor and
debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy Code,
the several banks and other financial institutions or entities from time to time
parties to this Agreement (the “Lenders”) and JPMORGAN CHASE BANK, N.A., as
administrative agent and collateral agent (in such capacity, the “Administrative
Agent”).
PRELIMINARY STATEMENTS
On June [                    ], 2011 (the “Petition Date”), the Debtors (such
term and other capitalized terms used in these recitals being used with the
meanings given to such terms in Section 1.1) filed voluntary petitions with the
Bankruptcy Court initiating the Cases and have continued in the possession of
their assets and in the management of their businesses pursuant to Bankruptcy
Code Sections 1107 and 1108;
Pursuant to this Agreement and the Orders, the Lenders are making available to
the Borrower a $125,000,000 debtor-in-possession term loan facility (the “Term
Loan Facility”) and a $75,000,000 debtor-in-possession revolving facility (the
“Revolving Facility”);
The proceeds of the Loans will be used for working capital purposes of the
Borrower, the other Loan Parties and their respective Subsidiaries (including
without limitation, for the payment of fees and expenses incurred in connection
with entering into this Agreement, the Cases and the transactions contemplated
hereby, the repayment of loans outstanding under the Prepetition Credit
Agreement and cash collateralization of the Prepetition Letters of Credit), in
all cases subject to the terms of this Agreement and the Orders;
To provide guarantees for the repayment of the Loans and the payment of the
other Obligations of the Loan Parties hereunder and under the other Loan
Documents, the Loan Parties are providing to the Administrative Agent and the
Lenders, pursuant to this Agreement, the other Loan Documents and the Orders,
the following (each as more fully described herein or therein, as applicable):
(a) a guarantee from each of the Debtors other than the Borrower of the due and
punctual payment and performance of the Obligations of the Borrower;
(b) an allowed administrative expense claim entitled to the benefits of
Bankruptcy Code Section 364(c)(1) in each of the Cases, having superpriority
over any and all administrative expenses of the kind specified in Bankruptcy
Code Sections 503(b) or 507(b);
(c) pursuant to Bankruptcy Code Section 364(c)(2) a perfected first priority
Lien on all present and after-acquired property of the Debtors not subject to a
valid, perfected and non-avoidable Lien on the Petition Date, excluding, in all
cases, with respect to the obligations of Loan Parties under any Loan Document,
(i) 35% of the Capital Stock of any new or existing Foreign Subsidiary
(including, for the avoidance of doubt, 100% of the issued and outstanding
Capital Stock of any new or existing Foreign Subsidiary not owned directly by a
Debtor) and (ii) 35% of the Capital Stock of any Subsidiary substantially all of
whose assets consist of Capital Stock of one or more Foreign Subsidiaries (any
Capital Stock so excluded, collectively, the “Excluded Equity Interests”);

 

 

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(d) pursuant to Bankruptcy Code Section 364(c)(3) a perfected junior Lien on all
present and after-acquired property of the Debtors that is otherwise subject to
a valid, perfected and non-avoidable Lien on the Petition Date (other than Liens
securing the Debtors’ Prepetition Obligations and Liens that are junior to the
Liens securing the Debtors’ Prepetition Obligations) or a valid Lien perfected
(but not granted) after the Petition Date to the extent such post-Petition Date
perfection in respect of a pre-Petition Date claim is expressly permitted under
the Bankruptcy Code, excluding, in all cases, the Excluded Equity Interests;
(e) pursuant to Bankruptcy Code Section 364(d)(1) a perfected first priority,
senior priming Lien on (i) all present and after-acquired property of the
Debtors that is subject to a Lien on or after the Petition Date to secure the
Debtors’ Prepetition Obligations other than the Lien on the L/C Cash Collateral,
(ii) all present and after-acquired assets that are presently subject to Liens
that are junior to the Liens that secure the Debtors’ Prepetition Obligations
and (iii) the Liens granted after the Petition Date to provide adequate
protection in respect of the Prepetition Obligations or obligations secured by
Liens that are junior to the Liens that secure the Debtors’ Prepetition
Obligations;
It is understood and agreed that, subject to the Orders, (i) to the extent any
Liens created prior to the Petition Date on any Collateral are avoided, such
Collateral will be automatically subject to the first priority Liens securing
the Obligations and (ii) the foregoing Liens and Superpriority Claims shall be
subject and subordinate to the Carve Out (other than with respect to the L/C
Cash Collateral).
NOW, THEREFORE, in consideration of the premises and the agreements hereinafter
set forth, the parties hereto hereby agree as follows:
Section 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.
“Account”: as defined in the UCC in effect in the State of New York from time to
time.
“Administrative Agent”: as defined in the preamble hereto.
“Affiliate”: as to any Person, any other Person which, directly or indirectly,
is in control of, is controlled by, or is under common control with, such
Person. For purposes of this definition, “control” of a Person means the power,
directly or indirectly, either to (a) vote 10% or more of the securities having
ordinary voting power for the election of directors (or persons performing
similar functions) of such Person or (b) direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.

 

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“Agreement”: as defined in the preamble hereto.
“Applicable Margin”: (a) for the Term Loans, (i) 6.00% per annum in the case of
Base Rate Loans and (ii) 7.00% per annum in the case of Eurodollar Loans and
(b) for the Revolving Credit Loans, (i) 2.50% per annum in the case of Base Rate
Loans and (ii) 3.50% per annum in the case of Eurodollar Loans.
“Applicable Percentage”: as to any Lender at any time, the percentage which such
Lender’s unutilized Commitments and Exposure then constitutes of the aggregate
unutilized Commitments and Exposures of all Lenders.
“Applicable Revolving Percentage”: as to any Revolving Lender at any time, the
percentage which such Revolving Lender’s Revolving Credit Commitment then
constitutes of the Total Revolving Credit Commitments (or, at any time after the
Revolving Credit Commitments shall have expired or terminated, the percentage
which the aggregate principal amount of such Revolving Lender’s Revolving Credit
Exposure then outstanding constitutes of the aggregate principal amount of the
Total Revolving Credit Exposure then outstanding).
“Applicable Term Loan Percentage”: as to any Term Lender at any time, the
percentage which such Term Lender’s Term Loan Commitment then constitutes of the
Total Term Loan Commitments (or, at any time after the First Availability Date,
the percentage which the aggregate principal amount of such Term Lender’s Term
Loan Exposure and unutilized Term Loan Commitment then outstanding constitutes
of the aggregate principal amount of the Total Term Loan Exposure and total
unutilized Term Loan Commitments then outstanding).
“Application”: an application, in such form as the Issuing Lender may specify
from time to time, requesting the Issuing Lender to open a Letter of Credit.
“Approved Fund”: as defined in Section 10.6(b).
“Arranger”: J.P. Morgan Securities LLC.
“Asset Sale”: any Disposition of Property or series of related Dispositions of
Property (excluding any such Disposition permitted by clause (a), (b) or (c) of
Section 7.5).
“Assignee”: as defined in Section 10.6(b).
“Assignment and Assumption”: an Assignment and Assumption, substantially in the
form of Exhibit E.
“Banking Services”: each and any of the following bank services provided to any
Loan Party by any Lender or any of its Affiliates (at the time such service is
provided): (a) credit cards for commercial customers (including, without
limitation, “commercial credit cards” and purchasing cards), (b) stored value
cards and (c) treasury management services (including, without limitation,
controlled disbursement, automated clearinghouse transactions, return items,
overdrafts and interstate depository network services).

 

3

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“Banking Services Obligations”: any and all obligations of the Loan Parties,
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 but
excluding Prepetition Banking Services Obligations.
“Bankruptcy Code”: the Bankruptcy Reform Act of 1978, as heretofore and
hereafter amended, and codified as 11 U.S.C. §§101 et seq.
“Bankruptcy Court”: the United States Bankruptcy Court for the District of
Delaware, or any other court having jurisdiction over the Cases from time to
time.
“Bankruptcy Event”: with respect to any Person, such Person becomes the subject
of a 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, 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, provided, further, that such
ownership interest does not result in or provide such Person with immunity from
the jurisdiction of courts within the United States or from the enforcement of
judgments or writs of attachment on its assets or permit such Person (or such
Governmental Authority or instrumentality) to reject, repudiate, disavow or
disaffirm any contracts or agreements made by such Person.
“Base Rate”: for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in effect on
such day, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of
1% and (c) the Eurodollar Rate for a Eurodollar Loan with a one-month interest
period commencing on such day plus 1.0% (provided that, for the avoidance of
doubt, the Eurodollar Rate for any day shall be based on the rate appearing on
the Reuters Screen LIBOR01 Page (or any successor or substitute page) at
approximately 11:00 a.m. London time on such day). For purposes hereof: “Prime
Rate” shall mean the rate of interest per annum publicly announced from time to
time by JPMorgan Chase Bank, N.A. as its prime or base rate in effect at its
principal office in New York City (the Prime Rate not being intended to be the
lowest rate of interest charged by JPMorgan Chase Bank, N.A. in connection with
extensions of credit to debtors). Any change in the Base Rate due to a change in
the Prime Rate, the Federal Funds Effective Rate or such Eurodollar Rate shall
be effective as of the opening of business on the effective day of such change
in the Prime Rate, the Federal Funds Effective Rate or such Eurodollar Rate,
respectively. Notwithstanding the foregoing, in the case of the Term Loans only,
the Base Rate shall not be less than 2.25% per annum.
“Base Rate Loans”: Loans the rate of interest applicable to which is based upon
the Base Rate.

 

4

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“Benefitted Lender”: as defined in Section 10.7.
“Board”: the Board of Governors of the Federal Reserve System of the United
States (or any successor).
“Bookstore”: any business establishment that has as its primary business the
sale of textbooks.
“Borrower”: as defined in the preamble hereto.
“Borrowing”: (a) Revolving Credit 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, and (b) a Protective Advance.
“Borrowing Base”: at any time, the sum of:
(a) the product of (i) 85% multiplied by (ii) the Eligible Accounts Receivable
of the Loan Parties at such time minus the Dilution Reserve, minus, without
duplication, any other Reserve related to Accounts, plus
(b) the lesser of (i) the product of (x) 55% (65% during the Peak Period)
multiplied by (y) the Eligible Inventory of the Loan Parties, valued at the
lower of cost or market value, at such time, minus, without duplication,
Inventory Reserves and (ii) the product of 85% multiplied by the Net Orderly
Liquidation Value percentage identified in the most recent inventory appraisal
ordered by the Administrative Agent multiplied by the Eligible Inventory of the
Loan Parties, valued at the lower of cost or market value, at such time minus,
without duplication, Inventory Reserves, minus
(c) the sum of (i) the Rent Reserve, (ii) the Carve Out Reserve and (ii) without
duplication, any other Reserve in the Permitted Discretion of the Administrative
Agent.
The Administrative Agent may, in its Permitted Discretion, reduce the advance
rates set forth above, adjust Reserves or reduce one or more of the other
elements used in computing the Borrowing Base, with any such changes to be
effective three Business Days after delivery of notice thereof to the Borrower
and the Lenders. The Borrowing Base at any time shall be determined by reference
to the most recent Borrowing Base Certificate delivered to the Administrative
Agent pursuant to Section 6.2(g).
At the time of any disposition of a Loan Party, or a sale of all or
substantially all of the assets of a Loan Party, the Borrower shall give the
Administrative Agent written notice of such disposition together with such
information as shall be required for the Administrative Agent to adjust the
Borrowing Base to reflect such disposition.

 

5

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“Borrowing Base Certificate”: a certificate in substantially the form of
Exhibit I hereto (with such changes thereto from time to time as may reasonably
be required by the Administrative Agent to reflect the components of and
reserves against the Borrowing Base as provided for herein), executed and
certified by a Responsible Officer of the Borrower, which certificate shall
include appropriate exhibits, schedules, supporting documentation and additional
reports (i) as outlined in Schedule 1 to Exhibit I and (ii) as provided for in
Section 6.2(g).
“Borrowing Date”: any Business Day specified by the Borrower as a date on which
the Borrower requests the relevant Lenders to make Loans hereunder.
“Budget”: the consolidated forecasts of the consolidated income statement of
Holdings and its Subsidiaries for each fiscal month, beginning with fiscal month
April 2011 through and including fiscal month June 2012, of the consolidated
cash flows and balance sheet of Holdings and its Subsidiaries for each fiscal
quarter until and including the second quarter of 2012 and of the Borrowing Base
and weekly cash receipts and disbursements of Holdings and its Subsidiaries for
each fiscal month, beginning with fiscal month April 2011 through and including
fiscal month March 2012, including the material assumptions on which such
forecasts were based (including, but not limited to, future cost reduction
initiatives), and setting forth the anticipated disbursements and uses of the
Loans and Letters of Credit.
“Business”: as defined in Section 4.17.
“Business Day”: (i) for all purposes other than as covered by clause (ii) below,
a day other than a Saturday, Sunday or other day on which commercial banks in
New York City are authorized or required by law to close and (ii) with respect
to all notices and determinations in connection with, and payments of principal
and interest on, Eurodollar Loans, any day which is a Business Day described in
clause (i) and which is also a day for trading by and between banks in Dollar
deposits in the interbank eurodollar market.
“Capital Lease Obligations”: as to any Person, 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 on
a balance sheet of such Person under GAAP, and, for the purposes of this
Agreement, the amount of such obligations at any time shall be the capitalized
amount thereof at such time determined in accordance with GAAP.
“Capital Stock”: any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.
“Carve Out”: as defined in Section 2.24(a).

 

6

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“Carve Out Reserves”: at any time, such reserves as the Administrative Agent,
from time to time, determines in its Permitted Discretion as being appropriate
to reflect (i) the remaining available amount of the Carve Out at such time, if
any and (ii) the accrued but unpaid fees, costs and expenses of professionals
retained by the Loan Parties and any Committee at such time, in each case as set
forth in the most recently delivered Borrowing Base Certificate.
“Cases”: one or more cases under Chapter 11 of the Bankruptcy Code with respect
to which the Debtors are the debtors and debtors-in-possession.
“Cash Collateral”: as defined in Section 363(a) of the Bankruptcy Code.
“Cash Dominion Period”: (a) each period when an Event of Default shall have
occurred and be continuing and (b) each period beginning on a date on which
Revolving Credit Availability is less than the greater of (i) 25% of the Total
Revolving Credit Commitments and (ii) $18,750,000; provided that any Cash
Dominion Period commencing under this clause (b) shall be discontinued when and
if Revolving Credit Availability shall be greater than such specified level for
60 consecutive days, provided further, however, that a Cash Dominion Period may
be discontinued no more than twice in any period of 12 consecutive months.
“Cash Equivalents”: (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition;
(b) certificates of deposit, time deposits, eurodollar time deposits or
overnight bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States of America or any state thereof having combined
capital and surplus of not less than $500,000,000; (c) commercial paper of an
issuer rated at least A-1 by Standard & Poor’s Ratings Services (“S&P”) or P-1
by Moody’s Investors Service, Inc. (“Moody’s”), or carrying an equivalent rating
by a nationally recognized rating agency, if both of the two named rating
agencies cease publishing ratings of commercial paper issuers generally, and
maturing within six months from the date of acquisition; (d) repurchase
obligations of any Lender or of any commercial bank satisfying the requirements
of clause (b) of this definition, having a term of not more than 30 days with
respect to securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least A
by S&P or A by Moody’s; (f) securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (b) of this
definition; or (g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition.
“Cash Flow Forecast”: as defined in Section 6.2(m).

 

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“Closing Date”: such date (which in no event shall be more than five Business
Days following the Interim Order Entry Date (or such later date as the
Administrative Agent may agree in its sole discretion)), on which the conditions
precedent set forth in Section 5.1 shall have been satisfied or waived by the
Arranger and the Term Loan shall have been funded.
“Code”: the Internal Revenue Code of 1986, as amended.
“Collateral”: all Property of the Loan Parties, now owned or hereafter acquired,
as more particularly described and referred to as “DIP Collateral” in the
Orders, and shall include any property upon which a Lien is purported to be
created by this Agreement, any Security Document, the Orders or any additional
orders of the Bankruptcy Court under the Cases (but shall exclude any Excluded
Equity Interests).
“Collateral Access Agreement”: as defined in the Guarantee and Collateral
Agreement.
“Collection Account”: as such term is defined in the Guarantee and Collateral
Agreement.
“Commitment Fee Rate”: 0.50% per annum.
“Commitment”: as to any Lender, collectively, such Lender’s Revolving Credit
Commitment and Term Loan Commitment.
“Committee”: any statutory committee appointed in the Cases.
“Commonly Controlled Entity”: an entity, whether or not incorporated, which is
under common control with any Loan Party within the meaning of Section 4001 of
ERISA or is part of a group which includes any Loan Party and which is treated
as a single employer under Section 414 of the Code.
“Compliance Certificate”: a certificate duly executed by a Responsible Officer
substantially in the form of Exhibit B.
“Concentration Account”: as defined in the Guarantee and Collateral Agreement.
“Conduit Lender”: any special purpose corporation organized and administered by
any Lender for the purpose of making Loans otherwise required to be made by such
Lender and designated by such Lender in a written instrument; provided, that the
designation by any Lender of a Conduit Lender shall not relieve the designating
Lender of any of its obligations to fund a Loan under this Agreement if, for any
reason, its Conduit Lender fails to fund any such Loan, and the designating
Lender (and not the Conduit Lender) shall have the sole right and responsibility
to deliver all consents and waivers required or requested under this Agreement
with respect to its Conduit Lender, and provided, further, that no Conduit
Lender shall (a) be entitled to receive any greater amount pursuant to
Section 2.16, 2.17, 2.18 or 10.5 than the designating Lender would have been
entitled to receive in respect of the extensions of credit made by such Conduit
Lender or (b) be deemed to have any Revolving Credit Commitment.

 

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“Confirmation Order”: an order of the Bankruptcy Court confirming the
Reorganization Plan.
“Consolidated EBITDA”: for any period, Consolidated Net Income for such period
plus, without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of (a) income
tax expense, (b) interest expense, amortization or writeoff of debt discount and
debt issuance costs and commissions, discounts and other fees and charges
associated with Indebtedness (including the Loans), (c) depreciation and
amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any non-cash extraordinary,
unusual or non-recurring expenses or losses (including, whether or not otherwise
includable as a separate item in the statement of such Consolidated Net Income
for such period, losses on sales of assets outside of the ordinary course of
business and excluding any non-cash expense to the extent that it represents an
accrual of or reserve for cash expenditures in any future period), (f) any other
non-cash charges, (g) (x) any costs, fees, expenses or disbursements of
attorneys, consultants or advisors to the Borrower and its Subsidiaries and to
the Committee, in each case, incurred in connection with the events leading up
to and the ongoing administration of the Cases, the Reorganization Plan and any
other financial restructuring and the negotiation, execution and documentation
of the Facilities and any amendments, waivers or other modifications to the
Prepetition Credit Agreement or this Agreement, together with any such costs,
fees, expenses or disbursements paid to the attorneys, consultants and advisors
of the agents and lenders in connection therewith; provided that the amounts
added back to Consolidated EBITDA pursuant to this clause (g)(x) in any period
of three consecutive fiscal months shall not exceed 120% of the amount projected
in the Budget for such costs, fees, expenses and disbursements for such period,
and (y) any upfront, arrangement or other fees paid by the Loan Parties in
connection with the Facilities, and (h) charges, premiums and expenses
associated with the discharge of Prepetition Indebtedness and minus, to the
extent included in the statement of such Consolidated Net Income for such
period, the sum of (x) interest income, (y) any extraordinary, unusual or
non-recurring income or gains (including, whether or not otherwise includable as
a separate item in the statement of such Consolidated Net Income for such
period, gains on the sales of assets outside of the ordinary course of business)
and (z) any other non-cash income, all as determined on a consolidated basis.
“Consolidated Net Income”: for any period, the consolidated net income (or loss)
of the Borrower and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary of the
Borrower or is merged into or consolidated with the Borrower or any of its
Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary
of the Borrower) in which the Borrower or any of its Subsidiaries has an
ownership interest, except to the extent that any such income is actually
received by the Borrower or such Subsidiary in the form of dividends or similar
distributions and (c) the undistributed earnings of any Subsidiary of the
Borrower to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary is not at the time permitted by the terms of
any Contractual Obligation (other than under any Loan Document) or Requirement
of Law applicable to such Subsidiary.

 

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Notwithstanding the foregoing, (i) Consolidated Net Income for any period will
be adjusted, on a Pro Forma Basis to take into account the effect of any
acquisition or disposition involving the acquisition or disposition of a
Subsidiary, or a business unit, division, product line or line of business
during such period, as if such acquisition or disposition (and any related
incurrence or prepayment of Indebtedness) had occurred on the first day of such
period and (ii) cash income attributable to rentals shall be recognized
consistent with the prior practice of the Borrower and not giving effect to any
deferral of revenue for such rental income pursuant to any accounting
methodology implemented after the Closing Date.
“Contingent Obligations”: any contingent indemnification obligations for which
no claim has been made, it being understood the following and similar
obligations shall not constitute Contingent Obligations: (a) the principal of,
and interest and premium (if any) on, and fees and expenses relating to, any
Obligation and (b) contingent reimbursement obligations in respect of amounts
that may be drawn under outstanding Letters of Credit.
“Continuing Directors”: as defined in Section 8.1(j) hereof.
“Contractual Obligation”: as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its Property is bound.
“Credit Party”: the Administrative Agent, the Issuing Lender or any other
Lender.
“Debtor”: SuperHoldings, Holdings, the Borrower and their respective
Subsidiaries.
“Default”: any of the events specified in Section 8.1, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
“Defaulted Account”: as defined in the definition of the “Eligible Accounts
Receivable”.
“Defaulting Lender”: 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 (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 promptly notifies the
Administrative Agent and the Borrower 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

 

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notified the 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) to fund prospective Loans and
participations in then outstanding Letters of Credit 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 become the
subject of a Bankruptcy Event.
“Deposit Account”: as defined in the Guarantee and Collateral Agreement.
“Deposit Account Control Agreement”: as defined in the Guarantee and Collateral
Agreement.
“Dilution Factors”: without duplication, with respect to any period, the
aggregate amount of all deductions, credit memos, returns, adjustments,
allowances, bad debt write-offs and other non-cash credits which are recorded to
reduce accounts receivable in a manner consistent with current and historical
accounting practices of the Borrower.
“Dilution Ratio”: at any date, (i) the amount (expressed as a percentage) equal
to (a) the aggregate amount of the applicable Dilution Factors for the twelve
(12) most recently ended fiscal months divided by (b) total gross sales for the
twelve (12) most recently ended fiscal months less (ii) 5%.
“Dilution Reserve”: at any date, the product of the applicable Dilution Ratio
multiplied by the Eligible Accounts Receivable on such date.
“Disposition”: with respect to any Property, any sale, sale and leaseback,
assignment, conveyance, transfer or other disposition thereof; and the terms
“Dispose” and “Disposed of” shall have correlative meanings.
“Dollars” and “$”: dollars in lawful currency of the United States of America.
“Domestic Subsidiary”: any Subsidiary of the Borrower organized under the laws
of any jurisdiction within the United States of America.
“Effective Date”: the effective date of the Reorganization Plan.

 

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“Eligible Accounts Receivable”: at the time of any determination, the gross
outstanding balance at such time, determined in accordance with GAAP and stated
on a basis consistent with the historical practices of the Borrower as of the
date hereof, of Accounts of the Borrower and its Subsidiaries, including the
aggregate amount of all Past-due Addbacks less, as applicable and without
duplication, the aggregate amount of (i) all charge-backs for returns, (ii) all
finance agreements, (iii) all trade discounts, (iv) all finance charges, late
fees and other fees that are unearned and (v) the aggregate amount of all
reserves for service fees and such other fees or commissions or similar amounts
that the Borrower or such Subsidiary has agreed to pay. Notwithstanding the
foregoing, an Account shall not be included in this definition of Eligible
Accounts Receivable if, at the time of any determination, without duplication:
(a) the Borrower or such Subsidiary has not complied with all material
requirements of applicable Federal, state and local laws, rules, regulations and
orders (including all laws, rules, regulations and orders of any governmental or
judicial authority relating to truth in lending, billing practices, fair credit
reporting, equal credit opportunity, debt collection practices and consumer
debtor protection) applicable to such Account (or any related contracts) or
affecting the collectibility of such Account; or
(b) (i) such Account is not assignable or requires consent of the Account debtor
and such a requirement of consent is enforceable law or (ii) a first priority
security interest in such Account in favor of the Administrative Agent for the
ratable benefit of the Lenders has not been obtained and fully perfected by
filing UCC financing statements against the Borrower or such Subsidiary; or
(c) such Account is subject to any Lien whatsoever other than Liens expressly
permitted by clause (h) of Section 7.3 and other than the Carve-Out, any junior
Liens for the benefit of any Prepetition Lender and the Liens permitted under
Section 7.3(h) and Section 7.3(m) of the Prepetition Credit Agreement as in
effect on the date hereof; or
(d) the Borrower or such Subsidiary, in order to be entitled to collect such
Account, is required to perform any additional service for, or perform or incur
any additional obligation to, the Account debtor, except the portion of such
Account that has arisen in respect of the sale of any Information Systems
Inventory; or
(e) such Account does not constitute a legal, valid and binding irrevocable
payment obligation of the Account debtor to pay the balance thereof in
accordance with its terms or is subject to any defense, setoff, recoupment or
counterclaim; or
(f) the Account debtor is an Affiliate, division or employee of the Borrower or
such Subsidiary; or
(g) (i) such Account (A) is an account of the United States Government or any of
its agencies or instrumentalities, (B) is subject to any Lien pursuant to the
Federal Assignment of Claims Act and (C) the Administrative Agent has not
received an assignment of claims in form and substance satisfactory to it within
45 days of the creation of such Account or (ii) such Account is (A) an account
of the government of any state of the United States or any political subdivision
thereof or any agency or instrumentality of any of the foregoing and (B) a first
priority security interest in such account in favor of the Administrative Agent
for the ratable benefit of the Lenders has not been obtained or a UCC financing
statements against the Borrower or such Subsidiary has not been filed; or

 

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(h) an estimated or accrual loss has been recognized in respect of such Account,
as determined in accordance with the Borrower’s or such Subsidiary’s usual
business practice (each such Account, a “Defaulted Account”); or
(i) 20% or more of the aggregate outstanding amount of all Accounts from the
Account debtor in respect of such Account and its Affiliates constitute
Defaulted Accounts; or
(j) any representation or warranty contained in this Agreement or in any other
Loan Documents applicable either to Accounts in general or to any such specific
Account shall prove to have been false or misleading in any material respect
when made or deemed made with respect to such Account; or
(k) 50% or more of the outstanding amount of all Accounts from the same Account
debtor have become, or have been determined by the Administrative Agent to be,
ineligible pursuant to subparagraph (m) below; or
(l) the Account debtor (i) has filed a petition for relief under the Bankruptcy
Code (or similar action under any successor law or under any comparable law),
(ii) has made a general assignment for the benefit of creditors, (iii) has filed
against it any petition or other application for relief under the Bankruptcy
Code (or similar action under any successor law or under any comparable law),
(iv) has failed, suspended business operations, become insolvent, called a
meeting of its creditors for the purpose of obtaining any financial concession
or accommodation or (v) had or suffered a receiver or a trustee to be appointed
for all or a significant portion of its assets or affairs; or
(m) (i) any portion of such Account has remained unpaid 90 or more days past the
original invoice date thereof or (ii) the Borrower or such Subsidiary has reason
to believe that all or a material portion of such Account is uncollectible (in
the reasonable discretion of the Administrative Agent); or
(n) [Reserved]; or
(o) the sale represented by such Account is to an Account debtor organized or
located outside the states of the United States, the District of Columbia or
Canada unless, in the case of any Account debtor controlled by an entity
organized or located outside one of the states of the United States or the
District of Columbia, the Administrative Agent has, for the benefit of the
Lenders, a valid, legal and perfected first-priority security interest in such
Account; or

 

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(p) the Account debtor is a supplier or creditor of the Borrower or such
Subsidiary (but only to the extent of the lesser of (i) the amount owing from
such Account debtor to the Borrower or such Subsidiary pursuant to Accounts that
are otherwise eligible and (ii) the amount owing to such Account debtor by the
Borrower or such Subsidiary); or
(q) such Account is not denominated in dollars or is payable outside the United
States; or
(r) if applicable, the sale represented by such Account is on a bill-and-hold,
undelivered sale, guaranteed sale, sale-or-return, consignment or
sale-on-approval basis or is subject to any right of return (other than (i) in
the ordinary course of business or (ii) a standard right of claim for defective
goods for which neither the related Account debtor has made a claim nor the
Borrower or such Subsidiary has any basis to believe that such Account debtor is
entitled to such a claim), charge-back or setoff; or
(s) the Administrative Agent believes, in its reasonable discretion, that the
collection of such Account may not be paid and the Administrative Agent shall so
notify the Borrower; or
(t) the Borrower or such Subsidiary is in default, in any material respect, in
the performance or observance of any of the terms of any agreement giving rise
to such Account; or
(u) the Borrower or such Subsidiary does not have good and marketable title to
such Account as sole owner of such Account; or
(v) such Account does not arise from the sale and delivery of goods or provision
of services in the ordinary course of business of the Borrower or such
Subsidiary to the Account debtor; or
(w) such Account is on terms other than those normal or customary in the
business or the Borrower or such Subsidiary; or
(x) any amounts payable under or in connection with such Account are evidenced
by promissory notes, agreements to repay cash advances or other instruments,
unless such promissory notes, agreements or instruments have been endorsed and
delivered to the Administrative Agent; or
(y) such Account has been paid by a check that has been returned for
insufficient funds; or
(z) the Account debtor is a third party credit card company or a debit card
company; or
(aa) such Account is not subject to the standard credit and collection policies
of the Borrower or such Subsidiary; or

 

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(bb) such Account has been placed with an attorney or other third party for
collection; or
(cc) the aggregate credit balances of the Borrower or such Subsidiary on an
Account debtor by Account debtor basis of all Accounts have remained unpaid for
the past due amounts referenced in subparagraphs (m) and (n) above; or
(dd) such Account is subject to any adverse security deposit, retainage or other
similar advance made by or for the benefit of the applicable Account debtor, in
each case only to the extent thereof; or
(ee) such Account was invoiced (i) in advance of goods or services provided, or
(ii) twice or more, or (iii) the associated income has not been earned; or
(ff) the goods giving rise to such Account have not been shipped and title has
not been transferred to the Account debtor, or the Account represents a
progress-billing or otherwise does not represent a complete sale, except the
portion of such Account that has arisen in respect of the sale of any
Information Systems Inventory; for purposes hereof, “progress-billing” means any
invoice for goods sold or leased or services rendered under a contract or
agreement pursuant to which the Account debtor’s obligation to pay such invoice
is conditioned upon the Borrower’s or such Subsidiary’s completion of any
further performance under the contract or agreement; or
(gg) such Account is created on cash on delivery terms;
provided that, all Accounts of any single Account debtor and its Affiliates
which, in the aggregate exceed (i) 20% in respect of an Account debtor whose
securities are rated Investment Grade, and (ii) 15% in respect of all other
Account debtors, of the total amount of all Accounts at the time of any
determination shall be deemed not to be Eligible Accounts Receivable to the
extent of such excess. Standards of eligibility may be made more restrictive
from time to time solely by the Administrative Agent in the exercise of its
Permitted Discretion, with any such changes to be effective three Business Days
after delivery of notice thereof to the Borrower and the Lenders.

