Exhibit 10.1

 

 

 

 

LOGO [g118719g66k92.jpg]

CREDIT AGREEMENT

dated as of

July 1, 2015

among

URBAN OUTFITTERS, INC.,

as the Company

The Subsidiaries from time to time party hereto,

as Subsidiary Borrowers

The other LOAN PARTIES party hereto

The LENDERS Party Hereto

and

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

 

J.P. MORGAN SECURITIES LLC and WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Joint Bookrunners and Joint Lead Arrangers

BANK OF AMERICA, N.A. and WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Co-Syndication Agents

HSBC BANK USA, NATIONAL ASSOCIATION,

as Documentation Agent

 

 

 

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TABLE OF CONTENTS

 

         Page  

ARTICLE I DEFINITIONS

     1   

Section 1.01

 

Defined Terms

     1   

Section 1.02

 

Classification of Loans and Borrowings

     47   

Section 1.03

 

Terms Generally

     47   

Section 1.04

 

Accounting Terms; GAAP

     48   

Section 1.05

 

Pro Forma Adjustments for Acquisitions and Dispositions

     49   

Section 1.06

 

Status of Obligations

     49   

Section 1.07

 

Exchange Rates; Currency Equivalents

     49   

ARTICLE II THE CREDITS

     49   

Section 2.01

 

Commitments

     49   

Section 2.02

 

Loans and Borrowings

     50   

Section 2.03

 

Requests for Borrowings

     51   

Section 2.04

 

Protective Advances

     51   

Section 2.05

 

Swingline Loans and Overadvances

     52   

Section 2.06

 

Letters of Credit

     54   

Section 2.07

 

Funding of Borrowings

     59   

Section 2.08

 

Interest Elections

     60   

Section 2.09

 

Termination and Reduction of Commitments; Increase in Commitments

     61   

Section 2.10

 

Repayment and Amortization of Loans; Evidence of Debt

     63   

Section 2.11

 

Prepayment of Loans

     63   

Section 2.12

 

Fees

     65   

Section 2.13

 

Interest

     66   

Section 2.14

 

Alternate Rate of Interest

     67   

Section 2.15

 

Increased Costs

     67   

Section 2.16

 

Break Funding Payments

     69   

Section 2.17

 

Withholding of Taxes; Gross-Up

     69   

Section 2.18

 

Payments Generally; Allocation of Proceeds; Sharing of Set-offs

     73   

Section 2.19

 

Mitigation Obligations; Replacement of Lenders

     75   

Section 2.20

 

Defaulting Lenders

     76   

 

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Section 2.21

 

Returned Payments

     77   

Section 2.22

 

Banking Services and Swap Agreements

     78   

Section 2.23

 

Access Rights

     78   

ARTICLE III REPRESENTATIONS AND WARRANTIES

     79   

Section 3.01

 

Organization; Powers

     79   

Section 3.02

 

Authorization; Enforceability

     79   

Section 3.03

 

Governmental Approvals; No Conflicts

     79   

Section 3.04

 

Financial Condition; No Material Adverse Change

     79   

Section 3.05

 

Properties

     79   

Section 3.06

 

Litigation and Environmental Matters

     80   

Section 3.07

 

Compliance with Laws and Agreements; No Default

     80   

Section 3.08

 

Investment Company Status

     80   

Section 3.09

 

Taxes

     80   

Section 3.10

 

ERISA

     81   

Section 3.11

 

Disclosure

     81   

Section 3.12

 

Reserved.

     81   

Section 3.13

 

Solvency

     81   

Section 3.14

 

Insurance

     82   

Section 3.15

 

Capitalization and Subsidiaries

     82   

Section 3.16

 

Security Interest in Collateral

     82   

Section 3.17

 

Employment Matters

     82   

Section 3.18

 

Federal Reserve Regulations

     83   

Section 3.19

 

Reserved

     83   

Section 3.20

 

No Burdensome Restrictions

     83   

Section 3.21

 

Anti-Corruption Laws and Sanctions

     83   

Section 3.22

 

Common Enterprise

     83   

Section 3.23

 

Credit Card Agreements

     83   

ARTICLE IV CONDITIONS

     84   

Section 4.01

 

Effective Date

     84   

Section 4.02

 

Each Credit Event

     87   

ARTICLE V AFFIRMATIVE COVENANTS

     88   

Section 5.01

 

Financial Statements; Borrowing Base and Other Information

     88   

Section 5.02

 

Notices of Material Events

     91   

 

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Section 5.03

 

Existence; Conduct of Business

     93   

Section 5.04

 

Payment of Obligations

     93   

Section 5.05

 

Maintenance of Properties

     93   

Section 5.06

 

Books and Records; Inspection Rights

     93   

Section 5.07

 

Compliance with Laws and Material Contractual Obligations

     94   

Section 5.08

 

Use of Proceeds

     94   

Section 5.09

 

Accuracy of Information

     94   

Section 5.10

 

Insurance

     94   

Section 5.11

 

Casualty and Condemnation

     95   

Section 5.12

 

Appraisals

     95   

Section 5.13

 

Depository Banks

     96   

Section 5.14

 

Additional Collateral; Further Assurances

     96   

Section 5.15

 

Designation of Subsidiaries

     96   

Section 5.16

 

Environmental Laws

     97   

Section 5.17

 

Credit Card Agreements and Notifications

     97   

Section 5.18

 

Post-Closing Obligations

     97   

ARTICLE VI NEGATIVE COVENANTS

     97   

Section 6.01

 

Indebtedness

     97   

Section 6.02

 

Liens

     100   

Section 6.03

 

Fundamental Changes; Changes in Name, Location

     102   

Section 6.04

 

Investments, Loans, Advances, Guarantees and Acquisitions

     103   

Section 6.05

 

Asset Sales

     104   

Section 6.06

 

Sale and Leaseback Transactions

     106   

Section 6.07

 

Swap Agreements

     106   

Section 6.08

 

Restricted Payments; Certain Payments of Indebtedness

     107   

Section 6.09

 

Transactions with Affiliates

     108   

Section 6.10

 

Restrictive Agreements

     108   

Section 6.11

 

Amendment of Material Documents

     108   

Section 6.12

 

Fixed Charge Coverage Ratio

     109   

Section 6.13

 

Disqualified Stock

     109   

ARTICLE VII EVENTS OF DEFAULT

     109   

ARTICLE VIII THE ADMINISTRATIVE AGENT

     112   

Section 8.01

 

Appointment

     112   

 

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Section 8.02

 

Rights as a Lender

     113   

Section 8.03

 

Duties and Obligations

     113   

Section 8.04

 

Reliance

     113   

Section 8.05

 

Actions through Sub-Agents

     113   

Section 8.06

 

Resignation

     114   

Section 8.07

 

Non-Reliance

     114   

Section 8.08

 

Other Agency Titles

     115   

Section 8.09

 

Not Partners or Co-Venturers; Administrative Agent as Representative of the
Secured Parties

     115   

Section 8.10

 

Flood Laws

     116   

Section 8.11

 

Additional Secured Parties

     116   

ARTICLE IX MISCELLANEOUS

     117   

Section 9.01

 

Notices

     117   

Section 9.02

 

Waivers; Amendments

     119   

Section 9.03

 

Expenses; Indemnity; Damage Waiver

     121   

Section 9.04

 

Successors and Assigns

     123   

Section 9.05

 

Survival

     127   

Section 9.06

 

Counterparts; Integration; Effectiveness; Electronic Execution

     127   

Section 9.07

 

Severability

     128   

Section 9.08

 

Right of Setoff

     128   

Section 9.09

 

Governing Law; Jurisdiction; Consent to Service of Process

     128   

Section 9.10

 

WAIVER OF JURY TRIAL

     129   

Section 9.11

 

Headings

     129   

Section 9.12

 

Confidentiality

     129   

Section 9.13

 

Several Obligations; Nonreliance; Violation of Law

     130   

Section 9.14

 

USA PATRIOT Act

     130   

Section 9.15

 

Disclosure

     130   

Section 9.16

 

Appointment for Perfection

     131   

Section 9.17

 

Interest Rate Limitation

     131   

Section 9.18

 

No Advisory or Fiduciary Responsibility

     131   

Section 9.19

 

Marketing Consent

     131   

Section 9.20

 

Authorization to Distribute Certain Materials to Public-Siders

     132   

Section 9.21

 

Judgment Currency

     132   

 

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ARTICLE X LOAN GUARANTY    132  

Section 10.01

 

Guaranty

     132   

Section 10.02

 

Guaranty of Payment

     133   

Section 10.03

 

No Discharge or Diminishment of Loan Guaranty

     133   

Section 10.04

 

Defenses Waived

     133   

Section 10.05

 

Rights of Subrogation

     134   

Section 10.06

 

Reinstatement; Stay of Acceleration

     134   

Section 10.07

 

Information

     134   

Section 10.08

 

Termination

     134   

Section 10.09

 

Taxes

     135   

Section 10.10

 

Maximum Liability

     135   

Section 10.11

 

Contribution

     135   

Section 10.12

 

Liability Cumulative

     136   

Section 10.13

 

Keepwell

     136   

ARTICLE XI THE BORROWER REPRESENTATIVE

     136   

Section 11.01

 

Appointment; Nature of Relationship

     136   

Section 11.02

 

Powers

     137   

Section 11.03

 

Employment of Agents

     137   

Section 11.04

 

Notices

     137   

Section 11.05

 

Successor Borrower Representative

     137   

Section 11.06

 

Execution of Loan Documents; Borrowing Base Certificate

     137   

Section 11.07

 

Reporting

     137   

 

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SCHEDULES:

Commitment Schedule

Schedule 3.06

  

–

  

Disclosed Matters

Schedule 3.15

  

–

  

Capitalization and Subsidiaries

Schedule 3.23

  

–

  

Credit Card Agreements

Schedule 5.18

  

–

  

Post-Closing Matters

Schedule 6.01

  

–

  

Existing Indebtedness

Schedule 6.02

  

–

  

Existing Liens

Schedule 6.04

  

–

  

Existing Investments

Schedule 6.10

  

–

  

Existing Restrictions

Schedule 9.01

  

–

  

Foreign Currency Notice Address

EXHIBITS:

Exhibit A

   –   

Form of Assignment and Assumption

Exhibit B

  

–

  

Form of Borrowing Base Certificate

Exhibit C

  

–

  

Reserved

Exhibit D

  

–

  

Form of Compliance Certificate

Exhibit E

  

–

  

Reserved

Exhibit F

  

–

  

Joinder Agreement

Exhibit G-1

  

–

  

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

Exhibit G-2

  

–

  

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

Exhibit G-3

  

–

  

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

Exhibit G-4

  

–

  

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

 

vi

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CREDIT AGREEMENT dated as of July 1, 2015, among URBAN OUTFITTERS, INC., a
Pennsylvania corporation (the “Company”), each of the Subsidiary Borrowers from
time to time party hereto, the other Loan Parties party hereto, the Lenders
party hereto, and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

The parties hereto agree as follows:

ARTICLE I

DEFINITIONS

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

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

“Account” has the meaning assigned to such term in the Security Agreement.

“Account Debtor” means any Person obligated to any Borrower under, with respect
to or on account of an Account or Credit Card Account.

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

“Adjusted Leverage Ratio” means, at any date, the ratio of (a) the sum of
(i) Total Funded Indebtedness on such date plus (ii) Rent Liability as of such
date, minus (iii) the aggregate amount of unrestricted cash and Cash Equivalents
of the Company and its Subsidiaries that would be reflected on a consolidated
balance sheet of the Company and its Subsidiaries in accordance with GAAP on
such date (other than the cash proceeds of any Indebtedness being incurred on
such date) in excess of $50,000,000, to (b) EBITDAR for the period of four
(4) consecutive fiscal quarters ended on such date (or, if such date is not the
last day of a fiscal quarter, ended on the last day of the fiscal quarter most
recently ended prior to such date).

“Adjusted LIBO Rate” means, with respect to any LIBOR Borrowing for any Interest
Period or for any ABR Borrowing, an interest rate per annum (rounded upwards, if
necessary, to the next 1/100 of 1%) equal to (a) the LIBO Rate for such Interest
Period multiplied by (b) the Statutory Reserve Rate.

“Administrative Agent” means JPMCB, in its capacity as administrative agent
hereunder and under the other Loan Documents, and including any of its
Affiliates (including, without limitation, J.P. Morgan Europe Limited)
performing any of the functions of the Administrative Agent at any time, and
their successors in such capacity as provided in Article VIII.

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

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

“Aggregate Commitments” means, at any time, the aggregate Commitments of all
Lenders, as increased or reduced from time to time pursuant to the terms and
conditions hereof. As of the Effective Date, the Aggregate Commitment is
$400,000,000.

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

“Agreement” means this Credit Agreement.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus  1⁄2 of 1% and (c) the Adjusted LIBO Rate for a
one month Interest Period on such day (or if such day is not a Business Day, the
immediately preceding Business Day) plus 1%, provided that, the Adjusted LIBO
Rate for any day shall be based on the LIBO Rate at approximately 11:00 a.m.
London time on such day, subject to the interest rate floor set forth in the
definition thereof (if any). Any change in the Alternate Base Rate due to a
change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO
Rate shall be effective from and including the effective date of such change in
the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate,
respectively. If the Alternate Base Rate is being used as an alternate rate of
interest pursuant to Section 2.14 hereof, then the Alternate Base Rate shall be
the greater of clause (a) and (b) above and shall be determined without
reference to clause (c) above.

“Alternative Currency” means any currency other than U.S. Dollars, Sterling,
Euros or Canadian Dollars.

“Anti-Corruption Laws” means all laws, rules, and regulations of any
jurisdiction applicable to any Borrower or its Subsidiaries from time to time
concerning or relating to bribery or corruption.

“Applicable Percentage” means, with respect to any Lender, a percentage equal to
a fraction the numerator of which is such Lender’s Commitment and the
denominator of which is the Aggregate Commitments provided that, if the
Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon such Lender’s share of the Aggregate Credit Exposure at
that time; provided that, in accordance with Section 2.20, so long as any Lender
shall be a Defaulting Lender, such Defaulting Lender’s Commitment shall be
disregarded in the calculations in this definition.

“Applicable Rate” means, for any day, with respect to any Loan, or with respect
to the commitment fees payable hereunder, the applicable rate per annum set
forth below under the caption “ABR Margin,” “LIBOR/CDOR/EURIBOR Margin” or
“Commitment Fee”, as the case may be, based upon the daily average Availability
(the “Average Quarterly Availability”) for the fiscal quarter of the Company
ending on the most recent Determination Date (as defined below) and the Adjusted
Leverage Ratio as of the most recent Determination Date, provided that until the
delivery to the Administrative Agent, pursuant to Section 5.01, of the Company’s
consolidated financial information for the Company’s

 

2

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first fiscal quarter ending after the Effective Date, the “Applicable Rate”
shall be the applicable rate per annum set forth below in Tier I, Level II:

 

   Tier I      

Adjusted Leverage

Ratio < 4.5 to 1.0

  

  

Level

  

Average Quarterly

Availability

   LIBOR / CDOR /
EURIBOR
Margin     ABR Margin     Commitment Fee  

I

  

> 66% of the Aggregate Commitments

     1.125 %      0.125 %      0.20 % 

II

  

< 66% of the Aggregate Commitments but > 33% of the Aggregate Commitments

     1.25 %      0.25 %      0.20 % 

III

  

< 33% of the Aggregate Commitments

     1.375 %      0.375 %      0.20 %     Tier II      

Adjusted Leverage

Ratio > 4.5 to 1.0

  

  

Level

  

Average Quarterly

Availability

   LIBOR / CDOR /
EURIBOR
Margin     ABR Margin     Commitment Fee  

I

  

> 66% of the Aggregate Commitments

     1.375 %      0.375 %      0.25 % 

II

  

< 66% of the Aggregate Commitments but > 33% of the Aggregate Commitments

     1.50 %      0.50 %      0.25 % 

III

  

< 33% of the Aggregate Commitments

     1.625 %      0.625 %      0.25 % 

; provided further that for any day during the Elective Pricing Period the
“Applicable Rate” with respect to any Elective Pricing Loan shall be 1.00% per
annum, and following the Elective Pricing Period, as otherwise set forth in this
definition.

For purposes of the foregoing, (a) the Applicable Rate shall be determined as of
the end of each fiscal quarter of the Company (each a “Determination Date”)
based upon the Borrowing Base Certificate delivered with respect to such
Determination Date and the Company’s annual or quarterly consolidated financial
statements delivered pursuant to Section 5.01 with respect to the fiscal quarter
ending on such Determination Date and (b) each change in the Applicable Rate
resulting from a change in the Average Quarterly Availability or the Adjusted
Leverage Ratio shall be effective during the period commencing on and including
the date that is the first day of the immediately succeeding calendar month
after the delivery to the Administrative Agent of the consolidated financial
statements for the most recent Determination Date and ending on the date
immediately preceding the effective date of the next such change; provided that
(x) if the Borrowers shall fail to deliver any Borrowing Base Certificate with

 

3

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respect to any Determination Date as and when due, at the option of the
Administrative Agent or at the request of the Required Lenders, Average
Quarterly Availability shall be deemed to be in Level III during the period from
the expiration of the time for delivery thereof until the date five (5) days
after such Borrowing Base Certificate is delivered, and (y) if the Borrowers
shall fail to deliver the annual or quarterly consolidated financial statements
required to be delivered by it pursuant to Section 5.01 with respect to any
Determination Date as and when due, at the option of the Administrative Agent or
at the request of the Required Lenders, the Adjusted Leverage Ratio shall be
deemed to be in Tier II during the period from the expiration of the time for
delivery thereof until the date five (5) days after such consolidated financial
statements are delivered.

If any financial statements or Borrowing Base Certificate shall prove to have
been inaccurate (regardless of whether any Commitments are in effect or any
amounts are outstanding hereunder when such inaccuracy is discovered), and such
inaccuracy shall have resulted in the payment or accrual of any interest or fees
at rates lower than those that would have been paid or accrued for any period,
then the Borrowers shall be required to pay within three (3) Business Days after
notice any additional amount that Borrowers would have been required to pay if
such financial statements had been accurate at the time they were delivered.

“Applicable Trigger Amount” means, with respect to any test of Availability
hereunder by reference to the Applicable Trigger Amount at a specified Level,
the following:

 

Level

       

Maximum Credit Amount

   Floor  

I

   Greatest of:    10.0% of the Maximum Credit Amount    $ 32,000,000   

II

   Greatest of:    12.5% of the Maximum Credit Amount    $ 40,000,000   

III

   Greatest of:    15.0% of the Maximum Credit Amount    $ 48,000,000   

IV

   Greatest of:    17.5% of the Maximum Credit Amount    $ 56,000,000   

V

   Greatest of:    20.0% of the Maximum Credit Amount    $ 64,000,000   

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

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

“Availability” means, at any time, an amount equal to the lesser of (a) the
Aggregate Commitments minus the Aggregate Credit Exposure, and (b) the Borrowing
Base minus the Aggregate Credit Exposure.

 

4

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

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

“Average Quarterly Availability” has the meaning assigned to such term in the
definition of “Applicable Rate”.

“Banking Services” means (a) each and any of the following bank services
provided to any Loan Party or its Subsidiaries by any Lender or any of its
Affiliates: (i) credit cards for commercial customers (including, without
limitation, “commercial credit cards” and purchasing cards), (ii) stored value
cards, (iii) merchant processing services, (iv) treasury management services
(including, without limitation, controlled disbursement, automated clearinghouse
transactions, return items, any direct debit arrangement, overdrafts and
interstate depository network services), and (v) foreign exchange and currency
management services, and (b) letters of credit issued under any Specified L/C
Facility so long as the issuer thereof is a Qualified Counterparty.

“Banking Services Obligations” means any and all obligations of the Loan Parties
and their Subsidiaries, 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.

“Banking Services/Swap Reserves” means, in respect of a specified Banking
Service Obligation or Swap Agreement Obligation, all reserves, if any, that the
Borrower Representative and the applicable provider of such Banking Service
Obligation or Swap Agreement Obligation agree shall be established with respect
thereto, to the extent the Administrative Agent receives a written notice of
such Banking Service Obligations or Swap Agreement Obligations in accordance
with Section 2.22 specifying the amount of such agreed reserves.

“Bankruptcy Code” means title 11 of the United States Code, as amended.

“Bankruptcy Event” means, with respect to any Person, when such Person becomes
the subject of a bankruptcy or insolvency proceeding, or has had a receiver,
interim receiver, monitor, 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, unless such ownership interest results in or provides
such Person with immunity from the jurisdiction of courts within the U.S. or
from the enforcement of judgments or writs of attachment on its assets or
permits such Person (or such Governmental Authority or instrumentality), to
reject, repudiate, disavow or disaffirm any contracts or agreements made by such
Person.

“Beneficial Owner” means, with respect to any U.S. Federal withholding Tax, the
beneficial owner, for U.S. Federal income tax purposes, to whom such Tax
relates.

“Board” means the Board of Governors of the Federal Reserve System of the U.S.

 

5

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

“Borrowers” means, individually and collectively as the context may require, the
Company and each Subsidiary Borrower.

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

“Borrowing Base” means, at any time, the sum of:

(a) the product of (i) 85% multiplied by (ii) the Eligible Trade Accounts of the
Borrowers at such time, plus

(b) the product of (i) 90% multiplied by (ii) the Eligible Credit Card Accounts
of the Borrowers at such time, plus

(c) the product of the Inventory Advance Percentage multiplied by the Net
Orderly Liquidation Value percentage identified in the most recent inventory
appraisal ordered and received by the Administrative Agent multiplied by the
Borrowers’ Eligible Inventory at such time, valued at the lower of cost or
market value, determined utilizing the retail method or such other method
approved in writing by the Administrative Agent (the amount resulting from the
foregoing calculation, the “Inventory Availability”), plus

(d) the product of the Inventory Advance Percentage multiplied by the Net
Orderly Liquidation Value percentage identified in the most recent inventory
appraisal ordered and received by the Administrative Agent multiplied by the
Borrowers’ Eligible In-Transit Inventory at such time, valued at the lower of
cost or market value, determined utilizing the retail method or such other
method approved in writing by the Administrative Agent provided that the dollar
amount included under this clause (d) shall not at any time exceed an amount
equal to ten percent (10%) of Inventory Availability, minus

(e) Reserves.

Subject to the provisions set forth in this Agreement expressly permitting the
Administrative Agent to adjust Reserves, 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 5.01(g) (or, prior to the first
such delivery, delivered to the Administrative Agent pursuant to
Section 4.01(m)). After an Event of Default, the Administrative Agent may, in
its Permitted Discretion, reduce the advance rates set forth above or reduce one
or more of the other elements used in computing the Borrowing Base.

“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer of the Borrower Representative, in
substantially the form of Exhibit B (with such changes thereto as may be
required by the Administrative Agent in its Permitted Discretion from time to
time to reflect the components of the Borrowing Base and Reserves as provided
for hereunder) or another form that is acceptable to the Administrative Agent in
its Permitted Discretion.

“Borrowing Base Reporting Date” means (a) during any period other than a period
set forth in clause (b) below, on the twentieth day (or the next Business Day if
the twentieth day is not a Business Day) after each of (i) the end of each
fiscal quarter of the Company and (ii) the end of each fiscal month in which any
Revolving Loans were outstanding or the LC Exposure was at any time $40,000,000
or more, and (b) during any period (i) commencing on the date when Availability
is less than the Applicable

 

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Trigger Amount (Level II) and (ii) ending on the date when Availability shall
have been equal to or greater than the Applicable Trigger Amount (Level II) for
a period of 60 consecutive days, four (4) Business Days after the end of each
week.

“Borrowing Request” means a request by the Borrower Representative for a
Borrowing in accordance with Section 2.03, which shall be, in the case of any
such written request, in a form approved by the Administrative Agent.

“Burdensome Restrictions” means any consensual encumbrance or restriction of the
type described in clause (a) or (b) of Section 6.10.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that (a) when used in connection with a LIBOR Loan in
any currency, the term “Business Day” shall also exclude any day on which banks
are not open for dealings in deposits in such currency in the London interbank
market, (b) when used in connection with a EURIBOR Loan, the term “Business Day”
shall also exclude any day on which the TARGET payment system is not open for
the settlement of payments in Euros and (c) when used in connection with a CDOR
Loan, the term “Business Day” shall also exclude any day on which banks are not
open for business in Toronto or London.

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

“Capital Expenditures” means, without duplication, any expenditure or commitment
to expend money for any purchase or other acquisition of any asset which would
be classified as a fixed or capital asset on a consolidated balance sheet of the
Company and its Subsidiaries prepared in accordance with GAAP.

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

“Cash Collateralize” has the meaning assigned to such term in Section 2.06(j).
Derivatives of such term have corresponding meanings.

“Cash Equivalents” means:

(a) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the U.S. (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the U.S.), in
each case maturing within two years from the date of acquisition thereof;

(b) investments in commercial paper maturing within 270 days from the date of
acquisition thereof and having, at such date of acquisition, a rating of at
least A-2 or P-2 from S&P or Moody’s (or, if at any time neither S&P nor Moody’s
shall be rating such obligations, then the highest rating from such other
nationally recognized rating services acceptable to the Administrative Agent);

(c) investments in certificates of deposit, bankers’ acceptances and time
deposits maturing within 180 days from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the laws
of the U.S. or any State thereof which has a combined capital and surplus and
undivided profits of not less than $500,000,000;

 

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(d) in the case of any Foreign Subsidiary, obligations and securities of any
foreign Governmental Authority or financial institution meeting substantially
similar criteria as set forth above;

(e) repurchase agreements maturing within 365 days from the date of acquisition
thereof for securities described in clause (a) above and entered into with any
Lender or any commercial bank satisfying the criteria described in clause (c)
above;

(f) money market funds that (i) comply with the criteria set forth in Securities
and Exchange Commission Rule 2a-7 under the Investment Company Act of 1940,
(ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of
at least $5,000,000,000;

(g) marketable direct obligations issued by any state of the U.S., or by the
Canadian federal government, or any province, commonwealth or territory of
Canada, or any political subdivision of any such state, province, commonwealth
or territory or any public instrumentality thereof, in each case maturing within
two years after the date of acquisition thereof and, at the time of acquisition,
in each case having the highest rate obtainable from either S&P or Moody’s (or,
if at any time neither S&P nor Moody’s shall be rating such obligations, then
the highest rating from such other nationally recognized rating services
acceptable to the Administrative Agent), and in the case of any Foreign
Subsidiary, other short-term investments that are (i) analogous to the
foregoing, (ii) comparable credit quality and (iii) customarily used by
companies in the jurisdiction of such Foreign Subsidiary for cash management
purposes;

(h) overnight investments with any Lender or any commercial bank satisfying the
criteria described in clause (c) above; and

(i) other instruments as readily marketable as the investments (and as limited
in duration if time instruments) as described in clause (c) above issued or sold
by any Lender or any commercial bank satisfying the criteria described in clause
(c) above.

“CDOR Loan” or “CDOR Borrowing” when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the CDOR Rate.

“CDOR Rate” means, with respect to any CDOR Borrowing for any Interest Period,
the applicable Screen Rate as of the Specified Time on the Quotation Day.

“CFC” means each Person that is a “controlled foreign corporation” within the
meaning of Section 957(a) of the Code.

“CFC Holdco” means a Domestic Subsidiary with no material assets other than
equity interests of one or more Foreign Subsidiaries that are CFCs.

“Change in Control” means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the SEC
thereunder as in effect on the date hereof) but excluding the Control Group, of
Equity Interests representing more than 50% of the aggregate ordinary voting
power represented by the issued and outstanding Equity Interests of the Company;
(b) the Company shall cease to own, directly or indirectly, at least 100% of the
outstanding voting Equity Interests of the other Loan Parties on a fully diluted
basis, or (c) any “change of control” or similar concept occurs under any
agreement governing Material Indebtedness.

 

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

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

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

“Collateral” means any and all property owned, leased or operated by a Person
covered by the Collateral Documents and any and all other property of any Loan
Party, now existing or hereafter acquired, that may at any time be, become or be
intended (pursuant to and in accordance with the terms of any Collateral
Document) to be, subject to a security interest or Lien in favor of the
Administrative Agent, on behalf of itself and the Lenders and other Secured
Parties, to secure the Secured Obligations.

“Collateral Access Agreement” has the meaning assigned to such term in the
Security Agreement.

“Collateral and Guaranty Requirement” means, at any time, the requirement that:

(a) the Administrative Agent shall have received from the Company and each
Designated Subsidiary either (i) in the case of the Company and each Designated
Subsidiary that is a Domestic Subsidiary, a counterpart of this Agreement and
the Security Agreement, duly executed and delivered on behalf of such Person, or
(ii) in the case of any Person that becomes a Designated Subsidiary after the
Effective Date, (A) a Joinder Agreement, duly executed and delivered on behalf
of such Person, and (B) instruments in the form or forms specified in the
Security Agreement under which such Person becomes a party to the Security
Agreement, duly executed and delivered on behalf of such Person, together with
such certificates, documents and opinions with respect to such Designated
Subsidiary as may reasonably be requested by the Administrative Agent;

(b) The Administrative Agent shall have received all Collateral Access
Agreements, Control Agreements and other Collateral Documents required to be
provided to it hereunder or under the applicable Security Agreement;

(c) all Equity Interests owned by or on behalf of any Loan Party shall have been
pledged pursuant to, and to the extent required by, the Security Agreement and,
in the case of Equity Interests entitled to vote (within the meaning of Treas.
Reg. Section 1.956-2(c)(2)) in any CFC or CFC Holdco owned by a Loan Party, the
Loan Party shall not be required to pledge more than 65% of such Equity

 

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Interests entitled to vote of any such CFC or CFC Holdco to the extent a pledge
of a greater percentage could reasonably be expected to result in adverse tax
consequences to the Company, and the Administrative Agent shall, to the extent
required by the Security Agreement, have received certificates or other
instruments representing all such certificated Equity Interests, together with
undated stock powers or other instruments of transfer with respect thereto
endorsed in blank;

(d) all documents and instruments, including UCC financing statements required
by the Collateral Documents or this Agreement with the priority required by the
Collateral Documents shall have been filed, registered or recorded or delivered
to the Administrative Agent for filing, registration or recording; and

(e) each Loan Party shall have obtained all material consents and approvals
required in connection with the execution and delivery of all Collateral
Documents to which it is a party and the performance of its obligations
thereunder.

Notwithstanding the foregoing, any Designated Subsidiary formed or acquired
after the Effective Date shall not be required to comply with the foregoing
requirements prior to the time specified in Section 5.14. The foregoing
definition shall not require the creation or perfection of pledges of or
security interests in, or legal opinions or other deliverables with respect to,
particular assets of the Loan Parties, or the provision of Guarantees by any
Subsidiary, if and for so long as the Administrative Agent, in consultation with
the Company, determines that the cost of creating or perfecting such pledges or
security interests in such assets, or obtaining legal opinions or other
deliverables in respect of such assets, or providing such Guarantees, shall be
excessive in view of the benefits to be obtained by the Lenders therefrom. The
Administrative Agent may in its sole discretion grant extensions of time for the
creation and perfection of security interests in, or the delivery of legal
opinions or other deliverables with respect to, particular assets or the
provision of any Guarantee by any Subsidiary (including extensions beyond the
Effective Date or in connection with assets acquired, or Subsidiaries formed or
acquired, after the Effective Date) where it determines that such action cannot
be accomplished without unreasonable effort or expense by the time or times at
which it would otherwise be required to be accomplished by this Agreement or the
Collateral Documents. Notwithstanding the foregoing, no action required to be
taken by any Person to effect compliance by the Administrative Agent and the
Lenders with any applicable Requirement of Law shall be deemed to cause
unreasonable effort or expense hereunder.

“Collateral Documents” means, collectively, the Security Agreements, any
Intercreditor Agreement, any Control Agreement, any Collateral Access Agreement,
and any other agreements, instruments and documents executed in connection with
this Agreement that are intended to create, perfect or evidence Liens to secure
the Secured Obligations, including, without limitation, all other security
agreements, pledge agreements, loan agreements, notes, guarantees, subordination
agreements, pledges and assignments, whether theretofore, now or hereafter
executed by any Loan Party and delivered to the Administrative Agent.

“Collateral-Related Property” has the meaning assigned to such term in
Section 2.23.

“Commercial LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn Dollar Amount of all outstanding commercial Letters of Credit plus
(b) the aggregate Dollar Amount of all LC Disbursements relating to commercial
Letters of Credit that have not yet been reimbursed by or on behalf of the
Borrowers. The Commercial LC Exposure of an Issuing Bank (in its capacity as
such) shall be the Commercial LC Exposure in respect of commercial Letters of
Credit issued by such Issuing Bank. The Commercial LC Exposure of any Lender at
any time shall be its Applicable Percentage of the aggregate Commercial LC
Exposure at such time. Commercial letters of credit issued under a Specified L/C
Facility shall not constitute Letters of Credit, and amounts thereunder (whether
undrawn or drawn but unreimbursed) shall not constitute Commercial LC Exposure.

 

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“Commitment” means, with respect to each Lender, the commitment, if any, of such
Lender to make Revolving Loans and to acquire participations in Letters of
Credit, Overadvances, Protective Advances and Swingline Loans hereunder,
expressed as an amount representing the maximum aggregate permitted amount of
such Lender’s Revolving Exposure hereunder, as such commitment may be reduced or
increased from time to time pursuant to (a) Section 2.09 and (b) assignments by
or to such Lender pursuant to Section 9.04. The initial amount of each Lender’s
Commitment is set forth on the Commitment Schedule, or in the Assignment and
Assumption pursuant to which such Lender shall have assumed its Commitment, as
applicable.