 

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“Eligible Inventory”: at any date of determination thereof, the value
(determined at the lowest of cost or market or the written-down value in
accordance with the Borrower’s historical practice in accordance with GAAP) at
such date of all inventories (“Inventory”) of the Borrower and its Subsidiaries
owned by the Borrower and its Subsidiaries and in the possession of the Borrower
and its Subsidiaries or any warehouseman, bailee, agent or processor of the
Borrower and its Subsidiaries, including any educational institution or
commercial Bookstore, net of (i) any interdivisional profit, (ii) any amounts
payable by the Borrower and its Subsidiaries in respect of commissions,
processing fees or other charges and (iii) any advance payments and unliquidated
progress billings in respect of such Inventory. Notwithstanding the foregoing,
Inventory shall not constitute Eligible Inventory if, without duplication:
(a) such item of Inventory is not assignable or a first priority security
interest in such item of Inventory in favor of the Administrative Agent for the
ratable benefit of the Lenders has not been obtained and fully perfected by
filing UCC financing statements against the Borrower or such Subsidiary; or
(b) such item of Inventory is subject to any Lien whatsoever; other than Liens
expressly permitted by clause (h) of Section 7.3 and other than the Carve-Out,
any junior Liens for the benefit of any Prepetition Lender and the Liens
permitted under Section 7.3(h) and Section 7.3(m) of the Prepetition Credit
Agreement as in effect on the date hereof; or
(c) there shall have occurred any event that, or any condition with respect to
such item of Inventory, would substantially impede the ability of the Borrower
or such Subsidiary to continue to use or sell such item of Inventory in the
normal course of business; or
(d) any claim disputing the title of the Borrower or such Subsidiary to, or
right to possession of or dominion over, such item of Inventory shall have been
asserted; or
(e) any representation or warranty contained in this Agreement or in any other
Loan Document applicable to either Inventory in general or to such specific item
of Inventory has been breached with respect to such item of Inventory; or
(f) the Borrower or such Subsidiary does not have good and marketable title to
such item of Inventory as sole owner of such item of Inventory; or
(g) such item of Inventory is located outside of the United States; or
(h) such item of Inventory is evidenced by an Account; or
(i) such item of Inventory consists of packing, packaging and/or shipping
supplies or materials; or
(j) such item of Inventory has been shipped to a customer, even if on a
consignment or “sale or return” basis; or
(k) such item of Inventory consists of obsolete Information Systems Inventory or
Retail Inventory, including books and related materials with titles classified
as slow-moving; or
(l) such item of Inventory consists of any unsaleable Inventory; or

 

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(m) such item of Inventory is located at a leased property, or is in the
possession or control of any lessor, warehouseman, bailee, agent or processor,
unless (i) with respect to any Inventory located in a Priming Jurisdiction,
(A) a Rent Reserve of the type specified in clause (i) of the definition of
“Rent Reserve” has been established for Inventory at that location, or (B) the
applicable lessor, warehouseman, bailee, agent or processor (including any
educational institution or commercial Bookstore), has been notified of the Lien
granted under the Security Documents and has entered into a Landlord Waiver or
(ii) with respect to any Inventory located in a jurisdiction that is not a
Priming Jurisdiction, (A) a Rent Reserve of the type specified in clause (ii) of
the definition of “Rent Reserve” has been established for Inventory at that
location or (B) the applicable lessor, warehouseman, bailee, agent or processor
(including any educational institution or commercial Bookstore), has been
notified of the Lien granted under the Security Documents and has entered into a
Landlord Waiver; or
(n) such item of Inventory consists of food, beverages or sundries; or
(o) such item of Inventory consists of cigarettes; or
(p) such item of Inventory is to be sold by the Borrower or such Subsidiary from
a vending machine; or
(q) such item of Inventory has been determined by the Administrative Agent,
exercising its reasonable discretion, to be unacceptable because (i) the
Administrative Agent believes that such item of Inventory is not readily
saleable under the customary terms on which it is usually sold or (ii) such item
of Inventory (other than Information Systems Inventory) is not of a type
typically sold by campus Bookstores; or
(r) such item of Inventory is goods returned or rejected by the Borrower’s or
such Subsidiary’s customers due to quality issues or is goods in transit to a
third party; or
(s) such item of Inventory is a reserve computed by the Borrower or such
Subsidiary to accrue for future adjustments to Inventory relating to
inaccuracies arising from the utilization of the gross profit method of
accounting for Retail Inventory; or
(t) such item of Inventory is an accrual computed by the Borrower or such
Subsidiary to accrue for anticipated returns of sold Inventory.
Standards of eligibility may be made more restrictive from time to time solely
by the Administrative Agent in the exercise of its Permitted Discretion, with
any such changes to be effective three Business Days after delivery of notice
thereof to the Borrower and the Lenders.

 

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“Environmental Laws”: any and all foreign, Federal, state, local or municipal
laws, rules, orders, regulations, statutes, ordinances, codes, decrees,
requirements of any Governmental Authority or other Requirements of Law
(including common law), in each case having the force or effect of law,
regulating, relating to or imposing liability or standards of conduct concerning
protection of human health or the environment, as now or may at any time
hereafter be in effect.
“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from
time to time.
“Eurocurrency Reserve Requirements”: for any day as applied to a Eurodollar
Loan, the aggregate (without duplication) of the maximum rates (expressed as a
decimal) of reserve requirements in effect on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.
“Eurodollar Base Rate”: with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, the rate per annum determined on the basis of
the rate for deposits in Dollars for a period equal to such Interest Period
commencing on the first day of such Interest Period appearing on Reuters Screen
LIBOR01 Page (or on any successor or substitute page of such Service providing
rate quotations comparable to those currently provided on such page of such
Service, as determined by the Administrative Agent from time to time for
purposes of providing quotations of interest rates applicable to dollar deposits
in the London interbank market) as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. In the event that such rate is
not available at such time for any reason, “Eurodollar Base Rate” for purposes
of this definition shall be determined by reference to such other comparable
publicly available service for displaying eurodollar rates as may be selected by
the Administrative Agent or, in the absence of such availability, by reference
to the rate at which the Administrative Agent is offered Dollar deposits at or
about 11:00 A.M., New York City time, two Business Days prior to the beginning
of such Interest Period in the interbank eurodollar market where its eurodollar
and foreign currency and exchange operations are then being conducted for
delivery on the first day of such Interest Period for the number of days
comprised therein. Notwithstanding the foregoing, in the case of the Term Loans
only, the Eurodollar Base Rate shall not be less than 1.25% per annum.
“Eurodollar Loans”: Loans the rate of interest applicable to which is based upon
the Eurodollar Rate.
“Eurodollar Rate”: with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):

        Eurodollar Base Rate           1.00 - Eurocurrency Reserve Requirements
 

 

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“Eurodollar Tranche”: the collective reference to Eurodollar Loans the then
current Interest Periods with respect to all of which begin on the same date and
end on the same later date (whether or not such Loans shall originally have been
made on the same day).
“Event of Default”: any of the events specified in Section 8.1, provided that
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
“Excluded Equity Interests”: as defined in the preliminary statements hereto.
“Excluded Foreign Subsidiary”: any Foreign Subsidiary.
“Excluded Taxes”: with respect to any payment made by any Loan Party under any
Loan Document, any of the following Taxes imposed on or with respect to a Credit
Party: (a) income or franchise Taxes imposed on (or measured by) net income by
the United States of America, or by the jurisdiction under the laws of which
such Credit Party is organized or in which its principal office is located or,
in the case of any Lender, in which its applicable lending office is located,
(b) any branch profits Taxes imposed by the United States of America or any
similar Taxes imposed by any other jurisdiction in which the Borrower is located
and (c) in the case of a Non-U.S. Lender (other than an assignee pursuant to a
request by the Borrower under Section 2.21), any U.S. withholding Taxes
resulting from any Requirement of Law in effect (including FATCA) on the date
such Non-U.S. Lender becomes a party to this Agreement (or designates a new
lending office) or is attributable to such Non-U.S. Lender’s failure to comply
with Section 2.17(f), except to the extent that such Non-U.S. Lender (or its
assignor, if any) was entitled, at the time of designation of a new lending
office (or assignment), to receive additional amounts from the Loan Party with
respect to such withholding Taxes pursuant to Section 2.17(a).
“Exposure”: as to any Lender at any time, an amount equal to the sum of (a) the
aggregate principal amount of all Loans made by such Lender then outstanding,
(b) such Lender’s Applicable Revolving Percentage of the L/C Obligations then
outstanding and (c) such Lender’s Applicable Revolving Percentage of the
aggregate principal amount of Protective Advances then outstanding.
“Facilities”: the Revolving Facility and the Term Loan Facility.
“FATCA”: Sections 1471 through 1474 of the Code, as of the date of this
Agreement and any regulations or official interpretations thereof.
“Federal Funds Effective Rate”: for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the quotations for
the day of such transactions received by the Reference Lender from three federal
funds brokers of recognized standing selected by it.

 

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“Fee Letter”: the Fee Letter, dated June [_], 2011, among the Borrower, JPMorgan
Chase Bank, N.A. and J.P. Morgan Securities LLC.
“Final Revolving Credit Loans”: as defined in Section 2.1(a).
“Final Order”: an order of the Bankruptcy Court entered in the Cases, in
substantially the form of the Interim Order, with such modifications thereto as
are in form and substance reasonably satisfactory to the Administrative Agent.
“Final Order Entry Date”: the date the Final Order is entered in the Cases.
“First Availability Date”: the first date on or following the Closing Date that
the conditions precedent set forth in Sections 5.1 and 5.3 shall have been
satisfied (or waived in accordance with Section 10.1).
“Foreign Benefit Arrangement”: any employee benefit arrangement mandated by
non-US law that is maintained or contributed to by any Loan Party.
“Foreign Plan”: each employee benefit plan (within the meaning of Section 3(3)
of ERISA, even though such Plan is not subject to ERISA) that is not subject to
US law and is maintained or contributed to by any Loan Party.
“Foreign Subsidiary”: any Subsidiary of the Borrower that is not a Domestic
Subsidiary.
“Funding Office”: the office specified from time to time by the Administrative
Agent as its funding office by notice to the Borrower and the Lenders pursuant
to Section 10.2.
“GAAP”: generally accepted accounting principles in the United States of
America.
“Governmental Authority”: any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government
(including, without limitation, the National Association of Insurance
Commissioners).
“Guarantee and Collateral Agreement”: the Guarantee and Collateral Agreement to
be executed and delivered by SuperHoldings, Holdings, the Borrower and each
Subsidiary Guarantor, substantially in the form of Exhibit A, as the same may be
amended, supplemented or otherwise modified from time to time.

 

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“Guarantee Obligation”: as to any Person (the “guaranteeing person”), any
obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the “primary obligations”)
of any other third Person (the “primary obligor”) in any manner, whether
directly or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such primary
obligation or any Property constituting direct or indirect security therefor,
(ii) to advance or supply funds (1) for the purchase or payment of any such
primary obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase Property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee Obligation is made and (b) the maximum amount
for which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person’s maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith.
“Guarantors”: the collective reference to SuperHoldings, Holdings and the
Subsidiary Guarantors.
“Holdings”: as defined in the preamble hereto.
“Holdings Discount Notes”: the 11% Senior Discount Notes of Holdings due 2013
and issued pursuant to the Holdings Discount Notes Indenture.
“Holdings Discount Notes Indenture”: the Indenture dated as of March 4, 2004
entered into by Holdings in connection with the issuance of the Holdings
Discount Notes, together with all instruments and other agreements entered into
by Holdings in connection therewith, as the same may be amended, supplemented or
otherwise modified from time to time.

 

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“Indebtedness”: of any Person at any date, without duplication (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of Property or services (other than
current trade payables incurred in the ordinary course of such Person’s
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
Property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such Property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party under bankers’ acceptance, letter of credit or similar facilities,
(g) all obligations of such Person, contingent or otherwise, to purchase,
redeem, retire or otherwise acquire for value any Capital Stock (other than
common stock) of such Person, (h) all Guarantee Obligations of such Person in
respect of obligations of the kind referred to in clauses (a) through (g) above;
(i) all obligations of the kind referred to in clauses (a) through (h) above
secured by (or for which the holder of such obligation has an existing right,
contingent or otherwise, to be secured by) any Lien on Property (including,
without limitation, accounts and contract rights) owned by such Person, whether
or not such Person has assumed or become liable for the payment of such
obligation, (j) for the purposes of Section 8(e) only, all obligations of such
Person in respect of Swap Agreements and (k) the liquidation value of any
mandatorily redeemable preferred Capital Stock of such Person or its
Subsidiaries held by any Person other than such Person and its Wholly Owned
Subsidiaries.
“Indemnified Taxes”: (a) Taxes, other than Excluded Taxes, imposed on or with
respect to any payment made by any Loan Party under any Loan Document and
(b) Other Taxes.
“Indentures”: the collective reference to the Holdings Discount Notes Indenture,
the Senior Subordinated Notes Indenture and the Senior Secured Notes Indenture.
“Information Systems Inventory”: all Inventory located at the Borrower’s
warehouses consisting of computer hardware and software, including IBM
point-of-sale register systems and related software.
“Initial Cash Flow Forecast”: as defined in Section 5.1(r).
“Initial Letters of Credit”: as defined in Section 5.1(p).
“Initial Revolving Credit Loans”: as defined in Section 2.1(a).
“Insolvency”: with respect to any Multiemployer Plan, the condition that such
Plan is insolvent within the meaning of Section 4245 of ERISA.
“Insolvent”: pertaining to a condition of Insolvency.
“Intellectual Property”: the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including, without
limitation, copyrights, copyright licenses, patents, patent licenses,
trademarks, domain names, trademark licenses, technology, know-how and
processes, and any other confidential or proprietary information, all
registrations and applications thereof, and all rights to sue at law or in
equity for any past, present or future infringement or other impairment thereof,
including the right to receive all proceeds and damages therefrom.

 

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“Interest Payment Date”: (a) as to any Base Rate Loan, the last day of each
calendar month while such Loan is outstanding and the final maturity date of
such Loan, (b) as to any Eurodollar Loan , the last day of each consecutive
30 day period running from the commencement of the Interest Period applicable to
such Loan and the Termination Date, and (c) as to any Loan (other than any
Revolving Credit Loan that is a Base Rate Loan), the date of any repayment or
prepayment made in respect thereof.
“Interest Period”: as to any Eurodollar Loan (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurodollar Loan and ending one, two, three or six months thereafter, as
selected by the Borrower in its notice of borrowing or notice of conversion, as
the case may be, given with respect thereto; and (b) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Eurodollar Loan and ending one, two, three or six months thereafter, as
selected by the Borrower by irrevocable notice to the Administrative Agent not
less than three Business Days prior to the last day of the then current Interest
Period with respect thereto; provided that, all of the foregoing provisions
relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;
(ii) any Interest Period that would otherwise extend beyond the Termination Date
shall end on the Termination Date;
(iii) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(iv) the Borrower shall select Interest Periods so as not to require a payment
or prepayment of any Eurodollar Loan during an Interest Period for such Loan.
“Interim Revolving Credit Loan Availability Amount”: as defined in Section
5.1(p).
“Interim Order”: an order of the Bankruptcy Court entered in the Cases granting
interim approval of this Agreement and the other Loan Documents, and the
contemplated borrowings and undertakings herein and therein by the Loan Parties,
and granting the Liens on the Collateral and the Superpriority Claims described
in the preliminary statements to this Agreement in favor of the Administrative
Agent and the Lenders, substantially in the form of Exhibit G hereto, and
otherwise in form and substance reasonably satisfactory to the Administrative
Agent.
“Interim Order Entry Date”: the date the Interim Order is entered in the Cases.
“Inventory”: as defined in the definition of “Eligible Inventory”.

 

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“Inventory Reserves”: reserves against Inventory equal to the sum of the
following (but without duplication):
(a) RTV Reserves; and
(b) a reserve determined by the Administrative Agent in its Permitted Discretion
for Inventory that it deems to be obsolete or which is discontinued or
slow-moving; and
(c) a reserve for Inventory which is recognized as damaged or off quality or not
to customer specifications by the Borrower; and
(d) a revaluation reserve whereby capitalized favorable variances shall be
deducted from Eligible Inventory and unfavorable variances shall not be added to
Eligible Inventory; and
(e) a lower of the cost or market value reserve for any differences between the
Borrower’s actual cost to produce versus its selling price to third parties,
determined on a product line basis; and
(f) any other Reserves, including reserves for inventory shrinkage as deemed
appropriate by the Administrative Agent in its Permitted Discretion, from time
to time.
“Investment Grade”: having a rating established by a third party rating agency
equivalent to BBB- or better from S&P or Baa3 or better from Moody’s.
“IRS” means the United States Internal Revenue Service.
“Issuing Lender”: JPMorgan Chase Bank, N.A., in its capacity as the issuer of
Letters of Credit hereunder. The Issuing Lender may, in its discretion, arrange
for one or more Letters of Credit to be issued by Affiliates of the Issuing
Lender, in which case the term “Issuing Lender” shall include any such Affiliate
with respect to Letters of Credit issued by such Affiliate.
“Landlord Waiver”: a written agreement reasonably satisfactory in form and
substance to the Administrative Agent (i) acknowledging that Inventory located
at a leased property or in possession or control of any warehouseman, bailee,
agent or processor is subject to the Lien granted under the Security Documents,
(ii) waiving and releasing any applicable Lien held by such lessor,
warehouseman, bailee, agent or processor with respect to such item of Inventory
(whether arising by operation of law or otherwise) and (iii) providing the
Administrative Agent with the right to receive notice of default, the right to
repossess such item of Inventory at any time upon the occurrence or during the
continuance of a Default or Event of Default and such other rights as may be
reasonably required by the Administrative Agent.
“L/C Cash Collateral”: the cash collateral pledged in support of the Prepetition
Letters of Credit pursuant to Section 7.3(p).

 

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“L/C Commitment”: $10,000,000.
“L/C Fee Payment Date”: the last day of each calendar month and the last day of
the Revolving Credit Commitment Period.
“L/C Obligations”: at any time, an amount equal to the sum of (a) the aggregate
then undrawn and unexpired amount of the then outstanding Letters of Credit and
(b) the aggregate amount of drawings under Letters of Credit which have not then
been reimbursed pursuant to Section 3.5.
“L/C Participants”: the collective reference to all the Lenders other than the
Issuing Lender.
“LC Exposure”: at any time, the sum of (a) the aggregate undrawn amount of all
outstanding Letters of Credit at such time plus (b) the aggregate amount of all
Reimbursement Obligations at such time. The LC Exposure of any Revolving Lender
at any time shall be its Applicable Revolving Percentage of the total LC
Exposure at such time.
“Lenders”: as defined in the preamble hereto; provided, that unless the context
otherwise requires, each reference herein to the Lenders shall be deemed to
include any Conduit Lender.
“Letters of Credit”: as defined in Section 3.1(a).
“Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge or other security interest or any
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).
“Liquidity”: on any date of determination, the sum, without duplication, of
(i) the cash and Cash Equivalents which are not subject to any Liens (other than
Liens securing the Obligations, customary bankers Liens, junior Liens in favor
of any Prepetition Lender and the Carve-Out) held by the Borrower and its
Subsidiaries on such date plus (ii) the aggregate Revolving Credit Availability
on such date (provided that such amount shall be deemed to be zero if a Event of
Default has occurred and is continuing on such date). Solely for the purposes of
determining compliance with Section 7.1(a) (but not for any other purposes under
this Agreement), the Borrower, by giving written notice to the Administrative
Agent, may elect that Revolving Credit Availability shall, for a period of 28
consecutive days after a new discretionary Reserve has been implemented by the
Administrative Agent, be calculated without giving effect to such new
discretionary Reserve; provided that the Borrowing Base component of Revolving
Credit Availability calculated for purposes of Section 7.1(a) shall at no time
be more than the actual amount of the Borrowing Base (including such new
discretionary Reserve) at such time plus $3,000,000.

 

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“Loan”: any loan made by any Lender pursuant to this Agreement.
“Loan Documents”: this Agreement, the Security Documents and the Notes as the
same may be amended, supplemented or otherwise modified from time to time.
“Loan Parties”: SuperHoldings, Holdings, the Borrower and each other Subsidiary
of SuperHoldings which is a party to a Loan Document.
“Material Adverse Effect”: any event, development or circumstance that has had
or could reasonably be expected to have a material adverse effect on (a) the
business, assets, operations, condition, financial or otherwise, of the Borrower
and its Subsidiaries taken as a whole (other than (i) any events leading up to
the filing of the Cases disclosed to the Lenders, (ii) the filing of the Cases
and (iii) those events which customarily occur following the commencement of a
proceeding under Chapter 11 of the Bankruptcy Code and other events ancillary
thereto), (b) the ability of any Loan Party to perform any of its obligations
under the Loan Documents to which it is a party, (c) the Collateral, or the
Administrative Agent’s Liens (on behalf of itself and the Lenders) on the
Collateral or the priority of such Liens, or (d) the rights of or benefits
available to the Administrative Agent, the Issuing Lender or the Lenders
thereunder.
“Materials of Environmental Concern”: any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes, defined or regulated as such in or under any
Environmental Law, including, without limitation, asbestos, polychlorinated
biphenyls and urea-formaldehyde insulation.
“Maturity Date”: the first anniversary of the Closing Date.
“Moody’s”: as defined in the definition of “Cash Equivalents”.
“Mortgaged Properties”: the owned real properties listed on Schedule 1.1B, as to
which the Administrative Agent for the benefit of the Lenders has been or shall
be granted a Lien pursuant to the Mortgages.
“Mortgages”: each mortgage referred to in Section 6.13 and each of the mortgages
and deeds of trust made by any Loan Party in favor of, or for the benefit of,
the Administrative Agent for the benefit of the Lenders and in form and
substance reasonably satisfactory to the Administrative Agent, as the same may
be amended, supplemented or otherwise modified from time to time.
“Multiemployer Plan”: a Plan which is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.

 

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“Net Cash Proceeds”: (a) in connection with any Asset Sale or any Recovery
Event, the proceeds thereof in the form of cash and Cash Equivalents (including
any such proceeds received by way of deferred payment of principal pursuant to a
note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) of such Asset Sale or Recovery Event,
net of attorneys’ fees, accountants’ fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness secured by a Lien
expressly permitted hereunder on any asset which is the subject of such Asset
Sale or Recovery Event (other than any Lien securing the Obligations or which is
junior to the Liens securing the Obligations) but only to the extent the holders
of such Indebtedness are not required to turn over any such proceeds to any or
all of the Credit Parties, insurance proceeds applied to pay costs incurred in
connection with the repair or restoration of any Property that is real property
in the event of damage by casualty and other customary fees and expenses
actually incurred in connection therewith and net of taxes paid or reasonably
estimated to be payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements) and (b) in
connection with any issuance or sale of debt securities or instruments or the
incurrence of loans, the cash proceeds received from such issuance or
incurrence, net of attorneys’ fees, investment banking fees, accountants’ fees,
underwriting discounts and commissions and other customary fees and expenses
actually incurred in connection therewith.
“Net Orderly Liquidation Value”: with respect to Inventory of the Borrower and
its Subsidiaries, the orderly liquidation value thereof as determined in a
manner reasonably acceptable to the Administrative Agent by an appraiser
reasonably acceptable to the Administrative Agent, net of all costs of
liquidation thereof.
“Non-Consenting Lender”: as defined in Section 10.1.
“Non-U.S. Lender”: a Lender that is not a U.S. Person.
“Notes”: the collective reference to any promissory note evidencing Loans.
“Obligations”: as defined in the Guarantee and Collateral Agreement.
“Orders”: the collective reference to the Interim Order and the Final Order.
“Other Taxes”: any present or future stamp, court, documentary, intangible,
recording, filing or similar excise or property Taxes that arise from any
payment made under, from the execution, delivery, performance, enforcement or
registration of, or from the registration, receipt or perfection of a security
interest under, or otherwise with respect to, any Loan Document.
“Parent”: with respect to any Lender, any Person as to which such Lender is,
directly or indirectly, a Subsidiary.
“Participant”: as defined in Section 10.6(c).
“Participant Register”: as defined in Section 10.6(c).
“Past-due Addbacks”: the aggregate amount of past due credit balances aged over
90 days from the original invoice date.

 

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“Payment Office”: the office specified from time to time by the Administrative
Agent as its payment office by notice to the Borrower and the Lenders.
“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).
“Peak Period”: the collective reference to (i) the period from and including May
1 of any year to and including August 31 of the same year and (ii) the period
from and including December 1 of any year to and including January 15 of next
succeeding year.
“Pension Act”: the Pension Protection Act of 2006.
“Permitted Discretion”: a determination made in good faith and in the exercise
of reasonable (from the perspective of a secured asset-based lender) business
judgment exercised in accordance with the Administrative Agent’s customary and
generally applicable credit practices.
“Person”: an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
“Petition Date”: as defined in the preliminary statements hereto.
“Plan”: at a particular time, any employee benefit plan (within the meaning of
Section 3(3) of ERISA) which is covered by ERISA and in respect of which any
Loan Party is (or, if such plan were terminated at such time, would under
Section 4062 or 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA or with respect to which any Loan Party has or may
reasonably be expected to have any liability (including any contingent liability
of any Commonly Controlled Entity).
“Prepetition Agent”: JPMorgan Chase Bank, N.A., in its capacity as
administrative agent under the Prepetition Credit Agreement.
“Prepetition Banking Services Obligations”: the “Banking Services Obligations”
(as defined in the Prepetition Credit Agreement) existing on the Petition Date.
“Prepetition Credit Agreement”: the Credit Agreement, dated as of February 13,
1998, as amended and restated as of December 10, 2003 and March 4, 2004 and
October 2, 2009 and as amended on March 22, 2010, among the Borrower,
SuperHoldings, Holdings, certain financial institutions and the Administrative
Agent.
“Prepetition Lenders”: the several banks and other financial institutions and
entities from time to time parties to the Prepetition Credit Agreement.
“Prepetition Letters of Credit”: as defined in Section 5.1(s).

 

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“Prepetition Obligations”: all the Debtors’ “Obligations” (as defined in the
Prepetition Credit Agreement), including Prepetition Banking Services
Obligations and Prepetition Swap Obligations.
“Prepetition Secured Parties”: the Prepetition Agent, the Prepetition Lenders
and any other holder of Prepetition Obligations.
“Prepetition Swap Agreements”: the “Swap Agreements” (as defined in the
Prepetition Credit Agreement) existing on the Petition Date.
“Prepetition Swap Obligations”: the “Swap Obligations” (as defined in the
Prepetition Credit Agreement) existing on the Petition Date.
“Primary Investors”: the collective reference to the Sponsors and their Related
Parties, and any additional investment fund for which any of the Sponsors is the
sole advisor or which is effectively controlled by any of the Sponsors.
“Priming Jurisdiction”: any jurisdiction listed on Schedule 1.1C hereto, which
schedule may be revised by the Administrative Agent to reflect changes in
applicable law. The Administrative Agent shall provide the Borrower with ten
days’ prior written notice of any revisions to the jurisdictions listed on
Schedule 1.1C hereto.
“Pro Forma Basis”: with respect to any test hereunder in connection with any
event, means that such test shall be calculated after giving effect on a pro
forma basis for the period of such calculation to (i) such event as if it
happened on the first day of such period (it being understood that with respect
to any acquisition or disposition, any such adjustments shall be permitted
solely to the extent they arise out of events which are directly attributable to
the acquisition or the disposition, are factually supportable and are expected
to have a continuing impact, in each case as determined on a basis consistent
with Article 11 of Regulation S-X of the Securities Act of 1933, as amended, as
interpreted by the SEC, and as certified by a Responsible Officer of the
Borrower) or (ii) the incurrence of any Indebtedness by the Borrower or any
Subsidiary and any incurrence, repayment, issuance or redemption of other
Indebtedness of the Borrower or any Subsidiary occurring at any time subsequent
to the last day of the applicable period and on or prior to the date of
determination, as if such incurrence, repayment, issuance or redemption, as the
case may be, occurred on the first day of such period.
“Prohibited Transaction”: as defined in Section 406 of ERISA and Section
4975(f)(3) of the Code.
“Properties”: as defined in Section 4.17.
“Property”: any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible, including,
without limitation, Capital Stock.
“Protective Advances”: as defined in Section 2.23(a).

 

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“Recovery Event”: any settlement of or payment in respect of any property, title
or casualty insurance claim or any condemnation proceeding relating to any asset
of the Debtors.
“Reference Lender”: the Administrative Agent.
“Register”: as defined in Section 10.6(b).
“Regulation U”: Regulation U of the Board as in effect from time to time.
“Reimbursement Obligation”: the obligation of the Borrower to reimburse the
Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of
Credit.
“Reinvestment Deferred Amount”: with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by any Debtor in connection therewith which
are not applied to prepay the Loans as a result of the delivery of a
Reinvestment Notice.
“Reinvestment Event”: any Asset Sale or Recovery Event in respect of which the
Borrower has delivered a Reinvestment Notice.
“Reinvestment Notice”: a written notice executed by a Responsible Officer
stating that no Event of Default has occurred and is continuing and that the
Borrower (directly or indirectly through a Subsidiary) intends and expects to
use all or a specified portion of the Net Cash Proceeds of an Asset Sale or
Recovery Event to acquire assets useful in its business.
“Reinvestment Prepayment Amount”: with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to
the relevant Reinvestment Prepayment Date to acquire assets useful in the
Borrower’s business.
“Reinvestment Prepayment Date”: with respect to any Reinvestment Event, the
earlier of (a) the date occurring 90 days after such Reinvestment Event and
(b) the date on which the Borrower shall have determined not to, or shall have
otherwise ceased to, acquire assets useful in the Borrower’s business with all
or any portion of the relevant Reinvestment Deferred Amount.
“Related Credit Party”: with respect to any Lender, any affiliate of such Lender
and such Lender’s and its affiliates’ respective officers, directors, employees,
agents and controlling persons.
“Related Party”: with respect to any of the Sponsors (A) any controlling
stockholder or partner, a direct or indirect 80% (or more) owned Subsidiary, or
spouse or immediate family member (in the case of an individual) of such
Sponsor, (B) any trust, corporation, partnership or other entity, the
controlling beneficiaries, stockholders, partners or owners of which, directly
or indirectly, consist of the Sponsor and/or such other Persons referred to in
the immediately preceding clause (A) and/or in the succeeding clause (D),
(C) any partner or stockholder of such Sponsor as of the Closing Date who
acquires any assets or voting stock of the Borrower or Holdings pursuant to a
general distribution by such Sponsor to each of its partners or stockholders or
(D) any officer or director of such Sponsor.

 

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“Rent Reserve”: on any date, (i) with respect to any retail store, distribution
center, warehouse, or other location in a Priming Jurisdiction where any
Eligible Inventory subject to a Lien arising by operation of contract and/or law
is located and with respect to which no Landlord Waiver is in effect, a reserve
equal to three months’ rent at such retail store, distribution center,
warehouse, or other location and (ii) with respect to any retail store,
distribution center, warehouse, or other location in any jurisdiction that is
not a Priming Jurisdiction where any Eligible Inventory subject to a Lien
arising by operation of contract and/or law is located and with respect to which
no Landlord Waiver is in effect, a reserve in an amount equal to the claims or
Liens that vendors, landlords, public warehouse operators or any third party
bailee may have against such Eligible Inventory.
“Reorganization”: with respect to any Multiemployer Plan, the condition that
such plan is in reorganization within the meaning of Section 4241 of ERISA.
“Reorganization Plan”: a plan of reorganization in the Cases with respect to one
or more of the Loan Parties.
“Report”: reports prepared by the Administrative Agent or another Person showing
the results of appraisals, field examinations or audits pertaining to the assets
of any Loan Party from information furnished by or on behalf of any Loan Party,
after the Administrative Agent has exercised its rights of inspection pursuant
to this Agreement, which Reports shall be distributed to the Lenders by the
Administrative Agent.
“Reportable Event”: any of the events set forth in Section 4043(c) of ERISA or
the regulations thereunder, other than those events as to which the thirty day
notice period is waived under PBGC Regulations.
“Repricing Transaction”: the prepayment or refinancing of all or any portion of
the Term Loans concurrently with the incurrence by the Borrower or any of its
Subsidiaries or any other Loan Parties of any indebtedness (other than under any
exit financing on the Effective Date) having a lower cost of financing than, or
any amendment to the Loan Documents that has the effect of reducing the interest
rate margin then applicable to, the Term Loans (including any mandatory
assignment in connection therewith).
“Required Lenders”: at any time, Lenders having Exposure and unused Commitments
representing more than 50% of the sum of all Exposure and unused Commitments at
such time.
“Requirement of Law”: as to any Person, the Certificate of Incorporation and
By-Laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or a court or
other Governmental Authority, 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.

 

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“Reserved Local Blocked Account”: as defined in the Guarantee and Collateral
Agreement.
“Reserved Local Blocked Account Reserve”: on any date, a reserve in an amount
equal to the sum of the most recent Reserved Local Block Account Values of all
Reserved Local Blocked Accounts.
“Reserved Local Blocked Account Value”: as of the last day of each calendar
month, for each Reserved Local Blocked Account, the greatest amount held in such
Reserved Local Blocked Account at any time during the prior thirteen calendar
months.
“Reserves”: any and all reserves which the Administrative Agent deems necessary,
in its Permitted Discretion, to maintain (including, without limitation, the
Dilution Reserve, reserves for accrued and unpaid interest on the Obligations,
reserves in respect of Banking Services, volatility reserves, Rent Reserves, the
Reserved Local Blocked Account Reserve, reserves for Inventory shrinkage,
reserves for customs charges and shipping charges related to any Inventory in
transit, reserves for Swap Obligations, reserves for contingent liabilities of
any Loan Party, reserves for uninsured losses of any Loan 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 or any Loan Party.
“Responsible Officer”: the chief executive officer, president or chief financial
officer of the Borrower, but in any event, with respect to financial matters,
the chief financial officer, vice president — finance or controller of the
Borrower.
“Restricted Payment”: as defined in Section 7.6.
“Retail Inventory”: all Inventory located at a Bookstore consisting of: new and
used textbooks, including any related study aids; general subject books;
medical, technical and reference books; periodicals and magazines; clothing,
including school insignia items; electronics; gifts; stationery and cards;
school and office supplies and art; food, beverages and sundries; and all other
items held for resale in the ordinary course of business.
“Revolving Credit Availability”: at any time, an amount equal to (a) the lesser
of (i) the Total Revolving Credit Commitments and (ii) the Borrowing Base (as
determined by the Administrative Agent in its Permitted Discretion) minus
(b) the Total Revolving Credit Exposure.
“Revolving Credit Commitment”: as to any Lender, the obligation of such Lender,
if any, to make Revolving Credit Loans and participate in Letters of Credit in
an aggregate principal and/or face amount not to exceed the amount set forth
under the heading “Revolving Credit Commitment” opposite such Lender’s name on
Schedule 1.1A or in the Assignment and Assumption pursuant to which such Lender
became a party hereto, as the same may be changed from time to time pursuant to
the terms hereof. The amount of the Total Revolving Credit Commitments on the
Closing Date is $75,000,000.

 

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“Revolving Credit Commitment Period”: the period from and including the Closing
Date to the Termination Date.
“Revolving Credit Loans”: as defined in Section 2.1(a).
“Revolving Credit Exposure”: as to any Revolving Lender at any time, an amount
equal to the sum of (a) the aggregate principal amount of all Revolving Credit
Loans made by such Revolving Lender then outstanding, (b) such Lender’s
Applicable Revolving Percentage of the L/C Obligations then outstanding and
(c) such Revolving Lender’s Applicable Revolving Percentage of the aggregate
principal amount of Protective Advances then outstanding.
“Revolving Facility”: as defined in the preliminary statements hereto.
“Revolving Lender”: any Lender holding a Revolving Credit Commitment.
“Rollover Issuing Lender”: JPMorgan Chase Bank, N.A., in its capacity as issuer
of the Rollover Letters of Credit.
“Rollover Letters of Credit”: the letter of credit or letters of credit
described on Schedule 3.1 outstanding as of the Petition Date and issued under
the Prepetition Credit Agreement.
“RTV Reserve”: at any time, an amount equal to the amount of Inventory that is
identified as to be returned to vendor.
“S&P”: as defined in the definition of “Cash Equivalents”.
“Second Availability Date”: the date immediately following the occurrence of the
Final Order Entry Date that the conditions precedent set forth in Sections 5.1,
5.2 and 5.3 shall have been satisfied (which in no event shall be more than five
Business Days following the Final Order Entry Date (or such later date as the
Administrative Agent may agree in its sole discretion)).
“Secured Parties”: as defined in the Guarantee and Collateral Agreement.
“Security Documents”: the collective reference to the Guarantee and Collateral
Agreement, the Mortgages and all other security documents hereafter delivered to
the Administrative Agent granting a Lien on any Property of any Person to secure
the obligations and liabilities of any Loan Party under any Loan Document.
“Senior Secured Notes Indenture”: the Indenture dated as of October 2, 2009
entered into by the Borrower and certain Subsidiary Guarantors in connection
with the issuance of the Senior Secured Notes, together with all instruments and
other agreements entered into by the Borrower in connection therewith, each as
amended, restated, supplemented or otherwise modified from time to time.

 

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“Senior Secured Notes”: the 10% Senior Secured Notes, as amended, of the
Borrower due 2011 and issued pursuant to the Senior Secured Notes Indenture.
“Senior Subordinated Notes Indenture”: the Indenture dated as of March 4, 2004
entered into by the Borrower and certain Subsidiary Guarantors in connection
with the issuance of the Senior Subordinated Notes, together with all
instruments and other agreements entered into by the Borrower in connection
therewith, as the same may be amended, supplemented or otherwise modified from
time to time in accordance with Section 7.9.
“Senior Subordinated Notes”: the 85/8% Senior Subordinated Notes of the Borrower
due 2012 and issued pursuant to the Senior Subordinated Notes Indenture.
“Single Employer Plan”: any Plan which is covered by Title IV of ERISA, but
which is not a Multiemployer Plan.
“Sponsors”: Weston Presidio Capital III, L.P., a Delaware limited partnership,
Weston Presidio Capital IV, L.P., a Delaware limited partnership, WPC
Entrepreneur Fund, L.P., a Delaware limited partnership, and WPC Entrepreneur
Fund II, L.P., a Delaware limited partnership.
“Subsidiary”: as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries,
or both, by such Person. Unless otherwise qualified, all references to a
“Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Borrower.
“Subsidiary Guarantor”: each Subsidiary of the Borrower other than any Excluded
Foreign Subsidiary.
“SuperHoldings”: as defined in the preamble hereto.
“Supermajority Revolving Lenders”: the holders of more than 75% of the Total
Revolving Credit Commitments or, if the Revolving Credit Commitments have been
terminated, the Total Revolving Credit Exposure.
“Superpriority Claim”: a claim against any Debtor in any of the Cases which is
an administrative expense claim having priority over any or all administrative
expenses of the kind specified in Section 503(b) or 507(b) of the Bankruptcy
Code, including a claim pursuant to Section 364(c)(1) of the Bankruptcy Code.

 

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“Swap Agreement”: any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies or commodities; 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 Company or the Subsidiaries shall be a Swap Agreement.
“Swap Obligations”: of a Person, any and all obligations of such Person, 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 entered into on
or after the Petition Date with a Lender (or any Affiliate of a Lender) at the
time entered into, and (b) any and all cancellations, buy backs, reversals,
terminations or assignments of any Swap Agreement transaction, if such Swap
Agreement is entered into on or after the Petition Date with a Lender (or any
Affiliate of a Lender) at the time entered into.
“Taxes”: any present or future taxes, levies, imports, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions or penalties applicable thereto.
“Term Lender”: any Lender holding a Term Loan Commitment.
“Term Loan Commitment”: as to any Lender, the obligation of such Lender, if any,
to make Term Loans on the Closing Date in an aggregate principal amount not to
exceed the amount set forth under the heading “Term Loan Commitment” opposite
such Lender’s name on Schedule 1.1A. The amount of the Term Loan Commitments on
the Closing Date is $125,000,000.
“Term Loan Exposure”: as to any Term Loan Lender at any time, an amount equal to
the sum of the aggregate principal amount of all Term Loans made by such Term
Loan Lender then outstanding.
“Term Loan Facility”: as defined in the preliminary statements hereto.
“Term Loans”: as defined in Section 2.1(b).
“Term Prepayment Premium”: one percent (1%) of the principal amount of the Term
Loans prepaid (or whose interest rate margin is effectively reduced) after the
Closing in connection with a Repricing Transaction.
“Termination Date”: the earliest to occur of (a) the Maturity Date, (b) the date
that is five Business Days after the Petition Date (or such later date as the
Administrative Agent may agree in its sole discretion) if entry of the Interim
Order shall not have occurred by such date, (c) the date that is thirty-five
days (or such later date as the Administrative Agent may agree, acting in its
sole discretion) after the Petition Date if entry of the Final Order shall not
have occurred by such date, (d) the Effective Date and (e) the acceleration of
the Loans and, in connection therewith, the termination of the unused
Commitments in accordance with the terms hereof.

 

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“Total Commitments”: at any time, the aggregate amount of the Total Revolving
Credit Commitments and the Total Term Loan Commitments at such time.
“Total Exposure”: at any time, the aggregate amount of the Exposure of all
Lenders at such time.
“Total Revolving Credit Commitments”: at any time, the aggregate amount of the
Revolving Credit Commitments at such time.
“Total Revolving Credit Exposure”: at any time, the aggregate amount of the
Revolving Credit Exposure of all Revolving Lenders at such time.
“Total Term Loan Commitments”: at any time, the aggregate amount of the Term
Loan Commitments at such time.
“Total Term Loan Exposure”: at any time, the aggregate amount of the Term Loan
Exposure of all Term Loan Lenders at such time.
“Transferee”: as defined in Section 10.15.
“Type”: as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.
“UCC”: as defined in the Guarantee and Collateral Agreement.
“Uniform Customs”: the Uniform Customs and Practice for Documentary Credits
(1993 Revision), International Chamber of Commerce Publication No. 500, as the
same may be amended from time to time.
“U.S. Person”: a “United States person” within the meaning of Section
7701(a)(30) of the Code.
“U.S. Tax Certificate”: as defined in Section 2.17(f)(ii)(D).
“Wholly Owned Subsidiary”: as to any Person, any other Person all of the Capital
Stock of which (other than directors’ qualifying shares required by law) is
owned by such Person directly and/or through other Wholly Owned Subsidiaries.
“Wholly Owned Subsidiary Guarantor”: any Subsidiary Guarantor that is a Wholly
Owned Subsidiary of the Borrower.
“Withdrawal Liability”: liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Title IV of ERISA.
“Withholding Agent”: any Loan Party and the Administrative Agent.

 

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1.2 Other Definitional Provisions. (a) Unless otherwise specified therein, all
terms defined in this Agreement shall have the defined meanings when used in the
other Loan Documents or any certificate or other document made or delivered
pursuant hereto or thereto.
(b) The words “hereof”, “herein” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally applicable to
both the singular and plural forms of such terms.
1.3 Accounting Terms; GAAP. 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 the Borrower notifies
the Administrative Agent that the Borrower requests an amendment to any
provision (including any definition) hereof to eliminate the effect of any
change occurring after the Closing Date in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for 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. In the event that
the historical accounting practices, systems or reserves relating to the
components of the Borrowing Base are modified in a manner that is adverse to the
Lenders in any material respect, the Borrower will agree to maintain such
additional reserves (for purposes of computing the Borrowing Base) in respect to
the components of the Borrowing Base and make such other adjustments (which may
include maintaining additional reserves, modifying the advance rates or
modifying the eligibility criteria for the components of the Borrowing Base) as
may be appropriate to eliminate the material adverse effects thereof.
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, without giving effect to
any election under Accounting Standards Codification 825-10-25 (previously
referred to as Statement of Financial Accounting Standards 159) (or any other
Accounting Standards Codification or Financial Accounting Standard having a
similar result or effect) to value any Indebtedness or other liabilities of any
Debtor at “fair value”, as defined therein.
Section 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Commitments. (a) Subject to the terms and conditions hereof, each Lender
severally agrees to make revolving credit loans (“Revolving Credit Loans”) to
the Borrower from time to time during the Revolving Credit Commitment Period in
an aggregate principal amount at any one time outstanding which, when added to
such Lender’s Applicable Revolving Percentage of the sum of (i) the L/C
Obligations then outstanding and (ii) the aggregate amount of the Protective
Advances then outstanding, does not exceed the amount of such Lender’s Revolving
Credit Commitment; provided that during the period from the First Availability
Date until the Second Availability Date, (A) unless approved by the
Administrative Agent, acting in its sole discretion, the Revolving Credit
Commitments may only be utilized for the Rollover Letters of Credit and not for
Initial Letters of Credit or Initial Revolving Credit Loans and (B) in addition,
the aggregate principal amount of Initial Revolving Credit Loans, Rollover
Letters of Credit and Initial Letters of Credit outstanding (any Revolving
Credit Loans extended during such period, “Initial Revolving Credit Loans” and
any Revolving Credit Loans on the Second Availability Date or thereafter, “Final
Revolving Credit Loans”) shall not exceed the Interim Revolving Credit
Availability Amount; provided further that no Revolving Credit Loans shall be
made if, after giving effect to the making of such Revolving Credit Loans, the
Total Revolving Credit Exposure would exceed the lesser of (A) the Borrowing
Base then in effect and (B) the Total Revolving Credit Commitments. During the
Revolving Credit Commitment Period the Borrower may use the Revolving Credit
Commitments by borrowing, prepaying the Revolving Credit Loans in whole or in
part, and reborrowing, all in accordance with the terms and conditions hereof.
The Revolving Credit Loans may from time to time be Eurodollar Loans or Base
Rate Loans, as determined by the Borrower and notified to the Administrative
Agent in accordance with Sections 2.2 and 2.10, provided that no Revolving
Credit Loan shall be made as a Eurodollar Loan after the day that is one month
prior to the Maturity Date.

 

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(b) Subject to the terms and conditions hereof, each Lender severally agrees to
make a term loan (the “Term Loans”) to the Borrower on the Closing Date in an
aggregate principal amount which does not exceed the amount of such Lender’s
Term Loan Commitment. Term Loans may not be reborrowed once repaid. The Term
Loans may only be borrowed in one single borrowing to be made on the Closing
Date. The Term Loans may from time to time be Eurodollar Loans or Base Rate
Loans, as determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.2 and 2.10, provided that no Term Loan shall be made
as a Eurodollar Loan after the day that is one month prior to the Maturity Date.
(c) The Borrower shall repay all outstanding Revolving Credit Loans on the
Termination Date. The Borrower shall repay all outstanding Term Loans on the
Termination Date.
2.2 Procedure for Borrowing. (a) The Borrower may borrow under the Revolving
Credit Commitments during the Revolving Credit Commitment Period on any Business
Day, provided that the Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative Agent prior to 1:00
P.M., New York City time, (a) three Business Days prior to the requested
Borrowing Date, in the case of Eurodollar Loans, or (b) on the requested
Borrowing Date, in the case of Base Rate Loans), specifying (i) the amount and
Type of Revolving Credit Loans to be borrowed, (ii) the requested Borrowing Date
and (iii) in the case of Eurodollar Loans, the respective amounts of each such
Type of Loan and the respective lengths of the initial Interest Period therefor.
Any Revolving Credit Loans made on the Closing Date shall initially be Base Rate
Loans. Each borrowing under the Revolving Credit Commitments shall be in an
amount equal to (x) in the case of Base Rate Loans, $1,000,000 or a whole
multiple thereof (or, if the Revolving Credit Availability is less than
$1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans,
$1,000,000 or a whole multiple of $500,000 in excess thereof. Upon receipt of
any such notice from the Borrower, the Administrative Agent shall promptly
notify each Revolving Lender thereof. Each Revolving Lender will make the amount
of its pro rata share of each borrowing available to the Administrative Agent
for the account of the Borrower at the Funding Office prior to 1:00 P.M., New
York City time, on the Borrowing Date requested by the Borrower in funds
immediately available to the Administrative Agent. Such borrowing will then be
made available to the Borrower by the Administrative Agent in like funds as
received by the Administrative Agent.

 

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(b) The Borrower may make one single borrowing of the Term Loans on the Closing
Date, provided that the Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative Agent prior to 1:00
P.M., New York City time, one Business Day prior to the Closing Date),
specifying (i) the amount to be borrowed and (ii) the requested Borrowing Date
(which shall be the Closing Date). The Term Loans made on the Closing Date shall
initially be Base Rate Loans. Upon receipt of any such notice from the Borrower,
the Administrative Agent shall promptly notify each Term Lender thereof. Each
Term Lender will make the amount of its pro rata share of the borrowing
available to the Administrative Agent for the account of the Borrower at the
Funding Office prior to 1:00 P.M., New York City time, on the Closing Date in
funds immediately available to the Administrative Agent. Such borrowing will
then be made available to the Borrower by the Administrative Agent in like funds
as received by the Administrative Agent.
2.3 Base Rate Loans Prior to Second Availability Date. Notwithstanding the
contrary herein, prior to the Second Availability Date, all Revolving Credit
Loans may only consist of Base Rate Loans.
2.4 RESERVED.
2.5 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
the appropriate Lender, (i) the then unpaid principal amount of each Revolving
Credit Loan of such Lender on the Termination Date, (ii) the then unpaid
principal amount of each Term Loan of such Term Loan Lender on the Termination
Date or (iii) the then unpaid amount of each Protective Advance on the earliest
of (A) the Termination Date, (B) the day that is 30 days after the making of
such Protective Advance (or if such day is not a Business Day, the next
succeeding Business Day) and (C) demand by the Administrative Agent. The
Borrower hereby further agrees to pay interest on the unpaid principal amount of
the Loans from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in
Section 2.12.
(b) During any Cash Dominion Period that exists other than as a result of an
Event of Default, on each Business Day, the Administrative Agent may, in its
Permitted Discretion (unless otherwise directed by the Required Lenders), apply
all funds credited to the Collection Account or Concentration Account as of
10:00 a.m., New York City time, on such Business Day (whether or not immediately
available) first to prepay any Protective Advances that may be outstanding, pro
rata, second to prepay the Revolving Credit Loans (without a corresponding
reduction in Revolving Credit Commitments) and cash collateralize Letters of
Credit, and third to prepay the Term Loans; provided that during an Event of
Default, all such amounts shall be applied in accordance with Section 8.2.
(c) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing indebtedness of the Borrower to such Lender resulting
from each Loan of such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to time under
this Agreement.

 

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(d) The Administrative Agent, on behalf of the Borrower, shall maintain the
Register pursuant to Section 10.6(b), and a subaccount therein for each Lender,
in which shall be recorded (i) the amount of each Loan made hereunder and any
Note evidencing such Loan, the Type thereof and each Interest Period applicable
thereto, (ii) the amount of any principal or interest due and payable or to
become due and payable from the Borrower to each Lender hereunder and (iii) both
the amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender’s share thereof.
(e) The entries made in the Register and the accounts of each Lender maintained
pursuant to Section 2.5 shall, to the extent permitted by applicable law, be
prima facie evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided, however, that the failure of any Lender or
the Administrative Agent to maintain the Register or any such account, or any
error therein, shall not in any manner affect the obligation of the Borrower to
repay (with applicable interest) the Loans made to such Borrower by such Lender
in accordance with the terms of this Agreement.
(f) The Borrower agrees that, upon the request to the Administrative Agent by
any Lender, the Borrower will execute and deliver to such Lender a promissory
note of the Borrower evidencing any Revolving Credit Loans or Term Loans, as the
case may be, of such Lender, substantially in the forms of Exhibit G-1 or G-2,
respectively, with appropriate insertions as to date and principal amount.
2.6 Commitment Fees, etc. (a) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a commitment fee for the period from and
including the Closing Date to the last day of the Revolving Credit Commitment
Period, computed at the Commitment Fee Rate on the average daily amount of the
Revolving Credit Commitment of such Lender during the period for which payment
is made, payable monthly in arrears on the last day of each calendar month and
on the Maturity Date, commencing on the first of such dates to occur after the
date hereof.
(b) The Borrower agrees to pay to the Administrative Agent the fees in the
amounts and on the dates from time to time agreed to in writing by the Borrower
and the Administrative Agent set forth in the Fee Letter. Such fees shall be
fully earned when paid and shall not be refundable for any reason whatsoever
(except as expressly agreed between the Borrower and the Administrative Agent).
2.7 Termination or Reduction of Revolving Credit Commitments. The Borrower shall
have the right, upon not less than three Business Days’ notice to the
Administrative Agent, to terminate the Revolving Credit Commitments or, from
time to time, to reduce the amount of the Revolving Credit Commitments; provided
that no such termination or reduction of Revolving Credit Commitments shall be
permitted if, after giving effect thereto and to any prepayments of the
Revolving Credit Loans made on the effective date thereof, the Total Revolving
Credit Exposure would exceed the Total Revolving Credit Commitments. Any such
reduction shall be in an amount equal to $500,000, or a whole multiple thereof,
and shall reduce permanently the Revolving Credit Commitments then in effect.

 

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2.8 Optional Prepayments. (a) The Borrower may at any time and from time to time
prepay the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Administrative Agent at least three Business
Days prior thereto in the case of Eurodollar Loans and at least one Business Day
prior thereto in the case of Base Rate Loans, which notice shall specify the
date and amount of prepayment and whether the prepayment is of Eurodollar Loans
or Base Rate Loans; provided, that if a Eurodollar Loan is prepaid on any day
other than the last day of the Interest Period applicable thereto, the Borrower
shall also pay any amounts owing pursuant to Section 2.18. Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof. If any such notice is given, the amount specified in such notice shall
be due and payable on the date specified therein, together with (except in the
case of Revolving Credit Loans which are Base Rate Loans) accrued interest to
such date on the amount prepaid. Prepayments of the Term Loans may not be
reborrowed.
(b) Notwithstanding the foregoing, the Borrower may not voluntarily prepay the
Term Loans (other than in connection with a Repricing Transaction so long as the
aggregate principal amount of the term loans under such Repricing Transaction is
the same as the aggregate principal amount of the repaid Term Loans at such time
plus the amount of any fees, costs, premiums and accrued interest paid in
connection therewith) until all Revolving Credit Loans have been paid in full in
cash, all LC Exposure has been cash collateralized and the Revolving Credit
Commitments have been terminated. Any prepayment of Term Loans pursuant to this
Section 2.8(b) (and any prepayment of Term Loans pursuant to a Repricing
Transaction described in the immediately preceding sentence) shall be
accompanied by the payment of the Term Prepayment Premium, if any is then due.
2.9 Mandatory Prepayments. (a) In the event and on such occasion that:
(i) the Revolving Credit Exposure of any Revolving Lender exceeds such Revolving
Lender’s Revolving Credit Commitment; or
(ii) the Total Revolving Exposure exceeds the lesser of (x) Total Revolving
Credit Commitments and (y) the Borrowing Base;
the Borrower shall repay the Revolving Credit Loans to the extent of such
excess, provided that if the aggregate principal amount of Revolving Credit
Loans then outstanding is less than the amount of such excess (because L/C
Obligations constitute a portion thereof), the Borrower shall, to the extent of
the balance of such excess, replace outstanding Letters of Credit and/or deposit
an amount in cash in a cash collateral account established with the
Administrative Agent for the benefit of the Lenders on terms and conditions
reasonably satisfactory to the Administrative Agent.
(b) If any Indebtedness shall be incurred by a Debtor, an amount equal to 100%
of the Net Cash Proceeds thereof received shall be applied on the date of
receipt of such Net Cash Proceeds as set forth in Section 2.9(d), provided,
however, that the foregoing requirements of this paragraph (b) shall not apply
to any Indebtedness incurred in accordance with Section 7.2 as in effect on the
date of this Agreement.
(c) If on any date a Debtor shall receive Net Cash Proceeds from any Asset Sale
or Recovery Event (or, in the event of damage by casualty, the date the repair
or restoration of the relevant Property is completed), then, unless a
Reinvestment Notice shall be delivered in respect thereof, such Net Cash
Proceeds shall be applied on such date as set forth in Section 2.9(d); provided,
that, notwithstanding the foregoing, on each Reinvestment Prepayment Date, an
amount equal to the Reinvestment Prepayment Amount with respect to the relevant
Reinvestment Event shall be applied as set forth in Section 2.9(d); and provided
further, that notwithstanding the foregoing, such Net Cash Proceeds which are
not subject to a Reinvestment Notice shall not be required to be applied as set
forth in Section 2.9(d) until the date upon which the aggregate amount of such
Net Cash Proceeds received by a Debtor and not previously applied toward the
prepayment of the Loans shall exceed $1,000,000.

 

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(d) All such amounts described in Sections 2.9(b) and (c) shall be applied,
first to prepay any Protective Advances that may be outstanding, pro rata,
second to prepay the Revolving Credit Loans without a corresponding reduction in
the Total Revolving Credit Commitments and cash collateralize Letters of Credit,
and third to prepay the Term Loans; provided that during an Event of Default,
all such amounts shall be applied in accordance with Section 8.2. If the precise
amount of insurance or condemnation proceeds allocable to Inventory as compared
to equipment, fixtures and real property is not otherwise determined, the
allocation and application of those proceeds shall be determined by the
Administrative Agent, in its Permitted Discretion.
(e) [Reserved]
(f) The Borrower shall notify the Administrative Agent by telephone (confirmed
by facsimile or by other electronic transmission) of any prepayment hereunder
(i) in the case of prepayment of a Eurocurrency Loan, not later than 10:00 A.M.,
New York City time, three Business Days before the date of prepayment or (ii) in
the case of prepayment of a Base Rate Loan, not later than 10:00 A.M., New York
City time, one Business Day before the date of prepayment. Each such notice
shall be irrevocable and shall specify the prepayment date and the principal
amount of each Borrowing or portion thereof to be prepaid and, in the case of a
mandatory prepayment, set forth a reasonably detailed calculation of the amount
of such prepayment, provided that a notice of optional prepayment may state that
such notice is conditioned upon the receipt of the proceeds from the issuance of
other Indebtedness or any other event, in which case such notice of prepayment
may be revoked by the Borrower (by notice to the Administrative Agent on or
prior to the specified date) if such condition is not satisfied. Promptly
following receipt of any such notice the Administrative Agent shall advise the
Lenders of the contents thereof. Each partial voluntary prepayment of any
Revolving Credit Loan shall be in an amount that would be permitted in the case
of an advance of a Borrowing of the same Type as provided in Section 2.2 and
each partial voluntary prepayment of any Term Loan shall be in an amount equal
to $500,000, or a whole multiple thereof. Each prepayment of a Borrowing shall
be applied ratably to the Loans included in the prepaid Borrowing. Prepayments
shall be accompanied by accrued interest to the extent required by Section 2.18.
2.10 Conversion and Continuation Options. (a) The Borrower may elect from time
to time to convert Eurodollar Loans to Base Rate Loans by giving the
Administrative Agent at least two Business Days’ prior irrevocable notice of
such election, provided that any such conversion of Eurodollar Loans may only be
made on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert Base Rate Loans to Eurodollar Loans
(except, solely in the case of Revolving Loans, prior to the Second Availability
Date) by giving the Administrative Agent at least three Business Days’ prior
irrevocable notice of such election (which notice shall specify the length of
the initial Interest Period therefor), provided that no Base Rate Loan may be
converted into a Eurodollar Loan (i) when any Event of Default has occurred and
is continuing and the Administrative Agent or the Required Lenders have
determined in its or their sole discretion not to permit such conversions or
(ii) after the date that is one month prior to the Maturity Date. Upon receipt
of any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof. This Section shall not apply to Protective Advances, which may
not be converted or continued.

 

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(b) Any Eurodollar Loan may be continued as such upon the expiration of the then
current Interest Period with respect thereto by the Borrower giving irrevocable
notice to the Administrative Agent, in accordance with the applicable provisions
of the term “Interest Period” set forth in Section 1.1, of the length of the
next Interest Period to be applicable to such Loans, provided that no Eurodollar
Loan may be continued as such (i) when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Required Lenders have
determined in its or their sole discretion not to permit such continuations or
(ii) after the date that is one month prior to the Maturity Date, and provided,
further, that if the Borrower shall fail to give any required notice as
described above in this paragraph or if such continuation is not permitted
pursuant to the preceding proviso such Loans shall be automatically converted to
Base Rate Loans on the last day of such then expiring Interest Period. Upon
receipt of any such notice the Administrative Agent shall promptly notify each
relevant Lender thereof.
2.11 Minimum Amounts and Maximum Number of Eurodollar Tranches. Notwithstanding
anything to the contrary in this Agreement, all borrowings, conversions,
continuations and optional prepayments of Eurodollar Loans hereunder and all
selections of Interest Periods hereunder shall be in such amounts and be made
pursuant to such elections so that, (a) after giving effect thereto, the
aggregate principal amount of the Eurodollar Loans comprising each Eurodollar
Tranche shall be equal to $2,500,000 or a whole multiple of $500,000 in excess
thereof and (b) no more than ten Eurodollar Tranches shall be outstanding at any
one time.
2.12 Interest Rates and Payment Dates. (a) Each Eurodollar Loan shall bear
interest for each day during each Interest Period with respect thereto at a rate
per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin (it being understood that Eurodollar Loans bear interest from
and including the first day of each Interest Period to but not including the
last day of such Interest Period).
(b) Each Base Rate Loan shall bear interest at a rate per annum equal to the
Base Rate plus the Applicable Margin.
(c) Upon the occurrence and during the continuation of an Event of Default,
(i) all outstanding Loans and Reimbursement Obligations (whether or not overdue)
shall bear interest at a rate per annum which is equal to (x) in the case of the
Loans, the rate that would otherwise be applicable thereto pursuant to the
foregoing provisions of this Section 2.12 plus 2% or (y) in the case of
Reimbursement Obligations, the rate applicable to Base Rate Loans plus 2%,
(ii) the Letter of Credit commission payable pursuant to Section 3.3(a) shall be
increased by 2% and (iii) if all or a portion of any interest payable on any
Loan or Reimbursement Obligation or any commitment fee or other amount payable
hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise) such overdue amount shall bear interest at a rate per
annum equal to the rate applicable to Base Rate Loans plus 2%.

 

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(d) Interest shall be payable in arrears on each Interest Payment Date, provided
that interest accruing pursuant to paragraph (c) of this Section 2.12 shall be
payable from time to time on demand.
2.13 Computation of Interest and Fees. (a) Interest, fees and commissions
payable pursuant hereto shall be calculated on the basis of a 360-day year for
the actual days elapsed, except that, with respect to Base Rate Loans the rate
of interest on which is calculated on the basis of the Prime Rate, the interest
thereon shall be calculated on the basis of a 365- (or 366-, as the case may be)
day year for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of each determination
of a Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the Base Rate or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.
(b) Each determination of an interest rate by the Administrative Agent pursuant
to any provision of this Agreement shall be conclusive and binding on the
Borrower and the Lenders in the absence of manifest error. The Administrative
Agent shall, at the request of the Borrower, deliver to the Borrower a statement
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to Section 2.12(a) and the manner of performing any
required calculation hereunder.
2.14 Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:
(a) the Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from the Required
Lenders that the Eurodollar Rate determined or to be determined for such
Interest Period will not adequately and fairly reflect the cost to such Lenders
(as conclusively certified by such Lenders) of making or maintaining their
affected Loans during such Interest Period, the Administrative Agent shall give
telecopy or telephonic notice thereof to the Borrower and the relevant Lenders
as soon as practicable thereafter. If such notice is given (x) any Eurodollar
Loans requested to be made on the first day of such Interest Period shall be
made as Base Rate Loans, (y) any Loans that were to have been converted on the
first day of such Interest Period to Eurodollar Loans shall be continued as Base
Rate Loans and (z) any outstanding Eurodollar Loans shall be converted, on the
first day of such Interest Period, to Base Rate Loans. Until such notice has
been withdrawn by the Administrative Agent, no further Eurodollar Loans shall be
made or continued as such, nor shall the Borrower have the right to convert
Loans to Eurodollar Loans.

 

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2.15 Pro Rata Treatment and Payments. (a) Each borrowing by the Borrower from
the Lenders hereunder, each payment by the Borrower on account of any commitment
fee and any reduction of the Commitments of the Lenders shall be made pro rata
according to the respective Applicable Revolving Percentages and Applicable Term
Loan Percentages, as the case may be, of the relevant Lenders.
(b) Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Revolving Credit Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving
Credit Loans then held by the Revolving Lenders.
(c) Each payment (including each prepayment) by the Borrower on account of the
principal of and interest on the Term Loans shall be made pro rata according to
the respective outstanding principal amounts of the Term Loans then held by the
Term Lenders. Amounts prepaid on account of the Term Loans may not be
reborrowed.
(d) All payments (including prepayments) to be made by the Borrower hereunder,
whether on account of principal, interest, fees or otherwise, shall be made
without setoff or counterclaim and shall be made prior to 1:00 P.M., New York
City time, on the due date thereof to the Administrative Agent, for the account
of the Lenders, at the Payment Office, in Dollars and in immediately available
funds. The Administrative Agent shall distribute such payments to the Lenders
promptly upon receipt in like funds as received. If any payment hereunder (other
than payments on the Eurodollar Loans) becomes due and payable on a day other
than a Business Day, such payment shall be extended to the next succeeding
Business Day. If any payment on a Eurodollar Loan becomes due and payable on a
day other than a Business Day, the maturity thereof shall be extended to the
next succeeding Business Day unless the result of such extension would be to
extend such payment into another calendar month, in which event such payment
shall be made on the immediately preceding Business Day. In the case of any
extension of any payment of principal pursuant to the preceding two sentences,
interest thereon shall be payable at the then applicable rate during such
extension.
(e) Unless the Administrative Agent shall have been notified in writing by any
Lender prior to a borrowing that such Lender will not make the amount that would
constitute its share of such borrowing available to the Administrative Agent,
the Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent may, but
shall not be required to, in reliance upon such assumption, make available to
the Borrower a corresponding amount. If such amount is not made available to the
Administrative Agent by the required time on the Borrowing Date therefor, such
Lender shall pay to the Administrative Agent, on demand, such amount with
interest thereon at a rate equal to the daily average Federal Funds Effective
Rate for the period until such Lender makes such amount immediately available to
the Administrative Agent. A certificate of the Administrative Agent submitted to
any Lender with respect to any amounts owing under this Section 2.15(e) shall be
conclusive in the absence of manifest error. If such Lender’s share of such
borrowing is not made available to the Administrative Agent by such Lender
within three Business Days of such Borrowing Date, the Administrative Agent
shall also be entitled to recover such amount with interest thereon at the rate
per annum applicable to Base Rate Loans under the applicable Facility (in lieu
of interest otherwise provided for hereunder), on demand, from the Borrower.