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

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

“Communications” has the meaning assigned to such term in Section 9.01(d).

“Company” means Urban Outfitters, Inc., a Pennsylvania corporation.

“Compliance Certificate” means a certificate executed by a Financial Officer of
the Borrower Representative in substantially the form of Exhibit D.

“Concentration Account” has the meaning assigned to such term in the Security
Agreement.

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

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

“Control Agreement” means, with respect to any deposit account, securities
account, commodity account, securities entitlement or commodity contract, an
agreement, in form and substance reasonably satisfactory to Administrative
Agent, among Administrative Agent, the financial institution or other Person at
which such account is maintained or with which such entitlement or contract is
carried and the applicable Loan Party (by virtue of such Loan Party maintaining
such account or owning such entitlement or contract), effective to grant
“control” (within the meanings of Articles 8 and 9 under the applicable UCC)
over such account to Administrative Agent.

“Control Group” means Richard A. Hayne and Margaret A. Hayne and any lineal
descendant thereof and any trust created for the benefit of Mr. Hayne,
Mrs. Hayne or any lineal descendant.

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

 

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“Credit Card Accounts” means any “payment intangibles”, as defined in the UCC,
or receivables due to any Borrower from a credit card issuer or a credit card
processor in connection with purchases of Inventory of such Borrower in the
ordinary course of business on (a) credit cards issued by Visa, MasterCard,
American Express, Discover, PayPal, each of their respective Affiliates, and any
other credit card issuers that are reasonably acceptable to the Administrative
Agent, (b) private label credit cards of any Borrower issued under non-recourse
arrangements substantially similar to those in effect on the Effective Date or
(c) debit cards and mall cards issued by issuers or providers that are
reasonably acceptable to the Administrative Agent, in each case under this
definition, which have been earned by performance by such Borrower but not yet
paid to such Borrower by such credit card issuer or credit card processor.

“Credit Card Agreement” means any agreement between a Borrower, on the one hand,
and a credit card issuer or a credit card processor (including any credit card
processor that processes purchases of Inventory from a Borrower through debit
cards or mall cards), on the other hand relating to any Credit Card Account
included or intended to be included in the Borrowing Base.

“Credit Card Notifications” means each credit card notification, in form and
substance reasonably satisfactory to the Administrative Agent, executed by one
or more Borrowers and delivered by such Borrowers to credit card issuers or
credit card processors that are party to any Credit Card Agreement.

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

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

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

“Deposit Account” has the meaning assigned to such term in the Security
Agreement.

“Designated Currency” means, in relation to any Loan or Borrowing, any currency
(a) that is freely transferable and convertible into U.S. Dollars in the London
interbank market, (b) for which LIBO Rates can be determined by reference to the
applicable Reuters screen as provided in the definition of “LIBO Rate” and
(c) that has been designated by the Administrative Agent as a Designated
Currency at the request of the Borrower Representative and with the consent of
each Lender.

 

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“Designated Subsidiary” means each Subsidiary other than any Excluded
Subsidiary.

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

“Disqualified Stock” means any Equity Interests which, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, (a) matures (excluding any
maturity as the result of an optional redemption by the issuer thereof) or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof, in whole or in part, or
requires the payment of any cash dividend or any other scheduled payment
constituting a return of capital, in each case at any time on or prior to the
first anniversary of the Maturity Date, or (b) is convertible into or
exchangeable (unless at the sole option of the issuer thereof) for (i) cash,
(ii) debt securities or (iii) any Equity Interests referred to in (a) above, in
each case at any time prior to the first anniversary of the Maturity Date.
Notwithstanding the foregoing, any Equity Interests that would constitute
Disqualified Stock solely because holders of the Equity Interests have the right
to require the issuer of such Equity Interests to repurchase such Equity
Interests upon the occurrence of a change of control or an asset sale will not
constitute Disqualified Stock if the terms of such Equity Interests provide that
the issuer may not repurchase or redeem any such Equity Interests pursuant to
such provisions unless such repurchase or redemption is permitted under the
terms of this Agreement.

“Document” has the meaning assigned to such term in the Security Agreement.

“Dollar Amount” means (a) with regard to any Obligation or calculation
denominated in U.S. Dollars, the amount thereof, and (b) with regard to any
Obligation or calculation denominated in any other currency, the amount of U.S.
Dollars which is equivalent to the amount so expressed in such currency at the
Spot Rate on the relevant date of determination.

“Domestic Subsidiary” means a Subsidiary organized under the laws of a
jurisdiction located in the U.S. (which, subject to the other provisions of this
Agreement, shall be deemed to include URBN Puerto Rico Retail LLC).

“Dominion Period” means (a) any period during which any Event of Default has
occurred and is continuing or (b) any period (i) commencing at any time when
Availability shall be less than the Applicable Trigger Amount (Level I), and
(ii) ending when Availability shall have been greater than the Applicable
Trigger Amount (Level I) for a period of 30 consecutive days; provided that no
more than two (2) Dominion Periods may end in any consecutive twelve (12) month
period.

“EBITDA” means, for any period, for the Company and its Subsidiaries on a
consolidated basis, an amount equal to Net Income for such period, plus

(a) the following without duplication and to the extent deducted in calculating
such Net Income:

(i) Interest Expense for such period;

 

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(ii) the provision for Federal, state, local and foreign income taxes (excluding
Federal, state, local and foreign income tax credits of the Company) payable by
the Company and its Subsidiaries for such period;

(iii) depreciation and amortization expense;

(iv) non-cash compensation expenses;

(v) non-recurring non-cash charges (including asset impairment charges,
unrealized foreign currency losses or other unrealized hedge agreement losses,
but for avoidance of doubt, excluding recurring non-cash charges, such as
non-cash charges that relate to the write-down or write-off of inventory) for
such period;

(vi) other non-recurring losses, costs, charges, or cash expenses (including
without limitation restructuring, business optimization costs, charges or
reserves (including any unusual or non-recurring operating expenses directly
attributable to the implementation of cost savings initiatives), and
non-recurring severance, relocation, consolidation, transition, integration or
other similar charges and expenses in an amount not to exceed $25,000,000 in the
aggregate for such period;

(vii) costs, fees, expenses, premiums or penalties incurred during such period
in connection with Acquisitions (whether or not consummated) and permitted asset
sales (whether or not consummated) in an amount not to exceed $5,000,000 in the
aggregate for such period, other than asset sales effected in the ordinary
course of business;

(viii) costs, fees, and expenses incurred in connection with the Transactions;
and minus

(b) the following without duplication and to the extent included in calculating
such Net Income:

(i) Federal, state, local and foreign income tax credits of the Company and its
Subsidiaries for such period;

(ii) all non-recurring non-cash items increasing Net Income for such period
(including, without limitation, foreign currency gains, but excluding normal
accruals in the ordinary course of business);

(iii) all non-recurring cash gains of the Company and its Subsidiaries
increasing Net Income for such period;

(iv) interest income for such period; and

(v) any cash payments for such period that were deducted in determining Net
Income and added back in determining EBITDA in such testing period or a previous
testing period under clause (a)(v) above.

For purposes of calculating EBITDA (except for purposes of determining
compliance with Section 6.12) for any period in connection with the
determination of whether the Payment Conditions have been satisfied, if during
any period the Company or any Subsidiary shall have consummated a Pro Forma
Event since the first day of such period, EBITDA for such period shall be
calculated on a Pro Forma Basis after giving effect thereto.

 

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“EBITDAR” means, for any period, for the Company and its Subsidiaries on a
consolidated basis, the sum of EBITDA plus Rentals.

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

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

“Elective Pricing Loan” means each Revolving Loan denominated in U.S. Dollars
designated as an Elective Pricing Loan in writing by the Company to the
Administrative Agent; provided that such designation shall be made prior to the
nine month anniversary of the Effective Date, and the Company may only provide
one such written notice of designation during the term of this Agreement (which
written notice may designate multiple Revolving Loans each as an Elective
Pricing Loan); provided further that the aggregate principal amount of Elective
Pricing Loans shall not exceed $100,000,000, and, for the avoidance of doubt,
Elective Pricing Loans, once repaid, cannot be reborrowed as Elective Pricing
Loans. Elective Pricing Loans shall constitute LIBOR Borrowings.

“Elective Pricing Period” means the period from the date on which one or more
Revolving Loans are designated as Elective Pricing Loans until and including the
eighteen month anniversary of the date of such designation.

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

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

“Eligible Credit Card Accounts” means at the time of any determination thereof,
each Credit Card Account of a Borrower that satisfies the following criteria at
the time of creation and continues to meet the same at the time of such
determination: such Credit Card Account (i) has been earned by performance and
represents the bona fide amounts due to a Borrower from a credit card issuer or
credit card processor, and in each case is originated in the ordinary course of
business of such Borrower, and (ii) in each case is not ineligible for inclusion
in the calculation of the Borrowing Base pursuant to any of clauses (a) through
(p) below. Without limiting the foregoing, to qualify as an Eligible Credit Card
Account, such Credit Card Account shall indicate no Person other than a Borrower
as payee or remittance party. Any Credit Card Account included within any of the
following categories shall not constitute an Eligible Credit Card Account:

(a) which is not earned or does not represent the bona fide amount due to a
Borrower from a credit card processor or a credit card issuer that originated in
the ordinary course of business of the applicable Borrower;

(b) which is not owned by a Borrower or to which a Borrower does not have good
or marketable title;

 

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(c) in which the payee of such Credit Card Account is a Person other than a
Borrower;

(d) which does not constitute an “Account” (as defined in the UCC) or a “Payment
Intangible” (as defined in the UCC);

(e) which has been outstanding for more than five (5) Business Days (or, in the
case of American Express, ten (10) calendar days) from the date of sale;

(f) with respect to which the applicable credit card issuer, credit card
processor or debit card or mall card issuer or provider has (i) applied for,
suffered, or consented to the appointment of any receiver, interim receiver,
custodian, trustee, monitor, administrator, sequestrator or liquidator of its
assets, (ii) has had possession of all or a material part of its property taken
by any receiver, interim receiver, custodian, trustee, monitor, administrator,
sequestrator or liquidator, (iii) filed, or had filed against it (but only so
long as any such involuntary filing has not been stayed or vacated), any request
or petition for liquidation, reorganization, arrangement, adjustment of debts,
adjudication as bankrupt, winding-up, or voluntary or involuntary case under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect, (iv) has admitted in writing its inability, or is
generally unable to, pay its debts as they become due, (v) become insolvent or
(vi) ceased operation of its business;

(g) which is not a valid, legally enforceable obligation of the applicable
credit card issuer or credit card processor with respect thereto;

(h) which is not subject to a duly perfected first priority security interest in
favor of the Administrative Agent (for the benefit of the Secured Parties);

(i) which is subject to any Lien, other than (i) a Lien in favor of the
Administrative Agent (for the benefit of the Secured Parties), (ii) any
Permitted Encumbrances contemplated by the applicable processor agreements and
for which appropriate Reserves (as determined by the Administrative Agent in its
Permitted Discretion) have been established and (iii) Liens securing Permitted
Term Loan Indebtedness that are subject to an Intercreditor Agreement and which
do not have priority over the Lien in favor of the Administrative Agent;

(j) with respect to which (i) (x) any covenant has been breached or (y) any
other representation or warranty is not true in all material respects to the
extent contained in this Agreement or the Security Agreement, it being
acknowledged that any representation or warranty as to eligibility under this
definition shall not be deemed qualified by materiality except as and to the
extent expressly so stated in another provision of this definition, or
(ii) (x) any covenant has been breached or (y) any representation or warranty is
not true in all material respects to the extent contained in the Credit Card
Agreements relating to such Credit Card Account, provided that each such
representation and warranty shall be true and correct in all respects to the
extent already qualified by a materiality standard;

(k) which is subject to risk of set-off, recoupment, non-collection or not being
processed due to unpaid and/or accrued credit card processor fee balances, to
the extent of the lesser of the balance of the applicable Credit Card Account or
the unpaid credit card processor fees;

(l) which is evidenced by “chattel paper” or an “instrument” of any kind unless
such “chattel paper” or “instrument” is in the possession of the Administrative
Agent, and to the extent necessary or appropriate, endorsed to the
Administrative Agent;

 

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(m) which the Administrative Agent in its Permitted Discretion determines may
not be paid by reason of the applicable credit card processor’s, credit card
issuer’s or debit card or mall card issuer’s or provider’s inability to pay;

(n) which represents a deposit or partial payment in connection with the
purchase of Inventory of such Borrower;

(o) which is not subject to a Credit Card Notification; or

(p) which does not meet such other eligibility criteria for Credit Card Accounts
as the Administrative Agent in its Permitted Discretion may determine from time
to time; provided, however, that the Administrative Agent shall not add any
additional eligibility criteria (or amend any then-existing eligibility criteria
to make the same more restrictive) without giving at least four (4) Business
Days’ prior notice to the Borrower Representative; provided further that, if
after the delivery of such notice the Borrower Representative notifies the
Administrative Agent that it desires to discuss the changes described therein,
then the Administrative Agent will discuss such changes with the Borrower
Representative, provided that nothing in this proviso shall obligate the
Administrative Agent to eliminate, reduce, or delay any such changes.

In determining the amount of an Eligible Credit Card Account of a Borrower, the
face amount of a Credit Card Account may, in the Administrative Agent’s
Permitted Discretion, be reduced by, without duplication, to the extent not
reflected in such face amount, (i) the amount of all accrued and actual fees,
expenses and charges due to the credit card issuer or credit card processor by
any Borrower, discounts, claims, credits or credits pending, promotional program
allowances, price adjustments, finance charges or other allowances (including
any amount that a Borrower may be obligated to rebate to a customer, a credit
card issuer or credit card processor pursuant to the terms of any agreement or
understanding (written or oral)) and (ii) the aggregate amount of all cash
received in respect of such Credit Card Account but not yet applied by the
Borrowers to reduce the amount of such Credit Card Account.

“Eligible In-Transit Inventory” means, as of the date of determination thereof,
without duplication, Inventory of a Borrower that, except as otherwise agreed by
the Administrative Agent in its Permitted Discretion, meets each of the
following criteria:

(a) the Administrative Agent shall have received, if requested, (1) a true and
correct copy of the bill of lading and other shipping documents for such
Inventory unless the Administrative Agent has entered into a duly executed
Collateral Access Agreement, in form and substance satisfactory to the
Administrative Agent, from the applicable freight forwarder for such Inventory
and (2) evidence of satisfactory casualty insurance naming the Administrative
Agent as lender loss payee and otherwise covering such risks as the
Administrative Agent may reasonably request;

(b) if the bill of lading is non-negotiable, the Inventory must be in transit
within the U.S. (or in transit from outside the U.S., if approved by the
Administrative Agent in writing) and the Administrative Agent shall have entered
into or delivered, if requested, a duly executed Collateral Access Agreement, in
form and substance satisfactory to the Administrative Agent, with or to the
applicable customs broker, freight forwarder or carrier for such Inventory;

(c) except as otherwise approved in writing by the Administrative Agent, (i) if
the bill of lading is negotiable, the inventory must be in transit from outside
the U.S., and (ii) whether the bill of lading is negotiable or non-negotiable,
the Administrative Agent shall have received (1) confirmation that the bill is
issued in the name of such Borrower and consigned to the order of the
Administrative Agent (or any other agent designated by the Administrative
Agent), (2) an acceptable agreement that has been

 

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executed with such Borrower’s customs broker, in which the customs broker agrees
that it holds any negotiable bill as agent for the Administrative Agent and has
granted the Administrative Agent access to the Inventory, (3) an estimate from
such Borrower of the customs duties and customs fees associated with the
Inventory in order to establish an appropriate Reserve, and (4) the
Administrative Agent shall have received confirmation that title to such
Inventory shall have passed to such Borrower and the Borrower shall be the sole
owner of such Inventory, and if the goods were covered by a commercial letter of
credit that such Borrower has paid for the goods;

(d) the common carrier is not an Affiliate of the applicable vendor or supplier;

(e) the customs broker is not an Affiliate of any Borrower;

(f) such Inventory has not been in-transit for more than 45 days from the date
such Inventory first became Eligible Inventory; and

(g) such Inventory satisfies all of the criteria for Eligible Inventory (except
the criteria in clauses (g) and (i)(ii) of the definition of “Eligible
Inventory”).

“Eligible Inventory” means, as of the date of determination thereof, without
duplication, items of Inventory of a Borrower that are finished goods,
merchantable and readily saleable in the ordinary course of such Borrower’s
business, in each case in this definition that is not excluded as ineligible by
virtue of one or more of the criteria set forth below. Eligible Inventory shall
not include any Inventory:

(a) which is not subject to a first priority perfected Lien in favor of the
Administrative Agent (for the benefit of the Secured Parties);

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent (for the benefit of the Secured Parties), (ii) a Permitted
Encumbrance which does not have priority over the Lien in favor of the
Administrative Agent (for the benefit of the Secured Parties) and (iii) Liens
securing Permitted Term Loan Indebtedness that are subject to an Intercreditor
Agreement and which do not have priority over the Lien in favor of the
Administrative Agent;

(c) which is slow moving (unless otherwise covered by a current appraisal
acceptable to the Administrative Agent), obsolete, unmerchantable, defective,
used, unfit for sale, unacceptable due to age, type, category and/or quantity or
which was not able to be valued under any appraisal conducted from time to time;

(d) (i) with respect to which any covenant, other representation or warranty
contained in this Agreement or in the Security Agreement has been breached or is
not true in any material respect (or with respect to any representation or
warranty that is already qualified by materiality, such representation and
warranty is untrue), it being acknowledged that any representation or warranty
as to eligibility under this definition shall not be deemed qualified by
materiality except as and to the extent expressly so stated in another provision
of this definition, or (ii) which does not conform in all material respects to
all standards imposed by any applicable Governmental Authority;

(e) in which any Person other than such Borrower shall (i) have any direct or
indirect ownership, interest or title or (ii) be indicated on any purchase order
or invoice with respect to such Inventory as having or purporting to have an
interest therein;

(f) which is not finished goods or which constitutes work-in-progress, raw
materials, spare or replacement parts, packaging and shipping material,
manufacturing supplies, samples, prototypes,

 

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displays or display items, bill-and-hold or ship-in-place goods, goods that are
returned or marked for return, repossessed goods, defective or damaged goods,
goods held on consignment, or goods which are not of a type held for sale in the
ordinary course of business (for the avoidance of doubt, sales in the ordinary
course of business includes clearance sales);

(g) which (i) is not located in the U.S., or (ii) is In-Transit Inventory;

(h) which is located in any location leased by such Borrower (other than any
retail store of such Borrower located in a jurisdiction that does not provide
for a common law or statutory landlord’s lien on the personal property of
tenants that would be prior or superior to the Liens of the Administrative
Agent) unless (i) the lessor has delivered to the Administrative Agent a
Collateral Access Agreement or (ii) a Reserve has been established by the
Administrative Agent in its Permitted Discretion;

(i) which is (i) located in any third party warehouse or is in the possession of
a bailee (other than a third party processor) unless (A) such warehouseman or
bailee has delivered to the Administrative Agent a Collateral Access Agreement
and such other documentation as the Administrative Agent may require or (B) an
appropriate Reserve has been established by the Administrative Agent in its
Permitted Discretion, or (ii) evidenced by a negotiable Document;

(j) which is being processed offsite at a third party location or outside
processor, or is in-transit to or from such third party location or outside
processor;

(k) which is the subject of a consignment by such Borrower as consignor;

(l) which contains or bears any intellectual property rights licensed to such
Borrower unless the Administrative Agent is satisfied that it may sell or
otherwise dispose of such Inventory without (i) infringing the rights of such
licensor, (ii) violating any contract with such licensor, or (iii) incurring any
liability with respect to payment of royalties other than royalties incurred
pursuant to sale of such Inventory under the current licensing agreement;

(m) which is not reflected in a current perpetual inventory report of such
Borrower (unless such Inventory is reflected in a report to the Administrative
Agent as “in transit” Inventory);

(n) for which reclamation rights have been asserted by the seller;

(o) which has been acquired from a Sanctioned Person;

(p) which has been designated or demanded to be returned to or retained by the
applicable vendor or which has been recognized as damaged or off quality by the
applicable Borrower; or

(q) which does not meet such other eligibility criteria for Inventory as the
Administrative Agent in its Permitted Discretion may determine from time to
time; provided, however, that the Administrative Agent shall not add any
additional eligibility criteria (or amend any then-existing eligibility criteria
to make the same more restrictive) without giving at least four (4) Business
Days’ prior notice to the Borrower Representative; provided further that, if
after the delivery of such notice the Borrower Representative notifies the
Administrative Agent that it desires to discuss the changes described therein,
then the Administrative Agent will discuss such changes with the Borrower
Representative, provided that nothing in this proviso shall obligate the
Administrative Agent to eliminate, reduce, or delay any such changes;

 

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provided further that in determining the value of the Eligible Inventory, such
value shall be reduced by, without duplication of amounts already accounted for
in determining such value, any amounts representing (i) vendor rebates;
(ii) costs included in Inventory relating to advertising; (iii) a shrink
reserve; and (iv) the unreconciled discrepancy between the general inventory
ledger and the perpetual inventory ledger, to the extent the general inventory
ledger reflects less Inventory than the perpetual inventory ledger. In the event
that Inventory of a Borrower which was previously Eligible Inventory ceases to
be Eligible Inventory hereunder, such cessation shall be reflected in the next
Borrowing Base Certificate.

“Eligible Trade Accounts” means, at any time, each Account (other than a Credit
Card Account) of a Borrower that satisfies the following criteria at the time of
creation and continues to meet the same at the time of such determination: such
Account (i) has been earned by performance and represents the bona fide amounts
due to a Borrower and in each case is originated in the ordinary course of
business of such Borrower, and (ii) in each case is not ineligible for inclusion
in the calculation of the Borrowing Base pursuant to any of clauses (a) through
(y) below. Without limiting the foregoing, to qualify as an Eligible Trade
Account, such Account shall indicate no Person other than a Borrower as payee or
remittance party. Any Account included within any of the following categories
shall not constitute an Eligible Trade Account:

(a) which is not subject to a first priority perfected security interest in
favor of the Administrative Agent (for the benefit of the Secured Parties);

(b) which is subject to any Lien other than (i) a Lien in favor of the
Administrative Agent, (ii) a Permitted Encumbrance which does not have priority
over the Lien in favor of the Administrative Agent and (iii) Liens securing
Permitted Term Loan Indebtedness that are subject to an Intercreditor Agreement
and which do not have priority over the Lien in favor of the Administrative
Agent;

(c) (i) with respect to which the scheduled due date is more than 90 days after
the date of the original invoice therefor, (ii) which is unpaid more than 90
days after the date of the original invoice therefor or more than 60 days after
the original due date therefor (in determining the aggregate amount from the
same Account Debtor that is unpaid hereunder there shall be excluded the amount
of any net credit balances relating to Accounts due from such Account Debtor
which are unpaid more than 90 days after the date of the original invoice
therefor or more than 60 days after the original due date therefor) or
(iii) which has been written off the books of such Borrower or otherwise
designated as uncollectible;

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

(e) which is owing by an Account Debtor to the extent the aggregate amount of
Accounts owing from such Account Debtor and its Affiliates to all Borrowers
exceeds 20% of the aggregate amount of Eligible Trade Accounts of all Borrowers;
provided that with respect to an Account which is owing by (i) Nordstrom, Inc.
or its Affiliates (a “Nordstrom Account”) to the extent the aggregate amount of
Nordstrom Accounts owing to all Borrowers exceeds 35% of the aggregate amount of
Eligible Trade Accounts of all Borrowers and (ii) Macy’s, Inc. or its Affiliates
(a “Macy’s Account”) to the extent the aggregate amount of Macy’s Accounts owing
to all Borrowers exceeds 35% of the aggregate amount of Eligible Trade Accounts
of all Borrowers; provided further that, should (i) Nordstrom, Inc. fail to
maintain a corporate credit rating from S&P of BBB- or higher, then the 35%
concentration limit set forth above for Nordstrom Accounts shall be reduced to
20% and (ii) Macy’s, Inc. fail to maintain a corporate credit rating from S&P of
BBB- or higher, then the 35% concentration limit set forth above for Macy’s
Accounts shall be reduced to 20%;

 

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(f) with respect to which any covenant, other representation or warranty
contained in this Agreement or in the Security Agreement has been breached or is
not true in all material respects (or, to the extent qualified by materiality,
in all respects), it being acknowledged that any representation or warranty as
to eligibility under this definition shall not be deemed qualified by
materiality except as and to the extent expressly so stated in another provision
of this definition;

(g) which (i) does not arise from the sale of Inventory or performance of
services in the ordinary course of business, (ii) is not evidenced by an invoice
or other documentation satisfactory to the Administrative Agent which has been
sent to the Account Debtor, (iii) represents a progress billing, (iv) is
contingent upon such Borrower’s completion of any further performance,
(v) represents a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale
on approval, consignment, cash-on-delivery or any other repurchase or return
basis or (vi) relates to payments of interest;

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

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

(j) which is owed by an Account Debtor which has (i) applied for, suffered, or
consented to the appointment of any receiver, custodian, trustee, or liquidator
of its assets, (ii) had possession of all or a material part of its property
taken by any receiver, custodian, trustee or liquidator, (iii) filed, or had
filed against it, any request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as bankrupt, winding-up, or
voluntary or involuntary case under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect (other than
post-petition accounts payable of an Account Debtor that is a
debtor-in-possession under the Bankruptcy Code and reasonably acceptable to the
Administrative Agent), (iv) admitted in writing its inability, or is generally
unable to, pay its debts as they become due, (v) become insolvent, or
(vi) ceased operation of its business;

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

(l) which is owed by an Account Debtor which (i) does not maintain its chief
executive office in the U.S. (including any territory thereof) or Canada, or the
European Union or (ii) is not organized under applicable law of the U.S., any
state or territory of the U.S. or the District of Columbia, Canada, or any
province or territory of Canada, or the European Union, or any country, province
or territory of the European Union unless, in any such case, such Account is
backed by a Letter of Credit acceptable to the Administrative Agent which is in
the possession of, and is directly drawable by, the Administrative Agent;
provided that in the case of Account Debtors that maintain their chief executive
office in the European Union or are organized in the European Union, or any
country, province or territory of the European Union, the aggregate amount of
such Accounts shall not exceed $2,500,000 at any time;

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

(n) which is owed by (i) any Governmental Authority of any country other than
the U.S. unless such Account is backed by a Letter of Credit acceptable to the
Administrative Agent which is in the possession of, and is directly drawable by,
the Administrative Agent, or (ii) any Governmental Authority of the U.S., or any
department, agency, public corporation, or instrumentality thereof, unless the
Federal Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq.
and 41 U.S.C. § 15 et seq.) and any other steps necessary to perfect the Lien of
the Administrative Agent in such Account have been complied with to the
Administrative Agent’s satisfaction;

 

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

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

(q) which is subject to any claim, counterclaim, deduction, defense, setoff or
dispute but only to the extent of any such counterclaim, deduction, defense,
setoff or dispute;

(r) which is evidenced by any promissory note, chattel paper or instrument or
judgment;

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

(t) with respect to which such Borrower has made any agreement with the Account
Debtor for any reduction thereof, for an extension of time for the payment
thereof, any compromise or settlement for less than the full amount thereof, any
release from liability therefor, or any deduction therefrom, other than
discounts and adjustments given in the ordinary course of business but only to
the extent of any such discount or adjustment, or any Account which was
partially paid and such Borrower created a new receivable for the unpaid portion
of such Account;

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

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

(w) which was created on cash on delivery terms;

(x) which the Administrative Agent determines in its Permitted Discretion may
not be paid by reason of the Account Debtor’s inability to pay; or

(y) which does not meet such other eligibility criteria for Accounts as the
Administrative Agent in its Permitted Discretion may determine from time to
time; provided, however, that the Administrative Agent shall not add any
additional eligibility criteria (or amend any then-existing eligibility criteria
to make the same more restrictive) without giving at least four (4) Business
Days’ prior notice to the Borrower Representative; provided further that, if
after the delivery of such notice the Borrower Representative notifies the
Administrative Agent that it desires to discuss the changes described therein,
then the Administrative Agent will discuss such changes with the Borrower
Representative, provided that nothing in this proviso shall obligate the
Administrative Agent to eliminate, reduce, or delay any such changes.

 

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

“Environmental Laws” means all laws, rules, regulations, codes, ordinances and
all binding orders, decrees, judgments, injunctions, notices or agreements
passed, adopted, issued, promulgated or entered into by any Governmental
Authority, relating to protection of the environment, preservation or
reclamation of natural resources, the management, Release or threatened Release
of any Hazardous Material or to health and safety matters to the extent related
to exposure to Hazardous Materials.

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

“Equipment” has the meaning assigned to such term in the applicable UCC.

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

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

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

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder, with respect to a Plan (other than
an event for which the 30-day notice period is waived); (b) the failure to
timely make any required contribution to any Plan or Multiemployer Plan or to
satisfy the “minimum funding standard” (as defined in Sections 412, 430 or 431
of the Code or Sections 302, 303 or 304 of ERISA), whether or not waived;
(c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA
of an application for a waiver of the minimum funding standard with respect to
any Plan; (d) the incurrence by any Borrower or any ERISA Affiliate of any
liability under

 

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Title IV of ERISA with respect to the termination of any Plan or a cessation of
operations under Section 4062(e) of ERISA; (e) the filing of a notice of intent
to terminate a Plan or receipt by any Borrower or any ERISA Affiliate from the
PBGC or a plan administrator of any notice relating to an intention to terminate
any Plan or Plans or to appoint a trustee to administer any Plan; (f) the
incurrence by any Borrower or any ERISA Affiliate of any liability with respect
to the withdrawal or partial withdrawal of any Borrower or any ERISA Affiliate
from any Plan or Multiemployer Plan; (g) the receipt by any Borrower or any
ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from any
Borrower or any ERISA Affiliate of any notice, concerning the imposition upon
any Borrower or any ERISA Affiliate of Withdrawal Liability or a determination
that a Multiemployer Plan is, or is expected to be, insolvent or in
reorganization, within the meaning of Title IV of ERISA; or (h) the imposition
of a Lien under Sections 412, 430(k) or 6321 of the Code or Sections 303 or 4068
of ERISA on any property of a Borrower or any ERISA Affiliate.

“EURIBO Rate” means, with respect to any EURIBOR Borrowing for any Interest
Period, the applicable Screen Rate as of the Specified Time on the Quotation
Day.

“EURIBOR Loan” or “EURIBOR Borrowing”, when used in reference to any Loan or
Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing,
is bearing interest at a rate determined by reference to the EURIBO Rate.

“Euro” or “€” means the single currency of the Participating Member States.

“European Union” means the region comprised of member states of the European
Union pursuant to the Treaty on the European Union.

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

“Excluded Account” has the meaning assigned to such term in the Security
Agreement.

“Excluded Asset” has the meaning assigned to such term in the Security
Agreement.

“Excluded Subsidiary” means each (a) Unrestricted Subsidiary, (b) Immaterial
Subsidiary, (c) CFC or CFC Holdco; provided that (x) any Domestic Subsidiary of
the Company that is a guarantor under any Permitted Term Loan Indebtedness or
(y) any other Subsidiary of the Company that guarantees the obligations under
any Permitted Term Loan Indebtedness shall become a Guarantor hereunder, and
(d) any other Subsidiary with respect to which, in the reasonable judgment of
the Administrative Agent (confirmed in writing by notice to the Company), the
cost or other consequences of becoming a Guarantor shall be excessive in view of
the benefits to be obtained by the Lenders therefrom.

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap
Obligation if, and to the extent that, all or a portion of the Guarantee of such
Guarantor of, or the grant by such Guarantor of a security interest to secure,
such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the
Commodity Exchange Act or any rule, regulation or order of the Commodity Futures
Trading Commission (or the application or official interpretation of any
thereof) by virtue of such Guarantor’s failure for any reason to constitute an
ECP at the time the Guarantee of such Guarantor or the grant of such security
interest becomes or would become effective with respect to such Swap Obligation.
If a Swap Obligation arises under a master agreement governing more than one
swap, such exclusion shall apply only to the portion of such Swap Obligation
that is attributable to swaps for which such Guarantee or security interest is
or becomes illegal.

 

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

“Existing Letters of Credit” means each of the letters of credit identified in
writing to the Administrative Agent on the Effective Date.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreement entered into
pursuant to Section 1471(b)(1) of the Code.

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) 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 that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it; provided that, if the Federal Funds
Effective Rate shall be less than zero, such rate shall be deemed to be zero for
purposes of this Agreement.

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of a Borrower.

“Fixed Charge Coverage Ratio” means, at any date, the ratio of (a) the sum of
(i) EBITDAR minus (ii) Unfinanced Capital Expenditures to (b) Fixed Charges, all
calculated for the period of four (4) consecutive fiscal quarters ended on such
date (or, if such date is not the last day of a fiscal quarter, ended on the
last day of the fiscal quarter most recently ended prior to such date).

“Fixed Charges” means, for any period, without duplication, cash Interest
Expense, plus Rentals, plus scheduled principal payments on Indebtedness
actually made, plus expenses for taxes paid in cash, plus Restricted Payments
paid in cash (other than Restricted Payments permitted to be made under
Section 6.08(a)(ii)), plus Capital Lease Obligations paid in cash, all
calculated on a consolidated basis for the Company and its Subsidiaries for such
period in accordance with GAAP.