 

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(f) Unless the Administrative Agent shall have been notified in writing by the
Borrower prior to the date of any payment being made hereunder that the Borrower
will not make such payment to the Administrative Agent, the Administrative Agent
may assume that the Borrower is making such payment, and the Administrative
Agent may, but shall not be required to, in reliance upon such assumption, make
available to the Lenders their respective pro rata shares of a corresponding
amount. If such payment is not made to the Administrative Agent by the Borrower
within three Business Days of such required date, the Administrative Agent shall
be entitled to recover, on demand, from each Lender to which any amount which
was made available pursuant to the preceding sentence, such amount with interest
thereon at the rate per annum equal to the daily average Federal Funds Effective
Rate. Nothing herein shall be deemed to limit the rights of the Administrative
Agent or any Lender against the Borrower.
(g) [Reserved]
(h) At the election of the Administrative Agent, all payments of principal,
interest, Reimbursement Obligations, fees, premiums, reimbursable expenses
(including, without limitation, all reimbursement for fees and expenses pursuant
to Section 10.5), 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 pursuant to Section 2.2 or a deemed request as provided in this
Section or may be deducted from any deposit account of the Borrower maintained
with the Administrative Agent. The Borrower hereby irrevocably authorizes
(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 and that all such Borrowings shall be deemed to have been
requested pursuant to Section 2.2 or 2.23, as applicable and (ii) the
Administrative Agent to charge any deposit account of the 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.
2.16 Requirements of Law. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof:
(i) shall subject any Credit Party to any Taxes (other than (A) Indemnified
Taxes covered by Section 2.17 and (B) and the imposition of, or any change in
the rate of, any Excluded Tax) on its loans, loan principal, letters of credit,
commitments, or other obligations, or its deposits, reserves, other liabilities
or capital attributable thereto;
(ii) shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender which
is not otherwise included in the determination of the Eurodollar Rate hereunder;
or
(iii) shall impose on such Lender any other condition;

 

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and the result of any of the foregoing is to increase, relative to the date
hereof, the cost to such Lender or such other Credit Party, by an amount which
such Lender or other Credit Party deems to be material, of making, converting
into, continuing or maintaining Eurodollar Loans (or, in the case of (i), any
Loan) or issuing or participating in Letters of Credit, or to reduce, relative
to the date hereof, any amount receivable hereunder in respect thereof, then, in
any such case, the Borrower shall promptly pay such Lender or such other Credit
Party, upon its demand, any additional amounts necessary to compensate such
Lender or Credit Party for such increased cost or reduced amount receivable. If
any Lender or Credit Party becomes entitled to claim any additional amounts
pursuant to this Section 2.16, it shall promptly notify the Borrower (with a
copy to the Administrative Agent) of the event by reason of which it has become
so entitled.
(b) If any Lender shall have determined that the adoption of or any change in
any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender’s or such corporation’s capital as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration such Lender’s or such
corporation’s policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, after submission by such
Lender to the Borrower (with a copy to the Administrative Agent) of a written
request therefor, the Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender for such reduction; provided that the
Borrower shall not be required to compensate a Lender pursuant to this paragraph
for any amounts incurred more than three months prior to the date that such
Lender notifies the Borrower of such Lender’s intention to claim compensation
therefor; and provided further that, if the circumstances giving rise to such
claim have a retroactive effect, then such three-month period shall be extended
to include the period of such retroactive effect.
(c) A certificate as to any additional amounts payable pursuant to this
Section 2.16 submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
obligations of the Borrower pursuant to this Section 2.16 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
(d) Notwithstanding anything herein to the contrary (i) the Dodd-Frank Wall
Street Reform and Consumer Protection Act and all requests, rules, guidelines or
directives thereunder or issued in connection therewith and (ii) all requests,
rules, guidelines, requirements and 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 be deemed to have been
introduced or adopted after the date hereof, regardless of the date enacted,
adopted or issued.

 

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2.17 Taxes. (a) Each payment by any Loan Party under any Loan Document shall be
made without withholding for any Taxes, unless such withholding is required by
any law. If any Withholding Agent determines, in its sole discretion exercised
in good faith, that it is so required to withhold Taxes, then such Withholding
Agent 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 Party shall be
increased as necessary so that, net of such withholding (including such
withholding applicable to additional amounts payable under this Section 2.17),
the applicable Credit Party receives the amount it would have received had no
such withholding been made.
(b) The Borrower shall timely pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.
(c) As soon as practicable after any payment of Indemnified Taxes or Excluded
Taxes by any Loan Party to a Governmental Authority, 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) The Loan Parties shall jointly and severally indemnify each Credit Party for
any Indemnified Taxes that are paid or payable by such Credit Party in
connection with any Loan Document (including amounts paid or payable under this
Section 2.17(d)) 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. The indemnity under this
Section 2.17(d) shall be paid within 10 days after the Credit Party delivers to
any Loan Party a certificate stating the amount of any Indemnified Taxes so paid
or payable by such Credit Party and describing the basis for the indemnification
claim. Such certificate shall be conclusive of the amount so paid or payable
absent manifest error. Such Credit Party shall deliver a copy of such
certificate to the Administrative Agent.
(e) Each Lender shall severally indemnify the Administrative Agent for any Taxes
(but, in the case of any Indemnified Taxes, 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)
attributable to such Lender that are paid or payable 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. The
indemnity under this Section 2.17(e) shall be paid within 10 days after the
Administrative Agent delivers to the applicable Lender a certificate stating the
amount of Taxes so paid or payable by the Administrative Agent. Such certificate
shall be conclusive of the amount so paid or payable absent manifest error.

 

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(f)
(i) Any Lender that is entitled to an exemption from, or reduction of, any
applicable withholding Tax with respect to any payments under any Loan Document
shall deliver to the Borrower and the Administrative Agent, at the time or times
reasonably requested by the Borrower or the Administrative Agent, such properly
completed and executed documentation reasonably requested by the Borrower or the
Administrative Agent as will permit such payments to be made without, or at a
reduced rate of, withholding. In addition, any Lender, if requested by the
Borrower or the Administrative Agent, shall deliver such other documentation
prescribed by law or reasonably requested by the Borrower or the Administrative
Agent as will enable the Borrower or the Administrative Agent to determine
whether or not such Lender is subject to any withholding (including 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
Sections 2.17(f)(ii)(A) through (E) below) shall not be required if in the
Lender’s judgment such completion, execution or submission would subject such
Lender to any material unreimbursed cost or expense (or, in the case of a change
in a Requirement of Law, any incremental material unreimbursed cost or expense)
or would materially prejudice the legal or commercial position of such Lender.
Upon the reasonable request of such Borrower or the Administrative Agent, any
Lender shall update any form or certification previously delivered pursuant to
this Section 2.17(f). If any form or certification previously delivered pursuant
to this Section expires or becomes obsolete or inaccurate in any respect with
respect to a Lender, such Lender shall promptly (and in any event within 10 days
after such expiration, obsolescence or inaccuracy) notify such Borrower and the
Administrative Agent in writing of such expiration, obsolescence or inaccuracy
and update the form or certification if it is legally eligible to do so.
(ii) Without limiting the generality of the foregoing, if the Borrower is a U.S.
Person, any Lender with respect to such Borrower shall, if it is legally
eligible to do so, deliver to such Borrower and the Administrative Agent (in
such number of copies reasonably requested by such Borrower and the
Administrative Agent) on or prior to the date on which such Lender becomes a
party hereto, duly completed and executed copies of whichever of the following
is applicable:
(A) in the case of a Lender that is a U.S. Person, IRS Form W-9 certifying that
such Lender is exempt from U.S. Federal backup withholding tax;
(B) in the case of a Non-U.S. Lender claiming the benefits of an income tax
treaty to which the United States is a party (1) with respect to payments of
interest under any Loan Document, IRS Form W-8BEN establishing an exemption
from, or reduction of, U.S. federal withholding Tax pursuant to the “interest”
article of such tax treaty and (2) with respect to any other applicable payments
under any Loan Document, IRS Form W-8BEN 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;
(C) in the case of a Non-U.S. Lender for whom payments under any Loan Document
constitute income that is effectively connected with such Lender’s conduct of a
trade or business in the United States, IRS Form W-8ECI;
(D) in the case of a Non-U.S. Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code both (1) IRS Form W-8BEN and
(2) a certificate substantially in the form of Exhibit H (a “U.S. Tax
Certificate”) to the effect that such Lender is not (a) a “bank” within the
meaning of Section 881(c)(3)(A) of the Code, (b) a “10 percent shareholder” of
the Borrower within the meaning of Section 881(c)(3)(B) of the Code (c) a
“controlled foreign corporation” described in Section 881(c)(3)(C) of the Code
and (d) conducting a trade or business in the United States with which the
relevant interest payments are effectively connected;

 

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(E) in the case of a Non-U.S. Lender that is not the beneficial owner of
payments made under any Loan Document (including a partnership or a
participating Lender) (1) an IRS Form W-8IMY on behalf of itself and (2) the
relevant forms prescribed in clauses (A), (B), (C), (D) and (F) of this
paragraph (f)(ii) that would be required of each such beneficial owner or
partner of such partnership if such beneficial owner or partner were a Lender;
provided, however, that if the Lender is a partnership and one or more of its
partners are claiming the exemption for portfolio interest under Section 881(c)
of the Code, such Lender may provide a U.S. Tax Certificate on behalf of such
partners; or
(F) any other form prescribed by applicable law as a basis for claiming
exemption from, or a reduction of, U.S. federal withholding Tax together with
such supplementary documentation necessary to enable the Borrower or the
Administrative Agent to determine the amount of Tax (if any) required by law to
be withheld.
(iii) 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 Withholding Agent, at the time or times prescribed by law
and at such time or times reasonably requested by the Withholding 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 Withholding Agent as may be necessary for the
Withholding Agent to comply with its obligations under FATCA, to determine that
such Lender has or has not 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 Section 2.17(f)(iii), “FATCA” shall include any amendments made
to FATCA after the date of this Agreement.
(g) 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 2.17 (including additional amounts paid pursuant to
this Section 2.17), 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 2.17 with respect to the Taxes giving rise to such refund), net of all
out-of-pocket expenses (including any 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 to such indemnified party pursuant to the previous sentence (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event such indemnified party is required to repay such refund
to such Governmental Authority. Notwithstanding anything to the contrary in this
Section 2.17(g), in no event will any indemnified party be required to pay any
amount to any indemnifying party pursuant to this Section 2.17(g) if such
payment would place such indemnified party in a less favorable position (on a
net after-Tax basis) than such indemnified party would have been in if the
indemnification payments or additional amounts giving rise to such refund had
never been paid. This Section 2.17(g) shall not be construed to require any
indemnified party to make available its Tax returns (or any other information
relating to its Taxes which it deems confidential) to the indemnifying party or
any other Person.

 

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2.18 Indemnity. The Borrower agrees to indemnify each Lender and to hold each
Lender harmless from any loss or expense which such Lender may sustain or incur
as a consequence of (a) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this
Agreement or (c) the making of a prepayment of Eurodollar Loans on a day which
is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender) which
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank eurodollar
market. A certificate as to any amounts payable pursuant to this Section 2.18
submitted to the Borrower by any Lender shall be conclusive in the absence of
manifest error. This covenant shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.
2.19 Illegality. Notwithstanding any other provision herein, if the adoption of
or any change in any Requirement of Law or in the interpretation or application
thereof shall make it unlawful for any Lender to make or maintain Eurodollar
Loans as contemplated by this Agreement, (a) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be cancelled and
(b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 2.18
2.20 Change of Lending Office. Each Lender agrees that, upon the occurrence of
any event giving rise to the operation of Section 2.16 or 2.17(a) with respect
to such Lender, it will, if requested by the Borrower, use reasonable efforts
(subject to overall policy considerations of such Lender) to designate another
lending office for any Loans affected by such event with the object of avoiding
the consequences of such event; provided, that such designation is made on terms
that, in the sole judgment of such Lender, cause such Lender and its lending
office(s) to suffer no economic, legal or regulatory disadvantage, and provided,
further, that nothing in this Section 2.20 shall affect or postpone any of the
obligations of any Borrower or the rights of any Lender pursuant to Section 2.16
or 2.17(a).

 

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2.21 Replacement of Lenders under Certain Circumstances The Borrower shall be
permitted to replace any Lender which (a) requests reimbursement for amounts
owing pursuant to Section 2.16 or Section 2.17(a) or (b) becomes a Defaulting
Lender, with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Default or
Event of Default shall have occurred and be continuing at the time of such
replacement, (iii) prior to any such replacement, such Lender shall have taken
no action under Section 2.20 so as to eliminate the continued need for payment
of amounts owing pursuant to Section 2.16 or 2.17(a), (iv) the replacement
financial institution shall purchase, at par, all Loans and other amounts owing
to such replaced Lender on or prior to the date of replacement, (v) the Borrower
shall be liable to such replaced Lender under Section 2.18 if any Eurodollar
Loan owing to such replaced Lender shall be purchased other than on the last day
of the Interest Period relating thereto, (vi) the replacement financial
institution, if not already a Lender, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Lender shall be obligated to make such
replacement in accordance with the provisions of Section 10.6 (provided that the
Borrower shall be obligated to pay the registration and processing fee referred
to therein) or pursuant to other procedures established by the Administrative
Agent, which may include a deemed assignment, (viii) until such time as such
replacement shall be consummated, the Borrower shall pay all additional amounts
(if any) required pursuant to Section 2.16 or 2.17(a), as the case may be, and
(ix) any such replacement shall not be deemed to be a waiver of any rights which
the Borrower, the Administrative Agent or any other Lender shall have against
the replaced Lender.
2.22 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 set forth in Section 2.6(a) shall cease to accrue on the unfunded
portion of the Revolving Credit Commitment of such Defaulting Lender;
(b) the Commitments, Revolving Credit Exposure and Term Loans of such Defaulting
Lender shall not be included in determining whether the Required Lenders have
taken or may take any action hereunder (including any consent to any amendment,
waiver or other modification pursuant to Section 10.1); provided, that this
clause (b) shall not apply to the vote of a Defaulting Lender in the case of an
amendment, waiver or other modification requiring the consent of each Lender or
each Lender affected thereby;
(c) if any LC Exposure exists or any Protective Advance is outstanding at the
time such Lender becomes a Defaulting Lender then:
(i) all or any part of such LC Exposure and Applicable Revolving Percentage of
Protective Advances shall be reallocated among the non-Defaulting Lenders in
accordance with their respective Applicable Revolving Percentages but only to
the extent the sum of all non-Defaulting Lenders’ LC Exposure and Applicable
Revolving Percentages of Protective Advances does not exceed the total of all
non-Defaulting Lenders’ Revolving Credit Commitments;

 

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(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrower shall within one Business Day following
notice by the Administrative Agent (x) first, cash collateralize for the benefit
of the Issuing Lender only the Borrower’s 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 reasonably
satisfactory to the Administrative Agent for so long as such LC Exposure is
outstanding and (y) cash collateralize such Defaulting Lender’s Applicable
Revolving Percentage of such Protective Advance;
(iii) if the Borrower cash collateralizes any portion of such Defaulting
Lender’s LC Exposure pursuant to clause (ii) above, the Borrower shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 3.3(a)
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
Section 2.6(a) and Section 3.3(a) shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Revolving Percentages; or
(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 Lender or any other
Lender hereunder, all fees payable under Section 3.3(a) with respect to such
Defaulting Lender’s LC Exposure shall be payable to the applicable Issuing
Lender until and to the extent that such LC Exposure is reallocated and/or cash
collateralized; and
(d) so long as any Lender is a Defaulting Lender, the Issuing Lender shall not
be required to issue, amend or increase any Letter of Credit, unless it is
satisfied that the related exposure and the Defaulting Lender’s then outstanding
LC Exposure will be 100% covered by the Revolving Credit Commitments of the
non-Defaulting Lenders and/or cash collateral will be provided by the Borrower
in accordance with paragraph (c) of this Section 2.19(c), and participating
interests in any such newly issued or increased Letter of Credit shall be
allocated among non-Defaulting Lenders in a manner consistent with paragraph
(c)(i) of this Section 2.22 (and such Defaulting Lender shall not participate
therein).
If (i) a Bankruptcy Event with respect to a Parent of any Lender shall occur
following the date hereof and for so long as such event shall continue or
(ii) the Issuing Lender has a good faith belief that any Lender has defaulted in
fulfilling its obligations under one or more other agreements in which such
Lender commits to extend credit, the Issuing Lender shall not be required to
issue, amend or increase any Letter of Credit, unless the Issuing Lender, as the
case may be, shall have entered into arrangements with the Borrower or such
Lender, satisfactory to the Issuing Lender, as the case may be, to defease any
risk to it in respect of such Lender hereunder.

 

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In the event that each of the Administrative Agent, the Borrower and the Issuing
Lender agree that a Defaulting Lender has adequately remedied all matters that
caused such Lender to be a Defaulting Lender, then the LC Exposure and
Applicable Percentage of Protective Advances of the Lenders shall be readjusted
to reflect the inclusion of such Lender’s Revolving Credit Commitment and on
such date such Lender shall purchase at par such of the Loans of the other
Lenders as the Administrative Agent shall determine is necessary in order for
the Lenders (including the previously referenced Defaulting Lender) to hold such
Loans in accordance with their Applicable Revolving Percentages.
2.23 Protective Advances. (a) Subject to the limitations set forth below, the
Administrative Agent is authorized by the Borrower and the Lenders, from time to
time in the Administrative Agent’s sole discretion (but shall have absolutely no
obligation), to make Loans to the Borrower, on behalf of the 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 (other than Swap Obligations and Banking Services
Obligations), or (iii) to pay any other amount chargeable to or required to be
paid by the Borrower pursuant to the terms of this Agreement, including payments
of reimbursable expenses (including costs, fees, and expenses as described in
Section 10.5) 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 5% of the Total Revolving Credit Commitments; provided, further, that the
aggregate Revolving Credit Exposure of all Lenders shall not exceed the Total
Revolving Credit Commitments. Protective Advances may be made even if the
conditions precedent set forth in Sections 5.1, 5.2 or 5.3 have not been
satisfied. Proceeds of a Protective Advance shall not be disbursed to the
Borrower or any other Loan Party and shall be applied in accordance with the
terms of this Section 2.23. 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 Base Rate
Loans. 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 Revolving Credit
Availability and the conditions precedent set forth in Sections 5.1, 5.2 and
5.3, if applicable, have been satisfied, the Administrative Agent may request
the Lenders to make a Revolving Credit 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 2.23(b).
(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 Revolving 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 Revolving Percentage of all payments of
principal and interest and all proceeds of Collateral received by the
Administrative Agent in respect of such Protective Advance.

 

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2.24 Priority and Liens. (a) The Debtors hereby covenant, represent and warrant
that, upon entry of the Interim Order (and the Final Order, as applicable), the
Obligations of the Debtors hereunder and under the other Loan Documents
(including the obligations of the Debtors under the Guarantee and Collateral
Agreement), (i) pursuant to Section 364(c)(1) of the Bankruptcy Code, shall at
all times constitute allowed Superpriority Claims in the Cases, (ii) pursuant to
Section 364(c)(2) of the Bankruptcy Code, shall be secured by a perfected first
priority Lien on all Collateral that is otherwise not encumbered by a valid,
perfected and non-avoidable Lien as of the Petition Date or a valid Lien
perfected (but not granted) thereafter to the extent such post-Petition Date
perfection in respect of a pre-Petition Date claim is expressly permitted under
the Bankruptcy Code, excluding claims and causes of action under
Sections 502(d), 544, 545, 547, 548, 549 and 550 of the Bankruptcy Code and the
proceeds therefrom (it being understood that, notwithstanding such exclusion,
upon entry of the Final Order, to the extent approved by the Bankruptcy Court,
such Lien shall attach to any proceeds thereof), (iii) pursuant to
Section 364(c)(3) of the Bankruptcy Code, shall be secured by a perfected junior
Lien upon all Collateral that is subject to (A) valid, perfected and
non-avoidable Liens (other than to secure the Debtors’ Prepetition Obligations
and Liens that are junior to the Liens securing the Debtors’ Prepetition
Obligations) in existence on the Petition Date or valid Liens perfected (but not
granted) thereafter to the extent such post-Petition Date perfection in respect
of a pre-Petition Date claim is expressly permitted under the Bankruptcy Code
and (B) other than as provided in clause (iv) below, post-Petition Date Liens
permitted hereunder, and (iv) pursuant to Section 364(d)(1) of the Bankruptcy
Code, shall be secured by a perfected first priority senior priming Lien upon
all Collateral (x) that is subject to a valid Lien or security interest in
effect on the Petition Date to secure the Debtors’ Prepetition Obligations,
(y) that is subject to a Lien granted after the Petition Date to provide
adequate protection in respect of the Debtors’ Prepetition Obligations or
(z) that is subject to a valid Lien in effect on the Petition Date that is
junior to the Liens that secure the Debtors’ Prepetition Obligations, subject
and subordinate in each case with respect to subclauses (i) through (iv) above,
only to the Carve Out. For purposes hereof, the “Carve Out” shall be defined as
set forth in the Interim Order and the Final Order, as applicable.
(b) As to all Collateral, including without limitation, all cash, Cash
Equivalents and real property the title to which is held by any Debtor, or the
possession of which is held by any Debtor in the form of a leasehold interest,
each Debtor hereby assigns and conveys as security, grants a security interest
in, hypothecates, mortgages, pledges and sets over unto the Administrative
Agent, for the benefit of the Lenders and the other holders of the Obligations,
all of the right, title and interest of the Borrower and such Guarantor in all
of such Collateral, including without limitation, all cash, Cash Equivalents and
owned real property and in all such leasehold interests, together in each case
with all of the right, title and interest of the Borrower and such Guarantor in
and to all buildings, improvements, and fixtures related thereto, any lease or
sublease thereof, all general intangibles relating thereto and all proceeds
thereof. Notwithstanding anything herein to the contrary, the Collateral shall
not include the L/C Cash Collateral, and the Liens granted to the Administrative
Agent shall not attach to, the L/C Cash Collateral, and the L/C Cash Collateral
shall not be subject to the Superpriority Claims granted to the Lenders. The
Borrower and each Guarantor acknowledges that, pursuant to and upon entry of the
Orders, the Liens granted in favor of the Administrative Agent (on behalf of the
Lenders) in all of the Collateral shall be perfected without the recordation of
any UCC financing statements, notices of Lien or other instruments of mortgage
or assignment, subject to the terms and conditions set forth in the Orders. The
Borrower and each Guarantor further agrees that (a) the Administrative Agent
shall have the rights and remedies set forth in Sections 8 and 11 and in the
Security Documents and the Orders in respect of the Collateral and (b) if
requested by the Administrative Agent, the Borrower and each of the other
Debtors shall enter into separate security agreements, pledge agreements and fee
and leasehold mortgages with respect to such Collateral on terms reasonably
satisfactory to the Administrative Agent.

 

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2.25 Payment of Obligations. Upon the maturity (whether by acceleration or
otherwise) of any of the Obligations under this Agreement or any of the other
Loan Documents, the Lenders shall be entitled to immediate payment of such
Obligations in full in cash, without further application to or order of the
Bankruptcy Court.
2.26 No Discharge; Survival of Claims. Each Debtor agrees that to the extent its
Obligations hereunder are not satisfied in full in cash (except as provided in
Section 2.24), (a) its Obligations arising hereunder shall not be discharged by
the entry of a Confirmation Order (and each Debtor, pursuant to
Section 1141(d)(4) of the Bankruptcy Code, hereby waives any such discharge) and
(b) the Superpriority Claim granted to the Administrative Agent and the Lenders
pursuant to the Orders and described in Section 2.24 and the Liens granted to
the Administrative Agent pursuant to the Orders and described in Section 2.24
shall not be affected in any manner by the entry of a Confirmation Order.
2.27 Conflicts. To the extent of any conflict between the provisions of this
Agreement and the other Loan Documents and provisions contained in the Interim
Order (or the Final Order, as applicable), the provisions of the applicable
Order shall govern.
Section 3. LETTERS OF CREDIT
3.1 L/C Commitment. (a) Prior to the Closing Date, the Rollover Issuing Lender
has issued the Rollover Letters of Credit listed on Schedule 3.1 which, from and
after the Closing Date, shall, subject to the terms and conditions hereof,
constitute Letters of Credit hereunder. Subject to the terms and conditions
hereof, the Issuing Lender, in reliance on the agreements of the other Revolving
Credit Lenders set forth in Section 3.4(a), agrees to issue letters of credit
(the letters of credit issued on and after the Closing Date pursuant to this
Section 3, together with the Rollover Letters of Credit, collectively, the
“Letters of Credit”) for the account of the Borrower on any Business Day during
the Revolving Credit Commitment Period in such form as may be approved from time
to time by the Issuing Lender; provided that the Issuing Lender shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance (i) the L/C Obligations would exceed the L/C Commitment, (ii) Revolving
Credit Availability would be less than zero or (iii) the Revolving Credit
Exposure would exceed the Interim Revolving Credit Availability Amount prior to
the Second Availability Date. Each Letter of Credit shall (i) be denominated in
Dollars and (ii) expire no later than the date which is five Business Days prior
to the Maturity Date.

 

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(b) Each Letter of Credit shall be subject to the Uniform Customs and, to the
extent not inconsistent therewith, the laws of the State of New York.
(c) The Issuing Lender shall not at any time be obligated to issue any Letter of
Credit hereunder if such issuance would conflict with, or cause the Issuing
Lender or any L/C Participant to exceed any limits imposed by, any applicable
Requirement of Law.
3.2 Procedure for Issuance of Letter of Credit. The Borrower may from time to
time request that the Issuing Lender issue a Letter of Credit by delivering to
the Issuing Lender at its address for notices specified herein an Application
therefor, completed to the satisfaction of the Issuing Lender, and such other
certificates, documents and other papers and information as the Issuing Lender
may request. Upon receipt of any Application, the Issuing Lender will process
such Application and the certificates, documents and other papers and
information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Lender shall promptly furnish to the Administrative Agent, which shall
in turn promptly furnish to the Lenders, notice of the issuance of each Letter
of Credit (including the amount thereof).
3.3 Commissions, Fees and Other Charges. (a) The Borrower will pay a commission
on all outstanding Letters of Credit at a per annum rate equal to the Applicable
Margin then in effect with respect to Eurodollar Loans under the Revolving
Facility, shared ratably among the Lenders and payable quarterly in arrears on
each L/C Fee Payment Date after the issuance date. In addition, the Borrower
shall pay to the Issuing Lender for its own account a fronting fee of 1/4 of 1%
per annum, payable quarterly in arrears on each L/C Fee Payment Date after the
issuance date.
(b) In addition to the foregoing fees and commissions, the Borrower shall pay or
reimburse the Issuing Lender for such normal and customary costs and expenses as
are incurred or charged by the Issuing Lender in issuing, negotiating, effecting
payment under, amending or otherwise administering any Letter of Credit.
3.4 L/C Participations. (a) The Issuing Lender irrevocably agrees to grant and
hereby grants to each L/C Participant, and, to induce the Issuing Lender to
issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from the Issuing Lender, on
the terms and conditions hereinafter stated, for such L/C Participant’s own
account and risk an undivided interest equal to such L/C Participant’s
Applicable Revolving Percentage in the Issuing Lender’s obligations and rights
under each Letter of Credit issued hereunder and the amount of each draft paid
by the Issuing Lender thereunder. Each L/C Participant unconditionally and
irrevocably agrees with the Issuing Lender that, if a draft is paid under any
Letter of Credit for which the Issuing Lender is not reimbursed in full by the
Borrower in accordance with the terms of this Agreement, such L/C Participant
shall pay to the Issuing Lender upon demand at the Issuing Lender’s address for
notices specified herein an amount equal to such L/C Participant’s Applicable
Revolving Percentage of the amount of such draft, or any part thereof, which is
not so reimbursed. Each 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 Revolving Credit Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever.

 

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(b) If any amount required to be paid by any L/C Participant to the Issuing
Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any
payment made by the Issuing Lender under any Letter of Credit is paid to the
Issuing Lender within three Business Days after the date such payment is due,
such L/C Participant shall pay to the Issuing Lender on demand an amount equal
to the product of (i) such amount, times (ii) the daily average Federal Funds
Effective Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to the
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to
Section 3.4(a) is not made available to the Issuing Lender by such L/C
Participant within three Business Days after the date such payment is due, the
Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to Base Rate Loans under the Revolving Facility. A
certificate of the Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this Section shall be conclusive in the absence of
manifest error.
(c) Whenever, at any time after the Issuing Lender has made payment under any
Letter of Credit and has received from any L/C Participant its pro rata share of
such payment in accordance with Section 3.4(a), the Issuing Lender receives any
payment related to such Letter of Credit (whether directly from the Borrower or
otherwise, including proceeds of collateral applied thereto by the Issuing
Lender), or any payment of interest on account thereof, the Issuing Lender will
distribute to such L/C Participant its pro rata share thereof; provided,
however, that in the event that any such payment received by the Issuing Lender
shall be required to be returned by the Issuing Lender, such L/C Participant
shall return to the Issuing Lender the portion thereof previously distributed by
the Issuing Lender to it.
3.5 Reimbursement Obligation of the Borrower. The Borrower agrees to reimburse
the Issuing Lender on each date on which the Issuing Lender notifies the
Borrower of the date and amount of a draft presented under any Letter of Credit
and paid by the Issuing Lender for the amount of (a) such draft so paid and
(b) any taxes, fees, charges or other costs or expenses incurred by the Issuing
Lender in connection with such payment. Each such payment shall be made to the
Issuing Lender at its address for notices specified herein in lawful money of
the United States of America and in immediately available funds. Interest shall
be payable on any and all amounts remaining unpaid by the Borrower under this
Section from the date such amounts become payable (whether at stated maturity,
by acceleration or otherwise) until payment in full at the rate set forth in
Section 2.12(c). Each drawing under any Letter of Credit shall (unless an event
of the type described in clause (i) or (ii) of Section 8(f) shall have occurred
and be continuing with respect to the Borrower, in which case the procedures
specified in Section 3.4 for funding by L/C Participants shall apply) constitute
a request by the Borrower to the Administrative Agent for a borrowing pursuant
to Section 2.2(a) of Base Rate Loans in the amount of such drawing. The
Borrowing Date with respect to such borrowing shall be the date of such drawing.

 

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3.6 Obligations Absolute. The Borrower’s obligations under this Section 3 shall
be absolute and unconditional under any and all circumstances and irrespective
of any setoff, counterclaim or defense to payment which the Borrower may have or
have had against the Issuing Lender, any beneficiary of a Letter of Credit or
any other Person. The Borrower also agrees with the Issuing Lender that the
Issuing Lender shall not be responsible for, and the Borrower’s Reimbursement
Obligations under Section 3.5 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though
such documents shall in fact prove to be invalid, fraudulent or forged, or any
dispute between or among the Borrower and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Borrower against any beneficiary of such Letter of
Credit or any such transferee. The Issuing Lender shall not be liable for any
error, omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Letter of
Credit, except for errors or omissions found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of the Issuing Lender. The Borrower agrees that
any action taken or omitted by the Issuing Lender under or in connection with
any Letter of Credit or the related drafts or documents, if done in the absence
of gross negligence or willful misconduct and in accordance with the standards
or care specified in the UCC of the State of New York, shall be binding on the
Borrower and shall not result in any liability of the Issuing Lender to the
Borrower.
3.7 Letter of Credit Payments. If any draft shall be presented for payment under
any Letter of Credit, the Issuing Lender shall promptly notify the Borrower of
the date and amount thereof. The responsibility of the Issuing Lender to the
Borrower in connection with any draft presented for payment under any Letter of
Credit shall, in addition to any payment obligation expressly provided for in
such Letter of Credit, be limited to determining that the documents (including
each draft) delivered under such Letter of Credit in connection with such
presentment are substantially in conformity with such Letter of Credit.
3.8 Applications. To the extent that any provision of any Application related to
any Letter of Credit is inconsistent with the provisions of this Section 3, the
provisions of this Section 3 shall apply.

 

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Section 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this Agreement
and to make the Loans and issue or participate in the Letters of Credit,
Holdings and the Borrower hereby jointly and severally represent and warrant to
the Administrative Agent and each Lender that:
4.1 Financial Condition. (a) [Reserved]
(b) (i) The audited consolidated balance sheets of Holdings and its consolidated
Subsidiaries as at March 31, 2009 and March 31, 2010, and the related
consolidated statements of income and of cash flows for the fiscal years ended
March 31, 2009 and March 31, 2010, reported on by and accompanied by an
unqualified report from Deloitte & Touche LLP present fairly in all material
respects the consolidated financial condition of Holdings and its consolidated
Subsidiaries as at such date, and the consolidated results of its operations and
its consolidated cash flows for the respective fiscal years then ended. The
unaudited consolidated balance sheet of Holdings and its consolidated
Subsidiaries as at March 31, 2011, and the related unaudited consolidated
statements of income and cash flows for the fiscal year ended on such date,
present fairly in all material respects the consolidated financial condition of
Holdings and its consolidated Subsidiaries as at such date, and the consolidated
results of its operations and its consolidated cash flows for the fiscal year
then ended (subject to normal year-end audit adjustments). All such financial
statements, including the related schedules and notes thereto, have been
prepared in accordance with GAAP applied consistently throughout the periods
involved (except as approved by the aforementioned firms of accountants and
disclosed therein). Holdings and its Subsidiaries do not have any material
Guarantee Obligations, material contingent liabilities or material liabilities
for taxes, or any long-term leases or unusual forward or long-term commitments,
including, without limitation, any interest rate or foreign currency swap or
exchange transaction or other obligation in respect of derivatives, which are
not reflected in the most recent financial statements (including the notes
thereto) referred to in this paragraph (b)(i). During the period from March 31,
2011 to and including the date hereof, there has been no Disposition by Holdings
or any of its Subsidiaries of any material part of its business or Property.
(ii) The audited consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as at March 31, 2009 and March 31, 2010, and the
related consolidated statements of income and of cash flows for the fiscal years
ended March 31, 2009 and March 31, 2010 reported on by and accompanied by an
unqualified report from Deloitte & Touche LLP present fairly in all material
respects the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date, and the consolidated results of its
operations and its consolidated cash flows for the respective fiscal years then
ended. The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at March 31, 2011, and the related unaudited
consolidated statements of income and cash flows for the fiscal year ended on
such date, present fairly in all material respects the consolidated financial
condition of the Borrower and its consolidated Subsidiaries as at such date, and
the consolidated results of its operations and its consolidated cash flows for
the fiscal year then ended (subject to normal year-end audit adjustments). All
such financial statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by the aforementioned firm of accountants
and disclosed therein). The Borrower and its Subsidiaries do not have any
material Guarantee Obligations, material contingent liabilities or material
liabilities for taxes, or any long-term leases or unusual forward or long-term
commitments, including, without limitation, any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, which are not reflected in the most recent financial statements
(including the notes thereto) referred to in this paragraph (b)(ii). During the
period from March 31, 2011 to and including the date hereof, there has been no
Disposition by the Borrower or any of its Subsidiaries of any material part of
its business or Property.

 

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(c) The Loan Parties have disclosed any material assumptions with respect to the
Budget, Initial Cash Flow Forecast and Cash Flow Forecasts and affirm that the
Budget, Initial Cash Flow Forecast and each Cash Flow Forecast were prepared in
good faith upon assumptions believed to be reasonable at the time made (it being
understood and agreed that the projections contained in such Budget, the Initial
Cash Flow Forecast and each Cash Flow Forecast are subject to significant
uncertainties and contingencies, many of which are beyond the control of the
Loan Parties and that no assurance can be given that the projections contained
in the Budget, the Initial Cash Flow Forecast and each Cash Flow Forecast will
be realized, and that the Budget, the Initial Cash Flow Forecast and each Cash
Flow Forecast are not a guarantee of financial performance and actual results
may differ from the Budget, Initial Cash Flow Forecast and each Cash Flow
Forecast and such differences may be material).
4.2 No Change. Since March 31, 2011 there has been no development or event which
has had or could reasonably be expected to have a Material Adverse Effect.
4.3 Corporate Existence; Compliance with Law. Each Debtor (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the corporate power and authority to own and operate its
Property, to lease the Property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of Property or the conduct of its business
requires such qualification, except where the failure to be so qualified could
not reasonably be expected to have a Material Adverse Effect, (d) is in
compliance with all Requirements of Law except, in the case of any Debtor, to
the extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect or is otherwise
permitted by Chapter 11 of the Bankruptcy Code and (e) is a debtor and
debtor-in-possession under the Cases.
4.4 Corporate Power; Authorization; Enforceable Obligations. Subject to entry by
the Bankruptcy Court of the Interim Order and the Final Order and to the terms
thereof, each Loan Party has the corporate power and authority, and the legal
right, to make, deliver and perform the Loan Documents to which it is a party
and, in the case of the Borrower, to borrow hereunder. Subject to entry by the
Bankruptcy Court of the Interim Order and the Final Order and to the terms
thereof, each Loan Party has taken all necessary corporate action to authorize
the execution, delivery and performance of the Loan Documents to which it is a
party and, in the case of the Borrower, to authorize the borrowings on the terms
and conditions of this Agreement. Other than entry by the Bankruptcy Court of
the Interim Order and the Final Order and to the terms thereof, no consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with the
borrowings hereunder or with the execution, delivery, performance, validity or
enforceability of this Agreement, any of the Loan Documents or the
Administrative Agent’s or Lenders’ rights under the Loan Documents or the
remedies in respect of the Collateral pursuant to the Orders and the Security
Documents, except as required by the Interim Order and the Final Order. Subject
to the entry by the Bankruptcy Court of the Interim Order and the Final Order
and to the terms thereof, each Loan Document has been duly executed and
delivered on behalf of each Loan Party party thereto. This Agreement
constitutes, and each other Loan Document upon execution will constitute, a
legal, valid and binding obligation of each Loan Party party thereto,
enforceable against each such Loan Party in accordance with its terms, subject
to entry by the Bankruptcy Court of the Interim Order and the Final Order and to
the terms thereof.

 

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4.5 No Legal Bar . The execution, delivery and performance of this Agreement and
the other Loan Documents, the issuance of Letters of Credit, the borrowings
hereunder and the use of the proceeds thereof will not violate any Requirement
of Law or any material Contractual Obligation of any Debtor (except in respect
of Contractual Obligations entered into prior to the Petition Date) and will not
result in, or require, the creation or imposition of any Lien on any of their
respective properties or revenues pursuant to any Requirement of Law or any such
Contractual Obligation (other than the Liens created by the Security Documents
or the Orders). No Requirement of Law or Contractual Obligation applicable to
the Borrower or any of its Subsidiaries could reasonably be expected to have a
Material Adverse Effect.
4.6 No Material Litigation. Other than the Cases, no litigation, investigation
or proceeding of or before any arbitrator or Governmental Authority is pending
or, to the knowledge of SuperHoldings, Holdings or the Borrower, threatened by
or against any Debtor or against any of their respective properties or revenues
(a) with respect to any of the Loan Documents or any of the transactions
contemplated hereby or thereby, or (b) which could reasonably be expected to
have a Material Adverse Effect.
4.7 No Default. No Debtor is in default under or with respect to any of its
Contractual Obligations (except in respect of Contractual Obligations entered
into prior to the Petition Date) in any respect which could reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
4.8 Ownership of Property; Liens. Each Debtor has title in fee simple to, or a
valid leasehold interest in, all its real property, and good title to, or a
valid leasehold interest in, all its other Property (except Intellectual
Property which is addressed in Section 4.9), and none of such Property is
subject to any Lien except as permitted by Section 7.3. Schedule 1.1B lists, as
of the Closing Date, each parcel of owned real property and each leasehold
interest in real property in respect of which aggregate annual rent payments in
excess of $250,000 are payable, in each case, located in the United States and
held by the Borrower or any of its Subsidiaries.
4.9 Intellectual Property. Each Debtor owns, or is licensed to use, all material
Intellectual Property necessary for the conduct of its business as currently
conducted, except as could not reasonably be expected to have a Material Adverse
Effect. Schedule 4.9 sets forth all of the applications for federal registration
and federally registered Intellectual Property owned or licensed by each Debtor
on the Closing Date. No material claim has been asserted and is pending by any
Person challenging or questioning the use of any Intellectual Property owned by
each Debtor or the validity or effectiveness of any Intellectual Property owned
by each Debtor, nor does SuperHoldings, Holdings or Borrower know of any valid
basis for any such claim, except as could not reasonably be expected to have a
Material Adverse Effect. The use of Intellectual Property by any Debtor and the
conduct of each of their businesses do not infringe on the rights of any Person,
except as could not reasonably be expected to have a Material Adverse Effect.

 

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4.10 Taxes. Each Loan Party has filed or caused to be filed all federal, state
and other material Tax returns that are required to be filed and has paid all
Taxes shown to be due and payable on said returns or on any assessments made
against it or any of its Property and all other Taxes, fees or other charges
imposed on it or any of its Property by any Governmental Authority (other than
any the amount or validity of which are currently being contested in good faith
by appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of the relevant Loan Party); no Tax Lien
has been filed, and, to the knowledge of SuperHoldings, Holdings and the
Borrower, no claim is being asserted, with respect to any such Tax, fee or other
charge.
4.11 Federal Regulations. No part of the proceeds of any Loans or Letters of
Credit will be used for “buying” or “carrying” any “margin stock” within the
respective meanings of each of the quoted terms under Regulation U as now and
from time to time hereafter in effect or for any purpose which violates the
provisions of the Regulations of the Board. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in
Regulation U.
4.12 Labor Matters. There are no strikes or other material labor disputes
against any Debtor pending or, to the knowledge of Holdings or the Borrower,
threatened that (individually or in the aggregate) could reasonably be expected
to have a Material Adverse Effect. Hours worked by and payment made to employees
of any Debtor have not been in violation of the Fair Labor Standards Act or any
other applicable Requirement of Law dealing with such matters that (individually
or in the aggregate) could reasonably be expected to have a Material Adverse
Effect. All payments due from any Debtor on account of employee health and
welfare insurance that (individually or in the aggregate) could reasonably be
expected to have a Material Adverse Effect if not paid have been paid or accrued
as a liability on the books of the relevant Debtor.
4.13 ERISA; Employee Benefits Plans. (a) Other than the commencement of the
Cases, which is a Reportable Event, during the five-year period prior to the
date on which this representation is made or deemed made, and except as could
not reasonably be expected to result in a Material Adverse Effect, (i) no
Reportable Event has occurred with respect to any Single Employer Plan,
(ii) each Plan has complied in all material respects with the applicable
provisions of ERISA and the Code; (iii) prior to the effectiveness of the
applicable provisions of the Pension Act, there has been no “accumulated funding
deficiency” (within the meaning of Section 412 of the Code or Section 302 of
ERISA) with respect to any Single Employer Plan, and, on and after the
effectiveness of the applicable provisions of the Pension Act, there has been no
failure of any Single Employer Plan to satisfy the minimum funding standards
(within the meaning of Sections 412 or 430 of the Code or Section 302 of ERISA)
applicable to any such Plan, in each case whether or not waived; (iv) there has
been no filing pursuant to, prior to the effectiveness of the applicable
provisions of the Pension Act, Section 412(d) of the Code or Section 303(d) of
ERISA or, on and after the effectiveness of the applicable provisions of the
Pension Act, 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
Single Employer Plan or failure to make by its due date a required installment
under Section 430(j) of the Code with respect to any Single Employer Plan;
(v) on and after the effectiveness of the applicable provisions of the Pension
Act, there has been no determination that any Single Employer Plan is, or is
expected to be, in ‘at-risk” status (as defined in Section 430(i)(4) of the Code
or Section 303(i)(4) of ERISA; (vi) no termination of a Single Employer Plan has
occurred, and no Lien in favor of the PBGC or a Plan has arisen; (vii) no Loan
Party or Commonly Controlled Entity has received from the PBGC or any Plan
Administrator any notice relating to an intention to terminate any Single
Employer Plan or Plans or to appoint a trustee to administer any Single Employer
Plan; (viii) no Loan Party or Commonly Controlled Entity has had a complete or
partial withdrawal from any Multiemployer Plan which has resulted or could
reasonably be expected to result in material Withdrawal Liability under ERISA;
(ix) no Multiemployer Plan is, or is expected to be, in Reorganization or
Insolvent and (x) the present value of all accrued benefits under each Single
Employer Plan (based on those assumptions used to fund such Plans) did not, as
of the last annual valuation date prior to the date on which this representation
is made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by a material amount.

 

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(b) Except as, in the aggregate, could not reasonably be expected to have a
Material Adverse Effect, (i) all employer and employee contributions required by
applicable law or by the terms of any Foreign Benefit Arrangement or Foreign
Plan have been made, or, if applicable, accrued in accordance with normal
accounting practices; (ii) the accrued benefit obligations of each Foreign Plan
(based on those assumptions used to fund such Foreign Plan) with respect to all
current and former participants do not exceed the assets of such Foreign Plan;
(iii) each Foreign Plan that is required to be registered has been registered
and has been maintained in good standing with applicable regulatory authorities;
and (iv) each such Foreign Benefit Arrangement and Foreign Plan is in compliance
(A) with all material provisions of applicable law and all material applicable
regulations and published interpretations thereunder with respect to such
Foreign Benefit Arrangement or Foreign Plan and (B) with the terms of such plan
or arrangement.
4.14 Investment Company Act; Other Regulations. No Loan Party is an “investment
company”, or a company “controlled” by an “investment company”, within the
meaning of the Investment Company Act of 1940, as amended. No Loan Party is
subject to regulation under any Requirement of Law (other than Regulation X of
the Board) which limits its ability to incur Indebtedness.
4.15 Capitalization and Subsidiaries. Schedule 4.15 sets forth (a) a correct and
complete list of the name and relationship to SuperHoldings of each and all of
SuperHoldings’ Subsidiaries, (b) a true and complete listing of each class of
each such Subsidiaries’ authorized Capital Stock, of which all of such issued
shares are validly issued, outstanding, fully paid and non-assessable, and owned
beneficially and of record by the Persons identified on Schedule 4.15, and
(c) the type of entity of SuperHoldings and each of its Subsidiaries. All of the
issued and outstanding Capital Stock owned by any Loan Party has been (to the
extent such concepts are relevant with respect to such ownership interests) duly
authorized and issued and is fully paid and non-assessable.

 

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4.16 Use of Proceeds. The proceeds of the Loans will be used for working capital
purposes (including, without limitation, “Chapter 11 expenses” (or
“administrative Costs reflecting Chapter 11 expenses”), repayment of loans under
the Prepetition Credit Agreement and the cash collateralization of letters of
credit permitted by Section 7.3(p)) and the payment of fees and expenses
incurred in connection with entering into this Agreement and the transactions
contemplated hereby; provided, except to the extent permitted by the Interim
Order or the Final Order or authorized pursuant to any “first day” order
approved by the Administrative Agent, that the proceeds of Loans and cash and
Cash Equivalents of the Loan Parties may not be used (a) in connection with the
investigation (including discovery proceedings), initiation or prosecution of
any claims, causes of action, adversary proceedings or other litigation against
the Lenders, the Administrative Agent or any parties to the Prepetition Credit
Agreement or (b) to pay obligations of the Debtors arising prior to the Petition
Date.
4.17 Environmental Matters. (a) The facilities and properties owned, leased or
operated by any Debtor (the “Properties”) do not contain, and have not
previously contained, any Materials of Environmental Concern in amounts or
concentrations or under circumstances which (i) constitute or constituted a
violation of, or (ii) could give rise to liability under, any Environmental Law,
except in either case insofar as such violation or liability, or any aggregation
thereof, could not reasonably be expected to result in a Material Adverse
Effect.
(b) The Properties and all operations at the Properties are in compliance, and
have in the last five years been in compliance, with all applicable
Environmental Laws, except for noncompliance that could not reasonably be
expected to result in a Material Adverse Effect, and there is no contamination
at, under or about the Properties or violation of any Environmental Law with
respect to the Properties or the business operated by any Debtor (the
“Business”) which could reasonably be expected to result in a Material Adverse
Effect. As of the Closing Date, no Debtor has assumed any liability of any other
Person under Environmental Laws that could not reasonably be expected to result
in a Material Adverse Effect.
(c) No Debtor has received any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental matters
or compliance with Environmental Laws with regard to any of the Properties or
the Business, nor does SuperHoldings, Holdings or the Borrower have knowledge
that any such notice will be received or is being threatened; except insofar as
such notice or threatened notice referred to in this paragraph, or any
aggregation thereof, does not involve a matter or matters that could reasonably
be expected to result in a Material Adverse Effect.
(d) Materials of Environmental Concern have not been transported or disposed of
from the Properties in violation of, or in a manner or to a location which could
give rise to liability under, any Environmental Law, nor have any Materials of
Environmental Concern been generated, treated, stored or disposed of at, on or
under any of the Properties in violation of, or in a manner that could give rise
to liability under, any applicable Environmental Law; except insofar as any such
violation or liability referred to in this paragraph, or any aggregation
thereof, could not reasonably be expected to result in a Material Adverse
Effect.

 

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(e) No judicial proceeding or governmental or administrative action is pending
or, to the knowledge of SuperHoldings, Holdings and the Borrower, threatened,
under any Environmental Law to which any Debtor is or, to the knowledge of
SuperHoldings, Holdings and the Borrower, will be named as a party with respect
to the Properties or the Business, nor are there any consent decrees or other
decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding arising under any
Environmental Law with respect to the Properties or the Business, except insofar
as such proceeding, action, decree, order or other requirement, or any
aggregation thereof, could not reasonably be expected to result in a Material
Adverse Effect.
(f) There has been no release or threat of release of Materials of Environmental
Concern at or from the Properties, or arising from or related to the operations
of any Debtor in connection with the Properties or otherwise in connection with
the Business, in violation of or in amounts or in a manner that could give rise
to liability under Environmental Laws, except insofar as any such violation or
liability referred to in this paragraph, or any aggregation thereof, could not
reasonably be expected to result in a Material Adverse Effect.
4.18 Accuracy of Information, etc. No statement or information contained in this
Agreement, any other Loan Document or any other document, certificate or
statement furnished to the Administrative Agent, the Lenders, the Bankruptcy
Court or any of them, by or on behalf of any Loan Party for use in connection
with the transactions contemplated by this Agreement or the other Loan
Documents, contained as of the date such statement, information, document or
certificate was so furnished, any untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements contained
herein or therein not misleading. The projections contained in the materials
referenced above are based upon good faith estimates and assumptions believed by
management of the Borrower to be reasonable at the time made, it being
recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount. There is no fact known
to any Loan Party that could reasonably be expected to have a Material Adverse
Effect that has not been expressly disclosed herein, in the other Loan Documents
or in any other documents, certificates and statements furnished to the
Administrative Agent and the Lenders for use in connection with the transactions
contemplated hereby and by the other Loan Documents.
4.19 Security Documents. (a) Subject to the Carve Out, the Interim Order is (and
the Final Order when entered will be) effective to create in favor of the
Lenders legal, valid, enforceable and fully perfected security interests in and
Liens on the Collateral described therein.
(b) Without limiting the foregoing, the Loan Documents are effective to create
in favor of the Administrative Agent, for the benefit of the Lenders, a legal,
valid and enforceable security interest in the Collateral described therein and
proceeds thereof. In the case of the Pledged Stock described in the Guarantee
and Collateral Agreement, when stock certificates representing such Pledged
Stock are delivered to the Administrative Agent, and in the case of the other
Collateral described in the Guarantee and Collateral Agreement in which a
security interest may be perfected by filing a financing statement, when
financing statements in appropriate form are filed in the offices specified on
Schedule 4.19(b), the Guarantee and Collateral Agreement shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties in such Collateral and the proceeds thereof, as security for
the Obligations (as defined in the Guarantee and Collateral Agreement), in each
case prior and superior in right to any other Person.

 

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(c) Each of the Mortgages, when executed and delivered, will be effective to
create in favor of the Administrative Agent, for the benefit of the Lenders, a
legal, valid and enforceable Lien on the Mortgaged Properties described therein
and proceeds thereof, and when the Mortgages referred to in Section 6.13 are
filed in the offices specified on Schedule 4.19(c), each such Mortgage shall
constitute a fully perfected Lien on, and security interest in, all right, title
and interest of the Loan Parties in the Mortgaged Properties and the proceeds
thereof, as security for the Obligations (as defined in the relevant Mortgage),
in each case prior and superior in right to any other Person, except for Liens
permitted in Section 7.3.
4.20 Insurance. Schedule 4.20 sets forth a description of all insurance
maintained by or on behalf of the Loan Parties and the Subsidiaries as of the
Closing Date. As of the Closing Date, all premiums in respect of such insurance
have been paid. The Borrower believes that the insurance maintained by or on
behalf of the Borrower and its Subsidiaries is adequate and commercially
reasonable.
4.21 Material Contracts. The Debtors are in material compliance with each
material contract entered into by any Debtor after the Petition Date or entered
into prior to the Petition Date and assumed pursuant to the Bankruptcy Code. As
of the Closing Date, the Debtors have assumed the contracts entered into prior
to the Petition Date and listed on Schedule 4.21 hereto.
Section 5. CONDITIONS PRECEDENT
5.1 Conditions to First Availability Date. The agreement of each Lender to make
the Term Loans and the Initial Revolving Credit Loans and issue the Initial
Letters of Credit requested to be made or issued by it is subject to the
satisfaction, prior to or concurrently with the making of such extension of
credit, of the following conditions precedent:
(a) Loan Documents. The Administrative Agent shall have received (i) this
Agreement, executed and delivered by a duly authorized officer of SuperHoldings,
Holdings and the Borrower and (ii) the Guarantee and Collateral Agreement,
executed and delivered by a duly authorized officer of SuperHoldings, Holdings,
the Borrower and each Subsidiary Guarantor.
(b) Certificates of Good Standing. The Administrative Agent shall have received
a long form good standing certificate for each Debtor from its jurisdiction of
organization.
(c) Prepetition Obligations. All Prepetition Obligations outstanding under the
Prepetition Credit Agreement, except for the Prepetition Letters of Credit and
other amounts acceptable to the Administrative Agent, acting in its sole
discretion, shall be paid in full (giving effect to any repayment from proceeds
of the Term Loans).

 

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(d) Financial Statements. The Lenders shall have received (i) audited
consolidated financial statements of each of Holdings and the Borrower referred
to in the first sentence of each of subsections 4.1(b)(i) and 4.1(b)(ii),
(ii) unaudited interim consolidated financial statements of each of Holdings and
the Borrower for each quarterly period ended subsequent to the date of the
latest applicable financial statements delivered pursuant to clause (i) of this
paragraph through March 31, 2011 and, in the case of quarterly financial
statements, such quarterly period ending at least 45 days prior to the Closing
Date, and such financial statements shall be reasonably satisfactory to the
Administrative Agent and (iii) the Budget, in form and substance reasonably
satisfactory to the Administrative Agent, accompanied by a certificate of a
Responsible Officer of the Borrower stating that such Budget is based on
estimates, information and assumptions believed by management of the Borrower to
be reasonable on the Closing Date and that such Responsible Officer (not in his
or her individual capacity, but solely as a Responsible Officer) has no reason
to believe that the projections set forth therein are incorrect or misleading in
any material respect (it being understood and agreed that the projections are
subject to significant uncertainties and contingencies, many of which are beyond
the control of the Responsible Officer and that no assurance can be given that
any of the projections will be realized, and that the Budget is not a guarantee
of financial performance and actual results may differ from the Budget and such
differences may be material).
(e) Approvals. All material governmental and third party approvals necessary in
connection with the continuing operations of the Debtors and the transactions
contemplated hereby shall have been obtained and be in full force and effect,
and all applicable waiting periods shall have expired without any action being
taken or threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on the financing contemplated hereby.
(f) Fees. The Lenders, the Administrative Agent and the Arrangers shall have
received all fees required to be paid, and all expenses for which invoices have
been presented, on or before the Closing Date, or such fees and expenses shall
have been designated for payment on the Closing Date from the proceeds of the
Term Loans.
(g) Lien Searches. The Administrative Agent shall have received the results of a
recent lien search in each of the jurisdictions of organization of the Loan
Parties, and such search shall reveal no Liens on any of the assets of the
Debtors except for Liens permitted by Section 7.3 or Liens to be discharged on
or prior to the Closing Date in a manner reasonably satisfactory to the
Administrative Agent.
(h) Appraisals and Field Exams. The Arrangers shall have received and be
reasonably satisfied with (i) appraisals of Inventory of the Loan Parties and
(ii) field exams of the Accounts, Inventory and related data processing and
other systems of the Loan Parties, in each case from appraisers reasonably
satisfactory to the Arrangers (it being understood that as of June [_____], such
condition has been satisfied).
(i) Closing Certificate. The Administrative Agent shall have received, with a
counterpart for each Lender, a certificate of each Loan Party, dated the Closing
Date, substantially in the form of Exhibit C, with appropriate insertions and
attachments.

 

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(j) Legal Opinions. The Administrative Agent shall have received the following
executed legal opinions:
(i) the legal opinion of Kirkland & Ellis LLP, counsel to SuperHoldings,
Holdings and the Borrower, substantially in the form of Exhibit F; and
(ii) the legal opinion of local counsel in Kansas and Illinois.
Each such legal opinion shall cover such matters incident to the transactions
contemplated by this Agreement as the Administrative Agent may reasonably
require.
(k) Pledged Stock; Stock Power; Pledged Notes. The Administrative Agent shall
have received (i) the certificates representing the shares of Capital Stock
pledged pursuant to the Guarantee and Collateral 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 pledged
to the Administrative Agent pursuant to the Guarantee and Collateral Agreement
endorsed (without recourse) in blank (or accompanied by an executed transfer
form in blank reasonably satisfactory to the Administrative Agent) by the
pledgor thereof.
(l) Filings, Registrations and Recordings. Subject to Section 6.13, each
document (including, without limitation, any UCC financing statement) required
by the Security 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 the Lenders, 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 7.3), shall be in proper form for filing, registration or recordation.
(m) Insurance. Except as set forth in Section 6.13(b), the Administrative Agent
shall be satisfied with the insurance program to be maintained by Holdings and
its Subsidiaries and shall have received satisfactory insurance certificates
with respect thereto.
(n) Funding Accounts. The Administrative Agent shall have received a notice
setting forth the deposit account(s) of the Borrower to which the Lender is
authorized by the Borrower to transfer the proceeds of any Borrowings requested
or authorized pursuant to this Agreement.
(o) “Know Your Customer” Requirements. The Lenders shall have received at least
three days prior to the Closing Date all documentation and other information
reasonably requested by the Administrative Agent and required under applicable
“know your customer” and anti-money laundering rules and regulations, including
all information required to be delivered pursuant to Section 10.16.

 

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(p) Interim Order. At the time of the making of the initial extension of credit,
and in any event no later than five Business Days after the Petition Date (or
such later date agreed to by the Administrative Agent in its sole discretion),
the Administrative Agent shall have received a copy of the Interim Order, which
Interim Order shall (i) be in form and substance reasonably satisfactory to the
Administrative Agent, (ii) be in full force and effect and shall not have been
stayed, reversed, vacated, rescinded, modified or amended in any respect, in the
case of any modification or amendment, in a manner, or relating to a matter,
without the consent of the Administrative Agent and (iii) authorize extensions
of credit to the Borrower in amounts not in excess of $[insert face amount of
Rollover Letters of Credit] of Revolving Credit Loans and Letters of Credit (the
“Initial Letters of Credit”) or such other amount acceptable to the
Administrative Agent as may be approved by order of the Bankruptcy Court (the
“Interim Revolving Credit Loan Availability Amount”), and $125,000,000 of Term
Loans. The Debtors shall be in compliance in all respects with the Interim Order
pursuant to the terms therein.
(q) First-Day Motions. All motions and orders submitted to the Bankruptcy Court
on or about the Petition Date shall be in form and substance reasonably
satisfactory to the Administrative Agent, and the Administrative Agent shall be
reasonably satisfied with any Cash Collateral arrangements applicable to any
material pre-Petition Date secured obligations of the Loan Parties.
(r) Initial Cash Flow Forecast. The Administrative Agent shall have received a
13-week cash flow projection of the Debtors, which shall be in form and
substance reasonably satisfactory to the Administrative Agent (the “Initial Cash
Flow Forecast”) and certified by a Responsible Officer of the Borrower as being
prepared based upon good faith estimates and assumptions that are believed by
such Responsible Officer to be reasonable at the time made and that such
Responsible Officer is not aware of (x) any information contained in such cash
flow forecast which is false or misleading in any material respect or (y) any
omission of information which causes such cash flow forecast to be false or
misleading in any material respect (it being understood and agreed that any
forecasts contained in the Initial Cash Flow Forecast is subject to significant
uncertainties and contingencies, many of which are beyond the control of the
Loan Parties and that no assurance can be given that such forecasts will be
realized and that the Initial Cash Flow Forecast is not a guarantee of financial
performance and actual results may differ from the Initial Cash Flow Forecast
and such differences may be material).
(s) Prepetition Letters of Credit. The Letters of Credit (as defined in the
Prepetition Credit Agreement) outstanding under the Prepetition Credit Agreement
on the Petition Date and described in Schedule 5.1(s) (the “Prepetition Letters
of Credit”) shall have been cash collateralized (or shall be cash collateralized
upon funding of the Term Loans) at 101% of the face amounts thereof on terms
reasonably acceptable to the Administrative Agent.

 

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5.2 Conditions to Second Availability Date. The agreement of each Lender to make
the Final Revolving Credit Loans requested to be made by it is subject to the
satisfaction, prior to or concurrently with the making of such extension of
credit, of the following conditions precedent:
(a) Final Order. (i) The Final Order shall be in full force and effect and shall
not have been stayed, reversed, vacated, rescinded, modified or amended in any
respect; (ii) the Final Order shall have been entered by the Bankruptcy Court no
later than thirty-five days after the Petition Date (or such later date agreed
to by the Administrative Agent in its sole discretion) and at the time of any
such extension of credit the Final Order shall be in full force and effect, and
shall not have been vacated, stayed, reversed, modified or amended in any
respect without the prior written consent of the Administrative Agent and the
Required Lenders; (iii) if the Final Order is the subject of a pending appeal in
any respect, none of the making of such extensions of credit, the grant of Liens
and Superpriority Claims pursuant to Section 2.24 or otherwise hereunder or the
performance by the Borrower or any Guarantor of any of their respective
obligations under any of the Loan Documents shall be the subject of a presently
effective stay pending appeal; and (iv) the Loan Parties shall be in compliance
with the Final Order in accordance with the terms therein.
(b) Fees and Expenses. All fees and expenses required to be paid hereunder and
invoiced before the Second Availability Date shall have been paid in full in
cash.
(c) Ratings. The Loan Parties shall have used, and shall have caused their
respective Subsidiaries to use, commercially reasonable efforts to obtain
ratings on the Facility by Moody’s and S&P.
5.3 Conditions to Each Extension of Credit. The agreement of each Lender to make
any extension of credit requested to be made by it on any date (including,
without limitation, its initial extension of credit) is subject to the
satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the representations and warranties
made by any Loan Party in or pursuant to the Loan Documents shall be true and
correct on and as of such date as if made on and as of such date.
(b) No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit
requested to be made on such date.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 5.3 have been satisfied.