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

“Foreign Currency Sublimit” means an amount equal to $25,000,000.

 

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“Foreign Lender” means (a) if a Borrower is a U.S. Person, a Lender, with
respect to such Borrower, that is not a U.S. Person, and (b) if a Borrower is
not a U.S. Person, a Lender, with respect to such Borrower, that is resident or
organized under the laws of a jurisdiction other than that in which such
Borrower is resident for tax purposes.

“Foreign Plan” means any employee benefit plan or arrangement (a) maintained or
contributed to by any Loan Party or Subsidiary that is not subject to the laws
of the United States; or (b) mandated by a government other than the United
States for employees of any Loan Party or Subsidiary.

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

“Funding Accounts” means the deposit account(s) of the Borrowers to which the
Administrative Agent or the Swingline Lender is authorized by the Borrowers (or
by the Borrower Representative on their behalf) to transfer the proceeds of any
Borrowings requested or authorized pursuant to this Agreement.

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

“Governmental Authority” means the government of the United States of America or
any other nation or any political subdivision thereof, whether territorial,
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national body exercising such powers or
functions, such as the European Union or the European Central Bank).

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided that the term Guarantee shall not include (i) customary
warranties or indemnities made in trade contracts, asset sale agreements,
acquisition agreements, commitment letters, engagement letters and brokerage and
deposit agreements in the ordinary course of business, and customary warranties
and indemnities to lenders in any documents evidencing Indebtedness permitted
pursuant to Section 6.01 with respect to the guarantor, (ii) any indemnities
made in connection with liability of a Person’s directors, officers and
employees in their capacities as such as permitted by applicable law, and
(iii) any contingent liability arising from the endorsement of negotiable or
other instruments for deposit or collection in the ordinary course of business,
and (iv) any continuing liability of the Company or its Subsidiaries as a lessee
under a lease after such lease has been assigned or subleased by such Person.

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

“Guarantor” means each Domestic Subsidiary of a Borrower that is listed on the
signature pages hereto as a Guarantor or that becomes a party hereto as a
Guarantor pursuant to Section 5.14, in each case, until such Subsidiary’s Loan
Guaranty is released in accordance herewith.

 

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“Guarantor Payment” has the meaning assigned to such term in Section 10.11.

“Hazardous Materials” means: (a) any substance, material, or waste that is
included within the definitions of “hazardous substances,” “hazardous
materials,” “hazardous waste,” “toxic substances,” “toxic materials,” “toxic
waste,” or words of similar import in any Environmental Law; (b) those
substances listed as hazardous substances by the United States Department of
Transportation (or any successor agency) (49 C.F.R. 172.101 and amendments
thereto) or by the Environmental Protection Agency (or any successor agency) (40
C.F.R. Part 302 and amendments thereto); and (c) any substance, material, or
waste that is petroleum, petroleum-related, or a petroleum by-product, asbestos
or asbestos-containing material, polychlorinated biphenyls, flammable,
explosive, radioactive, freon gas, radon, or a pesticide, herbicide, or other
substance regulated under the Federal Insecticide, Fungicide and Rodentide Act
(“FIFRA”), 7 U.S.C. § 136 et seq.

“Immaterial Subsidiary” shall mean any Subsidiary (other than a Borrower)
designated by the Borrower Representative to the Administrative Agent as an
“Immaterial Subsidiary” and that meets each of the following criteria as of the
last day of the most recent fiscal quarter for which financial statements have
been delivered to the Administrative Agent pursuant to Section 5.01(a) or
Section 5.01(b): (a) such Subsidiary and its Subsidiaries accounted for less
than (x) 2.5% of Total Assets at such date and (y) 2.5% of the consolidated
revenues of the Company and its Restricted Subsidiaries for the most recent four
fiscal quarter period ending on such date, and (b) all Immaterial Subsidiaries
and their respective Subsidiaries accounted for less than (x) 5.0% of Total
Assets at such date and (y) 5.0% of the consolidated revenues of the Company and
its Restricted Subsidiaries for the most recent four fiscal quarter period
ending on such date; provided, that no Subsidiary shall be or be designated as
an “Immaterial Subsidiary” if such Subsidiary has provided a Loan Guaranty of,
or pledged any Collateral as security for, any Permitted Term Loan Indebtedness.

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person upon which interest charges are customarily paid, (d) all obligations of
such Person under conditional sale or other title retention agreements relating
to property acquired by such Person, (e) all obligations of such Person in
respect of the deferred purchase price of property or services, (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed (but only to the extent of the lesser of such
Indebtedness and the fair market value of such secured property if such
Indebtedness has not been assumed by such Person), (g) all Guarantees by such
Person of Indebtedness of others, (h) all Capital Lease Obligations of such
Person, (i) all obligations, contingent or otherwise, of such Person as an
account party in respect of letters of credit and letters of guaranty, (j) all
obligations, contingent or otherwise, of such Person in respect of bankers’
acceptances, (k) obligations under any liquidated earn-out, (l) any other
Off-Balance Sheet Liability, (m) obligations, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired (including all
renewals, extensions and modifications thereof and substitutions therefor),
under (i) any and all Swap Agreements, and (ii) any and all cancellations, buy
backs, reversals, terminations or assignments of any Swap Agreement transaction
and (n) obligations, contingent or otherwise, with respect to Disqualified
Stock; provided, however, the term “Indebtedness” shall not include (1) current
trade accounts or current accounts payable (which references to “current”
include payment with trade payment terms as offered by the trade creditor (not
in any event to exceed 180 days) and include disputed accounts), accrued
expenses and liabilities incurred and customer deposits received, in each
instance, in the ordinary course of business and not constituting indebtedness
for borrowed money or evidenced by notes or other instruments, (2) capital stock
(other than Disqualified Stock) and surplus earned, (3) deferred compensation
payable to directors, officers or employees of the Company or any Subsidiary,
and (4) any

 

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earn-out or any customary purchase price adjustment incurred in connection with
an Acquisition, except to the extent that the amount payable pursuant to such
purchase price adjustment or earn-out is, or becomes, reasonably determinable.
The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.

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

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

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

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

“Intercreditor Agreement” means any Permitted Term Loan Intercreditor Agreement
or any Secured Inventory Intercreditor Agreement.

“Interest Election Request” means a request by the Borrower Representative to
convert or continue a Borrowing in accordance with Section 2.08, which shall be,
in the case of any such written request, in a form approved by the
Administrative Agent.

“Interest Expense” means, for any period, total interest expense (including that
attributable to Capital Lease Obligations) for such period with respect to all
outstanding Indebtedness (including all commissions, discounts and other fees
and charges owed by the Company or any Subsidiary with respect to letters of
credit and bankers’ acceptances and net costs under Swap Agreements in respect
of interest rates to the extent such net costs are allocable to such period in
accordance with GAAP), calculated on a consolidated basis for the Company and
its Subsidiaries for such period in accordance with GAAP.

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

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

 

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“Interpolated Screen Rate” means, with respect to any LIBOR Borrowing
denominated in any currency (other than U.S. Dollars), any EURIBOR Borrowing or
any CDOR Borrowing, in each case for any Interest Period, a rate per annum which
results from interpolating on a linear basis between (a) the applicable Screen
Rate for the longest maturity for which a Screen Rate is available that is
shorter than such Interest Period and (b) the applicable Screen Rate for the
shortest maturity for which a Screen Rate is available that is longer than such
Interest Period, in each case as of the Specified Time on the Quotation Day.

“In-Transit Inventory” means Inventory of a Borrower which is in transit with a
common carrier from vendors or suppliers of such Borrower.

“Inventory” has the meaning assigned to such term in the Security Agreement.

“Inventory Advance Percentage” shall mean, (i) during all times other than the
period from February 20 through June 20 of each year, 90%, and (ii) during the
period from February 20 through June 20 of each year, 92.5%.

“Investment” has the meaning assigned to such term in Section 6.04.

“Investment Policy” means the investment policies of the Company as approved by
the Company’s board of directors and in effect from time to time.

“IRS” means the United States Internal Revenue Service.

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

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

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

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

“LC Designated Currency” means (a) Canadian Dollars, (b) Sterling, (c) Euros or
(d) any other lawful currency (other than U.S. Dollars) acceptable to the
Administrative Agent and the applicable Issuing Bank which are, in the case of
this clause (d), freely transferable and convertible into U.S. Dollars and
freely available to the applicable Issuing Bank.

 

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

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

“LC Individual Sublimit” means, with respect to any Issuing Bank, an amount
equal to (a) with respect to Commercial Letters of Credit and Standby Letters of
Credit issued by the Issuing Banks designated as such on the Effective Date, the
amount set forth on the Commitment Schedule, and (b) with respect to Commercial
Letters of Credit and Standby Letters of Credit issued by any other Issuing Bank
designated as such by the Borrower Representative following the Effective Date,
the amount agreed to by the Issuing Bank and the Borrower Representative with
the approval of the Administrative Agent, in each case under this definition, as
such amount may be increased for an Issuing Bank as agreed to by such Issuing
Bank and the Borrower Representative with notice to the Administrative Agent.

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

“Letters of Credit” means the letters of credit and guarantees issued pursuant
to this Agreement, and the term “Letter of Credit” means any one of them or each
of them singularly, as the context may require; for the avoidance of doubt, the
Urban UK L/C shall constitute a Letter of Credit hereunder; further, for the
avoidance of doubt, letters of credit issued under a Specified L/C Facility
shall not constitute Letters of Credit.

“LIBO Rate” means, with respect to any LIBOR Borrowing denominated in any
currency for any Interest Period, the applicable Screen Rate as of the Specified
Time on the Quotation Day.

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

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.

“Loan Documents” means, collectively, this Agreement, any promissory notes
issued pursuant to this Agreement, any Letter of Credit applications, the
Collateral Documents, the Loan Guaranty, each Compliance Certificate, each fee
letter and all other agreements, instruments, documents and certificates
identified in Section 4.01 and each certificate delivered from time to time in
connection with the foregoing and all other documents identified therein as a
Loan Document, in each case executed and delivered to, or in favor of, the
Administrative Agent or any Lender and including all other pledges, powers of
attorney, consents, assignments and letter of credit agreements, in each case
whether heretofore, now or hereafter executed by or on behalf of any Loan Party
and delivered to the

 

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Administrative Agent or any Lender in connection with this Agreement or the
transactions contemplated hereby (excluding any agreement entered into or in
connection with any transaction arising out of any Specified L/C Facility, any
other Banking Services or any Swap Obligations). Any reference in this Agreement
or any other Loan Document to a Loan Document shall include all appendices,
exhibits or schedules thereto, and all amendments, restatements, supplements or
other modifications thereto, and shall refer to this Agreement or such Loan
Document as the same may be in effect at any and all times such reference
becomes operative.

“Loan Guaranty” means Article X of this Agreement.

“Loan Parties” means, collectively, the Borrowers and the Guarantors and any
other Person who becomes a party to this Agreement pursuant to a Joinder
Agreement and their successors and assigns, and the term “Loan Party” shall mean
any one of them or all of them individually, as the context may require;
provided however, that URBN Puerto Rico Retail LLC, which is anticipated to
become an active entity following the Effective Date, shall not be entitled to
receive proceeds of any Borrowings or otherwise be entitled to the benefits of
being a Borrower (or Guarantor) or Loan Party unless and until the Collateral
and Guaranty Requirement and each other condition applicable to a Borrower shall
have been satisfied to the extent required by the Administrative Agent as
evidenced by the Administrative Agent’s written confirmation thereof to the
Borrower Representative after the Effective Date.

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

“Local Time” means (a) with respect to a Loan or Borrowing denominated in U.S.
Dollars or any Letter of Credit, New York City time and (b) with respect to a
Loan or Borrowing denominated in Canadian Dollars, Sterling, Euros or an
Alternative Currency, London time.

“Macy’s Account” has the meaning assigned to such term in the definition of
“Eligible Trade Accounts”.

“Material Adverse Effect” means a material adverse effect on (a) the business,
assets, operations or financial condition of the Company and its Restricted
Subsidiaries taken as a whole, (b) the ability of the Loan Parties, taken as a
whole, to perform any of their obligations under the Loan Documents, (c) the
Collateral, or the Administrative Agent’s Liens (on behalf of itself and other
Secured Parties) on the Collateral or the priority of such Liens, or (d) the
rights or remedies available to the Administrative Agent, the Issuing Banks or
the Lenders under any of the Loan Documents.

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or obligations in respect of one or more Swap Agreements, of any one or
more of the Company and its Subsidiaries in an aggregate principal amount
exceeding $50,000,000. For purposes of determining Material Indebtedness, the
“principal amount” of the obligations of the Company or any Subsidiary in
respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that the Company or such Subsidiary
would be required to pay if such Swap Agreement were terminated at such time.

“Maturity Date” means July 1, 2020, or any earlier date on which the Commitments
are reduced to zero or otherwise terminated pursuant to the terms hereof.

“Maximum Credit Amount” means the lesser of (a) the Aggregate Commitments and
(b) the Borrowing Base.

 

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

“Moody’s” means Moody’s Investors Service, Inc.

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

“Net Income” means, for any period, the consolidated net income (or loss) of the
Company and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP; provided that there shall be excluded (a) extraordinary gains and
extraordinary losses, (b) the income (or deficit) of any Person accrued prior to
the date it becomes a Subsidiary or is merged into or consolidated with the
Company or any of its Subsidiaries, (c) the income (or deficit) of any Person
(other than a Subsidiary) in which the Company or any of its Subsidiaries has an
ownership interest, except to the extent that any such income is actually
received by the Company or such Subsidiary in the form of dividends or similar
distributions, (d) the undistributed earnings of any Subsidiary 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 and (e) any cancellation of Indebtedness income.

“Net Orderly Liquidation Value” means, with respect to Inventory of any Person,
the orderly liquidation value thereof as determined in a manner acceptable to
the Administrative Agent by an appraiser reasonably acceptable to the
Administrative Agent, net of all costs of liquidation thereof.

“Net Proceeds” means, with respect to any casualty, condemnation, sale,
transfer, disposition or similar event in respect of Collateral, (a) the cash
proceeds received in respect of such event including (i) any cash received in
respect of any non-cash proceeds (including any cash payments received by way of
deferred payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise, but excluding any interest
payments), but only as and when received, (ii) in the case of a casualty,
insurance proceeds and (iii) in the case of a condemnation or similar event,
condemnation awards and similar payments, minus (b) the sum of (i) all
reasonable fees and out-of-pocket expenses paid to third parties (other than
Affiliates) in connection with such event, (ii) in the case of a sale, transfer
or other disposition of an asset (including pursuant to a sale and leaseback
transaction or a casualty or a condemnation or similar proceeding), the amount
of all payments required to be made as a result of such event to repay
Indebtedness (other than Loans) that is secured by a Lien on such asset that is
not Collateral or is senior to the Liens securing the Secured Obligations or,
other than with respect to assets that are Collateral in which the
Administrative Agent has a first priority Lien, otherwise subject to mandatory
prepayment as a result of such event and (iii) the amount of all taxes paid (or
reasonably estimated to be payable) and the amount of any reserves established
to fund contingent liabilities reasonably estimated to be payable, in each case
during the year that such event occurred or the next succeeding year and that
are directly attributable to such event (as determined reasonably and in good
faith by a Financial Officer of the Borrower Representative).

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

“Nordstrom Account” has the meaning assigned to such term in the definition of
“Eligible Trade Accounts”.

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

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements (including pursuant to Section 2.06(a)), indemnities and other
obligations and indebtedness (including interest and fees accruing during

 

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the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding),
obligations and liabilities of any of the Loan Parties to any of the Lenders,
the Administrative Agent, each Issuing Bank or any indemnified party,
individually or collectively, existing on the Effective Date or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
by contract, operation of law or otherwise, arising or incurred under this
Agreement or any of the other Loan Documents or in respect of any of the Loans
made or reimbursement or other obligations incurred or any of the Letters of
Credit or other instruments at any time evidencing any thereof.

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

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

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

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

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

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

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

“Participating Member State” means any member state of the European Communities
that adopts or has adopted (and has not ceased to adopt) the euro as its lawful
currency in accordance with legislation of the European Community relating to
Economic and Monetary Union.

“Payment Conditions” means, at any applicable time of determination with respect
to a specified transaction, event, or payment, that (a) no Default or Event
Default then exists or would immediately arise as a result of the entering into
of such transaction, the occurrence of such event, or the making of such
payment, and (b) (i) immediately prior to such transaction, the occurrence of
such event, or such payment and (ii) on a Pro Forma Basis and, with respect to
the calculation of Availability, at all times during the Pro Forma Period
(Payment Conditions), after giving effect to such transaction, the occurrence

 

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of such event, or payment and any incurrence or repayment of Indebtedness in
connection therewith, either clause (A) or (B) below is satisfied:

(A) Availability is greater than the Applicable Trigger Amount (Level V);
provided that, with respect to any Permitted Acquisition, Availability is
greater than the Applicable Trigger Amount (Level IV), or

(B) (I) Availability is greater than the Applicable Trigger Amount (Level III)
(provided that, with respect to any Permitted Acquisition, Availability is
greater than the Applicable Trigger Amount (Level II)), and (II) the Fixed
Charge Coverage Ratio for the most recently ended four fiscal quarter period for
which financial statements have been (or were required to be) delivered to the
Administrative Agent pursuant to Section 5.01(a) or (b) is at least 1.1 to 1.0;

provided that, in each case, the Borrower Representative shall have delivered to
the Administrative Agent an updated Borrowing Base Certificate, a reasonably
detailed calculation of such Availability and projections for the Pro Forma
Period (Payment Conditions) with respect thereto, and, if applicable, the Fixed
Charge Coverage Ratio.

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

“Permitted Acquisition” means any Acquisition by the Company or any Restricted
Subsidiary in a transaction that satisfies each of the following requirements:

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

(b) the business acquired in connection with such Acquisition is not engaged,
directly or indirectly, in any line of business other than the businesses in
which the Loan Parties are engaged on the Effective Date and any business
activities that are reasonably similar, related, complementary or incidental
thereto so long as the core business of the Loan Parties on the Effective Date,
after giving effect to such Acquisition, does not change in any material way;

(c) both before and after giving effect to such Acquisition and the Loans (if
any) requested to be made in connection therewith, each of the representations
and warranties in the Loan Documents is true and correct in all material
respects (except (i) that any representation or warranty which by its terms is
made as of a specified date shall be true and correct in all material respects
only as of such specified date, and any representation or warranty which is
subject to any materiality qualifier shall be required to be true and correct in
all respects and (ii) to the extent the Administrative Agent has been notified
in writing by the Loan Parties that any representation or warranty is not
correct and the Administrative Agent has explicitly waived in writing compliance
with such representation or warranty) and no Default exists, will exist, or
would result therefrom;

(d) other than with respect to Immaterial Acquisitions (as defined in clause
(m) below) as soon as available, but not less than 15 days prior to such
Acquisition (or such shorter period as the Administrative Agent may agree), the
Borrower Representative has provided the Administrative Agent (i) notice of such
Acquisition and (ii) a copy of all business and financial information reasonably
requested by the Administrative Agent;

(e) if the Accounts, Credit Card Accounts or Inventory acquired in connection
with such Acquisition are proposed to be included in the determination of the
Borrowing Base, the Administrative Agent shall have conducted an audit and field
examination or appraisal of such Accounts, Credit Card Accounts and Inventory,
the results of which shall be satisfactory to the Administrative Agent;

 

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(f) if such Acquisition is an acquisition of the Equity Interests of a Person
organized under the laws of a jurisdiction in the U.S., such Acquisition is
structured so that the acquired Person shall become a wholly-owned Restricted
Subsidiary of a Borrower and a Loan Party pursuant to the terms of this
Agreement, except to the extent such acquired Person shall be properly
designated as an Unrestricted Subsidiary in accordance with Section 5.15 or
except to the extent otherwise acceptable to the Administrative Agent;

(g) if such Acquisition is an acquisition of Equity Interests, such Acquisition
will not result in any violation of Regulation U;

(h) if such Acquisition involves a merger or a consolidation involving a
Borrower or any other Loan Party, such Borrower or such Loan Party, as
applicable, shall be the surviving entity;

(i) neither any Loan Party nor any Restricted Subsidiary shall, as a result of
or in connection with any such Acquisition, assume or incur any direct or
contingent liabilities (whether relating to environmental, tax, litigation,
pension or other matters) that could be reasonably expected to cause a Material
Adverse Effect other than those otherwise permitted to exist hereunder;

(j) in connection with an Acquisition of the Equity Interests of any Person
organized under the laws of a jurisdiction of the U.S. or an Acquisition of the
assets of any Person, all Liens on such assets shall be terminated, except to
the extent otherwise permitted to exist pursuant to this Agreement;

(k) all actions required to be taken with respect to any newly acquired or
formed wholly-owned Domestic Subsidiary of a Borrower or a Loan Party, as
applicable, required under Section 5.14 shall have been taken;

(l) the Borrower Representative shall have delivered to the Administrative Agent
the final executed material documentation relating to such Acquisition within 15
days following the consummation thereof; and

(m) either (i) the Loan Parties shall have satisfied the Payment Conditions
before and immediately after giving effect to such Acquisition, or (ii) the
total consideration paid or payable (including, without limitation, any
earn-outs (calculated, for purposes of this definition only, at the time of
incurrence as the aggregate amount reasonably expected to be paid by any Loan
Party or its Subsidiaries in connection with such earn-out, as determined by
such Loan Party in its reasonable business judgment)) with respect to, and all
Indebtedness and other direct or contingent liabilities (whether relating to
environmental, tax, litigation, pension or other matters) assumed in connection
with, such Acquisition and series of related transactions shall not exceed with
respect to any such Acquisition and series of related transactions, $10,000,000
and $20,000,000 with respect to all such Acquisitions and series of related
transactions in the aggregate (Acquisitions described in this clause (m)(ii),
“Immaterial Acquisitions”), and at least five (5) Business Days prior to the
closing of any such Immaterial Acquisition, the Borrower Representative shall
have delivered to the Administrative Agent a description of any Indebtedness and
other direct or contingent liabilities to be assumed in connection with such
Immaterial Acquisition.

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

 

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“Permitted Encumbrances” means:

(a) (i) Liens imposed by law for Taxes that are not yet due or are being
contested in compliance with Section 5.04 and (ii) Liens securing an aggregate
amount not to exceed $5,000,000 imposed by law for Taxes due and which are not
being contested in compliance with Section 5.04; provided that, if the
Administrative Agent delivers written notice of any such Lien to a Loan Party,
the Loan Parties shall cause such underlying Tax obligations to be paid in full
within 90 days of the delivery of such notice and shall use commercially
reasonable efforts to cause such Lien to be released;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other
like Liens imposed by law (other than any Lien for Taxes or imposed under
ERISA), arising in the ordinary course of business and securing obligations that
are not overdue by more than thirty (30) days or are being contested in
compliance with Section 5.04;

(c) pledges and deposits made (i) in the ordinary course of business in
compliance with workers’ compensation, unemployment insurance and other social
security laws or regulations (other than any Lien for Taxes or imposed under
ERISA), and (ii) in respect of letters of credit, bank guarantees or similar
instruments issued for the account of the Company or any Subsidiary in the
ordinary course of business supporting obligations of the type set forth in
clause (i) above;

(d) deposits and pledges to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case under this clause (d) in the
ordinary course of business;

(e) judgment Liens (other than for the payment of Taxes) in respect of judgments
that do not constitute an Event of Default under clause (k) of Article VII and
that remain at all times junior to Administrative Agent’s Liens;

(f) easements, zoning restrictions, rights-of-way, site plan agreements,
development agreements, cross-easement or reciprocal agreements, and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of any Borrower or any Subsidiary or the ordinary operation
of such real property or (ii) title defects or irregularities with respect to
Real Estate which are of a minor nature and which in the aggregate do not
materially detract from the value of the affected property or interfere with the
ordinary conduct of business of any Borrower or any Subsidiary or the ordinary
operation of such real property;

(g) Liens arising from precautionary UCC financing statement filings (or similar
filings under applicable law) regarding “true” operating leases in the ordinary
course of business or, to the extent permitted under the Loan Documents, the
consignment of goods to a Loan Party;

(h) non-exclusive licenses or sublicenses of intellectual property granted to
other Persons in the ordinary course of business which could not materially
interfere with the business of any Loan Party, secure any Indebtedness for
borrowed money (provided that the foregoing reference to Indebtedness for
borrowed money shall not be applicable to the extent otherwise permitted
hereunder in respect of non-U.S. Restricted Subsidiaries) or interfere in any
respect with the Administrative Agent’s rights under any intellectual property
rights use agreement;

(i) any interest or title of a lessor or sublessor under any lease or sublease
of Real Estate entered into in the ordinary course of business, so long as such
interest or title relate solely to the Real Estate subject thereto and without
hindering or obstructing the effect of any lien waiver or access rights;

 

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(j) Liens arising in the ordinary course of business in favor of customs
brokers, custom and forwarding agents and similar Persons in respect of imported
goods and merchandise in the custody of such Persons;

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

(l) Liens or rights of setoff (other than as waived under any contractual
agreement or Control Agreement with the Administrative Agent) against credit
balances of the Company or any Restricted Subsidiary with credit card issuers or
credit card processors to secure obligations of the Company or such Restricted
Subsidiary, as the case may be, to any such credit card issuer or credit card
processor incurred in the ordinary course of business as a result of fees and
chargebacks;

(m) Bankers’ liens, rights of setoff and other similar Liens in the ordinary
course of business in favor of a bank or institution with which accounts or
deposits are maintained, liens in favor of collecting banks arising under the
UCC (or similar statutes or equivalents thereof under foreign jurisdictions) in
the ordinary course of business, and other Liens that are contractual rights of
set-off (other than as waived under any contractual agreement or Control
Agreement with the Administrative Agent);

(n) possessory Liens in favor of brokers and dealers arising in connection with
the acquisition or disposition of Investments owned as of the Effective Date and
Cash Equivalents (other than as waived under any contractual agreement or
Control Agreement with the Administrative Agent), provided that such liens
(i) attach only to such Investments and (ii) secure only obligations incurred in
the ordinary course and arising in connection with the acquisition or
disposition of such Investments and not any obligation in connection with margin
financing;

(o) statutory Liens of landlords and lessors in respect of rent not past due
more than 60 days unless being contested in good faith pursuant to the
provisions of Section 5.04 hereof, and customary restrictions on subletting and
assignments thereof; and

(p) deposits in connection with sweepstakes offerings conducted in the ordinary
course of business and consistent with past practice;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

“Permitted Term Loan Indebtedness” means Indebtedness in the form of term loans;
provided that (a) immediately before and after the issuance or incurrence
thereof, no Default or Event of Default shall have occurred and be continuing;
(b) if guaranteed, such Indebtedness shall not be guaranteed by any Person other
than the Loan Parties; (c) if such Indebtedness is secured, the Administrative
Agent and a representative acting on behalf of the holders of such Indebtedness
shall have entered into a Permitted Term Loan Intercreditor Agreement; (d) the
Collateral hereunder and the collateral securing such Indebtedness shall be
substantially identical, with the priorities therefor set forth in the Permitted
Term Loan Intercreditor Agreement; (e) such Indebtedness does not have a
scheduled maturity date prior to the date that is six (6) months after the final
Maturity Date and does not contain scheduled payments (other than customary
excess cash flow payments) in any year in excess of 5% of the original principal
amount of such Indebtedness; (f) the Secured Leverage Ratio before and, on a Pro
Forma Basis, after giving effect to the incurrence of such Indebtedness does not
exceed 1.50 to 1.00; (g) the Borrowers will be in compliance, on a Pro Forma
Basis, with the covenant contained in Section 6.12 after giving effect to the
incurrence of such Indebtedness (whether or not such financial covenant is
required to be tested in accordance with the terms of Section 6.12); (h) the
Payment Conditions are satisfied before and after

 

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giving effect to the incurrence of such Indebtedness; and (i) the Company shall
have delivered to the Administrative Agent a certificate of a Financial Officer,
including reasonably detailed calculations, demonstrating compliance with the
conditions above.

“Permitted Term Loan Intercreditor Agreement” means any intercreditor agreement,
by and among the Administrative Agent and the collateral agents or other
representatives for the holders of Permitted Term Loan Indebtedness, and
acknowledged by the Loan Parties, in form and substance reasonably satisfactory
to the Administrative Agent.

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

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

“Platform” means Debt Domain, Intralinks, Syndtrak or a substantially similar
electronic transmission system.

“Prepayment Event” means:

(a) any sale, transfer or other disposition (including pursuant to a sale and
leaseback transaction) of any Collateral by any Loan Party, other than
dispositions described in Section 6.05(a) or (c); or

(b) any casualty or other insured damage to, or any taking under power of
eminent domain or by condemnation or similar proceeding of, any Collateral with
a fair value immediately prior to such event equal to or greater than $5,000,000

, unless the proceeds therefrom are required by the terms of any Intercreditor
Agreement to be paid to the holder of a Lien on such property or asset having
priority over the Lien of the Administrative Agent.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by JPMCB as its prime rate in effect at its principal offices in New
York City. Each change in the Prime Rate shall be effective from and including
the date such change is publicly announced as being effective.

“Pro Forma Basis” means, with respect to any computation hereunder expressly
required to be made on a pro forma basis, computation thereof after giving pro
forma effect to adjustments in connection with such Pro Forma Events in
accordance with Section 1.05, in each case, using, for purposes of making such
computation, the consolidated financial statements of the Company and its
Subsidiaries (and, to the extent applicable, the historical financial statements
of any entities or assets so acquired or to be acquired, or so disposed or to be
disposed), which shall be reformulated as if such Pro Forma Event (and, in the
case of any pro forma computations made hereunder to determine whether such Pro
Forma Event is permitted to be consummated hereunder, to any other Pro Forma
Event consummated since the first day of the period covered by any component of
such pro forma computation and on or prior to the date of such computation), and
any Indebtedness or other liabilities incurred in connection with any such Pro
Forma Event, had been consummated and incurred at the beginning of such period.
If any Indebtedness bears a floating rate of interest and is being given pro
forma effect, the interest on such Indebtedness shall be calculated as if the
rate in effect on the date of determination had been the applicable rate for the
entire period (taking into account any Swap Agreement applicable to such
Indebtedness if such Swap Agreement has a remaining term in excess of 12
months).

 

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“Pro Forma Event” means any event that requires satisfaction of the Payment
Conditions for such event to be permitted under this Agreement.

“Pro Forma Period (Payment Conditions)” means the 90-day period immediately
prior to the date of the applicable transaction, event, or payment made or
occurring in reliance on the satisfaction of the Payment Conditions.

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

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

“Public-Sider” means a Lender whose representatives may trade in securities of
the Company or its controlling Person or any of its Subsidiaries while in
possession of the financial statements provided by the Company under the terms
of this Agreement.

“Qualified Counterparties” means the Administrative Agent, each Lender and each
Affiliate of a Lender (provided that any issuer under a Specified L/C Facility
who was a Lender or an Affiliate of a Lender shall continue to be a “Qualified
Counterparty” for a period of 90 days following the termination of their
capacity under this Agreement as a Lender or an Affiliate of a Lender solely in
respect of Specified L/C Obligations outstanding on the date such capacity
hereunder ceased).

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

“Quotation Day” means (a) with respect to any currency (other than Sterling or
Canadian Dollars) for any Interest Period, the day two (2) Business Days prior
to the first day of such Interest Period and (b) with respect to Sterling or
Canadian Dollars for any Interest Period, the first day of such Interest Period,
in each case unless market practice differs for loans such as the applicable
Loans priced by reference to rates quoted in the Relevant Interbank Market, in
which case the Quotation Day for such currency shall be determined by the
Administrative Agent in accordance with market practice for such loans priced by
reference to rates quoted in the Relevant Interbank Market (and if quotations
would normally be given by leading banks for such loans priced by reference to
rates quoted in the Relevant Interbank Market on more than one day, the
Quotation Day shall be the last of those days).

“Real Estate” shall mean all real property owned or leased by the Company and
its Restricted Subsidiaries.

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

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

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

 

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

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

“Relevant Interbank Market” means (a) with respect to any currency (other than
Euros or Canadian Dollars), the London interbank market, (b) with respect to
Euros, the European interbank market and (c) with respect to Canadian Dollars,
the Toronto interbank market.

“Rent Liability” means, as of any date, the result of eight (8) multiplied by
the aggregate Rentals for the most recently ended 12 consecutive month period,
calculated on a consolidated basis for the Company and its Subsidiaries for such
period in accordance with GAAP.

“Rentals” means, for any period, the aggregate fixed amounts payable under any
operating leases, calculated on a consolidated basis for the Company and its
Subsidiaries for such period in accordance with GAAP.

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

“Required Lenders” means, at any time, Lenders (other than Defaulting Lenders)
having Revolving Exposures and unused Commitments representing more than 50% of
the sum of the Aggregate Credit Exposure and unused Commitments at such time.