 

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Section 6. AFFIRMATIVE COVENANTS
SuperHoldings, Holdings and the Borrower hereby jointly and severally agree
that, so long as the Commitments remain in effect, any Letter of Credit remains
outstanding or any Loan or other amount is owing to any Lender or the
Administrative Agent hereunder, each of SuperHoldings, Holdings and the Borrower
shall and shall cause each of its Subsidiaries to:
6.1 Financial Statements. Furnish to the Administrative Agent and each Lender:
(a) (i) within 105 days after the end of each fiscal year of Holdings, a copy of
the audited consolidated balance sheet of Holdings and its consolidated
Subsidiaries as at the end of such year and the related audited consolidated
statements of income and of cash flows for such year, setting forth in each case
in comparative form the figures for the previous year, reported on without any
qualification arising out of the scope of the audit, by independent certified
public accountants of nationally recognized standing; and
(ii) within 105 days after the end of each fiscal year of the Borrower, a copy
of the audited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such year and the related audited consolidated
statements of income and of cash flows for such year, setting forth in each case
in comparative form the figures for the previous year, reported on without any
qualification arising out of the scope of the audit, by independent certified
public accountants of nationally recognized standing;
(b) (i) not later than 45 days after the end of each of the first three
quarterly periods of each fiscal year of Holdings, the unaudited consolidated
balance sheet of Holdings and its consolidated Subsidiaries as at the end of
such quarter and the related unaudited consolidated statements of income and of
cash flows for such quarter and the portion of the fiscal year through the end
of such quarter, setting forth in each case in comparative form the figures for
the previous year, certified by a Responsible Officer as being fairly stated in
all material respects (subject to normal year-end audit adjustments); and
(ii) not later than 45 days after the end of each of the first three quarterly
periods of each fiscal year of the Borrower, the unaudited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such
quarter and the related unaudited consolidated statements of income and of cash
flows for such quarter and the portion of the fiscal year through the end of
such quarter, setting forth in each case in comparative form the figures for the
previous year, certified by a Responsible Officer as being fairly stated in all
material respects (subject to normal year-end audit adjustments);
(c) (i) not later than 30 days after the end of each fiscal month (other than
the third, sixth, ninth and twelfth fiscal month in each fiscal year) of
Holdings, the unaudited consolidated balance sheet of Holdings and its
consolidated Subsidiaries as at the end of such fiscal month and the related
unaudited consolidated statements of income and of cash flows for such fiscal
month and the portion of the fiscal year through the end of such fiscal month,
setting forth in each case in comparative form the figures for the previous
year, certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments); and
(ii) not later than 30 days after the end of each fiscal month (other than the
third, sixth, ninth and twelfth fiscal month in each fiscal year) of the
Borrower, the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such fiscal month and the related
unaudited consolidated statements of income and of cash flows for such fiscal
month and the portion of the fiscal year through the end of such fiscal month,
setting forth in each case in comparative form the figures for the previous
year, certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments);

 

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all such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
6.2 Certificates; Other Information. Furnish to the Administrative Agent and
each Lender, or, in the case of clause (i), to the relevant Lender:
(a) concurrently with the delivery of the financial statements referred to in
Section 6.1(a), a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the examination
necessary therefor no knowledge was obtained of any Default or Event of Default,
except as specified in such certificate;
(b) concurrently with the delivery of any financial statements pursuant to
Section 6.1, a Compliance Certificate of a Responsible Officer stating, among
the matters included in Exhibit B, that (i) to the best of each such Responsible
Officer’s knowledge, each Loan Party during such period has observed or
performed all of its covenants and other agreements, and satisfied every
condition, contained in this Agreement and the other Loan Documents to which it
is a party to be observed, performed or satisfied by it, and that such
Responsible Officer has obtained no knowledge of any Default or Event of Default
except as specified in such certificate and (ii) in the case of quarterly or
annual financial statements, to the extent not previously disclosed to the
Administrative Agent, a description of any change in the jurisdiction of
organization of any Loan Party and a listing of any applications for
registration and registered Intellectual Property acquired by any Loan Party
since the date of the most recent list delivered pursuant to this clause (ii)
(or, in the case of the first such list so delivered, since the Closing Date);
(c) [Reserved];
(d) within 45 days after the end of each fiscal quarter of Holdings, a narrative
discussion and analysis of the financial condition and results of operations of
Holdings and its Subsidiaries (including, without limitation, with respect to
cost savings, restructuring costs and other matters as the Administrative Agent
or any Lender through the Administrative Agent may from time to time reasonably
request) for such fiscal quarter and for the period from the beginning of the
then current fiscal year to the end of such fiscal quarter, as compared to the
portion of the Budget covering such periods; and
(e) within 45 days after the end of each fiscal quarter of the Borrower, a
narrative discussion and analysis of the financial condition and results of
operations of the Borrower and its Subsidiaries (including, without limitation,
with respect to cost savings, restructuring costs and other matters as the
Administrative Agent or any Lender through the Administrative Agent may from
time to time reasonably request) for such fiscal quarter and for the period from
the beginning of the then current fiscal year to the end of such fiscal quarter,
as compared to the portion of the Budget covering such periods;

 

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(f) [Reserved];
(g) within five days after the same are sent, copies of all financial statements
and reports which Holdings or the Borrower sends to the holders of any class of
its debt securities or public equity securities and within five days after the
same are filed, copies of all financial statements and reports which Holdings or
the Borrower may make to, or file with, the Securities and Exchange Commission
or any successor or analogous Governmental Authority;
(h) as soon as available but in any event within 15 days of the end of each
fiscal month (or within 5 Business Days of the end of each week during the
continuance of an Event of Default or during any period following a day on which
Revolving Credit Availability is less than the greater of (x) 25% of the Total
Revolving Credit Commitments and (y) $18,750,000; provided that such period
shall be discontinued if Revolving Credit Availability ceases to be less than
such level for 60 consecutive days; provided further, however, that such period
may be discontinued no more than twice in any period of 12 consecutive months,)
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;
(i) concurrently with the delivery of each Borrowing Base Certificate (or at
such other times as the Administrative Agent may reasonably request), a
certificate from a Responsible Officer of the Borrower setting forth the
Revolving Credit Availability as of the period then ended, together with
supporting information in connection therewith;
(j) promptly upon obtaining knowledge of any such event, circumstance or change,
a written notice of any event, circumstance or change that has occurred since
the delivery of the most recent Borrowing Base Certificate in accordance with
the terms of this Agreement that would materially reduce the aggregate amount of
the Eligible Accounts Receivable or result in a material portion of the Eligible
Accounts Receivable ceasing to be Eligible Accounts Receivable, in each case,
other than as a result of payments thereof;
(k) [Reserved];
(l) prompt written notice of any casualty or other insured damage to any
material portion of the Collateral or the commencement of any action or
proceeding for the taking of any material portion of the Collateral or interest
therein under power of eminent domain or by condemnation or similar proceeding;

 

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(m) no later than Friday of every other calendar week, commencing on July 15,
2011 a rolling 13-week cash flow projection of the Borrower and its Subsidiaries
substantially in the form of the Initial Cash Flow Forecast (each, a “Cash Flow
Forecast”), which shall be certified by a Responsible Officer as being prepared
based upon good faith estimates and assumptions that are believed by such
Responsible Officer to be reasonable at the time made and that such Responsible
Officer is not aware of (x) any information contained in such cash flow forecast
which is false or misleading in any material respect or (y) any omission of
information which causes such cash flow forecast to be false or misleading in
any material respect;
(n) no later than Friday of every other calendar week, commencing on July 15,
2011, a variance report in form reasonably satisfactory to the Administrative
Agent, showing on a line item basis the percentage and dollar variance of actual
cash disbursements and cash receipts for each of the prior two weeks from the
amounts set forth for each such period in the most recent Cash Flow Forecast and
a narrative analysis of each material variance for the prior two week period;
(o) (i) commencing on [                    ] 2011, a certificate of a
Responsible Officer containing all information and calculations necessary for
determining compliance with Section 7.1(a) no later than Friday of every other
calendar week and no later than 30 days after the end of every calendar month
for determining compliance with Section 7.1(b) and (ii) concurrently with the
delivery of any financial statements pursuant to Sections 6.1(a) and (b), a
certificate of a Responsible Officer of the Borrower containing all information
and calculations necessary for determining compliance with Section 7.7;
(p) [Reserved];
(q) no later than [                    ], 2011, the consolidated forecasts of
the consolidated balance sheet of the Borrower and its Subsidiaries for each
fiscal quarter, beginning with the fiscal quarter ending [                    ],
2011 and ending with the fiscal quarter ending [                    ], 2012,
including the material assumptions on which such forecasts were based
(including, but not limited to, future cost reduction initiatives);]
(r) contemporaneously upon such filing or distribution, copies of all orders,
pleadings and motions, applications, judicial information, financial
information, plan of reorganization or liquidation and/or any disclosure
statement related to such plan and other documents to be filed by or on behalf
of the Debtors with the Bankruptcy Court or the United States Trustee in the
Cases, or to be distributed by or on behalf of the Debtors to any Committee
(other than (i) pleadings, motions applications or other filings which would
reasonably expected to be immaterial to the Administrative Agent and the
Lenders, (ii) emergency pleadings, motions or other filings where, despite such
Debtor’s best efforts, such contemporaneous delivery is impracticable, which
shall be delivered as soon as practicable after the filing or distribution
thereof and (iii) copies of pleadings and motions in connection with the
Facilities or the Cash Collateral, which shall be delivered as soon as
practicable in advance of the filing or distribution thereof); provided,
however, notwithstanding any of the foregoing to the contrary, the Loan Parties’
obligations in this clause (q) will be deemed satisfied if and to the extent any
of such information and documents is publicly available; and
(s) promptly, such additional financial and other information as any Lender may
from time to time reasonably request through the Administrative Agent.

 

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6.3 Payment of Obligations. Except in accordance with the Bankruptcy Code or by
an applicable order of the Bankruptcy Court, pay, discharge or otherwise satisfy
at or before maturity or before they become delinquent, as the case may be,
(i) all its post-petition material taxes and other material obligations of
whatever nature that constitute administrative expenses under Section 503(b) of
the Bankruptcy Code in the Cases, except, so long as no material property (other
than money for such obligation and the interest or penalty accruing thereon (or
property with a value not in excess of such amounts)) of any Loan Party is in
danger of being lost or forfeited as a result thereof, no such obligation need
be paid if the amount or validity thereof is currently being contested in good
faith by appropriate proceedings and any required reserves in conformity with
GAAP with respect thereto have been provided on the books of the relevant Debtor
and (ii) all material obligations arising from Contractual Obligations entered
into after the Petition Date or from Contractual Obligations entered into prior
to the Petition Date and assumed and which are permitted to be paid
post-petition by order of the Bankruptcy Court that has been entered with the
consent of (or non-objection by) the Administrative Agent.
6.4 Conduct of Business and Maintenance of Existence, etc. (a) (i) Preserve,
renew and keep in full force and effect its corporate existence and (ii) take
all reasonable action to maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business, except, in each
case, as otherwise permitted by Section 7.4 and except, in the case of clause
(ii) above, to the extent that failure to do so could not reasonably be expected
to have a Material Adverse Effect; and (b) subject to the effect of the Cases,
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith could not, in the aggregate, reasonably
be expected to have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance. (a) Except for Property that is
obsolete, worn out or economically non viable for Borrower’s business, keep all
Property useful and necessary in its business in good working order and
condition, ordinary wear and tear and damage by casualty or condemnation
excepted; (b) maintain with financially sound and reputable insurance companies
insurance on all its Property in at least such amounts and against at least such
risks (but including in any event public liability, product liability and
business interruption) as are usually insured against in the same general area
by companies engaged in the same or a similar business; and (c) furnish to the
Administrative Agent, upon request of the Administrative Agent, information in
reasonable detail as to the insurance so maintained.
6.6 Inspection of Property; Books and Records; Discussions; Appraisals; Field
Examinations. (a) (i) Keep proper books of records and account in which full,
true and correct entries in conformity with GAAP and all Requirements of Law
shall be made of all dealings and transactions in relation to its business and
activities and (ii) permit representatives designated by the Administrative
Agent (which may be a Lender or any representative of a Lender) in consultation
with the Borrower, upon reasonable prior written notice to the Borrower and at
the reasonable expense of the Borrower, to visit and inspect any of its
properties and examine and make abstracts from any of its books and records
during the Borrower’s normal business hours and to discuss the business,
operations, properties and financial and other condition of Holdings, the
Borrower and their respective Subsidiaries with officers and employees of
Holdings, the Borrower and such Subsidiaries and with their independent
certified public accountants.

 

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(b) On no more than one occasion prior to the Termination Date (in addition to
the appraisals referred to in Section 5.1(h)), but not prior to November 1,
2011, provide the Administrative Agent with appraisals or updates thereof of
Inventory of the Borrower and its Subsidiaries from an appraiser selected and
engaged by the Administrative Agent, and prepared on a basis reasonably
satisfactory to the Administrative Agent, such appraisals and updates to include
without limitation, information required by applicable law and regulations;
provided, however that if an Event of Default has occurred and is continuing,
there shall be no limitation on the number of such appraisals. For purposes of
this Section 6.6(b), it is understood and agreed that a single appraisal may
consist of examinations conducted at multiple relevant sites and involve one or
more relevant Loan Parties and their assets. All such appraisals shall be at the
sole expense of the Loan Parties.
(c) On no more than one occasion prior to the Termination Date (in addition to
the field examination referred to in Section 5.1(h)), but not prior to
November 1, 2011, at the request of the Administrative Agent, permit, upon
reasonable notice, the Administrative Agent to conduct a field examination to
ensure the adequacy of Collateral included in the Borrowing Base and related
reporting and control systems; provided, however that if an Event of Default has
occurred and is continuing, there shall be no limitation on the number or
frequency of field examinations. For purposes of this Section 6.6(c), it is
understood and agreed that a single field examination may be conducted at
multiple relevant sites and involve one or more relevant Loan Parties and their
assets. All such field examinations shall be at the sole expense of the Loan
Parties.
6.7 Notices. Promptly give notice to the Administrative Agent and each Lender
of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual Obligation of any
Debtor (other than defaults resulting from the filing of the Cases or from the
rejection under Section 365 of the Bankruptcy Code of any executory contracts or
leases) or (ii) litigation, investigation or proceeding which may exist at any
time between any Debtor and any Governmental Authority, which in either case, if
not cured or if adversely determined, as the case may be, could reasonably be
expected to have a Material Adverse Effect;
(c) any litigation not subject to the automatic stay under the Bankruptcy Code
or any proceeding other than in connection with the Cases against a Debtor in
which the amount involved is $1.000,000 or more and not covered by insurance or
in which injunctive or similar relief is sought;

 

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(d) the following events, as soon as possible and in any event within 30 days
after the Borrower knows or has reason to know thereof: (i) the occurrence of
any Reportable Event with respect to any Single Employer Plan, a failure to make
by its due date a required installment under Section 430(j) of the Code with
respect to any Single Employer Plan, any failure by any Single Employer Plan to
satisfy the minimum funding standards (within the meaning of Sections 412 or 430
of the Code or Section 302 of ERISA applicable to such Plan, any determination
that any Single Employer Plan is, or is expected to be, in “at risk” status
(within the meaning of Section 430 of the Code or Title IV of ERISA), the
termination of any Single Employer Plan, or the creation of any Lien in favor of
the PBGC or any Plan; (ii) any failure to make any material required
contribution to a Multiemployer Plan, any withdrawal from, termination,
Reorganization, or Insolvency of any Multiemployer Plan, or any determination
that any such Multiemployer Plan is in endangered or critical status (within the
meaning of Section 432 of the Code or Section 305 of ERISA, or the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the termination, Reorganization or Insolvency of, or
determination that any such Multiemployer Plan is in endangered or critical
status; or (iii) any failure to make or accrue any material employer or employee
contribution required by law or normal accounting practices to a Foreign Benefit
Arrangement or Foreign Plan, the accrued benefit obligations of any Foreign Plan
(based on those assumptions used to fund such Foreign Plan) with respect to all
current and former participants shall exceed the assets of such Foreign Plan by
a material amount, any Foreign Plan required to be registered shall not be in
good standing with applicable regulatory authorities, or any Foreign Benefit
Arrangement or Foreign Plan shall not be in compliance with any material
provision of applicable law or applicable regulations or with the material terms
of such plan or arrangement;
(e) any development or event which has had or could reasonably be expected to
have a Material Adverse Effect;
(f) as soon as possible after a Responsible Officer knows or reasonably should
know thereof, the failure to make any rental payment when due and payable with
respect to any property leased by the Borrower or any of its Domestic
Subsidiaries at which Inventory of the Borrower or any of its Domestic
Subsidiaries is located; and
(g) any sale or other disposition by the Primary Investors of any Capital Stock
having ordinary voting power in the election of directors of SuperHoldings or
Holdings.
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the relevant Debtor proposes to take with
respect thereto.
6.8 Environmental Laws. (a) Comply with, and use commercially reasonable efforts
to ensure compliance by all tenants and subtenants, if any, with, all applicable
Environmental Laws, and obtain and comply with and maintain, and use
commercially reasonable efforts to ensure that all tenants and subtenants obtain
and comply with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws; except, in
each case, to the extent the failure to do so would not reasonably be expected
to result in a Material Adverse Effect.

 

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(b) Conduct and complete all investigations, studies, sampling and testing, and
all remedial, removal and other actions required by Environmental Laws and
promptly comply with all lawful orders and directives of all Governmental
Authorities regarding Environmental Laws, except, in each case, to the extent
the failure to do so would not reasonably be expected to result in a Material
Adverse Effect.
6.9 Additional Collateral, etc. (a) With respect to any Property acquired after
the Closing Date by any Debtor (other than (x) any Property described in
paragraph (b), (c) or (d) below and (y) any Property subject to a Lien expressly
permitted by Section 7.3(g)) as to which the Administrative Agent, for the
benefit of the Lenders, does not have a perfected Lien, promptly (i) execute and
deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents as the Administrative Agent deems
necessary or advisable in order to grant to the Administrative Agent, for the
benefit of the Lenders, a security interest in such Property and (ii) take all
actions necessary or advisable to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in such
Property, including without limitation, the filing of UCC financing statements
in such jurisdictions as may be required by the Guarantee and Collateral
Agreement or by law or as may be requested by the Administrative Agent.
(b) With respect to any interest in any owned real property having a value
(together with improvements thereof) of at least $250,000 acquired after the
Closing Date by any Debtor (other than any such real property subject to a Lien
expressly permitted by Section 7.3(g)), as to which the Administrative Agent
does not have a perfected Lien, promptly (i) execute and deliver a first
priority Mortgage in favor of the Administrative Agent, for the benefit of the
Lenders, covering such real property, (ii) if reasonably requested by the
Administrative Agent, provide the Lenders with (x) title and extended coverage
insurance from a title insurance company reasonably satisfactory to the
Administrative Agent and covering such real property in an amount at least equal
to the purchase price of such real estate (or such other amount as shall be
reasonably specified by the Administrative Agent), subject to the Liens as
permitted by Section 7.3, as well as a current ALTA survey thereof from a
surveyor reasonably satisfactory to the Administrative Agent, together with a
surveyor’s certificate provided that, if the applicable Debtor is able to obtain
a “no change” affidavit acceptable to the title company and the Administrative
Agent to enable it to issue a title policy removing all exceptions which would
otherwise have been raised by the title company as a result of the absence of a
new survey for such real property, and issuing all survey related endorsements
and coverages, then a new survey shall not be required and (y) any consents or
estoppels reasonably deemed necessary or advisable by the Administrative Agent
in connection with such mortgage or deed of trust, each of the foregoing in form
and substance reasonably satisfactory to the Administrative Agent provided that,
Borrower shall only be required to exercise commercially best efforts to obtain
such consents or estoppels and (iii) if requested by the Administrative Agent,
deliver to the Administrative Agent legal opinions in local counsel and counsel
in the jurisdiction where the owner of such real property is organized relating
to the matters described above, which opinions shall be in form and substance,
and from counsel, reasonably satisfactory to the Administrative Agent.

 

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(c) With respect to any new Subsidiary (other than an Excluded Foreign
Subsidiary) created or acquired after the Closing Date (which, for the purposes
of this paragraph (c), shall include any existing Subsidiary that ceases to be
an Excluded Foreign Subsidiary) by any Debtor, promptly (i) execute and deliver
to the Administrative Agent such amendments to the Guarantee and Collateral
Agreement as the Administrative Agent deems necessary or advisable in order to
grant to the Administrative Agent, for the benefit of the Lenders, a perfected
first priority security interest in the Capital Stock of such new Subsidiary
which is owned by such Debtor, (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock, together with undated stock
powers, in blank, executed and delivered by a duly authorized officer of such
Debtor, (iii) cause such new Subsidiary (A) to become a party to the Guarantee
and Collateral Agreement and (B) to take such actions necessary or advisable to
grant to the Administrative Agent for the benefit of the Lenders a perfected
first priority security interest in the Collateral described in the Guarantee
and Collateral Agreement with respect to such new Subsidiary (subject to any
existing Liens on such Collateral securing Indebtedness existing at the time
such new Subsidiary is created or acquired, so long as such Indebtedness was not
incurred in anticipation of such creation or acquisition and such Lien is not
spread to encumber additional property of such Subsidiary), including, without
limitation, the filing of UCC financing statements in such jurisdictions as may
be required by the Guarantee and Collateral Agreement or by law or as may be
requested by the Administrative Agent, and (iv) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
(d) With respect to any new Excluded Foreign Subsidiary created or acquired
after the Closing Date by any Debtor, promptly (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent deems necessary or advisable in order to grant to
the Administrative Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Capital Stock of such new Subsidiary which is
owned by such Debtor (provided that in no event shall more than 65% of the total
outstanding Capital Stock of any such new Subsidiary be required to be so
pledged), (ii) deliver to the Administrative Agent the certificates representing
such Capital Stock, together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of such Debtor, and take such other
action as may be necessary or, in the opinion of the Administrative Agent,
desirable to perfect the Lien of the Administrative Agent thereon, and (iii) if
requested by the Administrative Agent, deliver to the Administrative Agent legal
opinions relating to the matters described above, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.
(e) Subject to the Orders, execute and deliver, or cause to be executed and
delivered, to the Administrative Agent such documents, agreements and
instruments, and take or cause to be taken such further actions which may be
required by 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 Security Documents and the Orders, all
at the expense of the Loan Parties.

 

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6.10 Control Agreements. (a) (i) Enter into the Deposit Account Control
Agreements required to be provided pursuant to Section 6.1 of the Guarantee and
Collateral Agreement, (ii) enter into the Local Blocked Account Agreements
required to be provided pursuant to Section 6.4 of the Guarantee and Collateral
Agreement, (iii) enter into the Collateral Access Agreements required to be
provided pursuant to Section 5.13 of the Guarantee and Collateral Agreement,
(iii) open the Collection Account with the Administrative Agent and (iv) deliver
to the Administrative Agent executed DDA Notifications (as defined in the
Guarantee and Collateral Agreement) required to be provided pursuant to
Section 6.4 of the Guarantee and Collateral Agreement. In connection with the
foregoing, the Borrower shall, if requested by the Administrative Agent,
promptly deliver to the Administrative Agent a favorable written opinion
(addressed to the Administrative Agent and the Lenders) of counsel for the
Borrower and the other Loan Parties, in form and substance reasonably
satisfactory to the Administrative Agent and covering customary matters relating
to such control and access agreements.
(b) The Borrower shall determine the aggregate balance of cash and Cash
Equivalents of all Loan Parties in accounts (including Reserved Local Blocked
Accounts but other than (i) each Deposit Account, the funds in which are used,
in the ordinary course of business, solely for the payment of salaries and
wages, workers’ compensation, pension benefits and similar expenses or taxes
related thereto, (ii) each Deposit Account (other than a Reserved Local Blocked
Account) used, in the ordinary course of business, solely for daily accounts
payable and that has an ending daily balance of zero and (iii) each Deposit
Account (other than Reserved Local Blocked Accounts) used in the ordinary course
of business for local store accounts (which shall be governed by Section 6.4 of
the Guarantee and Collateral Agreement)) not subject to Deposit Account Control
Agreements or other appropriate control agreements in favor of the
Administrative Agent in form and substance reasonably satisfactory to the
Administrative Agent at each time when the Borrower delivers Borrowing Base
reports pursuant to Section 6.2(g), and (x) if such aggregate balance under
clause (ii) above shall at any time of determination exceed $1,000,000, the
Borrower shall promptly eliminate such excess from such accounts or shall within
30 days enter, or cause the applicable Loan Parties to enter, into one or more
Deposit Account Control Agreements or other appropriate control agreements in
favor of the Administrative Agent in form and substance reasonably satisfactory
to the Administrative Agent so that there shall not thereafter be any such
excess and (y) if such aggregate balance in Reserved Local Blocked Accounts
shall at any time of determination exceed $1,000,000, the Borrower shall, within
three Business Days, eliminate such excess from such accounts; provided,
however, that the Borrower shall have 30 days after the Closing Date (or such
later date as the Administrative Agent shall agree in its Permitted Discretion)
to obtain such Deposit Account Control Agreements or other appropriate control
agreements.
6.11 Update Calls. As and when requested by the Administrative Agent (and in any
event once per month) at such times as the Borrower and the Administrative Agent
shall agree, the Borrower shall host (i) a “private side” conference call (with
a question and answer period) with the chief financial officer of the Borrower
and such other members of senior management of the Borrower as the Borrower
deems appropriate and the Administrative Agent and the Lenders and their
respective representatives and advisors to discuss the performance of the
business, strategic alternatives and other issues as the Administrative Agent
may reasonably request and (ii) a “public side” conference call with the chief
financial officer of the Borrower and such other members of senior management of
the Borrower as the Borrower deems appropriate and the Administrative Agent and
the Lenders and their respective representatives and advisors to discuss the
performance of the business and other issues as the Administrative Agent may
reasonably request, but in each case excluding material information regarding
the Debtors that is not publicly available.

 

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6.12 Ratings. Use commercially reasonable efforts to obtain, on or prior to the
Final Order Entry Date, ratings on the Facilities from S&P and Moody’s.
6.13 Post Closing Covenants. (a) Deliver Deposit Account Control Agreements and
Local Blocked Account Agreements required by Section 6.10 as soon as practicable
but in any event within 30 days after the Closing Date, as such compliance
period may be extended by the Administrative Agent in the exercise of its
reasonable discretion if the Loan Parties are diligently pursuing delivery
thereof;
(b) deliver the evidence of insurance and related certificates and endorsements
required by Section 5.1(m) as soon as practicable but in any event within
30 days after the Closing Date, as such compliance period may be extended by the
Administrative Agent in the exercise of its reasonable discretion if the Loan
Parties are diligently pursuing delivery thereof;
(c) deliver the Intellectual Property filings that may be required pursuant to
Section 5.1(l) as soon as practicable but in any event within 30 days after the
Closing Date, as such compliance period may be extended by the Administrative
Agent in the exercise of its reasonable discretion if the Loan Parties are
diligently pursuing delivery thereof; and
(d) if requested by the Administrative Agent, acting in its sole discretion,
deliver to the Administrative Agent as soon as practicable but in any event
within 30 days after any such request, as such compliance period may be extended
by the Administrative Agent in the exercise of its reasonable discretion if the
Loan Parties are diligently pursuing delivery thereof, Mortgages for each
Mortgaged Property existing on the Closing Date, in each case in form and
substance reasonably satisfactory to the Administrative Agent, executed and
delivered by a duly authorized officer of each party thereto and, for each
Mortgaged Property:
(i) A mortgagee’s title insurance policy (or policies) or marked up
unconditional binder for such insurance. Each such policy, subject to the Liens
as permitted by Section 7.3, shall (A) be in an amount reasonably satisfactory
to the Administrative Agent; (B) be issued at ordinary rates; (C) insure that
the Mortgage insured thereby creates a valid first Lien on such Mortgaged
Property free and clear of all defects and encumbrances, except as disclosed
therein; (D) name the Administrative Agent for the benefit of the Lenders as the
insured thereunder; (E) be in the form of ALTA Loan Policy — 2006 (or equivalent
policies or such other form of loan policy as is authorized in the state in
which the Mortgaged Property is located); (F) contain such title endorsements
and affirmative coverage as the Administrative Agent may reasonably request, to
the extent available at commercially reasonable rates and (G) be issued by title
companies reasonably satisfactory to the Administrative Agent (including any
such title companies acting as co-insurers or reinsurers, at the option of the
Administrative Agent). The Administrative Agent shall have received evidence
reasonably satisfactory to it that all premiums in respect of each such policy,
all charges for mortgage recording tax, and all related expenses, if any, have
been paid.

 

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(ii) If requested by the Administrative Agent, legal opinions of local counsel
in each jurisdiction where a Mortgaged Property is located and legal opinions in
each jurisdiction where the owner of each Mortgaged Property is organized, in
each case, in form and substance reasonably satisfactory to the Administrative
Agent.
(iii) A copy of all recorded documents referred to, or listed as exceptions to
title insurance, the title policy or policies referred to in clause (i) above
and a copy of all other material documents affecting the Mortgaged Properties.
(iv) (A) A “standard flood hazard determination”, (B) for each Mortgaged
Property which is located in a special flood hazard area, a policy of flood
insurance which (1) covers any parcel of improved real property which is
encumbered by any Mortgage (2) is written in an amount reasonably satisfactory
to the Administrative Agent, and (3) has a term ending not later than the
maturity of the Indebtedness secured by such Mortgage and (C) confirmation that
the Borrower has received the notice required pursuant to Section 208.25(i) of
Regulation H of the Board.
No Debtor shall be required to deliver any additional security documents
pursuant to this Section 6.13, if, as determined by the Administrative Agent,
acting in its sole discretion, the cost of obtaining or perfecting a security
interest is excessive in relation to the benefit afforded to the Secured Parties
thereby.
Section 7. NEGATIVE COVENANTS
SuperHoldings, Holdings and the Borrower hereby jointly and severally agree
that, so long as the Commitments remain in effect, any Letter of Credit remains
outstanding or any Loan or other amount is owing to any Lender or the
Administrative Agent hereunder, each of SuperHoldings, Holdings and the Borrower
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly:
7.1 Financial Condition Covenants(a).
(a) Minimum Liquidity. Permit Liquidity for any period of five consecutive
Business Days to be less than $20,000,000.

 

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(b) Minimum Cumulative Consolidated EBITDA. Permit the Consolidated EBITDA of
the Debtors for any period beginning on July 1, 2011 and ending on the last
Business Day of each of the months set forth below to be less than the amount
set forth opposite such month:

              Minimum Consolidated   Month   EBITDA  
July 2011
  $ 3,500,000  
August 2011
  $ 35,000,000  
September 2011
  $ 40,000,000  
October 2011
  $ 35,000,000  
November 2011
  $ 35,000,000  
December 2011
  $ 35,000,000  
January 2012
  $ 65,000,000  
February 2012
  $ 60,000,000  
March 2012
  $ 55,000,000  
April 2012
  $ 55,000,000  
May 2012
  $ 55,000,000  
June 2012
  $ 55,000,000  

7.2 Limitation on Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan Document;
(b) Indebtedness of the Borrower to any Subsidiary and of any Wholly Owned
Subsidiary Guarantor to the Borrower or any other Subsidiary; provided that any
Indebtedness of any Loan Party owed to any Person that is not a Loan Party shall
be subordinated to the payment in full of the Obligations;
(c) Indebtedness secured by Liens permitted by Section 7.3(g) in an aggregate
principal amount not to exceed $2,000,000 at any one time outstanding;
(d) Capital Lease Obligations in an aggregate principal amount not to exceed
$5,000,000 at any one time outstanding;
(e) Indebtedness outstanding on the Petition Date and listed on Schedule 7.2(e);
(f) guarantees made in the ordinary course of business by the Borrower or any of
its Subsidiaries of obligations of any Wholly Owned Subsidiary Guarantor created
after the Petition Date;
(g) [Reserved];
(h) [Reserved];

 

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(i) [Reserved];
(j) additional Indebtedness of the Borrower or any of its Subsidiaries in an
aggregate principal amount at any one time outstanding for the Borrower and all
Subsidiaries not to exceed $5,000,000 less the aggregate principal amount of
Indebtedness incurred pursuant to clauses (c) and (d) above at such time; and
(k) Indebtedness of the Borrower in respect of Swap Agreements permitted by this
Agreement.
Notwithstanding the foregoing, no Subsidiary of Holdings will create, incur,
assume or suffer to exist any Guarantee Obligation in respect of any
Indebtedness of Holdings.
7.3 Limitation on Liens. Create, incur, assume or suffer to exist any Lien upon
any of its Property or revenues, whether now owned or hereafter acquired, except
for:
(a) Liens for taxes not yet due or which are being contested in good faith by
appropriate proceedings, provided that adequate reserves with respect thereto
are maintained on the books of SuperHoldings, Holdings, the Borrower or their
respective Subsidiaries, as the case may be, in conformity with GAAP;
(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other
like Liens arising in the ordinary course of business which are not overdue for
a period of more than 60 days or which are being contested in good faith by
appropriate proceedings;
(c) pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security legislation;
(d) deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
(e) easements, rights-of-way, restrictions, encroachments, covenants,
conditions, title exceptions, survey exceptions, minor defects and
irregularities in title and other similar liens and encumbrances incurred in the
ordinary course of business which, either individually or in the aggregate, are
not substantial in amount and which do not in any case materially detract from
the value, operation, use or occupancy of the Property subject thereto or
materially interfere with the ordinary conduct of the business of the Borrower
or any of its Subsidiaries on the Property subject thereto;
(f) Liens in existence on the Petition Date listed on Schedule 7.3(f), securing
Indebtedness permitted by Section 7.2(e), provided that no such Lien is spread
to cover any additional Property after the Closing Date and that the amount of
Indebtedness secured thereby is not increased;

 

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(g) Liens securing Indebtedness of the Borrower or any other Subsidiary incurred
pursuant to Section 7.2(c) to finance the acquisition of fixed or capital
assets, provided that (i) such Liens shall be created substantially
simultaneously with the acquisition of such fixed or capital assets, (ii) such
Liens do not at any time encumber any Property other than the Property financed
by such Indebtedness and (iii) the amount of Indebtedness secured thereby is not
increased;
(h) Liens created pursuant to the Security Documents and/or the Orders and Liens
permitted by any of the Orders;
(i) any interest or title of a lessor, sublessor, licensor or sublicensor under
any lease or license entered into by the Borrower or any other Subsidiary in the
ordinary course of its business and covering only the assets so leased or
licensed;
(j) Liens not otherwise permitted by this Section 7.3 so long as neither (i) the
aggregate outstanding principal amount of the obligations secured thereby nor
(ii) the aggregate fair market value (determined as of the date such Lien is
incurred) of the assets subject thereto exceeds (as to the Borrower and all
Subsidiaries) $1,000,000 at any one time; provided that such Liens do not
encumber the Capital Stock of Holdings, the Borrower or their respective
Subsidiaries; and
(k) any covenants, conditions, encroachments, easements, restrictions,
encumbrances and exceptions contained in any mortgagee’s title insurance policy
delivered in connection with the Prepetition Credit Agreement;
(l) any existing leases, subleases, licenses, sublicenses or similar use or
occupancy agreements of all or any portion of a Mortgaged Property and any
renewals and extensions thereof, any leases, subleases, licenses, sublicenses or
similar use or occupancy agreements entered into upon the expiration or
termination of any such lease, sublease, license, sublicense or similar use or
occupancy agreements and any leases, subleases, license, sublicenses or similar
use or occupancy agreements hereafter entered into of all or any portion of a
Mortgaged Property not required by the Borrower for the operation of its
business;
(m) any municipal, land use, zoning or similar law, ordinance, building code or
right reserved to or vested in any governmental office or agency to control or
regulate the use of any real property;
(n) ground leases in respect of real property on which facilities leased by any
Loan Party are located;
(o) utility deposits, prepayments of trade creditors (to the extent permitted by
Section 7.7) and the cash collateralization of performance bonds, in each case
to the extent the same is (i) required as a result of the Cases and (ii) not in
excess of 120% of the amounts set forth therefor in the Budget; and
(p) Liens on cash collateral securing the Prepetition Letters of Credit or any
letters of credit replacing such Prepetition Letters of Credit (the “L/C Cash
Collateral”) in an aggregate amount not to exceed 101% of the face amount of the
Prepetition Letters of Credit (less the amount of cash collateral applied to the
reimbursement of any such letters of credit (net of any such amounts returned by
the beneficiary thereof in respect thereof)).