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

“Reserves” means (a) without duplication of any other Reserves or items that are
otherwise addressed through eligibility criteria, any reserves which the
Administrative Agent deems necessary, in its Permitted Discretion, to maintain
(including, without limitation, (i) to reflect impediments to the Administrative
Agent’s ability to realize upon the Collateral, (ii) to reflect claims and
liabilities that the Administrative Agent determines will need to be satisfied
in connection with the realization upon the Collateral or (iii) to reflect
criteria, events, conditions, contingencies or risks which adversely affect any
component of the Borrowing Base, or the assets, business, financial performance
or financial condition of any Loan Party, including, for example, reserves for
accrued and unpaid interest on the Obligations, gift card reserves, reserves for
rent at locations leased by any Borrower, reserves for loyalty programs,
reserves for consignee’s, warehousemen’s, mortgagee’s and bailee’s charges,
reserves for dilution of Accounts or Credit Card Accounts, reserves for
Inventory shrinkage, reserves for layaway deposits, reserves for customs charges
and shipping charges and other foreign landing costs related to any Inventory in
transit, reserves for expenses associated with merchandise repurpose processing,
reserves for contingent liabilities of any Loan Party, reserves for uninsured
losses of any Loan Party, reserves for

 

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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 and (b) Banking Services/Swap Reserves. The
Administrative Agent may, in its Permitted Discretion and with no less than four
(4) Business Days’ prior written notice to the Borrower Representative (other
than during a Dominion Period in which case notice shall not be required),
adjust Reserves, provided that, if after the delivery of such notice the
Borrower Representative notifies the Administrative Agent that it desires to
discuss the Reserves described therein, then the Administrative Agent will
discuss such Reserves with the Borrower Representative, provided that nothing in
this proviso shall obligate the Administrative Agent to eliminate, reduce, or
delay any such Reserves.

“Responsible Officer” means the chief executive officer, president, any vice
president, any Financial Officer, or any corporate secretary. Any document
delivered hereunder that is signed by a Responsible Officer of a Loan Party
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party in their capacity as an officer of such Loan Party and not in
any individual capacity.

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

“Restricted Subsidiary” means any Subsidiary of the Company other than an
Unrestricted Subsidiary.

“Revaluation Date” means (a) with respect to any Loan denominated in Canadian
Dollars, Sterling, Euros or any Alternative Currency, each of the following:
(i) each date of a Borrowing, (ii) each date of a continuation of such Loan
pursuant to Section 2.08, (iii) the date any Borrowing Base Certificate is
delivered, and (iv) such additional dates as the Administrative Agent shall
determine or the Required Lenders shall require, and (b) with respect to any
Letter of Credit denominated in any LC Designated Currency, each of the
following: (i) each date of issuance of such Letter of Credit, (ii) each date of
an amendment of such Letter of Credit having the effect of increasing the amount
thereof (solely with respect to the increased amount), (iii) each date of any
payment by the applicable Issuing Bank under such Letter of Credit, (iv) the
date any Borrowing Base Certificate is delivered and (v) such additional dates
as the Administrative Agent or the applicable Issuing Bank shall determine or
the Required Lenders shall require.

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

“Revolving Exposure Limitations” has the meaning assigned to such term in
Section 2.01.

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

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

 

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

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

“Sanctioned Person” means, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by the Office of Foreign
Assets Control of the U.S. Department of the Treasury, the U.S. Department of
State, or by the United Nations Security Council, the European Union or any
European Union member state, (b) any Person operating, organized or resident in
a Sanctioned Country or (c) any Person owned or controlled by any such person or
Person described in the foregoing clauses (a) or (b).

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

“Screen Rate” means (a) in respect of the LIBO Rate for any Interest Period, a
rate per annum equal to the London interbank offered rate as administered by the
ICE Benchmark Administration (or any other Person that takes over the
administration of such rate) for deposits in the applicable currency (for
delivery on the first day of such Interest Period) for a period equal in length
to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters
screen page that displays such rate (or, in the event such rate does not appear
on a page of the Reuters screen, on the appropriate page of such other
information service that publishes such rate from time to time as shall be
selected by the Administrative Agent in its reasonable discretion), (b) in
respect of the EURIBO Rate for any Interest Period, the percentage per annum
determined by the Banking Federation of the European Union for such Interest
Period as set forth on the Reuters screen page that displays such rate
(currently EURIBOR01) (or, in the event such rate does not appear on a page of
the Reuters screen, on the appropriate page of such other information service
that publishes such rate from time to time as shall be selected by the
Administrative Agent in its reasonable discretion) and (c) in respect of the
CDOR Rate for any Interest Period, the average rate for bankers’ acceptances as
administered by the Investment Industry Regulatory Organization of Canada (or
any other Person that takes over the administration of that rate) with a tenor
equal to such Interest Period, displayed on the CDOR page of the Reuters screen
(or, in the event such rate does not appear on a page of the Reuters screen, on
the appropriate page of such other information service that publishes such rate
from time to time as shall be selected by the Administrative Agent in its
reasonable discretion); provided that if any Screen Rate, determined as provided
above, would be less than zero, the Screen Rate shall for all purposes of this
Agreement be zero. If, as to any currency, no Screen Rate shall be available for
a particular Interest Period but Screen Rates shall be available for maturities
both longer and shorter than such Interest Period, then the Screen Rate for such
Interest Period shall be the Interpolated Screen Rate.

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

“Secured Inventory Intercreditor Agreement” has the meaning assigned to such
term in the definition of Secured Inventory Liens.

“Secured Inventory Liens” means Liens in favor of consignors of inventory and
proceeds (other than Accounts or Credit Card Accounts) thereof consigned by such
consignors to a Borrower or a Subsidiary of a Borrower, in each case granted in
the ordinary course of business and with prior written

 

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consent of the Administrative Agent, which consent may, to the extent such
Secured Inventory Liens encumber Collateral with a value in excess of $2,500,000
individually or in the aggregate, at the Administrative Agent’s sole discretion,
be conditioned upon the execution of an intercreditor agreement between the
consignor and the Administrative Agent (such an intercreditor agreement, a
“Secured Inventory Intercreditor Agreement”).

“Secured Leverage Ratio” means, at any date, the ratio of (a) Total Funded
Indebtedness on such date that is secured by a Lien on the assets of the Company
or any of its Subsidiaries to (b) EBITDA for the period of four (4) consecutive
fiscal quarters ended on such date (or, if such date is not the last day of a
fiscal quarter, ended on the last day of the fiscal quarter most recently ended
prior to such date).

“Secured Obligations” means all Obligations, together with all (a) Banking
Services Obligations of the Borrowers or any Subsidiary of a Borrower; and
(b) Swap Agreement Obligations of a Borrower or any Subsidiary of a Borrower;
provided that Excluded Swap Obligations with respect to any Loan Party shall not
be Secured Obligations of such Loan Party; provided further that,
notwithstanding anything to the contrary in this Agreement or any other Loan
Document, Specified L/C Obligations constituting Banking Services Obligations
shall not constitute Secured Obligations following such time as the Commitments
shall have expired or been terminated and the principal of and interest on each
Loan and all fees, expenses and other amounts payable under any Loan Document
(other than contingent or indemnity obligations for which no claim has been
made) shall have been paid in full and all Letters of Credit shall have expired
or have been Cash Collateralized pursuant to the terms hereof or terminated, in
each case without any pending draw, and all LC Disbursements shall have been
reimbursed.

“Secured Parties” means (a) the Administrative Agent, (b) the Lenders, (c) each
Issuing Bank, (d) Qualified Counterparties to whom any Banking Services
Obligations are owing, (e) Qualified Counterparties to whom Swap Agreement
Obligations constituting Secured Obligations hereunder are owing, (f) the
beneficiaries of each indemnification obligation undertaken by any Loan Party
under any Loan Document, and (g) the successors and assigns of each of the
foregoing.

“Security Agreement” means that certain Pledge and Security Agreement, dated as
of the Effective Date, among the Loan Parties and the Administrative Agent, and,
as the context requires, any other pledge or security agreement entered into,
after the Effective Date by any other Loan Party (as required by this Agreement
or any other Loan Document), or any other Person, as the same may be amended,
restated, supplemented, or otherwise modified from time to time.

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

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

“Specified L/C Facility” means (a) that certain Master Commercial Letter of
Credit Agreement dated as of June 29, 2015 issued by the Company in favor of
Bank of America, N.A. (as amended restated, supplemented or otherwise modified
from time to time as permitted hereunder) and (b) that certain Commercial Letter
of Credit Agreement dated as of July 1, 2015 among the Company and Wells Fargo
Bank, National Association (as amended restated, supplemented or otherwise
modified from time to time as permitted hereunder), in each case, so long as the
issuing bank thereunder is a Lender or an Affiliate of a Lender hereunder (and,
if such issuer ceases to be a Lender or an Affiliate of a Lender hereunder, for
a period of 90 days following the termination of its capacity under this
Agreement as a Lender or an Affiliate of a Lender).

 

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“Specified L/C Obligations” means all obligations and liabilities of any Loan
Party or any Subsidiary under any Specified L/C Facility with respect to
commercial letters of credit issued thereunder.

“Specified Time” means (a) with respect to the LIBO Rate, 11:00 a.m., London
time, (b) with respect to the EURIBO Rate, 11:00 a.m., Brussels time and
(c) with respect to the CDOR Rate, 11:00 a.m., Toronto time.

“Spot Rate” means, on any date, as determined by the Administrative Agent, the
spot selling rate posted by Reuters on its website for the sale of the
applicable currency for U.S. Dollars at approximately 11:00 a.m., New York City
time, on such date (the “Applicable Quotation Date”); provided, that if, for any
reason, no such spot rate is being quoted, the spot selling rate shall be
determined by reference to such publicly available service for displaying
exchange rates as may be reasonably selected by the Administrative Agent, or, in
the event no such service is selected, such spot selling rate shall instead be
the rate reasonably determined by the Administrative Agent as the spot rate of
exchange in the market where its foreign currency exchange operations in respect
of the applicable currency are then being conducted, at or about 11:00 a.m., New
York City time, on the Applicable Quotation Date for the purchase of the
relevant currency for delivery two Business Days later.

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

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

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

“Sterling” or “£” means the lawful currency of the United Kingdom.

“Subordinated Indebtedness” of a Person means any Indebtedness of such Person
the payment of which is subordinated to payment of the Secured Obligations to
the written satisfaction of the Administrative Agent.

“subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation,

 

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limited liability company, partnership, association or other entity (a) of which
securities or other ownership interests representing more than 50% of the equity
or more than 50% of the ordinary voting power or, in the case of a partnership,
more than 50% of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of such date, otherwise Controlled, by
the parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.

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

“Subsidiary Borrowers” means, collectively (i) each Domestic Subsidiary of the
Company that is a party to this Agreement as a “Borrower” on the Effective Date
and (ii) each Domestic Subsidiary of the Company that becomes a party to this
Agreement as a “Borrower” following the Effective Date pursuant to Section 5.14,
in each case, until such time as such Domestic Subsidiary is released from its
obligations under the Loan Documents in accordance with this Agreement.

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

“Swap Agreement Obligations” means any and all obligations of the Loan Parties
and their Subsidiaries, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor), under (a) any
and all Swap Agreements permitted hereunder with a Lender or an Affiliate of a
Lender, and (b) any and all cancellations, buy backs, reversals, terminations or
assignments of any such Swap Agreement transaction.

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

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

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

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

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

“Total Assets” means, at any date of determination, the consolidated total
assets of the Company and its Restricted Subsidiaries as of the last day of the
most recent fiscal quarter of the Company for which financial statements have
been delivered pursuant to Section 5.01(a) or (b) as adjusted to give effect to
any Pro Forma Event occurring since such date.

 

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“Total Funded Indebtedness” means, as of any date, with respect to the Company
and its Subsidiaries, determined on a consolidated basis, without duplication
(a) all obligations of such Persons for borrowed money, (b) all obligations of
such Persons evidenced by bonds, debentures, notes or similar instruments,
(c) all obligations of such Persons upon which interest charges are customarily
paid, (d) the aggregate amount of Capital Lease Obligations and Off-Balance
Sheet Liability of such Persons outstanding as of such date, (e) the aggregate
obligations of such Persons as an account party in respect of letters of credit
or letters of guaranty, other than contingent obligations in respect of any
letter of credit or letter of guaranty to the extent such letter of credit or
letter of guaranty does not support Indebtedness, (f) all obligations of such
Persons with respect to Disqualified Stock and (g) without duplication, all
Guarantees of any of the foregoing. For purposes of this definition, interest
paid-in-kind or capitalized (including accreted amounts thereon) shall be deemed
Total Funded Indebtedness.

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

“Treaty on the European Union” means the Treaty of Rome of March 25, 1957, as
amended by the Single European Act 1986 and the Maastricht Treaty (signed
February 7, 1992), as amended from time to time.

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

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

“Unfinanced Capital Expenditures” means, for any period, Capital Expenditures
made during such period (excluding replacement Capital Expenditures made
(x) with the proceeds of insurance or (y) in anticipation of the receipt of
insurance proceeds based on the good faith reasonable belief of the Company as
confirmed in writing to the Administrative Agent in advance of inclusion or
exclusion of capital expenditures in any calculation provided for herein (an
“Insurance Anticipation Capital Expenditure”), to the extent that the
anticipated insurance proceeds are actually received within 270 days after the
date of such Insurance Anticipation Capital Expenditure, and otherwise the
amount of such Insurance Anticipation Capital Expenditure (if no insurance
proceeds are timely received) or the excess of such Insurance Anticipation
Capital Expenditure (if insurance proceeds are timely received but in an amount
less than such Insurance Anticipation Capital Expenditure) over the related
insurance proceeds received shall be deemed to be part of the unfinanced portion
of Capital Expenditures in the fiscal quarter in which such 270-day period
expires) which are not financed from the proceeds of any Indebtedness (other
than the Revolving Loans; it being understood and agreed that, to the extent any
Capital Expenditures are financed with Revolving Loans, such Capital
Expenditures shall be deemed Unfinanced Capital Expenditures).

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

 

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“Unrestricted Subsidiary” means any Subsidiary of the Company that is identified
as an Unrestricted Subsidiary on Schedule 3.15 as of the Effective Date and any
other Subsidiary designated by the Company as an Unrestricted Subsidiary
pursuant to Section 5.15 subsequent to the Effective Date; provided that no
Subsidiary may be, or may be designated as, an Unrestricted Subsidiary unless
(a) it is a CFC or CFC Holdco or (b) it does not have any material liabilities,
does not own any assets with a book value of more than $5,000,000 in the
aggregate (and the aggregate book value of the assets of all Unrestricted
Subsidiaries shall not exceed $10,000,000), it is not obligated or liable,
directly or indirectly, contingently or otherwise, in respect of any
Indebtedness in any material amount, and none of its assets are included in the
calculation of the Borrowing Base immediately prior to such Subsidiary’s being
designated as an Unrestricted Subsidiary.

“Urban UK L/C” means that certain HM Revenues and Customs Deferment Guarantee
commencing on January 5, 1998, with the approval number of 8823295, issued by
Wells Fargo or any Affiliate thereof or successor thereto, as Guarantor, in
favor of Urban Outfitters UK Ltd., as Applicant, in the amount of, as of
Effective Date, £2,000,000, as such amount may be reduced or increased from time
to time after the Effective Date.

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

“U.S. Dollar” or “$“means the lawful money of the United States of America.

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

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

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

“Wells Fargo” means Wells Fargo Bank, National Association, and Wells Fargo Bank
NA, London Branch, as applicable.

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

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

SECTION 1.03 Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “law”
shall be construed as referring to all statutes, rules, regulations, codes and
other laws (including official rulings and interpretations thereunder having the
force of law or with which affected Persons customarily comply) and all
applicable judgments, orders and decrees of all Governmental Authorities. The
word

 

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“will” shall be construed to have the same meaning and effect as the word
“shall”. Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, restated, supplemented or otherwise modified (subject to
any restrictions on such amendments, restatements, supplements or modifications
set forth herein), (b) any definition of or reference to any statute, rule or
regulation shall be construed as referring thereto as from time to time amended,
supplemented or otherwise modified (including by succession of comparable
successor laws), (c) any reference herein to any Person shall be construed to
include such Person’s successors and assigns (subject to any restrictions on
assignments set forth herein) and, in the case of any Governmental Authority,
any other Governmental Authority that shall have succeeded to any or all
functions thereof, (d) the words “herein”, “hereof” and “hereunder”, and words
of similar import, shall be construed to refer to this Agreement in its entirety
and not to any particular provision hereof, (e) all references herein to
Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, this Agreement, (f) any
reference in any definition to the phrase “at any time” or “for any period”
shall refer to the same time or period for all calculations or determinations
within such definition, (g) the words “asset” and “property” shall be construed
to have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights and (h) the phrase “ordinary course of business” shall refer to
the ordinary course of the Company’s business.

SECTION 1.04 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 after
the date hereof there occurs any change in GAAP or in the application thereof on
the operation of any provision hereof and the Borrower Representative notifies
the Administrative Agent that the Borrowers request an amendment to any
provision hereof to eliminate the effect of such change in GAAP or in the
application thereof (or if the Administrative Agent notifies the Borrower
Representative that the Required Lenders request an amendment to any provision
hereof for 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, and the Borrower
Representative, the Administrative Agent and the Lenders agree to negotiate in
good faith with respect to any proposed amendment to eliminate or adjust for the
effect of any such change. Notwithstanding any other provision contained herein,
all terms of an accounting or financial nature used herein shall be construed,
and all computations of amounts and ratios referred to herein shall be made
(i) without giving effect to any election under Financial Accounting Standards
Board Accounting Standards Codification 825-10-25 (or any other Accounting
Standards Codification or Financial Accounting Standard having a similar result
or effect) to value any Indebtedness or other liabilities of the Company or any
Subsidiary at “fair value”, as defined therein, (ii) without giving effect to
any treatment of Indebtedness in respect of convertible debt instruments under
Financial Accounting Standards Board Accounting Standards Codification 470-20
(or any other Accounting Standards Codification or Financial Accounting Standard
having a similar result or effect) to value any such Indebtedness in a reduced
or bifurcated manner as described therein, and such Indebtedness shall at all
times be valued at the full stated principal amount thereof, and (iii) without
giving effect to any change in GAAP occurring after the Effective Date as a
result of the adoption of any proposals set forth in the Proposed Accounting
Standards Update, Leases (Topic 840), issued by the Financial Accounting
Standards Board on August 17, 2010, or any other proposals issued by the
Financial Accounting Standards Board in connection therewith, in each case if
such change would require treating any lease (or similar arrangement conveying
the right to use) as a capital lease where such lease (or similar arrangement)
was not required to be so treated under GAAP as in effect on the Effective Date.

 

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SECTION 1.05 Pro Forma Adjustments for Acquisitions and Dispositions. To the
extent any Borrower or any Subsidiary makes any Acquisition permitted pursuant
to Section 6.04 or disposition of assets outside the ordinary course of business
permitted by Section 6.05 during the period of four (4) fiscal quarters of the
Borrowers most recently ended, each of Adjusted Leverage Ratio, the Secured
Leverage Ratio, and the Fixed Charge Coverage Ratio, if required to be
calculated herein, shall be calculated after giving pro forma effect thereto
(including pro forma adjustments arising out of events which are directly
attributable to such Acquisition or 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 Financial Officer of
the Company), as if such Acquisition or such disposition (and any related
incurrence, repayment or assumption of Indebtedness) had occurred in the first
day of such four-quarter period.

SECTION 1.06 Status of Obligations. In the event that any Borrower or any other
Loan Party shall at any time issue or have outstanding any Subordinated
Indebtedness, such Borrower shall take or cause such other Loan Party to take
all such actions as shall be necessary to cause the Secured Obligations to
constitute senior indebtedness (however denominated) in respect of such
Subordinated Indebtedness and to enable the Administrative Agent and the Lenders
to have and exercise any payment blockage or other remedies available or
potentially available to holders of senior indebtedness under the terms of such
Subordinated Indebtedness. Without limiting the foregoing, the Secured
Obligations are hereby designated as “senior indebtedness” and as “designated
senior indebtedness” and words of similar import under and in respect of any
indenture or other agreement or instrument under which such Subordinated
Indebtedness is outstanding and are further given all such other designations as
shall be required under the terms of any such Subordinated Indebtedness in order
that the Lenders may have and exercise any payment blockage or other remedies
available or potentially available to holders of senior indebtedness under the
terms of such Subordinated Indebtedness.

SECTION 1.07 Exchange Rates; Currency Equivalents.

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

(b) For purposes of this Agreement and the other Loan Documents, the Dollar
Amount of any Borrowings, Loans, Letters of Credit and other Obligations shall
be determined in accordance with the terms of this Agreement in respect of the
most recent Revaluation Date. Such Dollar Amount shall become effective as of
such Revaluation Date for such Borrowings, Loans, Letters of Credit and other
Obligations and shall be the Dollar Amount employed in converting any amounts
between the applicable currencies until the next Revaluation Date to occur for
such Borrowings, Loans, Letters of Credit and other Obligations.

ARTICLE II

THE CREDITS

SECTION 2.01 Commitments. Subject to the terms and conditions set forth herein,
each Lender severally agrees, from time to time during the Availability Period,
to make Revolving Loans to the Borrowers in an aggregate principal amount that
will not result in:

(i) such Lender’s Revolving Exposure exceeding such Lender’s Commitment;

 

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(ii) the Aggregate Credit Exposure exceeding the Aggregate Commitments;

(iii) the Aggregate Credit Exposure exceeding the Borrowing Base; or

(iv) the Aggregate Credit Exposure denominated in currencies other than U.S.
Dollars exceeding the Foreign Currency Sublimit;

subject to the Administrative Agent’s authority, in its sole discretion, to make
Protective Advances and Overadvances pursuant to the terms of Section 2.04 and
Section 2.05. The limitations on Borrowings referred to in clauses (i) through
(iv) are referred to collectively as the “Revolving Exposure Limitations.”
Within the foregoing limits and subject to the terms and conditions set forth
herein, the Borrowers may borrow, prepay and reborrow Revolving Loans.

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

(b) Subject to the Foreign Currency Sublimit, all Borrowings shall be
denominated in U.S. Dollars, Sterling, Euros, Canadian Dollars or other
Designated Currencies. Subject to Section 2.14, (i) each Borrowing that is
denominated in U.S. Dollars shall be comprised entirely of ABR Loans (other than
Revolving Loans designated as Elective Pricing Loans at the time of Borrowing)
or LIBOR Loans as the Borrower Representative may request in accordance
herewith, provided that any Borrowings made on the Effective Date must be made
as ABR Borrowings but may be converted into LIBOR Borrowings in accordance with
Section 2.08, (ii) each Borrowing of Elective Pricing Loans (if so designated at
the time of Borrowing) shall be comprised entirely of LIBOR Loans, (iii) each
Borrowing denominated in Canadian Dollars shall be comprised entirely of CDOR
Loans, (iv) each Borrowing denominated in Sterling or any Alternative Currency
shall be comprised entirely of LIBOR Loans and (v) each Borrowing denominated in
Euros shall be comprised entirely of EURIBOR Loans. Each Swingline Loan shall be
denominated in U.S. Dollars and shall be an ABR Loan. Each Lender at its option
may make any Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan (and in the case of an Affiliate, the provisions of
Section 2.14, Section 2.15, Section 2.16 and Section 2.17 shall apply to such
Affiliate to the same extent as to such Lender); provided, however, (i) the
exercise of such option shall be recorded in the Register in accordance with
Section 9.04(b)(iv) and such Affiliate shall have provided the tax forms
required by Section 2.17(f) to the Administrative Agent, and (ii) any that any
exercise of such option shall not affect the obligation of the Borrowers to
repay such Loan in accordance with the terms of this Agreement.

(c) At the commencement of each Interest Period for any LIBOR Borrowing, CDOR
Borrowing or EURIBOR Borrowing, such Borrowing shall be in an aggregate amount
that is an integral multiple of 1,000,000 U.S. Dollars, Sterling, Euros,
Canadian Dollars or other Designated Currency, as applicable and not less than
1,000,000 U.S. Dollars, Sterling, Euros, Canadian Dollars or other Designated
Currency, as applicable. At the time that each ABR Borrowing is made, such
Borrowing shall be in an aggregate amount that is an integral multiple of
$500,000 or Cdn$500,000, as applicable and not less than $1,000,000 or
Cdn$1,000,000, as applicable; provided that an ABR Borrowing may be in an
aggregate amount that is equal to the entire unused balance of the Aggregate
Commitments or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.06(e). Each Swingline Loan shall be in
an amount that is an integral multiple of $500,000 and not less than

 

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$1,000,000. Borrowings of more than one Type may be outstanding at the same
time; provided that there shall not at any time be, collectively, more than a
total of 10 LIBOR, CDOR and EURIBOR Borrowings outstanding.

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

SECTION 2.03 Requests for Borrowings. To request a Borrowing, the Borrower
Representative shall notify the Administrative Agent of such request either in
writing (delivered by hand, facsimile or emailed in pdf format) in a form
approved by the Administrative Agent and signed by the Borrower Representative
or by telephone not later than (a) in the case of a CDOR Borrowing, 11:00 a.m.,
Local Time, four (4) Business Days before the date of the proposed Borrowing,
(b) in the case of a LIBOR Borrowing or EURIBOR Borrowing, 11:00 a.m., Local
Time, three (3) Business Days before the date of the proposed Borrowing or
(c) in the case of an ABR Borrowing (other than a Swingline Borrowing), noon,
Local Time, on the date of the proposed Borrowing; provided that any such notice
of an ABR Borrowing to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.06(e) may be given not later than 10:00 a.m., New York
time, on the date of such proposed Borrowing. Each such telephonic Borrowing
Request shall be irrevocable and shall be confirmed promptly by hand delivery,
facsimile or emailed in pdf format to the Administrative Agent of a written
Borrowing Request signed by the Borrower Representative. Each such telephonic
and written Borrowing Request shall specify the following information in
compliance with Section 2.02:

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

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

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

(iv) the Type of such Borrowing; and

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

Any Borrowing Request that shall fail to specify any of the information required
by the preceding provisions of this paragraph may be rejected by the
Administrative Agent if such failure is not corrected promptly after the
Administrative Agent shall give written or telephonic notice thereof to the
Borrower Representative and, if so rejected, will be of no force or effect.
Promptly following receipt of a Borrowing Request in accordance with this
Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender’s Loan to be made as part of the
requested Borrowing.

SECTION 2.04 Protective Advances. (a) Subject to the limitations set forth
below, the Administrative Agent is authorized by the Borrowers and the Lenders,
from time to time in the Administrative Agent’s sole discretion (but shall have
absolutely no obligation to), to make Loans to the Borrowers, on behalf of all
Lenders, which the Administrative Agent, in its Permitted Discretion, deems
necessary or desirable (i) to preserve or protect the Collateral, or any portion
thereof, (ii) to enhance the likelihood of, or maximize the amount of, repayment
of the Loans and other Obligations, or (iii) to pay any other amount chargeable
to or required to be paid by the Borrowers pursuant to the terms of this

 

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Agreement, including payments of reimbursable expenses (including costs, fees,
and expenses as described in Section 9.03) and other sums payable under the Loan
Documents (any of such Loans are herein referred to as “Protective Advances”);
provided that (i) the aggregate principal amount of outstanding Protective
Advances shall not, at any time, exceed (x) 5% of the Aggregate Commitments then
in effect or (y) when aggregated with the aggregate outstanding principal amount
of Overadvances, 10% of the Aggregate Commitments then in effect; provided
further that no Protective Advance shall be made if after giving effect thereto,
any Lender’s Revolving Exposure shall exceed such Lender’s Commitment.
Protective Advances may be made even if the conditions precedent set forth in
Section 4.02 have not been satisfied. The Protective Advances shall be secured
by the Liens in favor of the Administrative Agent in and to the Collateral and
shall constitute Obligations hereunder. All Protective Advances shall be ABR
Borrowings. The 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 the making of such Revolving Loan would not
violate the Revolving Exposure Limitations and the conditions precedent set
forth in Section 4.02 have been satisfied, the Administrative Agent may request
the Lenders to make a Revolving Loan to repay a Protective Advance. At any other
time the Administrative Agent may require the Lenders to fund their risk
participations described in Section 2.04(b).

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

SECTION 2.05 Swingline Loans and Overadvances.

(a) The Administrative Agent, the Swingline Lender and the Lenders agree that in
order to facilitate the administration of this Agreement and the other Loan
Documents, promptly after the Borrower Representative requests an ABR Borrowing
in U.S. Dollars, the Swingline Lender may elect to have the terms of this
Section 2.05(a) apply to such Borrowing Request by advancing, on behalf of the
Lenders and in the amount requested, same day funds to the applicable Borrowers,
on the date of the applicable Borrowing to the applicable Funding Account(s)
(each such Loan made solely by the Swingline Lender pursuant to this
Section 2.05(a) is referred to in this Agreement as a “Swingline Loan”), with
settlement among them as to the Swingline Loans to take place on a periodic
basis as set forth in Section 2.05(d). Each Swingline Loan shall be subject to
all the terms and conditions applicable to other ABR Loans funded by the
Lenders, except that all payments thereon shall be payable to the Swingline
Lender solely for its own account. In addition, the Borrowers hereby authorize
the Swingline Lender to, and the Swingline Lender shall, subject to the terms
and conditions set forth herein (but without any further written notice
required), not later than 2:00 p.m., New York time, on each Business Day, make
available to the Borrowers by means of a credit to the Funding Account(s), the
proceeds of a Swingline Loan to the extent necessary to pay items to be drawn on
any Controlled Disbursement Account that Business Day; provided that, if on any
Business Day there is insufficient borrowing capacity to permit the Swingline
Lender to make available to the Borrowers a Swingline Loan in the amount
necessary to pay all items to be so drawn on any such Controlled Disbursement
Account on such Business Day, then the Borrower Representative shall be deemed
to have requested an ABR Borrowing in U.S. Dollars pursuant to Section 2.03 in
the amount of such deficiency to be made on such Business Day. The aggregate

 

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amount of Swingline Loans outstanding at any time shall not exceed $25,000,000.
The Swingline Lender shall not make any Swingline Loan if, after giving effect
thereto, the Borrowers would not be in compliance with the Revolving Exposure
Limitations. All Swingline Loans shall be ABR Borrowings.

(b) Any provision of this Agreement to the contrary notwithstanding, at the
request of the Borrower Representative, the Administrative Agent may in its sole
discretion (but with absolutely no obligation), make Revolving Loans in U.S.
Dollars to the Borrowers, on behalf of the Lenders, in amounts that exceed
Availability (any such excess Revolving Loans are herein referred to
collectively as “Overadvances”); provided that, no Overadvance shall result in a
Default due to Borrowers’ failure to comply with Section 2.01 for so long as
such Overadvance remains outstanding in accordance with the terms of this
paragraph, but solely with respect to the amount of such Overadvance; provided,
further that the aggregate amount of outstanding Overadvances shall not, at any
time, exceed (x) 5% of the Aggregate Commitments then in effect or (y) when
aggregated with the aggregate outstanding amount of Protective Advances then
outstanding, 10% of the Aggregate Commitments then in effect; provided further
that no Overadvance shall be made if after giving effect thereto, any Lender’s
Revolving Exposure shall exceed such Lender’s Commitment. Overadvances may be
made even if the condition precedent set forth in Section 4.02(c) has not been
satisfied. All Overadvances shall be ABR Borrowings. The applicable Borrowers
shall be required to repay each Overadvance no later than the 30th day after the
date of the making thereof. The Administrative Agent’s authorization to make
Overadvances 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.

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

(d) The Administrative Agent, on behalf of the Swingline Lender, shall request
settlement (a “Settlement”) with the Lenders on at least a weekly basis or on
any date that the Administrative Agent elects, by notifying the Lenders of such
requested Settlement by facsimile, telephone, or e-mail no later than 1:00 p.m.
New York time on the date of such requested Settlement (the “Settlement Date”).
Each Lender (other than the Swingline Lender, in the case of the Swingline
Loans) shall transfer the amount of such Lender’s Applicable Percentage of the
outstanding principal amount of the applicable Loan with respect to which
Settlement is requested to the Administrative Agent, to such account of the
Administrative Agent as the Administrative Agent may designate, not later than
3:00 p.m., New York time, on such Settlement Date. Settlements may occur during
the existence of a Default and whether or not the applicable conditions
precedent set forth in Section 4.02 have then been satisfied. Such amounts
transferred to the Administrative Agent shall be applied against the amounts of
the Swingline Lender’s Swingline Loans and, together with Swingline Lender’s
Applicable Percentage of such Swingline Loan, shall constitute Revolving Loans
of such Lenders, respectively. If any such amount is not transferred to the
Administrative Agent by any Lender on such Settlement Date, the Swingline Lender
shall be entitled to recover from such Lender on demand such amount, together
with interest thereon, as specified in Section 2.07.

 

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SECTION 2.06 Letters of Credit. (a) General. Subject to the terms and conditions
set forth herein, the Borrower Representative may request the issuance of
Letters of Credit denominated in U.S. Dollars or an LC Designated Currency for
its own account or for the account of another Borrower as the applicant thereof
for the support of its or any Subsidiary’s obligations, in a form reasonably
acceptable to the Administrative Agent and the Issuing Bank, at any time and
from time to time during the Availability Period; provided that, for the
avoidance of doubt, notwithstanding that the Urban UK L/C has been issued for
the account of a Subsidiary of the Company, the Borrowers hereby acknowledge and
agree that the Borrowers shall be deemed to have requested that Wells Fargo, as
an Issuing Bank hereunder, issue the Urban UK L/C, and the Borrowers are and
shall be obligated for all reimbursement obligations under the Urban UK L/C,
including, without limitation, as if an application for such Urban UK L/C shall
have been executed by the Company. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrowers
to, or entered into by the Borrowers with, the Issuing Bank relating to any
Letter of Credit, the terms and conditions of this Agreement shall control. Each
Borrower unconditionally and irrevocably agrees that, in connection with any
Letter of Credit issued for the support of any Subsidiary’s obligations as
provided in the first sentence of this paragraph, such Borrower will be fully
responsible for the reimbursement of LC Disbursements in accordance with the
terms hereof, the payment of interest thereon and the payment of fees due under
Section 2.12(b) to the same extent as if it were the sole account party in
respect of such Letter of Credit (such Borrower hereby irrevocably waiving any
defenses that might otherwise be available to it as a guarantor or surety of the
obligations of such Subsidiary that is an account party in respect of any such
Letter of Credit). Notwithstanding anything herein to the contrary, the Issuing
Bank shall have no obligation hereunder to issue, and shall not issue, any
Letter of Credit (i) the proceeds of which would be made available to any Person
(A) to fund any activity or business of or with any Sanctioned Person, or in any
country or territory that, at the time of such funding, is the subject of any
Sanctions or (B) in any manner that would result in a violation of any Sanctions
by any party to this Agreement, (ii) if any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport to enjoin or
restrain the Issuing Bank from issuing such Letter of Credit, or any Requirement
of Law relating to the Issuing Bank or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction over
the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from,
the issuance of letters of credit generally or such Letter of Credit in
particular or shall impose upon the Issuing Bank with respect to such Letter of
Credit any restriction, reserve or capital requirement (for which the Issuing
Bank is not otherwise compensated hereunder) not in effect on the Effective
Date, or shall impose upon the Issuing Bank any unreimbursed loss, cost or
expense which was not applicable on the Effective Date and which the Issuing
Bank in good faith deems material to it, or (iii) if the issuance of such Letter
of Credit would violate one or more policies of the Issuing Bank applicable to
letters of credit generally; provided that, notwithstanding anything herein to
the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act
and all requests, rules, guidelines, requirements or directives thereunder or
issued in connection therewith or in the implementation thereof, and (y) all
requests, rules, guidelines, requirements or directives promulgated by the Bank
for International Settlements, the Basel Committee on Banking Supervision (or
any successor or similar authority) or the United States or foreign regulatory
authorities, in each case pursuant to Basel III, shall in each case be deemed
not to be in effect on the Effective Date for purposes of clause (ii) above,
regardless of the date enacted, adopted, issued or implemented.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower Representative shall
deliver by hand or facsimile (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank and the
Administrative Agent) to the Issuing Bank and the Administrative Agent
(reasonably in advance of, but in any event no less than three (3) Business Days
prior to the requested date of issuance, amendment, renewal or extension) a
notice requesting the issuance of a Letter of Credit, or identifying the Letter
of Credit to be amended, renewed or extended, and specifying the date of
issuance, amendment,

 

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renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (if applicable) (which shall comply with
paragraph (c) of this Section), the amount and currency of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter
of Credit. If requested by the Issuing Bank, the Borrower Representative also
shall submit a letter of credit application on the Issuing Bank’s standard form
in connection with any request for a Letter of Credit. A Letter of Credit shall
be issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit the Borrowers shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the aggregate LC Exposure shall not exceed $25,000,000,
(ii) the aggregate Standby LC Exposure shall not exceed $25,000,000, (iii) the
aggregate Commercial LC Exposure shall not exceed $5,000,000, (iv) the LC
Exposure of any Issuing Bank shall not exceed such Issuing Bank’s LC Individual
Sublimit, and (v) the Borrowers will be in compliance with the Revolving
Exposure Limitations.

(c) Expiration Date. Each Letter of Credit (other than the Urban UK L/C) shall
expire (or be subject to termination or non-renewal by notice from the
applicable Issuing Bank to the beneficiary thereof) at or prior to the close of
business on the earlier of (i) the date one year after the date of the issuance
of such Letter of Credit (or, in the case of any renewal or extension thereof,
including, without limitation, any automatic renewal provision, one year after
such renewal or extension) and (ii) the date that is five (5) Business Days
prior to the Maturity Date (or such later date as to which the Administrative
Agent may agree) unless in the case of this subclause (ii) such Letter of Credit
is Cash Collateralized on or prior to the date of issuance thereof. Any Letter
of Credit may provide by its terms that it may be automatically extended for
additional successive one year periods on terms reasonably acceptable to the
applicable Issuing Bank. Any Letter of Credit providing for automatic extension
shall be extended upon the then current expiration date without any further
action by any Person unless the applicable Issuing Bank shall have given notice
to the applicable beneficiary (with a copy to the Borrower Representative) of
the election by such Issuing Bank not to extend such Letter of Credit, such
notice to be given not fewer than 30 days prior to the then current expiration
date of such Letter of Credit; provided that no Letter of Credit may be extended
automatically or otherwise beyond the date that is five (5) Business Days prior
to the Maturity Date unless such Letter of Credit is Cash Collateralized on or
prior to the date of such extension. Notwithstanding the foregoing, for the
avoidance of doubt, the Urban UK L/C shall not be required to comply with the
foregoing requirements.

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

 

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(e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the Borrowers shall reimburse such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement
(i) not later than 1:00 p.m., New York time, on the date that such LC
Disbursement is made, if the Borrower Representative shall have received notice
of such LC Disbursement prior to 10:00 a.m., New York time, on such date, or,
(ii) if such notice has not been received by the Borrower Representative prior
to such time on such date, then not later than 12:00 noon, New York time, on
(A) the Business Day that the Borrower Representative receives such notice, if
such notice is received prior to 10:00 a.m., New York time, on the day of
receipt, or (B) the Business Day immediately following the day that the Borrower
Representative receives such notice, if such notice is not received prior to
such time on the day of receipt; provided that the Borrower Representative may,
subject to the conditions to borrowing set forth herein, request in accordance
with Section 2.03 or Section 2.05 that such payment be financed with an ABR
Borrowing or Swingline Loan in an equivalent amount and, to the extent so
financed, the Borrowers’ obligation to make such payment shall be discharged and
replaced by the resulting ABR Borrowing or Swingline Loan. If the Borrowers fail
to make such payment when due, such amount, if denominated in Canadian Dollars
or other Designated Currencies, shall be converted to U.S. Dollars and shall
bear interest at the Alternate Base Rate and the Administrative Agent shall
notify each Lender of the applicable LC Disbursement, the payment then due from
the Borrowers in respect thereof and such Lender’s Applicable Percentage
thereof. Promptly following receipt of such notice, each Lender shall pay to the
Administrative Agent its Applicable Percentage of the payment then due from the
Borrowers, in the same manner as provided in Section 2.07 with respect to Loans
made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to the
payment obligations of the Lenders), and the Administrative Agent shall promptly
pay to the Issuing Bank the amounts so received by it from the Lenders. Promptly
following receipt by the Administrative Agent of any payment from the Borrowers
pursuant to this paragraph, the Administrative Agent shall distribute such
payment to the applicable Issuing Bank or, to the extent that Lenders have made
payments pursuant to this paragraph to reimburse the Issuing Bank, then to such
Lenders and the Issuing Bank as their interests may appear. Any payment made by
a Lender pursuant to this paragraph to reimburse an Issuing Bank for any LC
Disbursement (other than the funding of Revolving Loans or a Swingline Loan as
contemplated above) shall not constitute a Loan and shall not relieve the
Borrowers of their obligation to reimburse such LC Disbursement.

(f) Obligations Absolute. The Borrowers’ joint and several obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein or herein,
(ii) any draft or other document presented under a Letter of Credit proving to
be forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect, (iii) any payment by the Issuing Bank under
a Letter of Credit against presentation of a draft or other document that does
not comply with the terms of such Letter of Credit, or (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrowers’ obligations
hereunder. None of the Administrative Agent, the Lenders, any Issuing Bank or
any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit
or any payment or failure to make any payment thereunder (irrespective of any of
the circumstances referred to in the preceding sentence), or any error,
omission, interruption, loss or delay in transmission or delivery of any draft,
notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of such Issuing Bank; provided that the foregoing shall not be
construed to excuse an Issuing Bank from liability to the Borrowers to the
extent of any direct damages (as opposed to special, indirect, consequential or
punitive damages, claims in respect of which

 

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are hereby waived by the Borrowers to the extent permitted by applicable law)
suffered by any Borrower that are caused by such Issuing Bank’s failure to
exercise care when determining whether drafts and other documents presented
under a Letter of Credit comply with the terms thereof. The parties hereto
expressly agree that, in the absence of gross negligence or willful misconduct
on the part of an Issuing Bank (as finally determined by a court of competent
jurisdiction), such Issuing Bank shall be deemed to have exercised care in each
such determination. In furtherance of the foregoing and without limiting the
generality thereof, the parties agree that, with respect to documents presented
which appear on their face to be in substantial compliance with the terms of a
Letter of Credit, an Issuing Bank may, in its sole discretion, either accept and
make payment upon such documents without responsibility for further
investigation, regardless of any notice or information to the contrary, or
refuse to accept and make payment upon such documents if such documents are not
in strict compliance with the terms of such Letter of Credit.

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

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

(i) Replacement of an Issuing Bank. Any Issuing Bank may be replaced at any time
by written agreement among the Borrower Representative, the Administrative
Agent, the replaced Issuing Bank and the successor Issuing Bank. The
Administrative Agent shall notify the Lenders of any such replacement of an
Issuing Bank. At the time any such replacement shall become effective, the
Borrowers shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.12(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of an Issuing Bank under this Agreement with respect to Letters
of Credit to be issued thereafter and (ii) references herein to the term
“Issuing Bank” shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit then outstanding and issued by it prior to such
replacement, but shall not be required to issue additional Letters of Credit.

(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower Representative receives notice
from the Administrative Agent or the Required Lenders demanding the deposit of
cash collateral pursuant to this paragraph, the Borrowers shall Cash
Collateralize all Letters of Credit; provided that the obligation to Cash
Collateralize all Letters of Credit shall become effective immediately, without
demand or other notice of any kind, upon the

 

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occurrence of any Event of Default with respect to any Borrower described in
clause (h) or (i) of Article VII. For the purposes of this Agreement, “Cash
Collateralize” shall mean, (x) with respect to any Letter of Credit other than
the Urban UK L/C, the deposit in U.S. Dollars in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders (the “LC Collateral Account”), an amount in cash equal to
(i) 103% of the amount of the LC Exposure in respect of such Letter of Credit
issued and outstanding on such date plus accrued and unpaid interest thereon,
plus (ii) 115% of the amount of the LC Exposure in respect of Letters of Credit
issued and outstanding in any LC Designated Currency on such date, plus accrued
and unpaid interest thereon, and (y) with respect to the Urban UK L/C, the
deposit in Sterling in an account with Wells Fargo, in the name of Wells Fargo
and for the benefit of the Lenders (the “Urban UK L/C Collateral Account”), an
amount in cash equal to 115% of the amount of the LC Exposure in respect of such
Urban UK L/C outstanding on such date, and such additional amounts as may be
required by Wells Fargo from time to time thereafter, plus accrued and unpaid
interest thereon. Such deposit in the LC Collateral Account shall be held by the
Administrative Agent as collateral for the payment and performance of the
Secured Obligations. Such deposit in the Urban UK L/C Collateral Account shall
be held by Wells Fargo as collateral for the payment and performance of the
Urban UK L/C and all other Secured Obligations. The Administrative Agent shall
have exclusive dominion and control, including the exclusive right of
withdrawal, over the LC Collateral Account and the Borrowers hereby grant the
Administrative Agent a security interest in the LC Collateral Account and all
money or other assets on deposit therein or credited thereto. Wells Fargo shall
have exclusive dominion and control, including the exclusive right of
withdrawal, over the Urban UK L/C Collateral Account and the Borrowers hereby
grant Wells Fargo and the other Secured Parties a security interest in and
charge over the Urban UK L/C Collateral Account and all money or other assets on
deposit therein or credited thereto. Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of the Administrative Agent and at the Borrowers’ risk and
expense, such deposits in the LC Collateral Account shall not bear interest.
Other than any interest earned on the investment of such deposits, which
investments shall be made at the option and sole discretion of Wells Fargo and
at the Borrowers’ risk and expense, such deposits in the Urban UK L/C Collateral
Account shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in the LC Collateral Account or the Urban UK L/C
Collateral Account, as applicable. Moneys in the LC Collateral Account shall be
applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrowers for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of the Required Lenders), be
applied to satisfy other Secured Obligations. Moneys in the Urban UK L/C
Collateral Account shall be applied by Wells Fargo first to reimburse Wells
Fargo, as Issuing Bank, for LC Disbursements with respect to the Urban UK L/C
for which it has not been reimbursed, and, to the extent of any excess following
such reimbursement in full, shall be applied as set forth in the immediately
preceding sentence. If the Borrowers are required to Cash Collateralize Letters
of Credit solely as a result of the occurrence of an Event of Default, the cash
collateral (to the extent not applied as aforesaid) shall be returned to the
Borrowers within three (3) Business Days after all such Events of Default have
been waived as confirmed in writing by the Administrative Agent. Not later than
concurrently with payoff or refinancing of the Obligations arising under the
Loan Documents (other than in respect of the Urban UK L/C), Wells Fargo and the
Borrowers shall take such actions and execute such agreements as the
Administrative Agent shall reasonably request in order to release the Lenders
(other than Wells Fargo) and the Administrative Agent from any liability or
continuing obligations in respect of the Urban UK L/C.

(k) Issuing Bank Reports to the Administrative Agent. Unless otherwise agreed by
the Administrative Agent, each Issuing Bank shall, in addition to its
notification obligations set forth elsewhere in this Section, report in writing
to the Administrative Agent (i) periodic activity (for such period or recurrent
periods as shall be requested by the Administrative Agent) in respect of Letters
of

 

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Credit issued by such Issuing Bank, including all issuances, extensions,
amendments and renewals, all expirations and cancelations and all disbursements
and reimbursements, (ii) reasonably prior to the time that such Issuing Bank
issues, amends, renews or extends any Letter of Credit, the date of such
issuance, amendment, renewal or extension, and the stated amount of the Letters
of Credit issued, amended, renewed or extended by it and outstanding after
giving effect to such issuance, amendment, renewal or extension (and whether the
amounts thereof shall have changed), (iii) on each Business Day on which such
Issuing Bank makes any LC Disbursement, the date and amount of such LC
Disbursement, (iv) on any Business Day on which any Borrower fails to reimburse
an LC Disbursement required to be reimbursed to such Issuing Bank on such day,
the date of such failure and the amount of such LC Disbursement, and (v) on any
other Business Day, such other information as the Administrative Agent shall
reasonably request as to the Letters of Credit issued by such Issuing Bank.

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

(m) Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of
Credit issued or outstanding hereunder is in support of any obligations of, or
is for the account of, a Subsidiary, the Borrowers shall be obligated to
reimburse the applicable Issuing Bank hereunder for any and all drawings under
such Letter of Credit. Each Borrower hereby acknowledges that the issuance of
Letters of Credit requested by such Borrower for the account of Subsidiaries
inures to the benefit of such Borrower, and that such Borrower’s business
derives substantial benefits from the businesses of such Subsidiaries.

(n) Existing Letters of Credit. Each Existing Letter of Credit shall be deemed
to be a Letter of Credit issued for the account of the Borrowers on the
Effective Date for all purposes hereof and of the other Loan Documents (whether
or not a Borrower was the applicant with respect thereto or otherwise
responsible for reimbursement obligations with respect thereto prior to the
Effective Date), and no issuance or similar fees (as distinguished from ongoing
participation or fronting fees) will be required in connection with the deemed
issuance of the Existing Letters of Credit on the Effective Date.

SECTION 2.07 Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by such Lender hereunder on the proposed date thereof by wire transfer of
immediately available funds by 1:00 pm, Local Time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders in an amount equal to such Lender’s Applicable Percentage. The
Administrative Agent will make such Loans available to the applicable Borrower
by promptly crediting the amounts so received, in like funds, to the applicable
Funding Account; provided that ABR Loans made to finance the reimbursement of
(i) an LC Disbursement as provided in Section 2.06(e) shall be remitted by the
Administrative Agent to the applicable Issuing Bank and (ii) a Protective
Advance shall be retained by the Administrative Agent.

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

 

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excluding the date of payment to the Administrative Agent, at (i) in the case of
such Lender, the rate reasonably determined by the Administrative Agent to be
the cost to it of funding such amount or (ii) in the case of the Borrowers, the
interest rate applicable to ABR Loans. If such Lender pays such amount to the
Administrative Agent, then such amount shall constitute such Lender’s Loan
included in such Borrowing.

SECTION 2.08 Interest Elections. (a) Each Borrowing initially shall be of the
Type specified in the applicable Borrowing Request and, in the case of a LIBOR
Borrowing, CDOR Borrowing or EURIBOR Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request. Thereafter, the Borrower
Representative may elect to convert such Borrowing to a different Type
(including, without limitation, the conversion of a Borrowing to a LIBOR
Borrowing in connection with the designation of Revolving Loans as Elective
Pricing Loans) or to continue such Borrowing and, in the case of a LIBOR
Borrowing, CDOR Borrowing or EURIBOR Borrowing, may elect Interest Periods
therefor, all as provided in this Section. The Borrower Representative may elect
different options with respect to different portions of the affected Borrowing,
in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing. This Section shall not apply
to Swingline Borrowings, Overadvances or Protective Advances, which may not be
converted or continued.

(b) To make an election pursuant to this Section, the Borrower Representative
shall notify the Administrative Agent of such election by telephone by the time
that a Borrowing Request would be required under Section 2.03 if the Borrowers
were requesting a Borrowing of the Type resulting from such election to be made
on the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
facsimile to the Administrative Agent of a written Interest Election Request in
a form approved by the Administrative Agent and signed by the Borrower
Representative. Notwithstanding any other provision of this Section, a Borrower
shall not be permitted to change the currency of any Borrowing.

(c) Each telephonic and written Interest Election Request shall specify the
following information in compliance with Section 2.02:

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

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

(iii) the Type of Borrowing;

(iv) if the resulting Borrowing is a LIBOR Borrowing, CDOR Borrowing or EURIBOR
Borrowing, the Interest Period to be applicable thereto after giving effect to
such election, which shall be a period contemplated by the definition of the
term “Interest Period”; and

(v) if such Interest Election Request is the designation of one or more
Revolving Loans as Elective Pricing Loans, the expiration date of the Elective
Pricing Period (which shall be the eighteen month anniversary of the date of
such designation) and the aggregate principal amount of such Elective Pricing
Loans.

 

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

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

(e) If the Borrower Representative fails to deliver a timely Interest Election
Request with respect to a LIBOR Borrowing, CDOR Borrowing or EURIBOR Borrowing
prior to the end of the Interest Period applicable thereto, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period
(i) in the case of a LIBOR Borrowing denominated in U.S. Dollars, such Borrowing
shall be converted to an ABR Borrowing and (ii) in the case of any other LIBOR
Borrowing, CDOR Borrowing or a EURIBOR Borrowing, such Borrowing shall become
due and payable on the last day of such Interest Period.

(f) Notwithstanding any contrary provision hereof, if an Event of Default has
occurred and is continuing and the Administrative Agent, at the request of the
Required Lenders, so notifies the Borrower Representative (provided that no such
notice shall be required in the case of an Event of Default under clause (h) or
(i) of Article VII), then, so long as an Event of Default is continuing (i) no
outstanding Borrowing denominated in U.S. Dollars may be converted to or
continued as a LIBOR Borrowing and no outstanding Borrowing may be converted to
or continued as a CDOR Borrowing, and (ii) unless repaid (A) each LIBOR
Borrowing denominated in U.S. Dollars shall be converted to an ABR Borrowing at
the end of the Interest Period applicable thereto, and (B) each CDOR Borrowing
shall be repaid at the end of the Interest Period applicable thereto.

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

(b) The Borrowers may at any time terminate the Commitments upon (i) the payment
in full of all outstanding Loans, together with accrued and unpaid interest
thereon and on any LC Exposure, (ii) the cancellation and return of all
outstanding Letters of Credit (or alternatively, with respect to each such
Letter of Credit, the Cash Collateralization (or at the discretion of the
Administrative Agent a backup standby letter of credit satisfactory to the
Administrative Agent and the Issuing Bank) of all outstanding Letters of
Credit), (iii) the payment in full of the accrued and unpaid fees, and (iv) the
payment in full of all reimbursable expenses and other Obligations, together
with accrued and unpaid interest thereon.

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

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

 

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(e) The Borrowers shall have the right to increase the Commitments by obtaining
additional Commitments, either from one or more of the Lenders or another
lending institution provided that (i) any such request for an increase shall be
in a minimum amount of $10,000,000, (ii) the aggregate amount of all additional
Commitments obtained under this clause (e) shall not exceed $150,000,000,
(iii) the Administrative Agent and the Issuing Bank have approved the identity
of any such new Lender, such approvals not to be unreasonably withheld, (iv) any
such new Lender assumes all of the rights and obligations of a “Lender”
hereunder, (v) the procedure described in Section 2.09(f) has been satisfied and
(vi) the terms and provisions of all additional Commitments and loans made
thereunder shall be identical (including yield and maturity date) to the then
existing Commitments and Revolving Loans, respectively. Nothing contained in
this Section 2.09 shall constitute, or otherwise be deemed to be, a commitment
on the part of any Lender to increase its Commitment hereunder at any time.

(f) Any amendment hereto for such an increase or addition shall be in form and
substance satisfactory to the Administrative Agent and shall only require the
written signatures of the Administrative Agent, the Borrowers and each Lender
being added or increasing its Commitment, subject only to the approval of the
Required Lenders if any such increase or addition would cause the Commitments to
exceed $550,000,000. As a condition precedent to such an increase or addition,
the Borrowers shall deliver to the Administrative Agent (i) a certificate of
each Loan Party signed by an authorized officer of such Loan Party
(A) certifying and attaching the resolutions adopted by such Loan Party
approving or consenting to such increase, and (B) in the case of the Borrowers,
certifying that, before and after giving effect to such increase or addition,
(1) the representations and warranties contained in Article III and the other
Loan Documents are true and correct in all material respects (except that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date, and that any representation or warranty which is subject to
any materiality qualifier shall be required to be true and correct in all
respects) and (2) no Default or Event of Default exists, and (ii) legal opinions
and documents consistent with those delivered on the Effective Date, to the
extent reasonably requested by the Administrative Agent.

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

 

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shall, and is hereby authorized and directed to, revise the Commitment Schedule
to reflect such increase or addition and shall distribute such revised
Commitment Schedule to each of the Lenders and the Borrower Representative,
whereupon such revised Commitment Schedule shall replace the old Commitment
Schedule and become part of this Agreement.

SECTION 2.10 Repayment and Amortization of Loans; Evidence of Debt. (a) The
Borrowers hereby unconditionally promise to pay (i) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving Loan on the Maturity Date, (ii) to the Administrative Agent the then
unpaid amount of each Protective Advance on the earlier of the Maturity Date and
demand by the Administrative Agent, and (iii) to the Administrative Agent the
then unpaid principal amount of each Overadvance on the earlier of the Maturity
Date and the 30th day after such Overadvance is made.

(b) On each Business Day during any Dominion Period, the Administrative Agent
shall apply all funds credited to a Concentration Account of the Borrowers on
such Business Day or the immediately preceding Business Day (at the discretion
of the Administrative Agent, whether or not immediately available), first, to
prepay any Protective Advances and Overadvance that may be outstanding, second,
to prepay the Revolving Loans and Swingline Loans, third to Cash Collateralize
outstanding LC Exposure, and fourth, as the Borrower Representative may direct.

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

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

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

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

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

 

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(b) Except for Overadvances permitted under Section 2.05, in the event and on
each occasion that the Borrowers are not in compliance with the Revolving
Exposure Limitations (including following any Revaluation Date), the Borrowers
shall severally prepay the Revolving Loans and/or Swingline Loans (or, if no
such Loans are outstanding, Cash Collateralize outstanding Letters of Credit) of
such Borrower(s) in an aggregate amount that, after giving effect to such
prepayments or Cash Collateralization the Borrowers shall be in compliance with
the Revolving Exposure Limitations.

(c) During any Dominion Period or during any time when an Event of Default shall
have occurred and be continuing, subject to the Permitted Term Loan
Intercreditor Agreement, if any, in the event and on each occasion that any Net
Proceeds are received by or on behalf of any Loan Party or any Restricted
Subsidiary in respect of any Prepayment Event, the Borrowers shall, immediately
after such Net Proceeds are received by any Loan Party or any Restricted
Subsidiary, prepay the Obligations and cash collateralize the LC Exposure as set
forth in Section 2.11(d) below in an aggregate amount equal to 100% of such Net
Proceeds;

provided that, in the case of any event described in clause (a) or (b) of the
definition of the term “Prepayment Event”, if the Borrower Representative shall
deliver to the Administrative Agent a certificate of a Financial Officer to the
effect that the Loan Parties intend to apply the Net Proceeds from such event
(or a portion thereof specified in such certificate), within 180 days after
receipt of such Net Proceeds, to acquire (or replace or rebuild) real property,
equipment or other tangible assets (excluding inventory) to be used in the
business of the Loan Parties, and certifying that no Default has occurred and is
continuing, then either (i) so long as full cash dominion is not in effect, no
prepayment shall be required pursuant to this paragraph in respect of the Net
Proceeds specified in such certificate or (ii) if full cash dominion is in
effect, then, if the Net Proceeds specified in such certificate are to be
applied to acquire, replace or rebuild such assets by (A) the Borrowers, such
Net Proceeds shall be applied by the Administrative Agent to reduce the
outstanding principal balance of the Revolving Loans (without a permanent
reduction of the Revolving Commitment) and upon such application, the
Administrative Agent shall establish a Reserve against the Borrowing Base in an
amount equal to the amount of such proceeds so applied and (B) any Loan Party
that is not a Borrower, such Net Proceeds shall be deposited in a cash
collateral account, and in the case of either (A) or (B), thereafter, such funds
shall be made available to the applicable Loan Party as follows:

(1) the Borrower Representative shall request a Borrowing of Revolving Loans
(specifying that the request is to use Net Proceeds pursuant to this Section) or
the applicable Loan Party shall request a release from the cash collateral
account be made in the amount needed;

(2) so long as the conditions set forth in Section 4.02 have been met, the
Revolving Lenders shall make such Borrowing of Revolving Loans or the
Administrative Agent shall release funds from the cash collateral account; and

(3) the Reserve established with respect to such insurance proceeds shall be
reduced by the amount of such Borrowing of Revolving Loans;

provided that to the extent of any such Net Proceeds therefrom that have not
been so applied by the end of such 180 day period, a prepayment shall be
required at such time in an amount equal to such Net Proceeds that have not been
so applied; provided, further that the Borrowers shall not be permitted to make
elections to use Net Proceeds to acquire (or replace or rebuild) real property,
equipment or other tangible assets (excluding inventory) with respect to Net
Proceeds in any fiscal year in an aggregate amount in excess of $25,000,000.

 

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(d) Subject to the Permitted Term Loan Intercreditor Agreement, if any, all such
amounts pursuant to Section 2.11(c) shall be applied, first to prepay any
Protective Advances and Overadvances that may be outstanding, pro rata, and
second to prepay the Revolving Loans (including Swingline Loans) without a
corresponding reduction in the Revolving Commitments and to cash collateralize
outstanding LC Exposure.

(e) The Borrower Representative shall notify the Administrative Agent (and, in
the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by facsimile) of any prepayment hereunder not later than (i) 11:00
a.m., New York time, (A) in the case of prepayment of a LIBOR Borrowing, CDOR
Borrowing or EURIBOR Borrowing, three (3) Business Days before the date of
prepayment, or (B) in the case of prepayment of an ABR Borrowing, on the date of
prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof to
be prepaid; provided that, if a notice of prepayment is given in connection with
a conditional notice of termination of the Commitments as contemplated by
Section 2.09, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.09. Promptly following
receipt of any such notice relating to a Borrowing of Revolving Loans, the
Administrative Agent shall advise the Lenders of the contents thereof. Each
partial prepayment of any Borrowing of Revolving Loans shall be in an amount
that would be permitted in the case of an advance of a Borrowing of Revolving
Loans of the same Type as provided in Section 2.02 and shall be the same
currency as the Borrowing of Revolving Loans being repaid. Each prepayment of a
Borrowing of Revolving Loans shall be applied ratably to the Revolving Loans
included in the prepaid Borrowing. Prepayments shall be accompanied by
(i) accrued interest to the extent required by Section 2.13 and (ii) break
funding payments, if any, pursuant to Section 2.16.

SECTION 2.12 Fees.

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

(b) The Borrowers agree to pay (i) to the Administrative Agent for the account
of each Lender a participation fee with respect to its participations in Letters
of Credit, at a per annum rate equal to (A) with respect to Standby LC Exposure,
the same Applicable Rate used to determine the interest rate applicable to LIBOR
Loans on the average daily amount of such Lender’s Standby LC Exposure
(excluding any portion thereof attributable to unreimbursed LC Disbursements),
and (B) with respect to Commercial LC Exposure, 50% less than the Applicable
Rate used to determine the interest rate applicable to LIBOR Loans on the
average daily amount of such Lender’s Commercial LC Exposure (excluding any
portion thereof attributable to unreimbursed LC Disbursements), in each case
during the period from and including the Effective Date to but excluding the
later of the date on which such Lender’s Commitment terminates and the date on
which such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee, which shall accrue at the rate of 0.125% per annum on the average
daily amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) attributable to Letters of Credit issued by the
Issuing Bank during the period from and including the Effective Date to but
excluding the later of the date of termination of the Commitments and the date
on which there ceases to be any LC Exposure, as well as the Issuing Bank’s
standard fees and commissions with respect to the issuance, amendment,
cancellation, negotiation, transfer, presentment,

 

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renewal or extension of any Letter of Credit or processing of drawings
thereunder. Participation fees and fronting fees accrued through and including
the last day of each calendar quarter shall be payable on the first Business Day
of each January, April, July and October following such last day, commencing on
the first such date to occur after the Effective Date; provided that all such
fees shall be payable on the date on which the Commitments terminate and any
such fees accruing after the date on which the Commitments terminate shall be
payable on demand. Any other fees payable to the Issuing Bank pursuant to this
paragraph shall be payable within 30 days after demand. All participation fees
and fronting fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day).

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

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

SECTION 2.13 Interest.

(a) The Loans comprising each ABR Borrowing (including each Swingline Loan
denominated in U.S. Dollars) shall bear interest at the Alternate Base Rate plus
the Applicable Rate.

(b) The Revolving Loans comprising each LIBOR Borrowing shall bear interest at
(i) in the case of a Borrowing denominated in U.S. Dollars, the Adjusted LIBO
Rate and (ii) in the case of a Borrowing denominated in a currency other than
U.S. Dollars, the LIBO Rate, in each case for the Interest Period in effect for
such Borrowing, plus the Applicable Rate.

(c) The Revolving Loans comprising each CDOR Borrowing shall bear interest at
the CDOR Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate.

(d) The Revolving Loans comprising each EURIBOR Borrowing shall bear interest at
the EURIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate.

(e) Each Protective Advance and each Overadvance shall bear interest at the
Alternate Base Rate plus the Applicable Rate plus 2%.

(f) Notwithstanding the foregoing, upon the occurrence and during the
continuance of an Event of Default, the Administrative Agent or the Required
Lenders may, at their option, by notice to the Borrower Representative, declare
that (i) all Loans shall bear interest at 2% plus the rate otherwise applicable
to such Loans as provided in the preceding paragraphs of this Section or (ii) in
the case of any other amount outstanding hereunder, such amount shall accrue at
2% plus the rate applicable to such fee or other obligation as provided
hereunder; provided, that (x) the default rate of interest set forth in this
clause (g) shall apply automatically and without notice to the Borrower
Representative upon the occurrence and during the continuance of any Event of
Default under clauses (a), (h) or (i) of Article VII and (y) application of the
default rate of interest pursuant to this clause (g) may be revoked at the
option of the Required Lenders notwithstanding any provision of Section 9.02
requiring the consent of “each Lender affected thereby” for reductions in
interest rates.

 

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

(h) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year) and
interest computed by reference to Sterling shall be computed on the basis of a
year of 365 days, and in each case shall be payable for the actual number of
days elapsed (including the first day but excluding the last day). The
applicable Adjusted LIBO Rate, LIBO Rate, CDOR Rate, EURIBO Rate or Alternate
Base Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error. For the purposes of the
Interest Act (Canada), the yearly rate of interest to which any rate calculated
on the basis of a period of time different from the actual number of days in the
year (360 days, for example) is equivalent is the stated rate multiplied by the
actual number of days in the year (365 or 366, as applicable) and divided by the
number of days in the shorter period (360 days, in the example).

SECTION 2.14 Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a LIBOR Borrowing, a CDOR Borrowing or a EURIBOR Borrowing
in any currency:

(a) the Administrative Agent determines (which determination shall be conclusive
and binding absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate, LIBO Rate, CDOR Rate or EURIBO
Rate, as the case may be, for such currency or in respect of a Loan in such
currency for such Interest Period; or

(b) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate, LIBO Rate, CDOR Rate or EURIBO Rate, as the case may be, for
such currency or in respect of a Loan in such currency for such Interest Period
will not adequately and fairly reflect the cost to such Lenders of making or
maintaining the Loans included in such Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower
Representative and the Lenders by electronic communication as provided in
Section 9.01 as promptly as practicable thereafter and, until the Administrative
Agent notifies the Borrower Representative and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, an affected LIBOR Borrowing, CDOR Borrowing or
a EURIBOR Borrowing, as the case may be, shall be ineffective, (ii) any affected
LIBOR Borrowing, CDOR Borrowing or EURIBOR Borrowing that is requested to be
continued shall (A) if denominated in U.S. Dollars, be continued as an ABR
Borrowing or (B) otherwise, be repaid on the last day of the then current
Interest Period applicable thereto and (iii) any Borrowing Request for an
affected LIBOR Borrowing, CDOR Borrowing or a EURIBOR Borrowing shall (A) if
denominated in U.S. Dollars, be deemed a request for an ABR Borrowing or
(B) otherwise, be ineffective.