 

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Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 7.3 may at any time attach to any Loan Party’s (1) Accounts, other than
those permitted under clause (h) above and those permitted under Section 7.3(h)
and Section 7.3(m) of the Prepetition Credit Agreement as in effect on the date
hereof and (2) Inventory, other than those permitted under clause (h) above and
those permitted under Section 7.3(h) and Section 7.3(m) of the Prepetition
Credit Agreement as in effect on the date hereof.
7.4 Limitation on Fundamental Changes. Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of all or substantially all of its
Property or business except:
(a) any Subsidiary Guarantor may be merged or consolidated with or into the
Borrower (provided that the Borrower shall be the continuing or surviving
corporation) or with or into any Wholly-Owned Subsidiary Guarantor (provided
that the Wholly-Owned Subsidiary Guarantor shall be the continuing or surviving
corporation); and
(b) any Subsidiary Guarantor may Dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or any Wholly-Owned
Subsidiary Guarantor.
7.5 Limitation on Sale of Assets. Dispose of any of its Property or business
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary’s Capital Stock to any Person, except:
(a) the Disposition of obsolete or worn out property in the ordinary course of
business;
(b) the sale of inventory in the ordinary course of business;
(c) Dispositions permitted by Section 7.4(b) and any Dispositions from the
Borrower to any Wholly Owned Subsidiary Guarantor;
(d) Sales of Assets set forth on Schedule 7.5; and
(e) the sale of other assets at fair market value provided that (i) such assets
have a fair market value not to exceed $2,000,000 in the aggregate from the
Closing Date and (ii) the consideration received by Holdings, the Borrower and
their respective Subsidiaries for each such sale of assets shall not be less
than 75% cash, provided, that the requirements of Section 2.9 are complied with
in connection therewith.

 

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7.6 Limitation on Restricted Payments. Declare or pay any dividend (other than
dividends payable solely in common stock of the Person making such dividend) on,
or make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any shares of any class of Capital Stock of SuperHoldings,
Holdings, the Borrower or any of their respective Subsidiaries or any warrants
or options to purchase any such Capital Stock, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly
or indirectly, whether in cash or property or in obligations of Holdings, the
Borrower or any of their respective Subsidiaries (collectively, “Restricted
Payments”), except that:
(a) any Subsidiary of the Borrower may make Restricted Payments to the Borrower
or any other Subsidiary of the Borrower;
(b) to the extent permitted by the Orders, the Borrower may pay cash dividends
to Holdings or SuperHoldings in aggregate amounts not to exceed $[_] and to the
extent required for such entity to pay, without duplication, foreign federal,
state and local income taxes, to the extent such income taxes are attributable
to the income of the Borrower and its Subsidiaries; and
(c) the Borrower may pay dividends to Holdings or make investments in Holdings
to permit Holdings, and Holdings may pay dividends to SuperHoldings or make
investments in SuperHoldings to permit SuperHoldings, to pay corporate overhead
expenses incurred in the ordinary course of business not to exceed $250,000 in
any fiscal year.
7.7 Limitation on Investments, Loans and Advances. Make any advance, loan,
extension of credit (by way of guaranty or otherwise) or capital contribution
to, or purchase any stock, bonds, notes, debentures or other securities of or
any assets constituting all or a material part of a business unit of, or make
any other investment in, any Person, except:
(a) extensions of trade credit in the ordinary course of business;
(b) investments in Cash Equivalents;
(c) Guarantee Obligations permitted by Section 7.2;
(d) loans and advances to employees of the Borrower or any of its Subsidiaries
in the ordinary course of business (including, without limitation, for travel,
entertainment and relocation expenses) in an aggregate amount for the Borrower
and its Subsidiaries not to exceed $250,000 at any one time outstanding;
(e) investments made by the Borrower or any of its Subsidiaries with the
proceeds of any Reinvestment Deferred Amount;
(f) investments by Holdings, the Borrower or any of its Subsidiaries in the
Borrower or any Person that, prior to such investment, is a Debtor; and

 

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(g) acquisitions by the Borrower or any of its Subsidiaries of the Capital Stock
of, or assets of, entities engaged in similar lines of business as the Borrower
and its Subsidiaries on the Closing Date, provided, that (i) the aggregate
purchase price for all such acquisitions occurring after the Closing Date shall
not exceed $10,000,000, (ii) no Default or Event of Default shall have occurred
or be continuing after giving effect to any such acquisition, (iii) no
Indebtedness shall be assumed by any Debtor in connection with any such
acquisition except to the extent otherwise permitted pursuant to this Agreement,
(iv) both immediately before and immediately after giving pro forma effect
thereto, Revolving Credit Availability shall not be less than the greater of
(x) 20% of the Total Revolving Credit Commitments and (y) $15,000,000 and (v) to
the extent the aggregate purchase price of all such acquisitions made pursuant
to this Section 7.7(g) after the Closing Date exceeds (or would exceed, giving
effect to any such acquisition) $5,000,000, the Borrower shall have delivered to
the Administrative Agent, prior to the consummation of any such acquisition, a
certificate of a Responsible Officer to the effect that (x) such Responsible
Officer reasonably expects each acquisition made pursuant to this Section 7.7(g)
to result in an increase of Consolidated EBITDA (calculated to exclude the
effects of one-time costs related to such acquisitions) of the Borrower during
the twelve-month period following each of such acquisitions (as reasonably
determined by the Borrower) by an amount which shall not be less than 25% of the
purchase price for each such acquisition made pursuant to this Section 7.7(g)
and (y) such acquisition otherwise complies with this Section 7.7(g);
(h) investments existing on the Petition Date and listed on Schedule 7.7;
(i) investments and advances made by the Borrower in Holdings to the extent
permitted by Section 7.6(c); and
(j) other investments in an aggregate amount not to exceed $3,000,000 at any one
time outstanding; provided that both immediately before and immediately after
giving pro forma effect thereto, Revolving Credit Availability shall not be less
than the greater of (i) 25% of the Total Revolving Credit Commitments and (ii)
$18,750,000.
7.8 Limitation on Modifications of Material Documents. Amend its certificate of
incorporation, bylaws or other organizational documents in any manner determined
by the Administrative Agent to be adverse to the Lenders without the prior
written consent of the Required Lenders except as required by the Bankruptcy
Code.
7.9 Limitation on Transactions with Affiliates. Enter into any transaction,
including, without limitation, any purchase, sale, lease or exchange of
Property, the rendering of any service or the payment of any management,
advisory or similar fees, with any Affiliate (other than Holdings, the Borrower
or any Wholly Owned Subsidiary Guarantor) unless such transaction is
(a) otherwise permitted under this Agreement, (b) in the ordinary course of
business of Holdings, the Borrower or such Subsidiary, as the case may be, (c)
exclusively among any Debtors or (d) upon fair and reasonable terms no less
favorable to Holdings, the Borrower or such Subsidiary, as the case may be, than
it would obtain in a comparable arm’s length transaction with a Person which is
not an Affiliate; provided that under no circumstance shall any Debtor enter
into any transaction with any of the Sponsor or any Primary Investor other than
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7.10 Limitation on Sales and Leasebacks. Enter into any arrangement with any
Person providing for the leasing by any Debtor of real or personal property
owned by any Debtor which has been or is to be sold or transferred by
SuperHoldings, Holdings, the Borrower or such Subsidiary to such Person or to
any other Person to whom funds have been or are to be advanced by such Person on
the security of such property or rental obligations of SuperHoldings, Holdings,
the Borrower or such Subsidiary.
7.11 Limitation on Changes in Fiscal Periods. Permit the fiscal year of the
Borrower to end on a day other than March 31 or change the Borrower’s method of
determining fiscal quarters or fiscal months, except as required by GAAP.
7.12 Limitation on Negative Pledge Clauses. Enter into or suffer to exist or
become effective any agreement which prohibits or limits the ability of any
Debtor to create, incur, assume or suffer to exist any Lien upon any of its
Property or revenues, whether now owned or hereafter acquired, to secure the
Obligations or, in the case of any guarantor, its obligations under the
Guarantee and Collateral Agreement, other than (a) this Agreement and the other
Loan Documents and (b) any agreements governing any purchase money Liens or
Capital Lease Obligations otherwise permitted hereby (in which case, any
prohibition or limitation shall only be effective against the assets financed
thereby).
7.13 Limitation on Restrictions on Subsidiary Distributions. Enter into or
suffer to exist or become effective any consensual encumbrance or restriction on
the ability of any Subsidiary of the Borrower to (a) pay dividends or make any
other distributions in respect of any Capital Stock of such Subsidiary held by,
or pay any Indebtedness owed to, the Borrower or any other Subsidiary of the
Borrower, (b) make loans or advances to the Borrower or any other Subsidiary of
the Borrower or (c) transfer any of its assets to the Borrower or any other
Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by reason of (i) any restrictions existing under the Loan
Documents and (ii) any restrictions with respect to a Subsidiary imposed
pursuant to an agreement which has been entered into in connection with the
Disposition of all or substantially all of the Capital Stock or assets of such
Subsidiary.
7.14 Limitation on Lines of Business. Enter into any business, either directly
or through any Subsidiary, except for those businesses in which the Borrower and
its Subsidiaries are engaged on the date of this Agreement or which are related,
ancillary or complementary thereto.
7.15 Limitation on Activities of Holdings and SuperHoldings. (a) In the case of
Holdings, notwithstanding anything to the contrary in this Agreement or any
other Loan Document, (i) conduct, transact or otherwise engage in, or commit to
conduct, transact or otherwise engage in, any business or operations other than
those incidental to its ownership of the Capital Stock of the Borrower,
(ii) incur, create, assume or suffer to exist any Indebtedness or other
liabilities or financial obligations, except (A) nonconsensual obligations
imposed by operation of law, (B) pursuant to the Loan Documents to which it is a
party and (C) obligations with respect to its Capital Stock, (iii) own, lease,
manage or otherwise operate any properties or assets (including cash (other than
cash received from the Borrower in accordance with Section 7.6 pending
application in the manner contemplated by said Section) and cash equivalents)
other than the ownership of shares of Capital Stock of the Borrower or (iv) own
the Capital Stock of any Subsidiary (other than the Borrower and its
Subsidiaries).

 

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(b) In the case of SuperHoldings, notwithstanding anything to the contrary in
this Agreement or any other Loan Document, (i) conduct, transact or otherwise
engage in, or commit to conduct, transact or otherwise engage in, any business
or operations other than those incidental to its ownership of the Capital Stock
of Holdings, (ii) incur, create, assume or suffer to exist any Indebtedness or
other liabilities or financial obligations, except (A) nonconsensual obligations
imposed by operation of law, (B) pursuant to the Loan Documents to which it is a
party and (C) obligations with respect to its Capital Stock and (iii) own,
lease, manage or otherwise operate any properties or assets (including cash
(other than cash received from Holdings in accordance with Section 7.6 pending
application in the manner contemplated by said Section) and cash equivalents)
other than the ownership of shares of Capital Stock of Holdings or (iv) own the
Capital Stock of any Subsidiary (other than Holdings and its Subsidiaries).
7.16 Swap Agreements. Enter into any Swap Agreement, except (a) Swap Agreements
entered into in the ordinary course of business to hedge or mitigate risks to
which the Borrower or any Subsidiary has actual exposure (other than those in
respect of Capital Stock of the Borrower or any of its 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) with respect to any interest-bearing liability or
investment of the Borrower or any Subsidiary.
7.17 No Non-Debtors. Permit SuperHoldings or any Subsidiary of SuperHoldings not
to be a “debtor” and “debtor-in-possession” under the Cases.
7.18 Chapter 11 Claims. Incur, create, assume, suffer to exist or permit any
other Superpriority Claim or Lien on any Collateral which is pari passu with or
senior to the Obligations (or the Liens securing the Obligations) hereunder,
except in each case for the Carve Out and Liens permitted pursuant to
Section 7.3(g) which, in accordance with the Interim Order (or Final Order, as
applicable), are senior to such Liens.
Section 8. EVENTS OF DEFAULT; APPLICATION OF PROCEEDS
8.1 Events of Default. If any of the following events shall occur and be
continuing:
(a) The Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when due in accordance with the terms hereof; or the
Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation
or any commitment fee or other amount payable hereunder or under any other Loan
Document within three Business Days after any such interest, commitment fee or
other amount becomes due in accordance with the terms hereof; or
(b) Any representation or warranty made or deemed made by any Loan Party herein
or in any other Loan Document or which is contained in any certificate, document
or financial or other statement furnished by it at any time under or in
connection with this Agreement or any such other Loan Document shall prove to
have been inaccurate in any material respect on or as of the date made or deemed
made; or

 

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(c) Any Loan Party shall default in the observance or performance of any
agreement contained in (x) clause (j) of Section 6.2 and such default shall
continue unremedied for a period of 3 Business Days or (y) clause (i) or (ii) of
Section 6.4(a) (with respect to Holdings and the Borrower only), Section 6.7(a),
6.10(b)(y) or Section 7; or
(d) Any Loan Party shall default in the observance or performance of any other
agreement contained in this Agreement or any other Loan Document (other than as
provided in paragraphs (a) through (c) of this Section), and such default shall
continue unremedied for a period of 30 days; or
(e) Any Debtor shall (i) default in making any payment of any principal of any
Indebtedness (including, without limitation, any Guarantee Obligation, but
excluding the Loans) incurred following the Petition Date on the scheduled or
original due date with respect thereto; or (ii) default in making any payment of
any interest on any such Indebtedness beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness was
created; or (iii) default in the observance or performance of any other
agreement or condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or beneficiary of such
Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to
cause, with the giving of notice if required, such Indebtedness to become due
prior to its stated maturity or (in the case of any such Indebtedness
constituting a Guarantee Obligation) to become payable; provided, that a
default, event or condition described in clause (i), (ii) or (iii) of this
paragraph (e) shall not at any time constitute an Event of Default unless, at
such time, one or more defaults, events or conditions of the type described in
clauses (i), (ii) and (iii) of this paragraph (e) shall have occurred and be
continuing with respect to Indebtedness the outstanding principal amount of
which exceeds in the aggregate $500,000; or
(f) [Reserved]; or
(g) (i) Any Person shall engage in any Prohibited Transaction involving any
Plan, (ii) any Single Employer Plan shall fail to satisfy the minimum funding
standards (within the meaning of Sections 412 or 430 of the Code or Section 302
of ERISA) applicable to such Plan, whether or not waived, (iii) any filing shall
be made pursuant to Section 412 of the Code or Section 303 of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Single Employer Plan, (iv) there shall exist any failure to make by its due date
a required installment under Section 430(j) of the Code with respect to a Single
Employer Plan or any required contribution to a Multiemployer Plan; (v) there
shall be a determination that any Single Employer Plan is in “at risk” status
(within the meaning of Section 430 of the Code or Title IV of ERISA), (vi) any
Lien in favor of the PBGC or a Plan shall arise on the assets of any Loan Party,
(vii) a Reportable Event shall occur with respect to, or proceedings shall
commence to have a trustee appointed, or a trustee shall be appointed, to
administer or to terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a trustee is, in the reasonable
opinion of the Required Lenders, likely to result in the termination of such
Plan for purposes of Title IV of ERISA, (viii) any Single Employer Plan shall
terminate for purposes of Title IV of ERISA, (ix) a Loan Party or any Commonly
Controlled Entity shall, or in the reasonable opinion of the Required Lenders be
likely to, incur any liability in connection with a withdrawal from, or the
Insolvency or Reorganization of, a Multiemployer Plan or determination that any
Multiemployer Plan is in endangered or critical status (within the meaning of
Section 432 of the Code or Section 305 of ERISA), (x) there shall exist a
failure to make or accrue any employer or employee contribution required by law
or normal accounting practices to a Foreign Benefit Arrangement or Foreign Plan,
(xi) the accrued benefit obligations of any Foreign Plan (based on those
assumptions used to fund such Foreign Plan) with respect to all current and
former participants shall exceed the assets of such Foreign Plan, (xii) any
Foreign Plan required to be registered shall not be in good standing with
applicable regulatory authorities or any Foreign Plan or Foreign Benefit
Arrangement shall not be in compliance with any material provision of applicable
law or applicable regulations, or (xiii) any other event or condition shall
occur or exist with respect to a Plan, Foreign Plan, or Foreign Benefit
Arrangement; and in each case in clauses (i) through (xiii) above, such event or
condition, together with all other such events or conditions, if any, could, in
the reasonable judgment of the Required Lenders, reasonably be expected to have
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(h) One or more judgments or decrees required to be satisfied as an
administrative expense claim shall be entered after the Petition Date against
any Debtor involving in the aggregate liabilities for all Debtors (not paid or
fully covered by insurance as to which the relevant insurance company has not
disputed coverage) in excess of $500,000, and all such judgments or decrees
shall not have been vacated, discharged, stayed or bonded pending appeal within
thirty days from the entry thereof; or
(i) [Reserved]
(j) (i) Any Person or “group” (within the meaning of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934, as amended) other than the Primary
Investors (A) shall have acquired beneficial ownership of a greater percentage
of SuperHoldings’ voting common stock than is then held by the Primary Investors
or (B) shall obtain the power (whether or not exercised) to elect a majority of
the Borrower’s, Holdings’ or SuperHoldings’ directors (for purposes of this
clause (i), and clause (ii)(B) below, any shares of voting stock that are
required to be voted for a nominee of any Primary Investor shall be deemed to be
held by such Primary Investor for purposes of determining the voting power held
by any Person); or (ii) (A) the board of directors of the Borrower, Holdings or
SuperHoldings shall not consist of a majority of Continuing Directors; as used
in this paragraph “Continuing Directors” shall mean the directors the Borrower,
Holdings or SuperHoldings, as the case may be, on the Closing Date and each
other director, if such other director’s nomination for election to the board of
directors of the Borrower, Holdings or SuperHoldings is recommended by a
majority of the then Continuing Directors or (B) the Primary Investors shall
cease to be able to elect a majority of the board of directors of
(x) SuperHoldings, (y) through SuperHoldings, Holdings, or (z) through Holdings,
the Borrower; or (iii) the Primary Investors shall cease to own legally and
beneficially at least 51% of each outstanding class of Capital Stock having
ordinary voting power in the election of directors of SuperHoldings; or
(iv) prior to the merger contemplated by Section 7.4(c), SuperHoldings shall
cease to own legally and beneficially 90% of each class of Capital Stock of
Holdings, free of Liens (other than Liens created by the Security Documents); or
(v) Holdings shall cease to own legally and beneficially 100% of each class of
Capital Stock of the Borrower, free of Liens (other than Liens created by the
Security Documents); or (vi) a “change of control” as defined in any Indenture
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(k) (i) An order of the Bankruptcy Court shall be entered granting another
Superpriority Claim (other than the Carve Out) or Lien pari passu with or senior
to that granted (x) to the Lenders and the Administrative Agent pursuant to this
Agreement and the Interim Order (or the Final Order, as applicable), or (y) to
the Prepetition Secured Parties pursuant to the Interim Order (or the Final
Order, as applicable), (ii) an order of the Bankruptcy Court shall be entered
reversing, rescinding, staying, vacating or otherwise amending, supplementing or
modifying the Interim Order (or the Final Order, as applicable) without the
written consent of the Administrative Agent, acting in its sole discretion;
(iii) an order of the Bankruptcy Court shall be entered under Section 1106(b) of
the Bankruptcy Code in any of the Cases appointing a Chapter 11 trustee with
plenary powers, a responsible officer or an examiner having enlarged powers
relating to the operation of the business of the Loan Parties (i.e., powers
beyond those set forth under Sections 1106(a)(3) and (4) of the Bankruptcy
Code); (iv) the Final Order Entry Date shall not have occurred by the date that
is thirty-five days following the date of entry of the Interim Order (or such
later date as the Administrative Agent, acting in its sole discretion, may
agree); or (v) a plan shall be confirmed in any of the Cases of the Debtors that
does not provide for termination of the Commitments and payment in full in cash
of the Obligations on the Effective Date of such plan of reorganization or any
order shall be entered which dismisses any of the Cases of the Debtors or
converts any of the Cases to a case under Chapter 7 of the Bankruptcy Code and
which order does not provide for termination of the Commitments and payment in
full in cash of the Obligations or any of the Debtors shall seek support, or
fail to contest in good faith the filing or confirmation of such a plan or the
entry of such an order; or
(l) Any Debtor shall make any payments relating to pre-Petition Date obligations
other than (i) as permitted under the Interim Order (or the Final Order, as
applicable), (ii) in respect of and in accordance with, and to the extent
authorized by, a “first day” order reasonably satisfactory to the Administrative
Agent and (iii) as otherwise expressly permitted under this Agreement; or
(m) The entry of an order granting relief from the automatic stay, to the extent
not stayed, so as to allow a third party to proceed against any property of any
Debtor which has a value in excess of $1,000,000 in the aggregate or to permit
other actions that could reasonably be expected to have a Material Adverse
Effect; or
(n) Any Debtor shall fail to comply with the Interim Order or the Final Order;
or

 

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(o) The filing of any pleading by any Loan Party seeking, or otherwise
consenting to, any of the matters set forth in paragraphs (k), (l), (m) or
(n) above in this Section 8.1; or
(p) Any proceeding shall be commenced by any Loan Party seeking, or otherwise
consenting to (i) the invalidation, subordination or other challenging of the
Superpriority Claims and Liens granted to secure the Obligations or (ii) any
relief under Section 506(c) of the Bankruptcy Code with respect to any
Collateral; or
(q) The Orders or any of the Collateral Documents shall cease, for any reason,
to be in full force and effect, or any Loan Party or any Affiliate of any Loan
Party shall so assert, or any Liens or Superpriority Claims created by the
Orders or any Collateral Documents shall cease to be enforceable and of the same
effect and priority purported to be created thereby other than by reason of the
release thereof in accordance with the terms thereof; or
(r) The Guarantees shall cease, for any reason, to be in full force and effect
or any Loan Party or any of their Affiliates shall so assert in writing;
then, the Administrative Agent may, and, at the request of the Required Lenders,
the Administrative Agent shall, by notice to the Borrower (with a copy to the
Prepetition Agent, counsel for any statutory committee appointed in the Cases
and to the United States Trustee), take one or more of the following actions, at
the same or different times (provided that with respect to clause (iii) below
and the enforcement of Liens or other remedies with respect to the Collateral
under clause (iv) below, the Administrative Agent shall provide the Borrower
(with a copy to the Prepetition Agent, counsel for any statutory committee
appointed in the Cases and to the United States Trustee) with seven Business
Days’ written notice prior to taking the action contemplated thereby; provided,
further, that upon receipt of the notice referred to in the immediately
preceding clause, the Borrower may continue to make ordinary course and Carve
Out disbursements from the account referred to in clause (iii) below but may not
withdraw or disburse any other amounts from such account) (in any hearing after
the giving of the aforementioned notice, the only issue that may be raised by
any party in opposition of any such action shall be whether, in fact, an Event
of Default has occurred and is continuing): (i) terminate forthwith the
Commitments; (ii) declare the Loans (including, without limitation, all amounts
of L/C Obligations, whether or not the beneficiaries of the then outstanding
Letters of Credit shall have presented the documents required thereunder) then
outstanding to be forthwith due and payable, whereupon the principal of the
Loans, together with accrued interest thereon and any unpaid accrued fees and
all other Obligations of the Borrower accrued hereunder and under any other Loan
Document, shall become forthwith due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived by the Loan Parties, anything contained herein or in any other Loan
Document to the contrary notwithstanding; (iii) subject to the Interim Order (or
Final Order, as applicable), set-off amounts held as cash collateral or in the
accounts of the Loan Parties and apply such amounts to the Obligations of the
Loan Parties hereunder and under the other Loan Documents in accordance with
Section 11.3; and (iv) exercise any and all remedies under this Agreement, the
other Loan Documents the Interim Order (or Final Order, as applicable), and
applicable law available to the Administrative Agent and the Lenders. With
respect to all Letters of Credit with respect to which presentment for honor
shall not have occurred at the time of exercise of remedies pursuant to this
paragraph, the Borrower shall at such time deposit in a cash collateral account
opened by the Administrative Agent an amount equal to the aggregate then undrawn
and unexpired amount of such Letters of Credit. Amounts held in such cash
collateral account shall be applied by the Administrative Agent to the payment
of drafts drawn under such Letters of Credit, and the unused portion thereof
after all such Letters of Credit shall have expired or been fully drawn upon, if
any, shall be applied to repay other Obligations. After all such Letters of
Credit shall have expired or been fully drawn upon, all Reimbursement
Obligations shall have been satisfied and all other Obligations shall have been
paid in full, the balance, if any, in such cash collateral account shall be
returned to the Borrower (or such other Person as may be lawfully entitled
thereto).

 

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8.2 Application of Proceeds. After the exercise of remedies provided for in
Section 8.1, any amounts received on account of the Obligations shall be applied
by the Administrative Agent and the Lenders in the following order:
First, to payment of that portion of the Obligations (excluding the Banking
Services Obligations and Swap Obligations) constituting fees, indemnities,
expenses and other amounts (including fees, charges and disbursements of counsel
to the Administrative Agent and amounts payable under Section 2) payable to the
Administrative Agent, in its capacity as such;
Second, to payment of that portion of the Obligations (excluding the Banking
Services Obligations and Swap Obligations) constituting indemnities, expenses,
and other amounts (other than principal, interest and fees) payable to the
Revolving Lenders and the Issuing Lender, ratably among them in proportion to
the amounts described in this clause Second payable to them;
Third, to payment of that portion of the Obligations consisting of accrued and
unpaid interest on the Protective Advances;
Fourth, to pay that portion of the Obligations consisting of unpaid principal of
the Protective Advances;
Fifth, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Revolving Credit Loans, LC Exposure and such other
Obligations owed to the Revolving Lenders, and fees (including Letter of Credit
fees), ratably among the Revolving Lenders and the Issuing Lender in proportion
to the respective amounts described in this clause Fifth payable to them;
Sixth, to payment of that portion of the Obligations constituting unpaid
principal of the Revolving Credit Loans and unreimbursed L/C Disbursements,
ratably among the Revolving Lenders and the Issuing Lender in proportion to the
respective amounts described in this clause Sixth held by them;
Seventh, to the Administrative Agent for the account of the Issuing Lender, to
cash collateralize that portion of LC Exposure comprised of the aggregate
undrawn amount of Letters of Credit;

 

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Eighth, to payment of all other Obligations (including without limitation the
cash collateralization of unliquidated indemnification obligations, but
excluding Banking Services Obligations), ratably among the Credit Parties (other
than the Term Lenders, their Affiliates and any Related Credit Party) of the
foregoing in proportion to the respective amounts described in this clause
Eighth held by them;
Ninth, to payment of that portion of the Obligations arising from Banking
Services Obligations and Swap Obligations, ratably among the Credit Parties in
proportion to the respective amounts described in this clause Ninth held by
them;
Tenth, ratably to pay any fees, indemnities, expenses and other amounts then due
to the Term Lenders, their Affiliates and the Related Credit Parties of the
foregoing until paid in full;
Eleventh, ratably to pay accrued and unpaid interest in respect of the Term
Loans until paid in full;
Twelfth, ratably to pay principal due in respect of Term Loans until paid in
full;
Thirteenth, to payment of all other Obligations (including without limitation
the cash collateralization of unliquidated indemnification obligations) to the
Term Lenders, their Affiliates and the Related Credit Parties of the foregoing;
and
Last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full, to the Loan Parties or as otherwise required by Applicable Law.
Subject to Section 3, amounts used to Cash Collateralize the aggregate undrawn
amount of Letters of Credit pursuant to clause Seventh above shall be applied to
satisfy drawings under such Letters of Credit as they occur. If any amount
remains on deposit as cash collateral after all Letters of Credit have either
been fully drawn or expired, such remaining amount shall be applied to the other
Obligations, if any, in the order set forth above.
Section 9. THE AGENTS
9.1 Appointment. Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the agent of such Lender under this Agreement and the
other Loan Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall have no duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
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9.2 Delegation of Duties. The Administrative Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Administrative Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.
9.3 Exculpatory Provisions. Neither the Administrative Agent nor any of its
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted from its or such Person’s own gross negligence or willful misconduct)
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 a party thereto to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be under
any obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document, or to inspect the properties, books or
records of any Loan Party.
9.4 Reliance by Administrative Agent. The Administrative Agent shall be entitled
to rely, and shall be fully protected in relying, upon any instrument, writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Loan Parties), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent may
deem and treat the payee of any Note as the owner thereof for all purposes
unless a written notice of assignment, negotiation or transfer thereof shall
have been filed with the Administrative Agent. The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders (or, if so specified by this Agreement, all
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Loan Documents in
accordance with a request of the Required Lenders (or, if so specified by this
Agreement, all Lenders), and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.

 

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9.5 Notice of Default. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender,
Holdings or the Borrower 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 Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders. The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders (or, if so specified by this
Agreement, all Lenders); provided that unless and until the Administrative Agent
shall have received such directions, the Administrative Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Lenders.
9.6 Non-Reliance on Administrative Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Arranger, the Administrative Agent nor
any of their respective officers, directors, employees, agents,
attorneys-in-fact or affiliates have made any representations or warranties to
it and that no act by the Arranger or the Administrative Agent hereinafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by the
Arranger or Administrative Agent to any Lender. Each Lender represents to the
Arranger and the Administrative Agent that it has, independently and without
reliance upon the Arranger or the Administrative Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Arranger, the Administrative Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement and the other Loan
Documents, and to make such investigation as it deems necessary to inform itself
as to the business, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their affiliates. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent hereunder, the Administrative Agent shall have no duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party which may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
9.7 Indemnification. The Lenders agree to indemnify the Arranger and the
Administrative Agent in their respective capacities as such (to the extent not
reimbursed by Holdings or the Borrower and without limiting the obligation of
Holdings or the Borrower to do so), ratably according to their respective
Applicable Percentage in effect on the date on which indemnification is sought
under this Section 9.7 (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 liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Loans) be imposed on, incurred by or
asserted against the Arranger or the Administrative Agent 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 the Administrative Agent under or in connection with any of the foregoing,
including all amounts owed by the Borrower under Section 10.5 which are not paid
by the Borrower; provided 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 which are found by a final
and nonappealable decision of a court of competent jurisdiction to have resulted
from the Arranger’s (in the case of the Arranger) or Administrative Agent’s (in
the case of the Administrative Agent) gross negligence or willful misconduct.
The agreements in this Section 9.7 shall survive the payment of the Loans and
all other amounts payable hereunder.