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

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

 

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

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

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

(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital or liquidity requirements has or would have the effect of
reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on
the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a
consequence of this Agreement, the Commitment of, or the Loans made by, or
participations in Letters of Credit or Swingline Loans held by, such Lender, or
the Letters of Credit issued by the Issuing Bank, to a level below that which
such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding
company could have achieved but for such Change in Law (taking into
consideration such Lender’s or the Issuing Bank’s policies and the policies of
such Lender’s or the Issuing Bank’s holding company with respect to capital
adequacy and liquidity), then from time to time the Borrowers will pay to such
Lender or the Issuing Bank, as the case may be, such additional amount or
amounts as will compensate such Lender or the Issuing Bank or such Lender’s or
the Issuing Bank’s holding company for any such reduction suffered.

(c) A certificate of a Lender or the Issuing Bank setting forth the amount or
amounts necessary to compensate such Lender or the Issuing Bank or its holding
company, as the case may be, as specified in paragraph (a) or (b) of this
Section shall be delivered to the Borrower Representative accompanied by a
certificate setting forth in reasonable detail any amount or amounts and upon
such delivery of such items shall be conclusive absent manifest error. The
Borrowers shall pay such Lender or the Issuing Bank, as the case may be, the
amount shown as due on any such certificate within 30 days after receipt
thereof.

(d) Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or the Issuing Bank’s right to demand such compensation; provided that
the Borrowers shall not be required to compensate a Lender or the Issuing Bank
pursuant to this Section for any increased costs or reductions incurred more
than 180 days prior to the date that such Lender or the Issuing Bank, as the
case may be, notifies the Borrower Representative of the Change in Law giving
rise to such increased costs or reductions and of such Lender’s or the Issuing
Bank’s intention to claim compensation therefor; provided further that, if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof.

 

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SECTION 2.16 Break Funding Payments. In the event of (a) the payment of any
principal of any LIBOR Loan, CDOR Loan or EURIBOR Loan other than on the last
day of an Interest Period applicable thereto (including as a result of an Event
of Default or as a result of any prepayment pursuant to Section 2.11), (b) the
conversion of any LIBOR Loan, CDOR Loan or EURIBOR Loan other than on the last
day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any LIBOR Loan, CDOR Loan or EURIBOR Loan on the
date specified in any notice delivered pursuant hereto (regardless of whether
such notice may be revoked under Section 2.09(d) and is revoked in accordance
therewith), or (d) the assignment of any LIBOR Loan, CDOR Loan or EURIBOR Loan
other than on the last day of the Interest Period applicable thereto as a result
of a request by the Borrower Representative pursuant to Section 2.19 or
Section 9.02(d), then, in any such event, the Borrowers shall compensate each
Lender for the loss, cost and expense (excluding any loss of margin or profit
therefrom) attributable to such event. Such loss, cost or expense to any Lender
shall be deemed to include an amount determined by such Lender to be the excess,
if any, of (i) with respect to a LIBOR Loan, CDOR Loan or EURIBOR Loan, the
amount of interest which would have accrued on the principal amount of such Loan
had such event not occurred, at the Adjusted LIBO Rate, the CDOR Rate or the
EURIBO Rate, as the case may be, that would have been applicable to such Loan
(but not including the Applicable Rate, margin or profit applicable thereto),
for the period from the date of such event to the last day of the then current
Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such
Loan), over (ii) the amount of interest that would accrue on such principal
amount for such period at the interest rate which such Lender would bid were it
to bid, at the commencement of such period, for deposits in the applicable
currency of a comparable amount and period from other banks in the London,
European or Canadian interbank market. A certificate of any Lender setting forth
in reasonable detail any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to the Borrower
Representative and shall be conclusive absent manifest error. The Borrowers
shall pay such Lender the amount shown as due on any such certificate within 30
days after receipt thereof.

SECTION 2.17 Withholding of Taxes; Gross-Up. (a) Payments Free of Taxes. Any and
all payments by or on account of any obligation of any Loan Party under any Loan
Document shall be made without deduction or withholding for any Taxes, except as
required by applicable law. If any applicable law (as determined in the good
faith discretion of an applicable withholding agent) requires the deduction or
withholding of any Tax from any such payment by a withholding agent, then the
applicable withholding agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party
shall be increased as necessary so that after such deduction or withholding has
been made (including such deductions and withholdings applicable to additional
sums payable under this Section 2.17) the applicable Recipient receives an
amount equal to the sum it would have received had no such deduction or
withholding been made.

(b) Payment of Other Taxes by the Borrowers. The Loan Parties shall timely pay
to the relevant Governmental Authority in accordance with applicable law, or at
the option of the Administrative Agent timely reimburse it for, Other Taxes.

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

 

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

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent, within 10 days after demand therefor, for (i) any
Indemnified Taxes attributable to such Lender (but only to the extent that any
Loan Party has not already indemnified the Administrative Agent for such
Indemnified Taxes and without limiting the obligation of the Loan Parties to do
so), (ii) any Taxes attributable to such Lender’s failure to comply with the
provisions of Section 9.04(c) relating to the maintenance of a Participant
Register and (iii) any Excluded Taxes attributable to such Lender, in each case
under this Section 2.17(e), that are payable or paid by the Administrative Agent
in connection with any Loan Document, and any reasonable expenses arising
therefrom or with respect thereto, whether or not such Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to any
Lender by the Administrative Agent shall be conclusive absent manifest error.
Each Lender hereby authorizes the Administrative Agent to set off and apply any
and all amounts at any time owing to such Lender under any Loan Document or
otherwise payable by the Administrative Agent to such Lender from any other
source against any amount due to the Administrative Agent under this paragraph
(e).

(f) Status of Lenders. (i) Any Lender that is entitled to an exemption from or
reduction of withholding Tax with respect to payments made under any Loan
Document shall deliver to the Borrower Representative and the Administrative
Agent, at the time or times reasonably requested by the Borrower Representative
or the Administrative Agent, such properly completed and executed documentation
reasonably requested by the Borrower Representative or the Administrative Agent
as will permit such payments to be made without withholding or at a reduced rate
of withholding. In addition, any Lender, if reasonably requested by the Borrower
Representative or the Administrative Agent, shall deliver such other
documentation prescribed by applicable law or reasonably requested by the
Borrower Representative or the Administrative Agent as will enable the Borrowers
or the Administrative Agent to determine whether or not such Lender is subject
to backup withholding or information reporting requirements. Notwithstanding
anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Section 2.17(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be
required if in the Lender’s reasonable judgment such completion, execution or
submission would subject such Lender to any material unreimbursed cost or
expense or would materially prejudice the legal or commercial position of such
Lender.

(ii) Without limiting the generality of the foregoing, in the event that any
Borrower is a U.S. Person,

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

 

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

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

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

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

(4) to the extent a Foreign Lender is not the Beneficial Owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or
W-8BEN-E, as applicable (or successor form), a U.S. Tax Compliance Certificate
substantially in the form of Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or
other certification documents from each Beneficial Owner, as applicable;
provided that if the Foreign Lender is a partnership and one or more direct or
indirect partners of such Foreign Lender are claiming the portfolio interest
exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate
substantially in the form of Exhibit G-4 on behalf of each such direct and
indirect partner;

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

 

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Administrative Agent), executed originals of any other form prescribed by
applicable law as a basis for claiming exemption from or a reduction in U.S.
Federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable law to permit the Borrowers or
the Administrative Agent to determine the withholding or deduction required to
be made; and

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

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

(g) Treatment of Certain Refunds. If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
as to which it has been indemnified pursuant to this Section 2.17 (including by
the payment of additional amounts 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 Taxes)
of such indemnified party and without interest (other than any interest paid by
the relevant Governmental Authority with respect to such refund). Such
indemnifying party, upon the request of such indemnified party, shall repay to
such indemnified party the amount paid over pursuant to this paragraph (g) (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event that such indemnified party is required to repay such
refund to such Governmental Authority. Notwithstanding anything to the contrary
in this paragraph (g), in no event will the indemnified party be required to pay
any amount to an indemnifying party pursuant to this paragraph (g) the payment
of which would place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax subject to
indemnification and giving rise to such refund had not been deducted, withheld
or otherwise imposed and the indemnification payments or additional amounts
giving rise to such refund had never been paid. This paragraph (g) shall not be
construed to require any indemnified party to make available its Tax returns (or
any other information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

(h) Survival. Each party’s obligations under this Section 2.17 shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Commitments
and the repayment, satisfaction or discharge of all obligations under any Loan
Document.

 

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

SECTION 2.18 Payments Generally; Allocation of Proceeds; Sharing of Set-offs.
(a) The Borrowers shall make each payment required to be made by them hereunder
(whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.15, Section 2.16 or Section 2.17, or
otherwise) prior to 3:00 p.m., New York time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 10 South Dearborn
Street, 22nd Floor, Chicago, Illinois, or as otherwise directed by the
Administrative Agent, except payments to be made directly to an Issuing Bank or
Swingline Lender as expressly provided herein and except that payments pursuant
to Section 2.15, Section 2.16, Section 2.17 and Section 9.03 shall be made
directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other Person
to the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be payable for the period of
such extension. All payments hereunder of principal or interest in respect of
any Loan shall, except as otherwise expressly provided herein, be made in the
currency of such Loan, all payments in respect of LC Disbursements shall, except
as otherwise expressly provided herein, be made in the currency applicable to
such Letter of Credit and all other payments hereunder and under each other Loan
Document shall be made in U.S. Dollars.

(b) Any proceeds of Collateral received by the Administrative Agent (i) not
constituting either (A) a specific payment of principal, interest, fees or other
sum payable under the Loan Documents (which prior to the occurrence of an Event
of Default shall be applied as specified by the Borrowers) or (B) amounts to be
applied from a Concentration Account during a Dominion Period (which shall be
applied in accordance with Section 2.10(b)) or (ii) after an Event of Default
has occurred and is continuing and the Administrative Agent so elects or the
Required Lenders so direct, shall be applied ratably first, to pay any fees,
indemnities, or expense reimbursements including amounts then due to the
Administrative Agent and the Issuing Banks from the Borrowers (other than in
connection with Banking Services Obligations or Swap Agreement Obligations),
second, to pay any fees or expense reimbursements then due to the Lenders from
the Borrowers (other than in connection with Banking Services Obligations or
Swap Agreement Obligations), third, to pay interest due in respect of the
Overadvances and Protective Advances, fourth, to pay the principal of the
Overadvances and Protective Advances, fifth, to pay interest then due and
payable on the Loans (other than the Overadvances and Protective Advances)
ratably, sixth, to prepay principal on the Loans (other than the Overadvances
and Protective Advances) and unreimbursed LC Disbursements ratably, seventh, to
Cash Collateralize all outstanding Letters of Credit, eighth, ratably to the
payment of any amounts owing with respect to Banking Services Obligations (other
than Specified L/C Obligations) and Swap Agreement Obligations for which Banking
Services/Swap Reserves have been established but only up to the amount of such
Banking Services/Swap Reserves, ninth, to payment of any amounts owing with
respect to Banking Services Obligations (other than Specified L/C Obligations)
and Swap Agreement Obligations not paid pursuant to clause eighth above up to
and including the amount most recently provided to the Administrative Agent
pursuant to Section 2.22, tenth, to the payment of any other Secured Obligation
(other than Specified L/C Obligations), and eleventh, to payment or cash
collateralization of all Specified L/C Obligations, by deposit in U.S. Dollars
in an account with the Administrative Agent for the benefit of the holders of
the Specified L/C Obligations, up to and including the amount most recently
provided to the Administrative Agent pursuant to Section 2.22. Notwithstanding
the foregoing, amounts received from any Loan Party shall not be applied to any
Excluded Swap Obligation of such Loan Party.

 

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

(c) At the election of the Administrative Agent, all payments of principal,
interest, LC Disbursements, fees, premiums, reasonable and documented
reimbursable expenses (including, without limitation, all reimbursement for
fees, costs and expenses pursuant to Section 9.03), and other sums payable under
the Loan Documents, may be paid from the proceeds of Borrowings made hereunder
whether made following a request by the Borrower Representative pursuant to
Section 2.03 or a deemed request as provided in this Section or may be deducted
from the specific deposit account of the Borrower Representative maintained with
the Administrative Agent and previously identified in writing to the
Administrative Agent; provided that, in the case of any deemed request (other
than a payment of principal, interest, LC Disbursements, and fees due under this
Agreement), the Administrative Agent shall have provided the Borrower
Representative prior written notice that such sums are due and payable, the
amount thereof and the date payment is requested to be made. Each Borrower
hereby irrevocably authorizes (i) the Administrative Agent to make a Borrowing
for the purpose of paying each payment referred to in the preceding sentence on
or after the date such payment is due and payable and agrees that all such
amounts charged shall constitute Loans (including Swingline Loans and
Overadvances, but such a Borrowing may only constitute a Protective Advance if
it is to reimburse costs, fees and expenses as described in Section 9.03) and
that all such Borrowings shall be deemed to have been requested pursuant to
Section 2.03, Section 2.04 or Section 2.05, as applicable, and (ii) the
Administrative Agent to charge the specific deposit account of the Borrower
Representative previously identified in writing to the Administrative Agent
(other than, so long as no Dominion Period is in effect or no Event of Default
shall have occurred or be continuing, any deposit account, including any
Excluded Account) maintained with the Administrative Agent for each payment of
principal, interest and fees as it becomes due hereunder or any other amount due
under the Loan Documents.

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

 

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

(f) If any Lender shall fail to make any payment required to be made by it
hereunder, then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), (i) apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations hereunder until all such unsatisfied obligations are fully paid
and/or (ii) hold any such amounts in a segregated account as cash collateral
for, and application to, any future funding obligations of such Lender
hereunder. Application of amounts pursuant to (i) and (ii) above shall be made
in any order determined by the Administrative Agent in its discretion.

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

SECTION 2.19 Mitigation Obligations; Replacement of Lenders.

(a) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any Indemnified Taxes or additional amounts to any Lender or
any Governmental Authority for the account of any Lender pursuant to
Section 2.17, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.15 or
Section 2.17, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender.

(b) If any Lender requests compensation under Section 2.15, or if the Borrowers
are required to pay any Indemnified Taxes or additional amounts to any Lender or
any Governmental Authority for the account of any Lender pursuant to
Section 2.17, or if any Lender becomes a Defaulting Lender, then the Borrowers
may, at their sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights (other than its existing rights to

 

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payments pursuant to Section 2.15 or Section 2.17) and obligations under this
Agreement and other Loan Documents to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) if the assignee is not already a Lender or an
Affiliate of a Lender, the Borrowers shall have received the prior written
consent of the Administrative Agent (and in circumstances where its consent
would be required under Section 9.04, the Issuing Bank and the Swingline
Lender), which consent shall not unreasonably be withheld or delayed, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and funded participations in LC Disbursements and
Swingline Loans, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder, from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or the Borrowers (in the case of all
other amounts) and (iii) in the case of any such assignment resulting from a
claim for compensation under Section 2.15 or payments required to be made
pursuant to Section 2.17, such assignment will result in a reduction in such
compensation or payments. A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrowers to require such
assignment and delegation cease to apply.

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

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

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

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

(i) all or any part of the Swingline Exposure and LC Exposure of such Defaulting
Lender shall be reallocated among the non-Defaulting Lenders in accordance with
their respective Applicable Percentages but only to the extent that (x) the
conditions set forth in Section 4.02 are satisfied at the time of such
reallocation (and, unless the Borrower Representative shall have otherwise
notified the Administrative Agent at such time, the Borrowers shall be deemed to
have represented and warranted that such conditions are satisfied at such time)
and (y) to the extent that such reallocation does not, as to any non-Defaulting
Lender, cause such non-Defaulting Lender’s Revolving Exposure to exceed its
Commitment;

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

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

 

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(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 2.12(a) and Section 2.12(b) shall be adjusted in accordance with such
non-Defaulting Lenders’ Applicable Percentages; and

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

(d) so long as such Lender is a Defaulting Lender, the Swingline Lender shall
not be required to fund any Swingline Loan and no Issuing Bank shall be required
to issue, amend, renew, extend or increase any Letter of Credit, unless it is
satisfied that the related exposure and such Defaulting Lender’s then
outstanding LC Exposure will be 100% covered by the Commitments of the
non-Defaulting Lenders and/or cash collateral will be provided by the Borrowers
in accordance with Section 2.20(c), and participating interests in any such
newly made Swingline Loan or newly issued or increased Letter of Credit shall be
allocated among non-Defaulting Lenders in a manner consistent with
Section 2.20(c)(i) (and such Defaulting Lender shall not participate therein).

If (i) a Bankruptcy Event with respect to the Parent of any Lender shall occur
following the date hereof and for so long as such event shall continue or
(ii) the Swingline Lender or the Issuing Bank 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 Swingline Lender
shall not be required to fund any Swingline Loan and the Issuing Bank shall not
be required to issue, amend or increase any Letter of Credit, unless the
Swingline Lender or the Issuing Bank, as the case may be, shall have entered
into arrangements with the Borrowers or such Lender, satisfactory to the
Swingline Lender or the Issuing Bank, as the case may be, to defease any risk to
it in respect of such Lender hereunder.

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

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

 

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SECTION 2.22 Banking Services and Swap Agreements. Each Lender or Affiliate
thereof providing Banking Services for, or having Swap Agreements with, any Loan
Party or any Subsidiary of a Loan Party shall deliver to the Administrative
Agent, promptly after entering into such Banking Services or Swap Agreements,
written notice setting forth the aggregate amount of all Banking Services
Obligations and Swap Agreement Obligations of such Loan Party or Subsidiary
thereof to such Lender or Affiliate (whether matured or unmatured, absolute or
contingent). In addition, each such Lender or Affiliate thereof shall deliver to
the Administrative Agent, from time to time after a significant change therein
or upon a request therefor, a summary of the amounts due or to become due in
respect of such Banking Services Obligations and Swap Agreement Obligations. The
most recent information provided to the Administrative Agent shall be used in
determining the amounts to be applied in respect of such Banking Services
Obligations and/or Swap Agreement Obligations pursuant to Section 2.18(b).

SECTION 2.23 Access Rights. Each Loan Party shall provide the Administrative
Agent, on behalf of itself and the Lenders and other Secured Parties, such
access rights, after the occurrence and during the continuance of an Event of
Default, to any parcel or item or other property of such Loan Party and each
Subsidiary which is reasonably necessary to enable the Administrative Agent
during normal business hours to: (i) in the event a Borrower manufactures
inventory, convert Collateral consisting of raw materials and work-in-process
into saleable finished goods and/or to transport such Collateral to a point
where such conversion can occur (to the extent applicable), (ii) otherwise
prepare Collateral for sale and/or to arrange or effect the sale of Collateral,
all in accordance with the manner in which such matters are completed in the
ordinary course of business (such Property, the “Collateral-Related Property”);
provided however that, to the extent any such Collateral-Related Property
consists of leasehold interests or other items or property which are not owned
by a Loan Party, Loan Parties shall only be required herein to use commercially
reasonable efforts to obtain such access rights. Subject to applicable law
and/or the applicable Collateral Access Agreements, Administrative Agent and its
agents, representatives and designees shall have an irrevocable, non-exclusive
right to have access to, and a rent-free right to use, the relevant
Collateral-Related Property of the Loan Parties for the purposes described
above. The Administrative Agent shall take proper and reasonable care under the
circumstances of any Collateral-Related Property that is used by the
Administrative Agent and repair and replace any damage (ordinary wear-and-tear
excepted) caused by the Administrative Agent or its agents, representatives or
designees and the Administrative Agent shall comply in all material respects
with all applicable laws and applicable Collateral Access Agreements in
connection with its use or occupancy or possession of the Collateral-Related
Property. The Administrative Agent shall indemnify and hold harmless the Loan
Parties for any injury or damage to Persons or property (ordinary wear-and-tear
excepted) caused by the acts or omissions of Persons under its control;
provided, however, that the Administrative Agent, the Lenders and the other
Secured Parties will not be liable for any diminution in the value of
Collateral-Related Property caused by the absence of the Collateral therefrom.
The Loan Parties shall not, and shall not permit any Subsidiary to, sell, remove
or dispose of any of the Collateral-Related Property if such Collateral-Related
Property is reasonably necessary to enable the Administrative Agent to convert,
transport or arrange to sell the Collateral as described above, unless the
Administrative Agent shall have approved satisfactory replacement arrangements
in relation to the rights and remedies of the Lenders and the Administrative
Agent in respect of Collateral affected by any proposed sale, removal or
disposition as evidenced by the prior written confirmation thereof by the
Administrative Agent delivered to the Borrower Representative. Notwithstanding
the foregoing, the Borrowers shall not be required to comply with the terms and
conditions of this Section 2.23 in respect of the Trenton, South Carolina
facility so long as such facility shall have been closed on or before August 31,
2015 (or as such time may be extended by the Administrative Agent in its sole
discretion in writing).

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Loan Party represents and warrants to the Lenders that:

SECTION 3.01 Organization; Powers. Each Loan Party and each Restricted
Subsidiary is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business,
and is in good standing, in every jurisdiction where such qualification is
required.

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

SECTION 3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect and except for filings necessary to perfect
Liens created pursuant to the Loan Documents, (b) will not violate any
Requirement of Law applicable to any Loan Party or any Subsidiary, (c) will not
violate or result in a default under any indenture, agreement or other
instrument binding upon any Loan Party or any Subsidiary or the assets of any
Loan Party or any Subsidiary, or give rise to a right thereunder to require any
payment to be made by any Loan Party or any of its Subsidiaries, except to the
extent such violation, default, or payment, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect, and
(d) will not result in the creation or imposition of any Lien on any asset of
any Loan Party or any Subsidiary, except Liens created pursuant to the Loan
Documents.

SECTION 3.04 Financial Condition; No Material Adverse Change. (a) The Company
has heretofore furnished to the Lenders its consolidated balance sheet and
statements of income, stockholders equity and cash flows (i) as of and for the
fiscal year ended January 31, 2015, reported on by Deloitte & Touche,
independent public accountants, and (ii) as of and for the fiscal quarter and
the portion of the fiscal year ended April 30, 2015, certified by its chief
financial officer. Such financial statements present fairly, in all material
respects, the financial position and results of operations and cash flows of the
Company and its consolidated Subsidiaries as of such dates and for such periods
in accordance with GAAP, subject to normal year-end audit adjustments and the
absence of footnotes in the case of the statements referred to in clause
(ii) above.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since January 31, 2015.

SECTION 3.05 Properties. (a) As of the Effective Date, Exhibit A of the Security
Agreement sets forth the address of each parcel of real property that is owned
or leased by any Loan Party. Each of such leases and subleases is valid and
enforceable in accordance with its terms and is in full force and effect, and no
default by any party to any such lease or sublease exists, except to the extent
the failure of the foregoing to be true could not reasonably be expected,
individually or in the aggregate,

 

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to result in a Material Adverse Effect. Each of the Loan Parties and each of its
Restricted Subsidiaries has good and indefeasible title to, or valid leasehold
interests in, all of its material real and personal property, free of all Liens
other than those permitted by Section 6.02.

(b) (i) Each Loan Party and each Restricted Subsidiary owns, or is licensed to
use, all trademarks, tradenames, copyrights, patents and other intellectual
property necessary to its business as currently conducted, and, except to the
extent such infringement would not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect, the use thereof by each
Loan Party and each Restricted Subsidiary does not infringe in any respect upon
the rights of any other Person; and (ii) each Loan Party’s and each Restricted
Subsidiary’s rights thereto are not subject to any licensing agreement or
similar arrangement (other than (A) restrictions relating to software licenses
that may limit such Loan Party’s ability to transfer or assign any such
agreement to a third party and (B) licensing agreements or similar agreements
that do not materially impair the ability of the Administrative Agent or the
Lenders to avail themselves of their rights of disposal and other rights granted
under the Collateral Documents in respect of Inventory), provided that the
Company shall have delivered to the Administrative Agent a copy of each such
agreement, at least ten (10) Business Days in advance of the effectiveness
thereof, that may impair such ability of the Administrative Agent or the
Lenders.

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

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

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

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

SECTION 3.09 Taxes. Each Loan Party and each Subsidiary has timely filed or
caused to be filed all federal, state, local and foreign income and franchise
and other material Tax returns and reports required to have been filed and has
paid or caused to be paid all Taxes required to have been paid by it, except
(a) Taxes that are being contested in good faith by appropriate proceedings and
for which such Loan Party or such Subsidiary, as applicable, has set aside on
its books adequate reserves or (b) to the extent that the failure to do so could
not be expected to result in a Material Adverse Effect. No Tax liens have been
filed and no claims are being asserted with respect to any such Taxes in an
aggregate amount in excess of $5,000,000.

 

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SECTION 3.10 ERISA.

(a) Except as could not reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect, (i) no ERISA Event has
occurred or is reasonably expected to occur, (ii) neither any Loan Party nor any
ERISA Affiliate has engaged in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA and (iii) on the Effective Date, the present
value of all accumulated benefit obligations under each Plan that is subject to
Title IV of ERISA (based on the assumptions used for purposes of Statement of
Accounting Standards Topic No. 715) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed the fair value of the
assets of such Plan, and the present value of all accumulated benefit
obligations of all underfunded Plans that are subject to Title IV of ERISA
(based on the assumptions used for purposes of Statement of Accounting Standards
Topic No. 715) did not, as of the date or dates of the most recent financial
statements reflecting such amounts, exceed the fair value of the assets of all
such underfunded Plans.

(b) Except as could not reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect, with respect to any Foreign
Plan, (i) all employer and employee contributions required by law or by the
terms of the Foreign Plan have been made, or, if applicable, accrued, in
accordance with normal accounting practices; (ii) the fair market value of the
assets of each funded Foreign Plan, the liability of each insurer for any
Foreign Plan funded through insurance, or the book reserve established for any
Foreign Plan, together with any accrued contributions, is not less than 80% of
the accrued benefit obligations with respect to all current and former
participants in such Foreign Plan according to the actuarial assumptions and
valuations most recently used to account for such obligations in accordance with
applicable generally accepted accounting principles; and (iii) it has been
registered as required and has been maintained in good standing with applicable
regulatory authorities.

SECTION 3.11 Disclosure. The Loan Parties have disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which any Loan
Party or any Subsidiary is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. All reports, financial statements, certificates or
other information furnished by or on behalf of any Loan Party or any Subsidiary
to the Administrative Agent or any Lender in connection with the negotiation of
this Agreement or any other Loan Document (as modified or supplemented by other
information so furnished) other than projections, other forward-looking
information and information of a general economic or industry specific nature,
when taken as a whole, do not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
contained therein not materially misleading in light of the circumstances under
which such statements were made; provided that, with respect to projected
financial information, the Loan Parties represent only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time delivered and, if such projected financial information was delivered prior
to the Effective Date, as of the Effective Date (it being understood that the
projections are subject to inherent uncertainties and contingencies, which may
be outside the control of any Loan Party and that no assurances can be given
that such projected financial information will be realized).

SECTION 3.12 Reserved.

SECTION 3.13 Solvency. (a) Immediately after the consummation of the
Transactions to occur on the Effective Date, (i) the fair value of the assets of
the Company and its Subsidiaries, on a consolidated basis, at a fair valuation,
will exceed its debts and liabilities, subordinated, contingent or otherwise;
(ii) the present fair saleable value of the property of the Company and its
Subsidiaries, on a consolidated basis, will be greater than the amount that will
be required to pay the probable liability of their debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (iii) the Company and its Subsidiaries, on a
consolidated basis, will be able

 

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to pay their debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (iv) the Company and
its Subsidiaries, on a consolidated basis, will not have unreasonably small
capital with which to conduct the business in which they are engaged as such
business is now conducted and is proposed to be conducted after the Effective
Date.

(b) No Loan Party intends to, nor will permit any Subsidiary to, and no Loan
Party believes that it or any Subsidiary will, incur debts beyond its ability to
pay such debts as they mature, taking into account the timing of and amounts of
cash to be received by it or any such Subsidiary and the timing of the amounts
of cash to be payable on or in respect of its Indebtedness or the Indebtedness
of any such Subsidiary.

SECTION 3.14 Insurance. Exhibit E of the Security Agreement sets forth a
description of all insurance maintained by or on behalf of the Loan Parties and
their Restricted Subsidiaries as of the Effective Date. As of the Effective
Date, all premiums in respect of such insurance have been paid. Each Borrower
maintains, and has caused each Restricted Subsidiary to maintain, with insurance
companies with an AM Best rating of A- or better, insurance on all their real
and personal property in such amounts, subject to such deductibles and
self-insurance retentions and covering such properties and risks as are adequate
and customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations.

SECTION 3.15 Capitalization and Subsidiaries. Schedule 3.15 sets forth (a) a
correct and complete list of the name and relationship to the Company of each
and all of the Company’s Subsidiaries, (b) a true and complete listing of each
class of authorized Equity Interests owned by the Company or any Subsidiary in
each Subsidiary, all of which issued Equity Interests are validly issued,
outstanding, fully paid and non-assessable, and owned beneficially and of record
by the Persons identified on Schedule 3.15, (c) the type of entity of the
Company and each of its Subsidiaries and (d) whether any such Subsidiary is a
Restricted Subsidiary or an Unrestricted Subsidiary. All of the issued and
outstanding Equity Interests owned by any Loan Party have been (to the extent
such concepts are relevant with respect to such ownership interests) duly
authorized and issued and are fully paid and non-assessable. As of the Effective
Date, there are no outstanding stock purchase warrants, subscriptions, options,
securities, instruments or other rights of any type or nature whatsoever, which
are convertible into, exchangeable for or otherwise provide for or permit the
issuance of capital stock of any Subsidiary of the Company.

SECTION 3.16 Security Interest in Collateral. The provisions of this Agreement
and the other Loan Documents create legal and valid Liens on all of the
Collateral granted by the Loan Parties in favor of the Administrative Agent (for
the benefit of the Secured Parties), securing the Secured Obligations and,
constitute perfected and continuing Liens on the Collateral (to the extent such
Liens can be perfected by possession, by filing a UCC financing statement or
equivalent under each applicable jurisdiction, or by a control agreement),
securing the applicable Secured Obligations, enforceable against the applicable
Loan Party, and having priority over all other Liens on the Collateral except in
the case of (x) Liens permitted by Section 6.02, to the extent any such Liens
would have priority over the Liens in favor of the Administrative Agent pursuant
to any applicable law or an agreement permitted hereunder, (y) Liens perfected
only by possession (including possession of any certificate of title) to the
extent the Administrative Agent has not obtained or does not maintain possession
of such Collateral and (z) Liens perfected only by control, filing or recording
to the extent that Administrative Agent has not obtained control or has not
recorded such lien.

SECTION 3.17 Employment Matters. Except as could not reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect,
(i) there are no strikes, lockouts, slowdowns or any other labor disputes
against the Company or any Restricted Subsidiary pending or, to the knowledge of
the Company, threatened, (ii) the hours worked by and payments made to employees
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the Company and the Restricted Subsidiaries have not been in violation of the
Fair Labor Standards Act of 1938 or any other applicable Federal, state, local
or foreign law dealing with such matters and (iii) all payments due from the
Company or any Restricted Subsidiary, or for which any claim may be made against
the Company or any Restricted Subsidiary, on account of wages and employee
health and welfare insurance and other benefits, have been paid or accrued as a
liability on the books of the Company or such Subsidiary to the extent required
under GAAP. The consummation of the Transactions do not give rise to any right
of termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which the Company or any Restricted
Subsidiary is bound.

SECTION 3.18 Federal Reserve Regulations. No part of the proceeds of any Loan or
Letter of Credit has been used or will be used, whether directly or indirectly,
for any purpose that entails a violation of any of the Regulations of the Board,
including Regulations T, U and X.

SECTION 3.19 Reserved.

SECTION 3.20 No Burdensome Restrictions. No Loan Party is subject to any
Burdensome Restrictions except Burdensome Restrictions permitted under
Section 6.10.

SECTION 3.21 Anti-Corruption Laws and Sanctions. The Company has implemented and
maintains in effect policies and procedures designed to ensure compliance by
each Loan Party, its Subsidiaries and their respective directors, officers,
employees and agents with Anti-Corruption Laws and applicable Sanctions, and
each Loan Party, its Subsidiaries and their respective officers and, to the
knowledge of the Company, its directors, employees and agents, are in compliance
with Anti-Corruption Laws and applicable Sanctions in all material respects.
None of (a) the Company, any Subsidiary or any of their respective officers, or
(b) to the knowledge of any such Loan Party or Subsidiary, any of their
respective directors, employees or agents of such Loan Party or any Subsidiary
that will act in any capacity in connection with or benefit from the credit
facility established hereby, is a Sanctioned Person. No Borrowing or Letter of
Credit, use of proceeds, Transaction or other transaction contemplated by this
Agreement or the other Loan Documents will violate Anti-Corruption Laws or
applicable Sanctions.