 

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9.8 Administrative Agent in Its Individual Capacity. The Administrative Agent
and its Affiliates may make loans to, accept deposits from and generally engage
in any kind of business with any Loan Party as though the Administrative Agent
was not the Administrative Agent. With respect to its Loans made or renewed by
it and with respect to any Letter of Credit issued or participated in by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Loan Documents as any Lender and may exercise the same as though
it were not the Administrative Agent, and the terms “Lender” and “Lenders” shall
include the Administrative Agent in its individual capacity.
9.9 Successor Administrative Agent. The Administrative Agent may resign as
Administrative Agent upon 10 days’ notice to the Lenders and the Borrower. If
the Administrative Agent shall resign as Administrative Agent under this
Agreement and the other Loan Documents, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders, which successor agent
(unless a Default or Event of Default shall have occurred and be continuing)
shall be subject to approval by the Borrower (which approval shall not be
unreasonably withheld or delayed), whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term
“Administrative Agent” shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent’s rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. If no successor agent
has accepted appointment as Administrative Agent by the date that is 10 days
following a retiring Administrative Agent’s notice of resignation, the retiring
Administrative Agent’s resignation shall nevertheless thereupon become
effective, and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above. After any retiring
Administrative Agent’s resignation as Administrative Agent, the provisions of
this Section 9 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement and the
other Loan Documents.
9.10 Authorization to Release Liens. The Administrative Agent is hereby
irrevocably authorized by each of the Lenders to release any Lien covering any
Property of the Borrower or any of its Subsidiaries that is the subject of a
Disposition which is permitted by this Agreement or which has been consented to
in accordance with Section 10.1.

 

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9.11 Reports. Each Lender hereby agrees that (a) it has requested a copy of each
Report prepared by or on behalf of the Administrative Agent; (b) the
Administrative Agent (i) 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 (ii) shall not be liable for any information contained
in any Report; (c) 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; (d) it will keep all Reports confidential and
strictly for its internal use, not share the Report with any Person except as
otherwise permitted pursuant to this Agreement; and (e) without limiting the
generality of any other indemnification provision contained in this Agreement,
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 attorney fees) incurred by as the direct or indirect
result of any third parties who might obtain all or part of any Report through
the indemnifying Lender.
9.12 Arranger. The Arranger shall have no duties or responsibilities hereunder
in its capacity as such.
Section 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement, any other Loan Document,
nor any terms hereof or thereof may be amended, supplemented or modified except
in accordance with the provisions of this Section 10.1. The Required Lenders and
each Loan Party party to the relevant Loan Document may, or (with the written
consent of the Required Lenders) the Administrative Agent and each Loan Party
party to the relevant Loan Document may, from time to time, (a) enter into
written amendments, supplements or modifications hereto and to the other Loan
Documents for the purpose of adding any provisions to this Agreement or the
other Loan Documents or changing in any manner the rights of the Lenders or of
the Loan Parties hereunder or thereunder or (b) waive, on such terms and
conditions as the Required Lenders, or the Administrative Agent, as the case may
be, may specify in such instrument, any of the requirements of this Agreement or
the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) forgive the principal amount or extend the
final scheduled date of maturity of any Loan, reduce the stated rate of any
interest, fee or letter of credit commission payable hereunder or extend the
scheduled date of any payment thereof, extend the duration of any Interest
Period beyond six months, or increase the amount or extend the expiration date
of any Lender’s Commitment, in each case without the consent of each Lender
directly affected thereby; (ii) amend, modify or waive any provision of this
Section 10.1 or reduce any percentage specified in the definition of Required
Lenders or Supermajority Revolving Lenders, consent to the assignment or
transfer by the Borrower of any of its rights and obligations under this
Agreement and the other Loan Documents, amend or modify the Superpriority Claim
status of the Lenders or release or subordinate all or substantially all of the
Liens or Collateral granted to the Secured Parties under any Loan Document or
under the Orders, or release Holdings or, while SuperHoldings remains in
existence, SuperHoldings or all or substantially all of the Subsidiary
Guarantors from their obligations under the Guarantee and Collateral Agreement,
in each case without the written consent of all Lenders; (iii) amend, modify or
waive any provision of Section 9 without the written consent of the
Administrative Agent; (iv) amend, modify or waive any provision of Section 3 or
other rights of the Issuing Lender (including its rights to Cash Collateral)
without the written consent of the Issuing Lender; (v) amend or modify the
definition of “Borrowing Base”, “Eligible Accounts Receivable” or “Eligible
Inventory” or otherwise make changes affecting Borrowing Base eligibility
criteria that have the effect of increasing Revolving Credit Availability or
that affect or alter priority of payments set forth in Section 8.2 or that amend
Section 2.8(b), in each case without the consent of the Supermajority Revolving
Lenders, or (vi) amend, modify or waive any provision of Sections 2.15(a),
(b) or (c) without the written consent of each Lender adversely affected
thereby. Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the Loan
Parties, the Lenders, the Administrative Agent and all future holders of the
Loans. In the case of any waiver, the Loan Parties, the Lenders and the
Administrative Agent shall be restored to their former position and rights
hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.

 

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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 not obtained being
referred to herein as a “Non-Consenting Lender”), then the Borrower 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 Borrower and the Administrative Agent 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 (or
pursuant to other arrangements specified by the Administrative Agent, which may
include a deemed assignment) 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
Section 10.6(b), and (ii) the Borrower 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
Borrower hereunder to and including the date of termination, including without
limitation payments due to such Non-Consenting Lender under Sections 2.16 and
2.18, 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 2.18 had the Loans
of such Non-Consenting Lender been prepaid on such date rather than sold to the
replacement Lender.
10.2 Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by telecopy), and,
unless otherwise expressly provided herein, shall be deemed to have been duly
given or made when delivered, or three Business Days after being deposited in
the mail, postage prepaid, or, in the case of telecopy notice, when received by
a responsible officer of the addressee, addressed as follows in the case of
SuperHoldings, Holdings, the Borrower and the Administrative Agent, and as set
forth in an administrative questionnaire delivered to the Administrative Agent
in the case of the Lenders, or to such other address as may be hereafter
notified by the respective parties hereto:

     
SuperHoldings and Holdings:
  NBC Acquisition Corp.

 
  4700 South 19th Street

 
  Lincoln, Nebraska 68501

 
  Attention: Chief Financial Officer

 
  Facsimile: 402-421-0507

 

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The Borrower:
  Nebraska Book Company, Inc.

 
  4700 South 19th Street

 
  Lincoln, Nebraska 68501

 
  Attention: Chief Financial Officer

 
  Facsimile: 402-421-0507
 
   
With a copy to:
  Kirkland & Ellis LLP

 
  601 Lexington Avenue

 
  New York, New York 10022

 
  Attention: Leonard Klingbaum, Esq.

 
  Facsimile: 212-446-6460
 
   
The Administrative Agent:
  JPMorgan Chase Bank, N.A.

 
  Bank Loans and Agency Services

 
  1111 Fannin Street, 10th Floor

 
  Houston, TX 77002

 
  Attention: Syed X Abbas

 
  Facsimile: 713-286-3245
 
   
with a copy to:
  JPMorgan Chase Bank, N.A.

 
  270 Park Avenue

 
  New York, New York 10017

 
  Attention: [Eric H Pratt]

 
  Facsimile: 212-270-6842

provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Section 2 unless otherwise agreed by the Administrative Agent and
the applicable Lender. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

 

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10.4 Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.
10.5 Payment of Expenses. The Borrower agrees (a) to pay or reimburse the
Administrative Agent, for all its reasonable documented out-of-pocket costs and
expenses incurred in connection with the preparation and execution of, and any
amendment, supplement or modification to, this Agreement and the other Loan
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including, without limitation, the reasonable fees, disbursements
and other charges of counsel to the Administrative Agent (with such counsel to
include no more than one local counsel in each applicable jurisdiction so long
as such counsel are engaged with the Borrower’s prior written consent) and of
other professional advisors to the Administrative Agent, (b) to pay or reimburse
each Lender and the Administrative Agent for all their reasonable out-of-pocket
costs and expenses incurred in connection with the enforcement or preservation
of any rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the reasonable fees, disbursements and
other charges of one lead counsel (including all such costs and expenses
incurred during any negotiations, workouts, restructurings or legal proceedings)
and of one local counsel in each relevant jurisdiction and the fees and
disbursements of any financial advisor or third party consultants or appraisers
to and of the Administrative Agent (and the allocated fees and expenses of
in-house counsel), (c) to pay or reimburse the Administrative Agent for all
reasonable documented out-of-pocket costs and expenses incurred in connection
with this Agreement and the other Loan Documents, the Orders or the Cases
(including, without limitation, the on-going monitoring of the Cases, including
attendance at hearings or other proceedings and the on-going review of documents
filed with the Bankruptcy Court, and all fees, disbursements and charges of
counsel for the Administrative Agent and other professional advisors to the
Administrative Agent), (d) to pay, indemnify, and hold each Lender, the Arranger
and the Administrative Agent harmless from, any and all recording and filing
fees and any and all liabilities with respect to, or resulting from any delay in
paying, stamp, excise and other Taxes, if any, that may be payable or determined
to be payable in connection with the execution and delivery of, or consummation
or administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and
(e) to pay, indemnify, and hold each Lender and the Administrative Agent and
their respective affiliates and their respective officers, directors, employees,
agents and controlling persons (each, an “indemnitee”) harmless from and against
any and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and any such other
documents, including, without limitation, any of the foregoing relating to the
use of proceeds of the Loans or the violation of, noncompliance with or
liability under, any Environmental Law applicable to the operations of Holdings,
the Borrower any of their respective Subsidiaries or any of the Properties and
the reasonable fees, disbursements and other charges of one lead counsel and of
one local counsel in each relevant jurisdiction (and the allocated fees and
expenses of in-house counsel) to each Lender and of counsel to the
Administrative Agent (all the foregoing in this clause (e), collectively, the
“indemnified liabilities”), provided, that the Borrower shall have no obligation
hereunder to any indemnitee with respect to indemnified liabilities (i) to the
extent such indemnified liabilities are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such indemnitee or (ii) arising from a
lawsuit or administrative proceeding against such indemnitee if the Borrower was
not given notice of such lawsuit or administrative proceeding and an opportunity
to participate in the defense thereof at its own expense, and provided further,
that this Section 10.5(e) shall not apply with respect to Taxes other than Taxes
that represent losses or damages arising from any non-Tax claim. Without
limiting the foregoing, and to the extent permitted by applicable law, Holdings
and the Borrower agree not to assert and to cause their Subsidiaries not to
assert, and hereby waive and agree to cause their Subsidiaries to so waive, all
rights for contribution or any other rights of recovery with respect to all
claims, demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, under or related to Environmental Laws,
that any of them might have by statute or otherwise against any indemnitee. The
agreements in this Section shall survive repayment of the Loans and all other
amounts payable hereunder.

 

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Expenses being reimbursed by the Borrower under this Section include, without
limiting the generality of the foregoing, costs and expenses incurred in
connection with:
(i) appraisals and insurance reviews;
(ii) 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, together with the reasonable fees and expenses
associated with collateral monitoring services performed by the Specialized Due
Diligence Group of the Administrative Agent (and the Borrower agrees to modify
or adjust the computation of the Borrowing Base — which may include maintaining
additional Reserves, modifying the advance rates or modifying the eligibility
criteria for the components of the Borrowing Base — to the extent required by
the Administrative Agent as a result of any such evaluation, appraisal or
monitoring);
(iii) background checks regarding senior management and/or key investors, as
deemed necessary or appropriate in the reasonable discretion of the
Administrative Agent;
(iv) taxes, fees and other charges for (A) lien and title searches and title
insurance and (B) recording the Mortgages, filing financing statements and
continuations, and other actions to perfect, protect, and continue the
Administrative Agent’s Liens;
(v) 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
(vi) 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 costs and expenses may be charged to the Borrower as
Revolving Credit Loans or to another deposit account, all as described in
Section 8.2.

 

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10.6 Successors and Assigns; Participations and Assignments. (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 Lender that issues any Letter of Credit), except
that (i) neither the Borrower nor Holdings 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 the 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.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees (other than the Borrower, an
Affiliate of the Borrower or a natural person) (each, an “Assignee”) all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably delayed or withheld) of:
(A) the Borrower, provided that no consent of the Borrower shall be required for
an assignment to a Lender, an Affiliate of a Lender, an Approved Fund (as
defined below) or, if an Event of Default has occurred and is continuing, any
other Person; and
(B) the Administrative Agent and, in the case of the Revolving Facility, the
Issuing Lender.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender, an Affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Revolving Credit Commitments or Loans, the amount of the
Revolving Credit Commitments 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 in the case of the Revolving Facility and $1,000,000 in
the case of the Term Facility, unless each of the Borrower and the
Administrative Agent otherwise consent, provided that such amounts shall be
aggregated in respect of each prospective Lender and its Affiliates or Approved
Funds, if any;

 

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(B) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500 (treating multiple or simultaneous assignments by
or to two or more Approved Funds or two or more funds that are engaged in
making, purchasing, holding or investing in bank loans and similar extensions of
credit in the ordinary course of business that are managed by the same
investment advisor or Affiliated advisors as a single assignment); and
(C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an administrative questionnaire.
For the purposes of this Section 10.6, “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; provided that, for purposes of proviso (2) of
clause (b)(ii)(A) above, in connection with an assignment to a prospective
Lender not previously a Lender, the term “Lender” as it is used in clauses (a),
(b) and (c) of this paragraph shall mean such prospective Lender.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
below, 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 of Sections 2.16,
2.17, 2.18 and 10.5). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 10.6
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 an agent of the
Borrower, 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 Commitments of, and principal amount of the
Loans and L/C Obligations 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 Borrower, the Administrative Agent, the Issuing Lender 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 Borrower, the Issuing Lender and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an Assignee, 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. 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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(vi) Any assignment need not be ratable between the Facilities.
(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(but in no case to the Borrower, an Affiliate of the Borrower or a natural
person) (a “Participant”) in all or a portion of such Lender’s rights and
obligations under this Agreement (including all or a portion of its Commitments
and the Loans owing to it); provided that (A) such Lender’s obligations under
this Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent, the Issuing Lender 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 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 may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or
waiver that (1) requires the consent of each Lender directly affected thereby
pursuant to the proviso to the second sentence of Section 10.1 and (2) directly
affects such Participant. The Borrower agrees that each Participant shall be
entitled to the benefits of (and the limitations of) Sections 2.16, 2.17 and
2.18 (subject to the requirements and limitations therein, including the
requirements under Section 2.17(f) (it being understood that the documentation
required under Section 2.17(f) shall be delivered to the participating Lender))
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 such
Participant (A) agrees to be subject to the provisions of Sections 2.16 and 2.17
as if it were an assignee under paragraph (b) of this Section; and (B) shall not
be entitled to receive any greater payment under Sections 2.16 or 2.17, with
respect to any participation, than its participating Lender would have been
entitled to receive, except to the extent such entitlement to receive a greater
payment results from an adoption of or any change in any Requirement of Law or
in the interpretation or application thereof or compliance by any Lender with
any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date hereof
that occurs after the Participant acquired the applicable participation. To the
extent permitted by law, each Participant also shall be entitled to the benefits
of Section 10.7(b) as though it were a Lender, provided such Participant shall
be subject to Section 10.7(a) as though it were a Lender. Each Lender that sells
a participation shall, acting solely for this purpose as an agent of the
Borrower, 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
(the “Participant Register”); provided that no Lender shall have any obligation
to disclose all or any portion of the Participant Register to any Person
(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) 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.

 

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(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 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.
(e) The Borrower, upon receipt of written notice from the relevant Lender,
agrees to issue Notes to any Lender requiring Notes to facilitate transactions
of the type described in paragraph (d) above.
(f) Notwithstanding the foregoing, any Conduit Lender may assign any or all of
the Loans it may have funded hereunder to its designating Lender without the
consent of the Borrower or the Administrative Agent and without regard to the
limitations set forth in Section 10.6(b). Each of Holdings, the Borrower, each
Lender and the Administrative Agent hereby confirms that it will not institute
against a Conduit Lender or join any other Person in instituting against a
Conduit Lender any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding under any state bankruptcy or similar law, for one year
and one day after the payment in full of the latest maturing commercial paper
note issued by such Conduit Lender; provided, however, that each Lender
designating any Conduit Lender hereby agrees to indemnify, save and hold
harmless each other party hereto for any loss, cost, damage or expense arising
out of its inability to institute such a proceeding against such Conduit Lender
during such period of forbearance.
10.7 Adjustments; Set-off. (a) Except to the extent that this Agreement or any
Court Order provides for payments to be allocated to the Lenders or a particular
Lender or the Administrative Agent, if any Lender (a “Benefitted Lender”) shall
at any time receive any payment of all or part of its Loans or the Reimbursement
Obligations owing to it, or interest thereon, or receive any collateral in
respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to
events or proceedings of the nature referred to in Section 8(f), or otherwise),
in a greater proportion than any such payment to or collateral received by any
other Lender, if any, in respect of such other Lender’s Loans or the
Reimbursement Obligations owing to such other Lender, or interest thereon, such
Benefitted Lender shall purchase for cash from the other Lenders a participating
interest in such portion of each such other Lender’s Loan and/or of the
Reimbursement Obligations owing to each such other Lender, or shall provide such
other Lenders with the benefits of any such collateral, or the proceeds thereof,
as shall be necessary to cause such Benefitted Lender to share the excess
payment or benefits of such collateral or proceeds ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such Benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest.

 

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(b) In addition to any rights and remedies of the Lenders provided by law,
subject to the Carve Out and the Orders and, after the giving of the notice
described in Section 8.1 notwithstanding the provisions of Section 362 of the
Bankruptcy Code, each Lender shall have the right, without prior notice to
SuperHoldings, Holdings or the Borrower, any such notice being expressly waived
by SuperHoldings, Holdings and the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by SuperHoldings,
Holdings or the Borrower hereunder (whether at the stated maturity, by
acceleration or otherwise) to set off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender, any Affiliate
thereof or any branch or agency thereof to or for the credit or the account of
SuperHoldings, Holdings or the Borrower. Each Lender agrees promptly to notify
SuperHoldings, Holdings, the Borrower and the Administrative Agent after any
such setoff and application made by such Lender, provided that the failure to
give such notice shall not affect the validity of such setoff and application.
10.8 Counterparts. This Agreement may be executed by one or more of the parties
to this Agreement on any number of separate counterparts (including by telecopy
or other electronic transmission), and all of said counterparts taken together
shall be deemed to constitute one and the same instrument. A set of the copies
of this Agreement signed by all the parties shall be lodged with the Borrower
and the Administrative Agent.
10.9 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.10 Integration. This Agreement and the other Loan Documents represent the
agreement of SuperHoldings, Holdings, the Borrower, the Administrative Agent and
the Lenders with respect to the subject matter hereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to subject matter hereof not expressly set forth or
referred to herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK AND, TO THE EXTENT
APPLICABLE, THE BANKRUPTCY CODE.

 

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10.12 Submission To Jurisdiction; Waivers. Each of SuperHoldings, Holdings and
the Borrower, the Administrative Agent and each Lender hereby irrevocably and
unconditionally:
(a) submits for itself and its Property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
exclusive general jurisdiction of the Bankruptcy Court and, if the Bankruptcy
Court does not have (or abstains from) jurisdiction, to the exclusive general
jurisdiction of any State or Federal court of competent jurisdiction sitting in
New York County, New York;
(b) consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to SuperHoldings, Holdings
or the Borrower, as the case may be at its address set forth in Section 10.2 or
at such other address of which the Administrative Agent shall have been notified
pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
Section 10.12 any special, exemplary, punitive or consequential damages.
10.13 Acknowledgements. Each of SuperHoldings, Holdings and the Borrower hereby
acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and delivery of
this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender nor the Arranger has any
fiduciary relationship with or duty to SuperHoldings, Holdings or the Borrower
arising out of or in connection with this Agreement or any of the other Loan
Documents, and the relationship between Administrative Agent, Lenders and the
Arranger, on one hand, and SuperHoldings, Holdings and the Borrower, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among SuperHoldings, Holdings, the Borrower and the Lenders.

 

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10.14 WAIVERS OF JURY TRIAL. SUPERHOLDINGS, HOLDINGS, THE BORROWER, THE
ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
10.15 Confidentiality. The Administrative Agent and each Lender agrees to keep
confidential all non-public information provided to it by any Loan Party
pursuant to this Agreement that is designated by such Loan Party as
confidential; provided that nothing herein shall prevent the Administrative
Agent or any Lender from disclosing any such information (a) to the
Administrative Agent, the Arranger, any other Lender or any affiliate of any
Lender, (b) to any Participant or Assignee (each, a “Transferee”) or prospective
Transferee which agrees to comply with the provisions of this Section, (c) to
the employees, directors, agents, attorneys, accountants and other professional
advisors of such Lender or its Affiliates, (d) upon the request or demand of any
Governmental Authority having jurisdiction over the Administrative Agent or such
Lender, (e) in response to any order of any court or other Governmental
Authority or as may otherwise be required pursuant to any Requirement of Law,
(f) if requested or required to do so in connection with any litigation or
similar proceeding, (g) which has been publicly disclosed other than in breach
of this Section 10.15, (h) to the National Association of Insurance
Commissioners or any similar organization or any nationally recognized rating
agency that requires access to information about a Lender’s investment portfolio
in connection with ratings issued with respect to such Lender, (i) in connection
with the exercise of any remedy hereunder or under any other Loan Document or
(j) to any direct or indirect contractual counterparty in swap agreements or
such contractual counterparty’s professional advisor (so long as such
contractual counterparty or professional advisor to such contractual
counterparty agrees to be bound by the provisions of this Section). 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 SECTION 10.15 FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE BORROWER AND ITS AFFILIATES 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
BORROWER 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 BORROWER, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE BORROWER 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.

 

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10.16 USA PATRIOT Act. Each Lender that is subject to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”) hereby notifies the Borrower that pursuant to the requirements of
the Act, it is required to obtain, verify and record information that identifies
the Borrower, which information includes the names and addresses of the Borrower
and other information that will allow such Lender to identify the Borrower in
accordance with the Act.
10.17 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 Lenders, in assets which, in accordance with
Article 9 of the UCC or any other applicable law can be perfected only by
possession. Should any Lender (other than the Administrative Agent) obtain
possession 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.
10.18 Reserved.
10.19 Release of Liens. The Lenders 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) upon the termination of the all Commitments, payment and satisfaction in
full in cash of all Obligations (other than the Contingent Obligations), and the
cash collateralization of any outstanding Letters of Credit in a manner
satisfactory to the Issuing Lender, (ii) constituting property being sold or
disposed of if the Loan Party disposing of such property certifies to the
Administrative Agent that the sale or 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), and to the extent that the
property being sold or disposed of constitutes 100% of the Capital Stock of a
Subsidiary, the Administrative Agent is authorized to release such Loan Party
from its obligations under the Security Documents, (iii) constituting property
leased to a Loan Party under a lease which has expired or been terminated in a
transaction permitted under this Agreement, or (iv) as required to effect any
sale or other disposition of such Collateral in connection with any exercise of
remedies of the Administrative Agent and the Lenders pursuant to Section 8. In
addition, the Administrative Agent may in its discretion, release its Liens on
Collateral valued in the aggregate not in excess of $10,000,000 during any
calendar year without the prior written authorization of the Required Lenders.
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. At the request and sole expense of each Loan
Party following any such release, the Administrative Agent shall deliver to such
Loan Party any Collateral held by the Administrative Agent, and execute and
deliver to such Loan Party such documents as such Loan Party shall reasonably
request to evidence such release.
10.20 Disclosure. Each Loan Party and each Lender 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.

 

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Section 11. REMEDIES; APPLICATION OF PROCEEDS
11.1 Remedies; Obtaining the Collateral Upon Default. Upon the occurrence and
during the continuance of an Event of Default and with not fewer than three
Business Days prior written notice by the Administrative Agent (or such longer
time as may be required pursuant to the Orders), to the extent any such action
is not inconsistent with the Interim Order (including paragraph 9 thereof) (or
the Final Order, as applicable) or Section 8, the Administrative Agent, in
addition to any rights now or hereafter existing under applicable law, and
without application to or order of the Bankruptcy Court, shall have all rights
as a secured creditor under the Uniform Commercial Code in all relevant
jurisdictions and may:
(a) personally, or by agents or attorneys, immediately retake possession of the
Collateral or any part thereof, from the Borrower, any Guarantor, or any other
Person who then has possession of any part thereof with or without notice or
process of law (but subject to any Requirements of Law), and for that purpose
may enter upon the Borrower’s or any Guarantor’s premises where any of the
Collateral is located and remove the same and use in connection with such
removal any and all services, supplies, aids and other facilities of the
Borrower or such Guarantor;
(b) instruct the obligor or obligors on any agreements, instrument or other
obligation constituting the Collateral to make any payment required by the terms
of such instrument or agreement directly to any cash collateral account;
(c) sell, assign or otherwise liquidate, or direct any Loan Party to sell,
assign or otherwise liquidate, any or all of the Collateral or any part thereof
in accordance with Section 11.2, and take possession of the proceeds of any such
sale, assignment or liquidation; and
(d) take possession of the Collateral or any part thereof, by directing the
Borrower and any Guarantor in writing to deliver the same to the Administrative
Agent at any place or places reasonably designated by the Administrative Agent,
in which event the Borrower and such Guarantor shall at its own expense:
(i) forthwith cause the same to be moved to the place or places so designated by
the Administrative Agent and there delivered to the Administrative Agent,
(ii) store and keep any Collateral so delivered to the Administrative Agent at
such place or places pending further action by the Administrative Agent as
provided in Section 11.2, and
(iii) while the Collateral shall be so stored and kept, provide such guards and
maintenance services as shall be necessary to protect the same and to preserve
and maintain them in good condition;
it being understood that the Borrower’s and each Guarantor’s obligation so to
deliver the Collateral is of the essence of this Agreement and that,
accordingly, upon application to the Bankruptcy Court, the Administrative Agent
shall be entitled to a decree requiring specific performance by the Borrower or
such Guarantor of such obligation.

 

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11.2 Remedies; Disposition of the Collateral. Upon the occurrence and during the
continuance of an Event of Default (and following not fewer than seven Business
Days prior written notice by the Administrative Agent (or such longer time as
may be required pursuant to the Orders)), and to the extent not inconsistent
with the Interim Order (or the Final Order, as applicable), without application
to or order of the Bankruptcy Court, any Collateral repossessed by the
Administrative Agent under or pursuant to Section 11.1 or the Interim Order (or
the Final Order, as applicable) or otherwise, and any other Collateral whether
or not so repossessed by the Administrative Agent, may be sold, assigned, leased
or otherwise disposed of under one or more contracts or as an entirety, and
without the necessity of gathering at the place of sale the property to be sold,
and in general in such manner, at such time or times, at such place or places
and on commercially reasonable terms, in compliance with any Requirements of
Law. Any of the Collateral may be sold, leased or otherwise disposed of, in the
condition in which the same existed when taken by the Administrative Agent or
after any overhaul or repair which the Administrative Agent shall determine to
be commercially reasonable. Any such disposition which shall be a private sale
or other private proceeding permitted by applicable Requirements of Law shall be
made upon not less than ten days’ written notice to the Borrower specifying the
time at which such disposition is to be made and the intended sale price or
other consideration therefor, and shall be subject, for the ten days after the
giving of such notice, to the right of the Borrower or any nominee of the
Borrower to acquire the Collateral involved at a price or for such other
consideration at least equal to the intended sale price or other consideration
so specified. Any such disposition which shall be a public sale permitted by
applicable Requirements of Law shall be made upon not less than ten days’
written notice to the Borrower specifying the time and place of such sale and,
in the absence of applicable Requirement of Law, shall be by public auction
(which may, at the Administrative Agent’s option, be subject to reserve), after
publication of notice of such auction not less than ten days prior thereto in
USA Today and The Wall Street Journal, National Edition. Subject to
Section 11.4, to the extent permitted by any such Requirement of Law, the
Administrative Agent on behalf of the Lenders or any Lender may bid for and
become the purchaser of the Collateral or any item thereof, offered for sale in
accordance with this Section 11.2 without accountability to the Borrower, any
Guarantor or the Prepetition Secured Parties (except to the extent of surplus
money received). If, under mandatory Requirements of Law, the Administrative
Agent shall be required to make disposition of the Collateral within a period of
time which does not permit the giving of notice to the Borrower as hereinabove
specified, the Administrative Agent need give the Borrower only such notice of
disposition as shall be reasonably practicable.
11.3 Application of Proceeds.
(a) Notwithstanding anything to the contrary contained in this Agreement or any
other Loan Document, (i) if the Administrative Agent takes action under
Section 8 upon the occurrence and during the continuance of an Event of Default,
or at any time on or after the Termination Date, any payment by any Debtor on
account of principal of, interest on and fees with respect to the Loans or
Reimbursement Obligations, or any guarantee obligations with respect thereto,
and any proceeds arising out of any realization (including after foreclosure)
upon the Collateral shall be applied in accordance with Section 8.2, and
(ii) any payments or distributions of any kind or character, whether in cash,
property or securities, made by any Debtor or otherwise in a manner inconsistent
with clause (i) of this Section 11.3(a) shall be held in trust and paid over or
delivered to the Administrative Agent so that the priorities and requirements
set forth in such clause (i) are satisfied.

 

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(b) It is understood that the Debtors shall remain liable to the extent of any
deficiency between the amount of the proceeds of the Collateral and the amount
of the Obligations.
11.4 WAIVER OF CLAIMS. EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, THE LOAN
PARTIES HEREBY WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW:
(a) NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE ADMINISTRATIVE AGENT’S
TAKING POSSESSION OR THE ADMINISTRATIVE AGENT’S DISPOSITION OF ANY OF THE
COLLATERAL, INCLUDING WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING
FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH THE US BORROWER,
OR ANY GUARANTOR WOULD OTHERWISE HAVE UNDER ANY REQUIREMENT OF LAW;
(b) ALL DAMAGES OCCASIONED BY SUCH TAKING OF POSSESSION EXCEPT ANY DAMAGES WHICH
ARE THE DIRECT RESULT OF THE ADMINISTRATIVE AGENT’S OR ANY LENDER’S BAD FAITH,
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT;
(c) ALL OTHER REQUIREMENTS WITH RESPECT TO THE TIME, PLACE AND TERMS OF SALE OR
OTHER REQUIREMENTS WITH RESPECT TO THE ENFORCEMENT OF THE ADMINISTRATIVE AGENT’S
RIGHTS HEREUNDER; AND
(d) ALL RIGHTS OF REDEMPTION, APPRAISEMENT, STAY, EXTENSION OR MORATORIUM NOW OR
HEREAFTER IN FORCE UNDER ANY APPLICABLE LAW IN ORDER TO PREVENT OR DELAY THE
ENFORCEMENT OF THIS AGREEMENT OR THE ABSOLUTE SALE OF THE COLLATERAL OR ANY
PORTION THEREOF, AND EACH LOAN PARTY, FOR ITSELF AND ALL WHO MAY CLAIM UNDER IT,
INSOFAR AS IT OR THEY NOW OR HEREAFTER LAWFULLY MAY, HEREBY WAIVES THE BENEFIT
OF ALL SUCH LAWS.

 

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11.5 Remedies Cumulative. Each and every right, power and remedy hereby
specifically given to the Administrative Agent and the Lenders shall be in
addition to every other right, power and remedy specifically given under this
Agreement, the Orders or the other Loan Documents or now or hereafter existing
at law or in equity, or by statute and each and every right, power and remedy
whether specifically herein given or otherwise existing may be exercised from
time to time or simultaneously and as often and in such order as may be deemed
expedient by the Administrative Agent or any Lender. All such rights, powers and
remedies shall be cumulative and the exercise or the beginning of exercise of
one shall not be deemed a waiver of the right to exercise of any other or
others. No delay or omission of the Administrative Agent or any Lender in the
exercise of any such right, power or remedy and no renewal or extension of any
of the Obligations shall impair any such right, power or remedy or shall be
construed to be a waiver of any Default or Event of Default or an acquiescence
therein. In the event that the Administrative Agent shall bring any suit to
enforce any of its rights hereunder and shall be entitled to judgment, then in
such suit the Administrative Agent may recover reasonable expenses, including
reasonable attorneys’ fees, and the amounts thereof shall be included in such
judgment.
11.6 Discontinuance of Proceeding. In case the Administrative Agent shall have
instituted any proceeding to enforce any right, power or remedy under this
Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall
have been discontinued or abandoned for any reason or shall have been determined
adversely to the Administrative Agent, then and in every such case the Borrower,
the Administrative Agent and each holder of any of the Obligations shall be
restored to their former positions and rights hereunder with respect to the
Collateral subject to the Liens granted under this Agreement and the Orders, and
all rights, remedies and powers of the Administrative Agent and the Lenders
shall continue as if no such proceeding had been instituted.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.

            NBC HOLDINGS CORP.
      By:           Name:           Title:      

            NBC ACQUISITION CORP.
      By:           Name:           Title:      

            NEBRASKA BOOK COMPANY, INC.
      By:           Name:           Title:      

 

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            JPMORGAN CHASE BANK, N.A.
as Administrative Agent and a Lender
      By:           Name:           Title:      

 

 

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SCHEDULE 1.1A
COMMITMENTS

                      Term Loan     Revolving Credit   Lender   Commitment    
Commitment  
JPMorgan Chase Bank, N.A.
  $ 125,000,000     $ 75,000,000  
 
               
TOTAL COMMITMENTS
  $ 125,000,000     $ 75,000,000