SECTION 3.22 Common Enterprise. The successful operation and condition of each
of the Loan Parties is dependent on the continued successful performance of the
functions of the group of the Loan Parties as a whole and the successful
operation of each of the Loan Parties is dependent on the successful performance
and operation of each other Loan Party. Each Loan Party expects to derive
benefit (and its board of directors or other governing body has determined that
it may reasonably be expected to derive benefit), directly and indirectly, from
(i) successful operations of each of the other Loan Parties and (ii) the credit
extended by the Lenders to the Borrowers hereunder, both in their separate
capacities and as members of the group of companies. Each Loan Party has
determined that execution, delivery, and performance of this Agreement and any
other Loan Documents to be executed by such Loan Party is within its purpose, in
furtherance of its direct and/or indirect business interests, will be of direct
and/or indirect benefit to such Loan Party, and is in its best interest.

SECTION 3.23 Credit Card Agreements. Schedule 3.23 (as updated from time to time
as permitted by Section 5.17) sets forth a list of all Credit Card Agreements to
which any Loan Party is a party. A true and complete copy of each Credit Card
Agreement listed on Schedule 3.23 has been delivered to the Administrative
Agent, together with all material amendments, waivers and other modifications
thereto; provided that the Loan Parties shall deliver any such amendment, waiver
or other modification to the Administrative Agent within thirty days after the
effectiveness of such amendment, waiver or other modification (or as such time
may be extended in writing in the Administrative Agent’s sole discretion). All
such Credit Card Agreements are in full force and effect, currently binding upon
each Loan Party that is a party thereto and, to the knowledge of the Loan
Parties, binding upon other parties thereto in accordance with their terms. The
Loan Parties are in compliance in all material respects with each such Credit
Card Agreement.

 

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ARTICLE IV

CONDITIONS

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

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

(b) Opinions. The Administrative Agent shall have received a written opinion of
Drinker Biddle & Reath LLP, counsel to the Loan Parties’ (together with, where
not covered by such opinion, opinions of local counsel where each Loan Party is
organized), in each case addressed to the Administrative Agent, the Issuing Bank
and the Lenders and in form and substance reasonably satisfactory to the
Administrative Agent and its counsel (provided that delivery of a local counsel
opinion in respect of the Loan Party organized in Puerto Rico may be delayed
until such date as may be required by the Administrative Agent consistent with
Section 5.14 hereof).

(c) Financial Statements and Projections. The Lenders shall have received
(i) audited consolidated financial statements of the Company for the fiscal year
ended January 31, 2015, (ii) unaudited interim consolidated financial statements
of each fiscal quarter ended after the date of the latest applicable financial
statements delivered pursuant to clause (i) of this paragraph as to which such
financial statements are available, and such financial statements shall not, in
the reasonable judgment of the Administrative Agent, reflect any material
adverse change in the consolidated financial condition of the Company and its
Subsidiaries, as reflected in the audited consolidated financial statements
described in clause (i) of this paragraph, (iii) the Company’s most recent
projected income statement, balance sheet and cash flows through the end of the
Company’s fiscal year ending January 2020, and (iv) the projected Borrowing Base
on a quarterly basis through January 31, 2016.

(d) Closing Certificates; Certified Certificate of Incorporation; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of
each Loan Party, dated the Effective Date and executed by its Secretary or
Assistant Secretary, which shall (A) certify the resolutions of its Board of
Directors, members or other body authorizing the execution, delivery and
performance of the Loan Documents to which it is a party, (B) identify by name
and title and bear the signatures of the Responsible Officers of such Loan Party
authorized to sign the Loan Documents to which it is a party and, in the case of
the Company, its Financial Officer, and (C) contain appropriate attachments,
including the certificate or articles of incorporation or organization of each
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authority of the jurisdiction of organization of such Loan Party and a true and
correct copy of its by-laws or operating, management or partnership agreement,
or other organizational or governing documents and (ii) a good standing
certificate for each Loan Party from its jurisdiction of organization or the
substantive equivalent available in the jurisdiction of organization for each
Loan Party from the appropriate governmental officer in such jurisdiction.

(e) Collateral and Guaranty Requirement. Subject to Section 5.18, the Collateral
and Guaranty Requirement shall have been satisfied with respect to all
Designated Subsidiaries as of the Effective Date.

(f) No Default Certificate. The Administrative Agent shall have received a
certificate, signed by a Financial Officer of the Borrower Representative, dated
as of the Effective Date (i) stating that no Default has occurred and is
continuing, (ii) stating that the representations and warranties contained in
Article III are true and correct as of such date (or if qualified by
“materiality” and “Material Adverse Effect” or similar language, in all respects
(after giving effect to such qualification)) and (iii) certifying as to any
other factual matters as may be reasonably requested by the Administrative
Agent.

(g) Fees. The Lenders and the Administrative Agent shall have received all fees
required to be paid, and all expenses for which invoices have been presented
(including the reasonable fees and expenses of legal counsel), on or before the
Effective Date.

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

(i) Pay-Off Letter. The Administrative Agent shall have received satisfactory
pay-off letters for all existing Indebtedness to be repaid on the Effective
Date, confirming that all Liens upon any of the property of the Loan Parties
constituting Collateral will be terminated concurrently with such payment and
all letters of credit issued or guaranteed as part of such Indebtedness shall
have been cash collateralized, supported by a Letter of Credit, become Existing
Letters of Credit or letters of credit under a Specified L/C Facility.

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

(k) Customer List. The Administrative Agent shall have received a true and
complete customer list for each Borrower and its Subsidiaries with respect to
each Eligible Trade Account, which list shall state the customer’s name, mailing
address and phone number and shall be certified as true and correct by a
Financial Officer of the Borrower Representative.

(l) Control Agreements. Subject to Section 5.18, the Administrative Agent shall
have received each Control Agreement required to be provided pursuant to the
Security Agreement.

(m) Credit Card Notifications. The Administrative Agent shall have received
copies of duly executed Credit Card Notifications with respect to all Eligible
Credit Card Accounts.

 

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(n) Solvency. The Administrative Agent shall have received a solvency
certificate, in form and substance satisfactory to the Administrative Agent,
from a Financial Officer of the Company dated the Effective Date.

(o) Borrowing Base Certificate. The Administrative Agent shall have received a
Borrowing Base Certificate which calculates the Borrowing Base as of the end of
the fiscal quarter immediately preceding the Effective Date.

(p) Closing Availability. After giving effect to all Borrowings to be made on
the Effective Date, the issuance of any Letters of Credit on the Effective Date,
including the deemed issuance of Existing Letters of Credit, and the payment of
all fees and expenses due hereunder, and with all of the Loan Parties’
Indebtedness (other than Specified L/C Obligations), liabilities, and
obligations current (excluding, in each case, current accounts payable to the
extent excluded from Indebtedness), Availability shall not be less than
$125,000,000.

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

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

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

(t) Letter of Credit Application. If a Letter of Credit is requested to be
issued on the Effective Date, the applicable Issuing Bank shall have received a
properly completed letter of credit application (whether standalone or pursuant
to a master agreement, as applicable). The Borrowers shall have executed the
Issuing Bank’s master agreement for the issuance of commercial Letters of
Credit.

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

(v) Corporate Structure. The corporate structure, capital structure and other
material debt instruments, material accounts and governing documents of the
Borrowers and their Subsidiaries shall be acceptable to the Administrative
Agent.

(w) Field Examination. The Administrative Agent or its designee shall have
conducted a field examination of the Borrowers’ Accounts, Credit Card Accounts,
Inventory and related working capital matters and of the Borrowers’ related data
processing and other systems, the results of which shall be satisfactory to the
Administrative Agent.

 

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(x) Legal Due Diligence. The Administrative Agent and its counsel shall have
completed all legal due diligence, the results of which shall be satisfactory to
Administrative Agent.

(y) Inventory Appraisal(s). The Administrative Agent shall have received an
appraisal of the Borrowers’ Inventory from one or more firms reasonably
satisfactory to the Administrative Agent, which appraisal shall be satisfactory
to the Administrative Agent.

(z) USA PATRIOT Act, Etc. The Administrative Agent and the Lenders shall have
received all documentation and other information required by bank regulatory
authorities under applicable “know your customer” and anti-money laundering
rules and regulations, including the USA PATRIOT Act, for each Loan Party.

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

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

(a) The representations and warranties of the Loan Parties set forth in the Loan
Documents shall be true and correct in all material respects (provided that such
materiality qualifications shall not apply in respect of any Borrowing and
issuance or deemed issuance of a Letter of Credit under this Agreement on the
Effective Date) with the same effect as though made on and as of the date of
such Borrowing or the date of issuance, amendment, renewal or extension of such
Letter of Credit, as applicable (it being understood and agreed that (i) any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date, (ii) any representation or warranty which is subject to any
materiality qualifier shall be required to be true and correct in all respects,
(iii) any representation or warranty which is no longer true and correct to the
extent resulting from changes after the Effective Date from any actions, sales,
mergers, acquisitions, dispositions or other transactions permitted under this
Agreement shall have been updated by delivery by the Company to the
Administrative Agent of updated disclosure schedules reflecting such changes
upon the request of the Administrative Agent, not more frequently than quarterly
and (iv) any representation or warranty in Section 3.15 which is no longer true
and correct to the extent resulting from changes after the Effective Date from
any actions, sales, mergers, acquisitions, dispositions or other transactions
permitted under this Agreement shall have been updated by delivery by the
Company to the Administrative Agent of an updated Schedule 3.15 reflecting such
changes);

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

(c) After giving effect to any Borrowing or the issuance, amendment, renewal or
extension of any Letter of Credit, the Borrowers shall be in compliance with the
Revolving Exposure Limitations.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrowers on the date thereof as to the matters specified in paragraphs (a),
(b), and (c) of this Section.

Notwithstanding the failure to satisfy the conditions precedent set forth in
paragraphs (a) or (b) of this Section, unless otherwise directed by the Required
Lenders, the Administrative Agent may, but shall have no obligation to, continue
to make Loans and an Issuing Bank may, but shall have no obligation to, issue,

 

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amend, renew or extend, or cause to be issued, amended, renewed or extended, any
Letter of Credit for the ratable account and risk of the Lenders from time to
time if the Administrative Agent believes that making such Loans or issuing,
amending, renewing or extending, or causing the issuance, amendment, renewal or
extension of, any such Letter of Credit is in the best interests of the Lenders.

ARTICLE V

AFFIRMATIVE COVENANTS

Until the Commitments shall have expired or been terminated and the principal of
and interest on each Loan and all fees, expenses and other amounts payable under
any Loan Document (other than contingent or indemnity obligations for which no
claim has been made) shall have been paid in full and all Letters of Credit
shall have expired or have been Cash Collateralized pursuant to the terms hereof
or terminated, in each case without any pending draw, and all LC Disbursements
shall have been reimbursed, each Loan Party executing this Agreement covenants
and agrees, jointly and severally with all of the other Loan Parties, with the
Lenders that:

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

(a) within 90 days after the end of each fiscal year of the Company, its audited
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all reported
on by independent public accountants of recognized national standing (without a
“going concern” or like qualification or exception and without any qualification
or exception as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of the Company and its consolidated
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, accompanied by any management letter prepared by said accountants;

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

(c) during any period (i) commencing on the date when Availability is less than
the Applicable Trigger Amount (Level II) and (ii) ending on the date when
Availability shall have been equal to or greater than the Applicable Trigger
Amount (Level II) for a period of 60 consecutive days, within 30 days after the
end of each fiscal month of the Company, its consolidated balance sheet and
related statements of operations, stockholders’ equity and cash flows as of the
end of and for such fiscal month and the then elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by a Financial Officer of
the Company as presenting fairly in all material respects the financial
condition and results of operations of the Company and its consolidated
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments and the absence of
footnotes;

 

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(d) concurrently with any delivery of financial statements under clause (a),
(b) or (c) above, a Compliance Certificate, which shall (i) when delivered
concurrently with the delivery of the financial statements delivered under
clause (b) or (c), certify that such financial statements present fairly in all
material respects the financial condition and results of operations of the
Company and its consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments and
the absence of footnotes, (ii) certify as to whether a Default has occurred and,
if a Default has occurred, specifying the details thereof and any action taken
or proposed to be taken with respect thereto, (iii) set forth reasonably
detailed calculations of the Fixed Charge Coverage Ratio (whether or not
required to be tested pursuant to Section 6.12) and, if applicable,
demonstrating compliance with Section 6.12, and (iv) state whether any change in
GAAP or in the application thereof has occurred since the date of the audited
financial statements referred to in Section 3.04 and, if any such change has
occurred, specifying the effect of such change on the financial statements
accompanying such certificate, (v) set forth the full legal name of each Loan
Party and its jurisdiction of organization, and describe whether, since the
later of the Effective Date and the date of the last Compliance Certificate, any
such Loan Party shall have (A) changed its name as it appears in official
filings in the state of incorporation or organization, (B) changed its chief
executive office, (C) changed the type of entity that it is, (D) change its
organization identification number, if any, issued by its state of incorporation
or other organization, or (E) changed its state of incorporation or
organization;

(e) Reserved;

(f) no later than the end of each fiscal year of the Company, a copy of the plan
and forecast (including a projected consolidated balance sheet, income statement
and funds flow statement) of the Company for each quarter (or each month, if
requested by the Administrative Agent) of the upcoming fiscal year (the
“Projections”) in form reasonably satisfactory to the Administrative Agent;

(g) on or before each Borrowing Base Reporting Date, a Borrowing Base
Certificate setting forth a computation of the Borrowing Base as of the most
recently ended fiscal quarter, fiscal month or week, as applicable, to which
such Borrowing Base Reporting Date relates, together with supporting information
and any additional reports with respect to the Borrowing Base that the
Administrative Agent may reasonably request (including, in respect of any
Borrowing Base Certificate delivered for a month which is also the end of any
fiscal quarter of the Company, a calculation of Average Quarterly Availability
for such quarter then ended and an indication of what the Applicable Rate is as
a result of such Average Quarterly Availability);

(h) on or before each Borrowing Base Reporting Date, the following information
as of the most recently ended fiscal quarter, fiscal month or week, as
applicable, to which such Borrowing Base Reporting Date relates, all delivered
electronically in a text formatted file in form reasonably acceptable to the
Administrative Agent:

(i) (A) a detailed aging of the Borrowers’ Accounts, including all invoices aged
by invoice date and due date (with an explanation of the terms offered),
prepared in a manner reasonably acceptable to the Administrative Agent, together
with a summary specifying the name, address, and balance due for each Account
Debtor and (B) a detailed aging of the Borrowers’ Credit Card Accounts
(1) including aging by each credit card issuer and credit card processor and
(2) reconciled to the Borrowing Base Certificate delivered as of such date, in a
form reasonably acceptable to the Administrative Agent, together with a summary
specifying the balance due from each credit card issuer or credit card
processor;

(ii) a schedule detailing the Borrowers’ Inventory, in form reasonably
satisfactory to the Administrative Agent, (1) by location (showing Inventory in
transit, any Inventory located

 

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with a third party under any consignment, bailee arrangement, or warehouse
agreement), by class (raw material, work-in-process and finished goods) and by
volume on hand, which Inventory shall be valued at the lower of average cost or
market, determined utilizing the retail method as appropriate, and adjusted for
Reserves as the Administrative Agent has previously indicated to the Borrower
Representative are deemed by the Administrative Agent to be appropriate in its
Permitted Discretion, and (2) including a report of any variances or other
results of Inventory counts performed by the Borrowers since the last Inventory
schedule (including information regarding sales or other reductions, additions,
returns, credits issued by Borrowers and complaints and claims made against the
Borrowers);

(iii) a worksheet of calculations prepared by the Borrowers to determine
Eligible Credit Card Accounts, Eligible Trade Accounts and Eligible Inventory,
such worksheets detailing the Credit Card Accounts, Accounts and Inventory
excluded from Eligible Credit Card Accounts, Eligible Trade Accounts and
Eligible Inventory and the reason for such exclusion;

(iv) a reconciliation of the Borrowers’ Credit Card Accounts, Accounts and
Inventory between (A) the amounts shown in the Borrowers’ general ledger and
financial statements and the reports delivered pursuant to clauses (i) and
(ii) above and (B) the amounts and dates shown in the reports delivered pursuant
to clauses (i) and (ii) above and the Borrowing Base Certificate delivered
pursuant to clause (g) above as of such date; and

(v) a schedule and aging of the Loan Parties’ accounts payable as of the quarter
then ended, delivered electronically in a text formatted file in a form
reasonably acceptable to the Administrative Agent;

(i) within 30 days (as such time period may be extended in writing by the
Administrative Agent in its sole discretion) of each March 31 and September 30,
an updated customer list for each Borrower with respect to each Eligible Trade
Account, which list shall state the customer’s name, mailing address and phone
number, delivered electronically in a text formatted file acceptable to the
Administrative Agent and certified as true and correct by a Financial Officer of
the Borrower Representative;

(j) promptly upon the Administrative Agent’s request:

(i) a schedule detailing the balance of all intercompany accounts of the Loan
Parties; and

(ii) such other information as the Administrative Agent may from time to time
reasonably request;

(k) concurrent with any field exam permitted under Section 5.06 (or at such
other times as agreed upon by the Administrative Agent and the Company), the
Borrower Representative shall provide notice to the Administrative Agent of any
removal or addition of any credit card issuer or credit card processor to the
extent that (i) in the case of a removal, Credit Card Accounts of such credit
card issuer or credit card processor were included in any previous Borrowing
Base or (ii) in the case of an addition, the Borrower Representative desires to
include the Credit Card Accounts of such credit card issuer or credit card
processor in the Borrowing Base, and concurrently with any such notice of an
addition, the Company shall provide to the Administrative Agent (A) evidence
reasonably satisfactory to the Administrative Agent that a Credit Card
Notification shall have been delivered to such credit card issuer or credit card
processor, (B) a true and complete copy of each Credit Card Agreement with
respect thereto, together with all material amendments, waivers and other
modifications thereto, and (C) such

 

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other information with respect thereto as may be reasonably requested by the
Administrative Agent; for the avoidance of doubt, unless otherwise agreed by the
Administrative Agent, no Credit Card Accounts of an added credit card issuer or
credit card processor may be included in the Borrowing Base until a field exam
with respect thereto has been completed;

(l) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by the Company or
any Subsidiary with the SEC, or with any national securities exchange, or
distributed by the Company to its shareholders generally, as the case may be;

(m) promptly after any request therefor by the Administrative Agent or any
Lender, copies of (i) any documents described in Section 101(k)(1) of ERISA that
any Borrower or any ERISA Affiliate may request with respect to any
Multiemployer Plan, (ii) any notices described in Section 101(l)(1) of ERISA
that any Borrower or any ERISA Affiliate may request with respect to any
Multiemployer Plan and (iii) the annual funding notice, as described in
Section 101(f) of ERISA; provided that, with respect to the notices described in
(i) or (ii), if a Borrower or any ERISA Affiliate has not requested such
documents or notices from the administrator or sponsor of the applicable
Multiemployer Plan, the applicable Borrower or the applicable ERISA Affiliate
shall promptly make a request for such documents and notices from such
administrator or sponsor and shall provide copies of such documents and notices
promptly after receipt thereof;

(n) within five (5) Business Days after a Responsible Officer of the Borrower
Representative has knowledge of the production or the receipt by a Loan Party
thereof, copies of any material environmental reports produced by or on behalf
of any Loan Party or Restricted Subsidiary; and

(o) promptly following any request therefor, such other information regarding
the operations, business affairs and financial condition of any Loan Party or
any Subsidiary, or compliance with the terms of this Agreement, as the
Administrative Agent or any Lender may reasonably request.

The Borrower Representative shall be deemed to have furnished to the
Administrative Agent the financial statements and certificates required to be
delivered pursuant to Sections 5.01(a) and (b) and the reports and other
material required by Section 5.01(l) upon the filing of such financial
statements or material by the Company through the SEC’s EDGAR system (or any
successor electronic gathering system) or the publication by the Company of such
financial statements on its website, so long as such system or website is
publicly available; provided that, at the request of the Administrative Agent or
any Lender, the Borrower Representative shall promptly deliver electronic or
paper copies of such filings together with all accompanying exhibits,
attachments, calculations, or other supporting documentation included with such
filing.

SECTION 5.02 Notices of Material Events. The Borrower Representative will
furnish to the Administrative Agent prompt (but in any event within any time
period after such Responsible Officer has such knowledge that may be specified
below) written notice of the following:

(a) within two (2) Business Days after knowledge by a Responsible Officer of the
Borrower Representative or any other Borrower of the occurrence of any Default
or Event of Default;

(b) within two (2) Business Days after knowledge by a Responsible Officer of the
Borrower Representative or any other Borrower of the receipt by any Loan Party
or any Subsidiary of any notice of any investigation by a Governmental Authority
or any litigation or proceeding commenced or threatened against any Loan Party
or any Subsidiary that, individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect;

 

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(c) within two (2) Business Days after knowledge by a Responsible Officer of the
Borrower Representative or any other Borrower of the receipt by any Loan Party
or Subsidiary of any Lien or claim made or asserted against any of the
Collateral having an aggregate value in excess of $5,000,000, excluding from the
scope of this clause (c) Permitted Encumbrances other than income tax Liens of
the type referred to in clause (a)(ii) of Permitted Encumbrances to the extent
exceeding $1,000,000 individually or in the aggregate;

(d) within five (5) Business Days after knowledge by a Responsible Officer of
the Borrower Representative or any other Borrower of the occurrence of any loss,
damage, or destruction to the Collateral having a value in the amount of
$7,500,000 or more, whether or not covered by insurance;

(e) within ten (10) Business Days after knowledge by a Responsible Officer of
the Borrower Representative or any other Borrower of the receipt by any Loan
Party or Restricted Subsidiary thereof, any default notices received under or
with respect to any leased location or public warehouse where Collateral in the
amount of $7,500,000 or more is located;

(f) promptly after knowledge by a Responsible Officer of the Borrower
Representative of the occurrence of any ERISA Event or breach of any
representation made in Section 3.10;

(g) within five (5) Business Days after knowledge by a Responsible Officer of
the Borrower Representative of the occurrence of any default or event of default
under a Specified L/C Facility or any other event that requires, or enables any
issuing bank under the Specified L/C Facility to require, the Company or any of
its Subsidiaries to provide cash collateral for all or any portion of any
Specified L/C Obligations;

(h) within two (2) Business Days after the occurrence thereof, the occurrence of
any default or event of default under any Permitted Term Loan Indebtedness or
receipt of any notice asserting a default or event of default thereunder
(together with a copy of such notice);

(i) (A) within five (5) Business Days after knowledge by a Responsible Officer
of the Borrower Representative (1) of the occurrence of any default or event of
default by any Person under any Credit Card Agreement relating to Credit Cards
Accounts contained in the Borrowing Base, (2) the establishment of, or receipt
by any Borrower of a notice of any proposed establishment of, a reserve or
reserve account (or similar concept), whether in the form of an actual deposit
account, book entry or otherwise, in connection with any Credit Card Agreement
for the purposes of securing all or any portion of any Borrower’s existing or
potential obligations to the applicable credit card issuer or processor under
such Credit Card Agreement, or (3) that any credit card issuer, credit card
processor or debit card or mall card issuer or provider with respect to Credit
Card Accounts ceases to meet the requirements of clause (f) of the definition of
“Eligible Credit Card Accounts” and (B) on and at the time of submission to the
Administrative Agent of the Borrowing Base Certificate after a Responsible
Officer of the Borrower Representative has knowledge that any Borrower has
entered into a material amendment, waiver or other modification of a Credit Card
Agreement applicable to any Credit Card Account included in the Borrowing Base;

(j) within five (5) Business Days after knowledge by a Responsible Officer of
the Borrower Representative of the filing of any Lien with respect to any
delinquent Taxes in excess of $2,500,000; and

(k) promptly after knowledge by a Responsible Officer of the Borrower
Representative or any other Borrower of any other development that results, or
could reasonably be expected to result in, a Material Adverse Effect.

 

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

SECTION 5.03 Existence; Conduct of Business. Each Loan Party will, and will
cause each Restricted Subsidiary to, (a) do or cause to be done all things
reasonably necessary to preserve, renew and keep in full force and effect
(i) its legal existence and (ii) except to the extent failure to do so could
not, individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect, the rights, qualifications, licenses, permits, franchises,
governmental authorizations, intellectual property rights, licenses and permits
with respect to the conduct of its business, and maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted, provided that the foregoing shall not prohibit any merger,
consolidation, liquidation, dissolution, disposition or other transaction
permitted under Section 6.03, and (b) carry on and conduct its business in
substantially the same manner and in fields of enterprise consistent with the
provisions of Section 6.03(b).

SECTION 5.04 Payment of Obligations. Each Loan Party will, and will cause each
Subsidiary to, pay or discharge all Material Indebtedness and all other material
liabilities and obligations, including Taxes, before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) such Loan Party or
Subsidiary has set aside on its books adequate reserves with respect thereto in
accordance with GAAP and (c) the failure to make payment pending such contest
could not reasonably be expected to result in a Material Adverse Effect (it
being acknowledged that if any of the Collateral in an aggregate amount of
$5,000,000 or more would become subject to forfeiture or loss as a result of the
contest, then such failure to make payment would be expected to result in a
Material Adverse Effect).

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

SECTION 5.06 Books and Records; Inspection Rights. Each Loan Party will, and
will cause each Subsidiary to, (a) keep proper books of record and account in
which full, true and correct (in all material respects) entries are made of all
dealings and transactions in relation to its business and activities and
(b) permit any representatives designated by the Administrative Agent or any
Lender (including employees of the Administrative Agent, any Lender or any
consultants, accountants and agents retained by the Administrative Agent), as
and when determined by the Administrative Agent, upon reasonable prior notice
and during normal business hours, to visit and inspect its properties, to
conduct at such Loan Party’s premises field examinations of such Loan Party’s
assets, liabilities, books and records, including examining and making extracts
from its books and records, environmental assessment reports and Phase I or
Phase II studies, and to discuss its affairs, finances and condition with its
officers and independent accountants, all at such reasonable times and as often
as reasonably requested; provided, however, that, (i) so long as at all times
during any calendar year no Revolving Loans are outstanding and the LC Exposure
is less than $40,000,000, the Loan Parties shall not be required to pay the fees
and expenses of the Administrative Agent and such professionals with respect to
any such examinations and evaluations conducted during such calendar year and
(ii) otherwise, unless an Event of Default has occurred and is continuing, only
one such field examination per calendar year shall be at the expense of the Loan
Parties; provided further that one additional field examination per calendar
year may be done at the expense of the Loan Parties if Availability is at any
time during such calendar year less than the Applicable Trigger Amount (Level
V). For the avoidance of doubt, all such examinations and evaluations conducted
after the occurrence and during the continuance of an Event of Default shall be
at the expense of the Loan Parties, and it is understood that the election to
conduct or not conduct any examinations and evaluations is in the

 

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discretion of the Administrative Agent. Each Loan Party acknowledges that the
Administrative Agent, after exercising its rights of inspection, may prepare and
distribute to the Lenders certain Reports pertaining to such Loan Party’s assets
for internal use by the Administrative Agent and the Lenders.

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

SECTION 5.08 Use of Proceeds.

(a) The proceeds of the Loans and the Letters of Credit will be used only for
general corporate purposes and working capital needs of the Borrowers (including
for Investments, Permitted Acquisitions, Capital Expenditures and Restricted
Payments), subject to the restrictions otherwise set forth in this Agreement. No
part of the proceeds of any Loan and no Letter of Credit will be used, whether
directly or indirectly, (i) for any purpose that entails a violation of any of
the Regulations of the Board, including Regulations T, U and X or (ii) to make
any Acquisition other than Permitted Acquisitions.

(b) No Borrower will request any Borrowing or Letter of Credit, and no Borrower
shall, directly or indirectly, use the proceeds of any Borrowing or Letter of
Credit, or lend, contribute or otherwise make available such proceeds to any
Subsidiary or other Person, (a) in furtherance of an offer, payment, promise to
pay, or authorization of the payment or giving of money, or anything else of
value, to any Person in violation of any Anti-Corruption Laws, (b) for the
purpose of funding, financing or facilitating any activities, business or
transaction of or with any Sanctioned Person, or in any Sanctioned Country, or
(c) in any manner that would result in the violation of any Sanctions applicable
to any party hereto.

SECTION 5.09 Accuracy of Information. The Loan Parties will ensure that any
information, including financial statements or other documents, furnished to the
Administrative Agent or the Lenders in connection with this Agreement or any
other Loan Document or any amendment or modification hereof or thereof or waiver
hereunder or thereunder contains no material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, and the
furnishing of such information shall be deemed to be a representation and
warranty by the Borrowers on the date thereof as to the matters specified in
this Section 5.09; provided that, with respect to projected financial
information, the Loan Parties will only ensure that such information was
prepared in good faith based upon assumptions believed to be reasonable at the
time delivered (it being understood that the projections are subject to inherent
uncertainties and contingencies, which may be outside the control of any Loan
Party and that no assurances can be given that such projected financial
information will be realized).

SECTION 5.10 Insurance.

(a) Each Loan Party will, and will cause each Restricted Subsidiary to, maintain
with financially sound and reputable carriers having a financial strength rating
of at least A- by A.M. Best

 

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Company insurance in such amounts (with no greater risk retention) and against
such risks (including, without limitation: loss or damage by fire and loss in
transit; theft, burglary, pilferage, larceny, embezzlement, and other criminal
activities; business interruption; and general liability) and such other
hazards, as is customarily maintained by companies of established repute engaged
in the same or similar businesses operating in the same or similar locations.
The Borrowers will furnish to the Lenders, upon request of the Administrative
Agent, information in reasonable detail as to the insurance so maintained. All
insurance policies required hereunder shall name the Administrative Agent (for
the benefit of the Administrative Agent and the Secured Parties) as an
additional insured or as lender loss payee, as applicable, and shall contain
lender loss payable clauses, through endorsements in form and substance
reasonably satisfactory to the Administrative Agent, which provide that: (i) all
proceeds thereunder with respect to any Collateral shall be payable to the
Administrative Agent; (ii) no such insurance shall be affected by any act or
neglect of the insured or owner of the property described in such policy; and
(iii) such policy and lender loss payable clauses may be canceled, amended, or
terminated only upon at least thirty (30) days prior written notice given to the
Administrative Agent.

(b) In the event any Collateral is located in any area that has been designated
by the Federal Emergency Management Agency as a “Special Flood Hazard Area”,
such Loan Party shall purchase and maintain flood insurance on such Collateral
(including any personal property which is located on any real property leased by
such Loan Party within a “Special Flood Hazard Area”). The amount of flood
insurance required by this Section shall at a minimum comply with applicable
law, including the Flood Disaster Protection Act of 1973, as amended.

(c) All premiums on any such insurance shall be paid when due by such Loan
Party, and copies of the policies delivered to the Administrative Agent. If such
Loan Party fails to obtain any insurance as required by this Section, the
Administrative Agent may obtain such insurance at the Loan Parties’ expense. By
purchasing such insurance, the Administrative Agent shall not be deemed to have
waived any Default arising from the Loan Parties’ failure to maintain such
insurance or pay any premiums therefor.

SECTION 5.11 Casualty and Condemnation. The Borrowers will (a) furnish to the
Administrative Agent and the Lenders prompt written notice of any casualty or
other insured damage to any material portion of the Collateral or any material
portion of the Inventory included in the Borrowing Base 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 and (b) ensure that the Net Proceeds of any such event
(whether in the form of insurance proceeds, condemnation awards or otherwise)
are collected and applied in accordance with the applicable provisions of this
Agreement and the Collateral Documents.

SECTION 5.12 Appraisals. At any time that the Administrative Agent requests, the
Borrower Representative will cause an appraiser selected and engaged by the
Administrative Agent to provide the Administrative Agent with appraisals or
updates thereof of the Loan Parties’ Inventory, such appraisals and updates to
be prepared on a basis satisfactory to the Administrative Agent and to include,
without limitation, information required by any applicable Requirement of Law;
provided, however, that, (a) so long as at all times during any calendar year no
Revolving Loans are outstanding and the LC Exposure is less than $40,000,000,
the Loan Parties shall not be required to pay the fees and expenses with respect
to any such appraisals conducted during such calendar year and (b) otherwise, if
no Event of Default has occurred and is continuing, only one such appraisal of
Inventory per calendar year shall be at the expense of the Loan Parties;
provided further that (x) one additional appraisal of Inventory per calendar
year shall be at the expense of the Loan Parties if Availability is at any time
during such calendar year less than the Applicable Trigger Amount (Level V), and
(y) in addition to the foregoing, an additional appraisal of Inventory shall be
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Administrative Agent in connection with a change in the Borrowers’ inventory
costing methodology following the Effective Date. For the avoidance of doubt,
all such appraisals conducted after the occurrence and during the continuance of
an Event of Default shall be at the expense of the Loan Parties, and it is
understood that the election to conduct or not conduct any appraisals is in the
discretion of the Administrative Agent.

SECTION 5.13 Depository Banks. The Loan Parties will maintain, and will cause
their respective Domestic Subsidiaries to maintain, with the Administrative
Agent or one or more Lenders acceptable to the Administrative Agent in its
Permitted Discretion as their principal depository bank, including for the
maintenance of operating, administrative, cash management, collection activity,
and other Deposit Accounts for the conduct of their business; provided that the
Loan Parties and their respective Domestic Subsidiaries shall not be required to
satisfy the foregoing requirement with respect to any Deposit Account (i) that
is an Excluded Account or an Excluded Asset or (ii) with respect to which the
applicable Loan Parties have entered into a Control Agreement in accordance with
the applicable Security Agreement and Section 5.14, as applicable, in favor of
the Administrative Agent.

SECTION 5.14 Additional Collateral; Further Assurances. (a) Subject to
applicable law, each Borrower and each Loan Party will cause each Designated
Subsidiary formed or acquired after the date of this Agreement or that becomes a
Designated Subsidiary after the Effective Date in accordance with the terms of
this Agreement within 30 days (in each case, as such time may be extended in the
Administrative Agent’s sole discretion) to become a Borrower (excluding, for the
avoidance of doubt, any Foreign Subsidiary) or a Guarantor pursuant to a Joinder
Agreement and take all such further actions (including the filing and recording
of financing statements and other documents) that are required under the
Collateral Documents or this Agreement to cause the Collateral and Guaranty
Requirement to be satisfied with respect to such Designated Subsidiary. Upon
execution and delivery thereof, each such Person (i) shall automatically become
a Borrower or Guarantor, as applicable hereunder and thereupon shall have all of
the rights, benefits, duties, and obligations in such capacity under the Loan
Documents and (ii) will grant Liens to the Administrative Agent, for the benefit
of the Administrative Agent and the applicable Secured Parties, in any property
of such Loan Party which constitutes Collateral, under the applicable Security
Agreement.

(b) The Loan Parties will execute any and all further documents, financing
statements, agreements and instruments, and take all such further actions
(including the filing and recording of financing statements, fixture filings,
and other documents) which may be required by any Requirement of Law or which
the Administrative Agent may, from time to time, reasonably request, to cause
the Collateral and Guaranty Requirement to be and remain satisfied at all times.
The Loan Parties also agree to provide to the Administrative Agent, from time to
time upon reasonable request, evidence reasonably satisfactory to the
Administrative Agent as to the perfection and priority of the Liens created or
intended to be created by the Collateral Documents. For the avoidance of doubt,
until an opinion of local counsel, in form and substance satisfactory to the
Administrative Agent, is received by the Administrative Agent with respect to
the Loan Party organized in Puerto Rico, the assets of such Puerto Rican Loan
Party shall not be eligible for inclusion in the Borrowing Base.

SECTION 5.15 Designation of Subsidiaries. The Company may at any time designate
any Restricted Subsidiary of the Company (other than any Borrower) as an
Unrestricted Subsidiary or any Unrestricted Subsidiary as a Restricted
Subsidiary; provided that (a) immediately before and after such designation, no
Default or Event of Default shall have occurred and be continuing, (b) on Pro
Forma Basis, the Payment Conditions shall be satisfied, and (c) no Restricted
Subsidiary may be designated as an Unrestricted Subsidiary if (i), after such
designation, it would be a “restricted subsidiary” under any Permitted Term Loan
Indebtedness or Subordinated Debt or (ii) any Restricted Subsidiary would be a
Subsidiary of such Unrestricted Subsidiary. The designation of any Restricted
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Unrestricted Subsidiary after the Effective Date shall constitute an Investment
by the Company therein at the date of designation in an amount equal to the fair
market value of the Company or its Restricted Subsidiaries’ (as applicable)
Investments therein as determined in good faith by the Borrower Representative.
The designation of any Unrestricted Subsidiary as a Restricted Subsidiary after
the Effective Date shall constitute at the time of designation the incurrence of
any Indebtedness or Liens of such Restricted Subsidiary existing at such time.

SECTION 5.16 Environmental Laws. Except where the failure to do so would not
reasonably be expected to have Material Adverse Effect, the Company and each
Subsidiary shall (i) conduct its operations and keep and maintain all of its
real property in compliance with all Environmental Laws; (ii) obtain and renew
all environmental permits necessary for its operations and properties; and
(iii) implement any and all investigation, remediation, removal and response
actions that are necessary to comply with Environmental Laws pertaining to the
presence, generation, treatment, storage, use, disposal, transportation or
release of any Hazardous Materials on, at, in, under, above, to, from or about
any of its Real Estate, provided, however, that neither a Loan Party nor any of
its Subsidiaries shall be required to undertake any such cleanup, removal,
remedial or other action to the extent that its obligation to do so is being
contested in good faith and by proper proceedings and adequate reserves have
been set aside and are being maintained by the Loan Parties with respect to such
circumstances in accordance with GAAP.

SECTION 5.17 Credit Card Agreements and Notifications. Each Borrower will
(a) comply in all material respects with all its obligations under each Credit
Card Agreement to which it is party and (b) maintain credit card arrangements
solely with the credit card issuers and credit card processors identified in
Schedule 3.23; provided, however, that the Company may amend Schedule 3.23 to
remove any credit card issuer or credit card processor identified on such
schedule or to add additional credit card issuers and credit card processors
that are reasonably satisfactory to the Administrative Agent, and concurrently
with or promptly following the making of any such amendment the Company shall
provide to the Administrative Agent evidence that a Credit Card Notification
shall have been delivered to any credit card issuer or credit card processor
added to such Schedule 3.23.

SECTION 5.18 Post-Closing Obligations. The Loan Parties will execute and deliver
the documents and complete the tasks set forth on Schedule 5.18, in each case
within the time limits specified on such schedule (or such longer period as the
Administrative Agent may agree in its sole discretion).

ARTICLE VI

NEGATIVE COVENANTS

Until the Commitments shall have expired or been terminated and the principal of
and interest on each Loan and all fees, expenses and other amounts payable under
any Loan Document (other than contingent or indemnity obligations for which no
claim has been made) shall have been paid in full and all Letters of Credit
shall have expired or have been Cash Collateralized pursuant to the terms
hereof, or terminated, in each case without any pending draw, and all LC
Disbursements shall have been reimbursed, each Loan Party executing this
Agreement covenants and agrees, jointly and severally with all of the other Loan
Parties, with the Lenders that:

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

(a) (i) the Secured Obligations (other than Specified L/C Obligations) and
(ii) Specified L/C Obligations or any other trade letter of credit facilities in
addition thereto on substantially similar terms as determined by the
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aggregate undrawn amount of all letters of credit issued thereunder plus the
aggregate amount of all drawn and unreimbursed obligations with respect to all
letters of credit thereunder does not exceed $150,000,000;

(b) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and
extensions, renewals, refinancings and replacements of any such Indebtedness in
accordance with clause (f) hereof;

(c) Indebtedness of the Company to any Restricted Subsidiary and of any
Restricted Subsidiary to the Company or any other Restricted Subsidiary;
provided that (A) such Indebtedness shall not have been transferred to any
Person other than the Company or any Restricted Subsidiary, (B) any such
Indebtedness owing by a Loan Party to a Restricted Subsidiary that is not a Loan
Party shall be unsecured and subordinated in right of payment to the Secured
Obligations on terms customary for intercompany subordinated Indebtedness, as
reasonably determined by the Administrative Agent, and (C) any such Indebtedness
shall be incurred in compliance with Section 6.04(d);

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

(e) Indebtedness of any Borrower or any Restricted Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or capital
assets (but excluding any real property) (whether or not constituting purchase
money Indebtedness), including Capital Lease Obligations and any Indebtedness
assumed in connection with the acquisition of any such assets or secured by a
Lien on any such assets prior to the acquisition thereof, and extensions,
renewals and replacements of any such Indebtedness in accordance with clause
(f) below; provided that (i) such Indebtedness is incurred prior to or within
270 days after such acquisition or the completion of such construction or
improvement and the principal amount of such Indebtedness does not exceed the
cost of acquiring, constructing or improving such fixed or capital assets, and
(ii) the aggregate principal amount of Indebtedness permitted by this clause
(e) together with any Refinance Indebtedness in respect thereof permitted by
clause (f) below, and together with any Indebtedness permitted by clause
(r) below, shall not exceed $100,000,000 at any time outstanding;

(f) Indebtedness which represents amendments, restatements, supplements,
extensions, renewals, refinancing or replacements (such Indebtedness being so
amended, restated, supplemented, extended, renewed, refinanced or replaced being
referred to herein as the “Refinance Indebtedness”) of any of the Indebtedness
described in clauses (b), (e), and (m) hereof (such Indebtedness being referred
to herein as the “Original Indebtedness”); provided that (i) such Refinance
Indebtedness does not increase the principal amount of the Original
Indebtedness, (ii) any Liens securing such Refinance Indebtedness are not
extended to any additional property of any Loan Party or any Restricted
Subsidiary, (iii) no Loan Party or any Restricted Subsidiary that is not
originally obligated with respect to repayment of such Original Indebtedness is
required to become obligated with respect to such Refinance Indebtedness,
(iv) such Refinance Indebtedness does not result in a shortening of the average
weighted maturity of such Original Indebtedness, (v) the terms of such Refinance
Indebtedness are not materially less favorable to the obligor thereunder than
the original terms of such Original Indebtedness and (vi) if such Original
Indebtedness was subordinated in right of payment to any of the Secured
Obligations, then the terms and conditions of such Refinance Indebtedness must
include subordination terms and conditions that are at least as favorable to the
Administrative Agent and the Lenders as those that were applicable to such
Original Indebtedness;

 

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

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

(i) Indebtedness in respect of netting services, overdraft protections and
otherwise in connection with deposit and checking accounts, in each case under
this clause (i), in the ordinary course of business;

(j) Indebtedness in the form of bona fide purchase price adjustments or
earn-outs incurred in connection with any Permitted Acquisition or other
Investment permitted by Section 6.04;

(k) Indebtedness in the form of Swap Agreements permitted under Section 6.07;

(l) Permitted Term Loan Indebtedness;

(m) Indebtedness of any Person that becomes a Restricted Subsidiary after the
date hereof; provided that such Indebtedness exists at the time such Person
becomes a Restricted Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Restricted Subsidiary;

(n) Indebtedness incurred under leases of real property in respect of tenant
improvements;

(o) obligations under any agreement governing the provision of treasury or cash
management services, including deposit accounts, overnight draft, credit cards,
debit cards, p-cards (including purchasing cards and commercial cards), funds
transfer, automated clearinghouse, zero balance accounts, returned check
concentration, controlled disbursement, lockbox, account reconciliation and
reporting and other cash management services;

(p) Indebtedness with respect to the deferred purchase price for any Permitted
Acquisition, provided that such Indebtedness is subordinated to the Secured
Obligations on terms reasonably acceptable to the Administrative Agent;

(q) so long as no Event of Default then exists or would arise immediately after
giving effect thereto, other Indebtedness not to exceed $50,000,000 in the
aggregate at any time outstanding;

(r) Indebtedness in an aggregate principal amount subject to the limitation in
amount referred to in clause 6.01(e)(ii) above incurred for the construction,
development or acquisition or improvement of, or to finance or to refinance, any
real estate owned or leased by any Loan Party (including therein any
Indebtedness incurred in connection with sale-leaseback transactions permitted
hereunder and any Off-Balance Sheet Liabilities), provided that prior to
incurrence of such Indebtedness the Loan Parties shall have caused the holders
of such Indebtedness and the lessors under any sale-leaseback or other such
transaction to enter into a Collateral Access Agreement on terms reasonably
satisfactory to the Administrative Agent unless not required in the reasonable
judgment of the Administrative Agent as confirmed in writing by the
Administrative Agent; and

(s) unsecured Indebtedness or Subordinated Indebtedness not otherwise
specifically described herein, in each case under this clause (s), with a
maturity date and an average life to maturity that is at least six (6) months
following the Maturity Date and that does not require amortization or
prepayments prior to the Maturity Date.

 

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Anything in this Section 6.01 to the contrary notwithstanding, (a) Specified L/C
Obligations may only be created, incurred, assumed or exist pursuant to
Section 6.01(a)(ii) and (b) Permitted Term Loan Indebtedness may only be
created, incurred, assumed or exist pursuant to Section 6.01(l).

SECTION 6.02 Liens. No Loan Party will, nor will it permit any Restricted
Subsidiary to, create, incur, assume or permit to exist any Lien on any
property, asset, income or revenue (including Accounts) now owned or hereafter
acquired by it, except:

(a) Liens in favor of the Administrative Agent created pursuant to any Loan
Document;

(b) Permitted Encumbrances;

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

(d) Liens on fixed or capital assets acquired, constructed or improved by any
Borrower or any Restricted Subsidiary; provided that (i) such Liens secure
Indebtedness permitted by clause (e) of Section 6.01, (ii) such Liens and the
Indebtedness secured thereby are incurred prior to or within 270 days after such
acquisition or the completion of such construction or improvement, (iii) such
Liens shall not apply to any other property or assets of such Borrower or
Restricted Subsidiary or any other Borrower or Restricted Subsidiary and
(iv) the Indebtedness secured thereby does not exceed the cost of the property
being acquired, constructed or improved on the date of acquisition, construction
or improvement;

(e) any Lien existing on any specific tangible property or specific tangible
asset (other than Collateral) prior to the acquisition thereof by any Borrower
or any Restricted Subsidiary or existing on any property or asset (other than
Collateral) of any Person that becomes a Loan Party after the date hereof prior
to the time such Person becomes a Loan Party; provided that (i) such Lien is not
created in contemplation of or in connection with such acquisition or such
Person becoming a Loan Party, as the case may be, (ii) such Lien shall not apply
to any other property or assets of the Loan Party, (iii) such Lien shall secure
only those obligations which it secures on the date of such acquisition or the
date such Person becomes a Loan Party, as the case may be, and extensions,
renewals and replacements thereof that do not increase the outstanding principal
amount thereof and (iv) such Lien and the documentation governing the creation
thereof do not prohibit or interfere with (x) the Administrative Agent’s access
rights to such property or asset for purposes of Collateral rights in accordance
with Section 2.23 hereof except to the extent otherwise approved by the
Administrative Agent in its sole discretion in writing and (y) if applicable,
the intellectual property license granted to the Administrative Agent pursuant
to the Security Agreement;

(f) (i) Liens of a collecting bank arising in the ordinary course of business
under Section 4-208 of the UCC in effect in the relevant jurisdiction covering
only the items being collected upon and (ii) Liens in favor of securities
intermediaries, rights of setoff or similar rights and remedies as to deposit
accounts or securities accounts or other funds maintained with depository
institutions or securities intermediary (other than as waived under any
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(g) Liens arising out of Sale and Leaseback Transactions permitted by
Section 6.06;

(h) Liens securing Permitted Term Loan Indebtedness; provided that, such Liens
must be and remain subject to a Permitted Term Loan Intercreditor Agreement;

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

(j) Liens on Equity Interests or other assets being sold arising in connection
with the sale or transfer of such Equity Interests or such other assets in a
transaction permitted under Section 6.05, customary rights and restrictions in
respect of such Equity Interests or other assets being sold contained in
agreements relating to such sale or transfer pending the completion thereof;

(k) in the case of (i) any non-Loan Party Restricted Subsidiary that is not a
wholly-owned Restricted Subsidiary or (ii) the Equity Interests in any Person
that is not a Restricted Subsidiary, any encumbrance or restriction, including
any put and call arrangements, related to Equity Interests in such Restricted
Subsidiary or such other Person set forth in the organizational documents of
such Restricted Subsidiary or such other Person or any related joint venture,
shareholders’ or similar agreement;

(l) Liens solely on any cash earnest money deposits or escrow arrangements made
by the Company or any Restricted Subsidiary in connection with any letter of
intent or purchase agreement for a Permitted Acquisition or other transaction
permitted hereunder;

(m) other Liens on specifically identified tangible personal property securing
Indebtedness or other obligations in an aggregate principal amount not to exceed
$20,000,000 at any time outstanding so long as the Administrative Agent and the
collateral agents or other representatives for the holders of such Indebtedness
have entered into an intercreditor agreement, acknowledged by the Loan Parties,
in form and substance reasonably satisfactory to the Administrative Agent (it
being understood that in the event any such Liens extend to Accounts, Credit
Card Accounts or Inventory, such Accounts, Credit Card Accounts or Inventory, to
the extent otherwise included therein, will not constitute or will cease to be
Eligible Trade Accounts, Eligible Credit Card Accounts or Eligible Inventory, as
applicable);

(n) Liens in favor of landlords on leasehold improvements financed by allowances
or advances pursuant to lease arrangements in the ordinary course of business
(subject to the terms of the applicable Collateral Access Agreement to the
extent otherwise required hereunder to be entered into with the Administrative
Agent);

(o) Liens in favor of insurance companies or their affiliates on the unearned
portion of the premium financed in connection with insurance premium financing
in the ordinary course of business;

(p) [reserved];

(q) Liens on Real Estate, provided that such Liens only secure Indebtedness
permitted by clause (r) of Section 6.01;

(r) Secured Inventory Liens; and

(s) Liens on motor vehicles, aircraft, avionics, vessels and property related
thereto and other property the subject of certificates of title or other
certificates of registration and operation, provided that the Indebtedness
secured by any such Lien does not exceed the cost of such motor vehicle,
aircraft, avionic, vessel or other property, as applicable.

 

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Notwithstanding the foregoing, (A) none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to any Loan Party’s (1) Accounts or Credit
Card Accounts, other than those permitted under clauses (a) and (m) of the
definition of Permitted Encumbrances and clauses (a), (h) and (m) above and
(2) Inventory, other than those permitted under clauses (a) and (c) of the
definition of Permitted Encumbrances and clauses (a) and (h) above and (B) none
of the Specified L/C Obligations may be cash collateralized unless such cash
collateral constitutes Collateral hereunder for the benefit of all of the
Secured Parties in accordance with, and subject to, Section 2.18 of the Loan
Documents.

SECTION 6.03 Fundamental Changes; Changes in Name, Location. (a) No Loan Party
will, nor will it permit any Restricted Subsidiary to, merge into or consolidate
with any other Person, or permit any other Person to merge into or consolidate
with it, or liquidate or dissolve, except that, if at the time thereof and
immediately after giving effect thereto no Default or Event of Default shall
have occurred and be continuing (i) any Subsidiary of any Borrower may merge
into a Borrower in a transaction in which such Borrower is the surviving entity,
(ii) any Borrower may merge into another Borrower, (iii) any Person (other than
a Borrower) may merge into, amalgamate with or consolidate with any Restricted
Subsidiary in a transaction in which the surviving entity is a Restricted
Subsidiary and, if any party to such merger, amalgamation or consolidation is a
Loan Party, a Loan Party, (iv) any Restricted Subsidiary (other than a Loan
Party) may merge into, amalgamate with or consolidate with any Person (other
than a Loan Party) in a transaction permitted under Section 6.05 in which, after
giving effect to such transaction, the surviving entity is not a Restricted
Subsidiary, and (v) any Restricted Subsidiary that is not a Loan Party may
liquidate or dissolve if the Borrower which owns such Restricted Subsidiary
determines in good faith that such liquidation or dissolution is in the best
interests of such Borrower and is not materially disadvantageous to the Lenders;
provided that (x) any merger or consolidation that is in connection with an
Acquisition must be a Permitted Acquisition, (y) any such merger or
consolidation involving a Person that is not a wholly-owned Restricted
Subsidiary immediately prior to such merger or consolidation shall not be
permitted unless also permitted by Section 6.04, and (z) in all circumstances,
such merging or consolidating entities are from the same country of domicile
except that the terms of this clause (z) shall not apply in respect of entities
that are all non-Loan Parties.

(b) No Loan Party will, nor will it permit any Subsidiary to, engage in any
business other than businesses (i) of the type conducted by the Borrowers and
their Restricted Subsidiaries on the date hereof and businesses reasonably
similar, related, complementary or ancillary thereto and extensions thereof, so
long as the core business of the Loan Parties and Restricted Subsidiaries on the
Effective Date, after giving effect to any of the foregoing, does not change in
any material way and (ii) in respect of Unrestricted Subsidiaries, consistent
with the definition of such term.

(c) No Loan Party shall (a) change its name as it appears in official filings in
the state of incorporation or organization, (b) change its chief executive
office or any distribution centers at which Collateral is held or stored,
(c) change the type of entity that it is, (d) change its organization
identification number, if any, issued by its state of incorporation or other
organization, or (e) change its state of incorporation or organization, in each
case under this Section 6.03(c), unless the Administrative Agent shall have
received at least thirty (30) days prior written notice of such change and the
Administrative Agent shall have acknowledged in writing that either (1) such
change will not adversely affect the validity, perfection or priority of the
Administrative Agent’s security interest in the Collateral, or (2) any
reasonable action requested by the Administrative Agent in connection therewith
has been completed or taken (including any action to continue the perfection of
any Liens in favor of the Administrative Agent, on behalf of the Secured
Parties, in any Collateral).

(d) No Loan Party will, nor will it permit any Restricted Subsidiary to, change
its fiscal year from the basis in effect on the Effective Date without first
providing 30 days’ prior written notice thereof to the Administrative Agent, in
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the effectiveness of such change, and are hereby authorized by the Lenders to,
make any adjustments to this Agreement that are reasonably necessary in the
judgment of the Administrative Agent to reflect such change in fiscal year.

(e) No Loan Party will change the accounting basis upon which its financial
statements are prepared, other than immaterial changes to comply with changes in
GAAP, without first having provided to the Administrative Agent 30 days’ prior
written notice thereof, in which case, the Loan Parties and the Administrative
Agent shall, prior to the effectiveness of such change, and are hereby
authorized by the Lenders to, make any adjustments to this Agreement that are
reasonably necessary in the judgment of the Administrative Agent to reflect such
change; it being acknowledged that with respect to calculations of the Borrowing
Base such change must be approved in writing by the Administrative Agent.

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

(a) Investments in cash and Cash Equivalents;

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

(c) Investments in existence on the Effective Date by the Company and its
Restricted Subsidiaries in their respective Subsidiaries;

(d) Investments by the Company and the Restricted Subsidiaries in their
respective Subsidiaries made after the Effective Date; provided that (i) the
aggregate amount of such Investments by the Loan Parties in Subsidiaries that
are not Loan Parties shall not exceed $20,000,000 at any time outstanding
(determined without regard to any write-downs or write-offs) and (ii) any such
Investments that are loans and advances made by a Loan Party shall be evidenced
by a promissory note pledged pursuant to the Security Agreement to the extent
required to be so pledged by the Security Agreement;

(e) loans or advances made by a Loan Party or a Restricted Subsidiary to its
employees, officers, or directors on an arm’s-length basis in the ordinary
course of business consistent with past practices for travel and entertainment
expenses, relocation costs and similar purposes;

(f) accounts receivable, notes payable, or stock or other securities issued by
Account Debtors to a Loan Party pursuant to negotiated agreements with respect
to settlement of such Account Debtor’s Accounts obligations in the ordinary
course of business, consistent with past practices, and Investments received in
satisfaction or partial satisfaction thereof from financially troubled Account
Debtors to the extent reasonably necessary in order to prevent or limit loss or
received in connection with the bankruptcy or reorganization of customers or
suppliers, or settlement of disputes with suppliers, in each case in the
ordinary course of business;

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

 

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

(i) Investments made as a result of receipt of non-cash consideration from a
sale, transfer or other disposition of assets permitted under Section 6.05;

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

(k) Permitted Acquisitions;

(l) Investments (excluding Acquisitions but including Investments in
Subsidiaries) not otherwise permitted by this Section 6.04 so long as the
Payment Conditions are satisfied before and immediately after giving effect to
each such Investment and so long as no such Investment requires the incurrence
of any Indebtedness, contingent obligation (including any capital call) or other
liability not otherwise permitted under this Agreement by any Loan Party or
otherwise enables a creditor to have recourse to any Loan Party not otherwise
permitted under this Agreement;

(m) deposits, prepayments, advances and other credits to suppliers, vendors,
customers, lessors and landlords or in connection with marketing promotions, in
each instance, made in the ordinary course of business;

(n) Investments the sole payment for which is common stock of the Company and
which do not constitute Indebtedness;

(o) any earn-out or customary indemnity, purchase price adjustment, or similar
obligation payable to the Company or any of its Restricted Subsidiaries pursuant
to a Permitted Acquisition or a disposition permitted under Section 6.05;

(p) so long as no Default or Event of Default has occurred and is continuing
before or after giving effect to such Investments and so long as no such
Investment requires the incurrence of any Indebtedness or contingent obligation
(including any capital call) or other liability by any Loan Party or otherwise
enables a creditor to have recourse to any Loan Party, in each case not
otherwise permitted to exist under another Section of this Agreement, other
Investments (excluding Acquisitions) in an aggregate amount not to exceed
$15,000,000 at any time outstanding;

(q) Investments (excluding Acquisitions) made pursuant to the Company’s
Investment Policy and otherwise consistent with the other provisions of this
Agreement; and

(r) Restricted Payments permitted by Section 6.08.

For the purposes of this Section 6.04, any unreimbursed payment by the Company
or any Restricted Subsidiary for goods or services delivered to any Restricted
Subsidiary shall be deemed to be an Investment in such Restricted Subsidiary.

SECTION 6.05 Asset Sales. No Loan Party will, nor will it permit any Restricted
Subsidiary to, sell, transfer, lease or otherwise dispose of any asset,
including any Equity Interest owned by it or any assignment (whether
non-recourse, recourse, or otherwise) of income or revenue (including Accounts),
nor will any Borrower permit any Restricted Subsidiary to issue any additional
Equity Interest in such

 

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Restricted Subsidiary (other than to another Borrower or another Restricted
Subsidiary in compliance with Section 6.04 and other than directors’ qualifying
shares and other nominal amounts of Equity Interests that are required to be
held by other Persons under applicable law), excluding therefrom the payment of
advances, customer deposits, trade payables and other accrued expenses and
liabilities incurred in the ordinary course of business, and the transfer and
sale of Cash Equivalents and other marketable securities, except:

(a) (i) sales of inventory, (ii) sales, transfers and other dispositions of
used, damaged, surplus, obsolete or outmoded machinery or equipment and
(iii) dispositions of Investments in Cash Equivalents so long as the proceeds of
such disposition are invested in an Investment permitted under Section 6.04,
applied as Restricted Payments permitted by Section 6.08 or otherwise used in a
manner not expressly prohibited by this Agreement, in each case (other than in
the case of clause (iii)) in the ordinary course of business;

(b) sales, transfers, leases and other dispositions to the Company or any
Restricted Subsidiary; provided that any such sales, transfers, leases or other
dispositions involving a Loan Party and a Restricted Subsidiary that is not a
Loan Party shall be made in compliance with Section 6.04(d) and Section 6.09 and
shall exclude assets of the type included in the Borrowing Base and related
assets evidencing or supporting such assets, and Equity Interests in
Subsidiaries (other than (x) Equity Interests in Foreign Subsidiaries,
(y) Equity Interests in Subsidiaries (other than Borrowers) having assets with
an aggregate value not to exceed $10,000,000 at such date the disposition of
which shall not change the core operations of the Borrowers (as in existence on
the Effective Date) in any material respect and (z) transfers of Inventory by a
Borrower directly to the retail locations (for sale therein) of a Canadian
Subsidiary of the Company on arms-length terms applicable to an unaffiliated
third party and that are consistent with past practice of the Loan Parties);

(c) the sale or discount of accounts receivable arising in the ordinary course
of business, but only in connection with the compromise or collection thereof
and not in connection with any financing transaction;

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

(e) dispositions resulting from any casualty or other insured damage to, or any
taking under power of eminent domain or by condemnation or similar proceeding
of, any property or asset of any Borrower or any Subsidiary;

(f) leases or subleases of real property granted by the Company or any
Restricted Subsidiary to third Persons not interfering in any material respect
with the business of the Company or any Restricted Subsidiary, including,
without limitation, retail store lease assignments and surrenders;

(g) other dispositions of assets (other than assets of the type included in the
Borrowing Base and related assets evidencing or supporting such assets,
including, without limitation, patents, trademarks, copyrights and other
intellectual property) of the Company and its Restricted Subsidiaries not
otherwise permitted under this Section 6.05, provided that before and after
giving effect to such disposition, the Payment Conditions are satisfied;
provided further that, with respect to any disposition of Equity Interests in
Subsidiaries, such disposition shall only be permitted pursuant to this clause
(g) so long as (i) at the time of such disposition, no Default or Event of
Default shall exist or shall result from such disposition; (ii) the
consideration received for such disposition shall be in an amount at least equal
to the fair market value of the Equity Interests sold, transferred, licensed or
otherwise disposed of; (iii) at least seventy-five percent (75%) of the
consideration received for such disposition shall be cash; and (iv) the
aggregate fair market value of all Equity Interests so sold, transferred,
licensed or otherwise so disposed of shall not

 

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exceed $10,000,000 during the term of this Agreement and shall not include
Equity Interests of any Loan Party (x) if such disposition changes any
Borrower’s core business as in effect on the Effective Date or (y) if such Loan
Party owns patents, trademarks, copyrights and other intellectual property
relating to any Borrower’s core business as in effect on the Effective Date;

(h) other dispositions of assets (whether or not of the type included in the
Borrowing Base) of the Company and its Restricted Subsidiaries not otherwise
permitted under this Section 6.05, the aggregate fair market value of assets
disposed of pursuant to this clause (h) not to exceed $10,000,000 during the
term of this Agreement;

(i) the sale, transfer or other disposition of patents, trademarks, copyrights
and other intellectual property or the granting of franchises and similar
rights, in each case (i) in the ordinary course of business, including pursuant
to non-exclusive licenses of intellectual property; provided that no such sale,
transfer or other disposition shall adversely affect in any material respect the
fair value of any Eligible Inventory or the ability of the Administrative Agent
to dispose of or otherwise realize upon any Eligible Inventory after an Event of
Default; provided that, this clause (i) shall not permit the sale, transfer or
other disposition (other than non-exclusive licenses) of any such intellectual
property of a Loan Party to any Foreign Subsidiary or any non-Loan Party, or
(ii) which, in the reasonable judgment of the Company or any Subsidiary, are
determined to be uneconomical, negligible or obsolete in the conduct of
business;

(j) Restricted Payments permitted by Section 6.08;

(k) dispositions of equipment or real property to the extent that (i) such
property is exchanged for credit against the purchase price of similar
replacement property or (ii) the proceeds of such disposition are reasonably
promptly applied to the purchase price of similar replacement property; and

(l) as long as no Event of Default then exists or would arise therefrom, sales
of real property of any Loan Party or Restricted Subsidiary;

provided that all sales, transfers, leases and other dispositions permitted
hereby (other than those permitted by paragraphs (a)(ii), (b), (f), (j) or
(k) above) shall be made for fair value and for at least 75% cash consideration
(or, in the case of a sale, transfer, lease or other disposition of assets
included in the Borrowing Base, 100% cash consideration).

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

SECTION 6.07 Swap Agreements. No Loan Party will, nor will it permit any
Restricted Subsidiary to, enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which any Borrower or any
Restricted Subsidiary has actual exposure (other than those in respect of Equity
Interests of any Borrower or any of its Restricted Subsidiaries), and (b) Swap
Agreements entered into in order to effectively cap, collar or exchange interest
rates (from floating to fixed rates, from one floating rate to another floating
rate or otherwise) with respect to any interest-bearing liability or investment
of any Borrower or any Restricted Subsidiary.

 

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SECTION 6.08 Restricted Payments; Certain Payments of Indebtedness.

(a) No Loan Party will, nor will it permit any Restricted Subsidiary to, declare
or make, or agree to declare or make, directly or indirectly, any Restricted
Payment, or incur any obligation (contingent or otherwise) to do so, except:

(i) the Company may declare and pay dividends with respect to its Equity
Interests payable solely in common stock;

(ii) any Restricted Subsidiary of the Company may declare and pay dividends or
make other distributions with respect to its Equity Interests, or make other
Restricted Payments in respect of its Equity Interests, in each case ratably to
the holders of such Equity Interests (or, if not ratably, on a basis more
favorable to the Company and the Restricted Subsidiaries);

(iii) the Company may repurchase Equity Interests upon the exercise of stock
options, deferred stock units and restricted shares to the extent such Equity
Interests represent a portion of the exercise price of such stock options,
deferred stock units or restricted shares;

(iv) the Company may make cash payments in lieu of the issuance of fractional
shares representing insignificant interests in the Company in connection with
the exercise of warrants, options or other securities convertible into or
exchangeable for shares of common stock in the Company; and

(v) the Company may declare and make Restricted Payments including dividends or
share repurchases so long as before and immediately after giving effect to such
Restricted Payments the Payment Conditions are satisfied.

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

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

(ii) payment of regularly scheduled interest and principal payments or
reimbursement obligations under letters of credit, in each case, as and when due
in respect of any Indebtedness permitted under Section 6.01, other than payments
in respect of the Subordinated Indebtedness prohibited by the subordination
provisions thereof and subject in the case of the Specified L/C Obligations to
any other provisions applicable thereto as provided in this Agreement or any
other Loan Document (including the provisions of Section 2.18); and

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

(iv) payment of secured Indebtedness that becomes due as a result of (A) any
voluntary sale or transfer of any assets (other than assets included in any
Borrowing Base) securing such Indebtedness or (B) any casualty or condemnation
proceeding (including a disposition in lieu thereof) of any assets (other than
assets included in any Borrowing Base) securing such Indebtedness;

 

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(v) payments of or in respect of Indebtedness solely by issuance of the common
stock of the Company;

(vi) payments of intercompany Indebtedness owed to any Loan Party; and

(vii) other payments of or in respect of Indebtedness; provided that at the time
of and immediately after giving effect thereto the Payment Conditions have been
satisfied.

SECTION 6.09 Transactions with Affiliates. No Loan Party will, nor will it
permit any Restricted Subsidiary to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) transactions that (i) are in the ordinary course of
business and (ii) are at prices and on terms and conditions not less favorable
to such Loan Party or such Restricted Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties, (b) transactions between or
among any Loan Parties not involving any other Affiliate, (c) any Investment
permitted by Section 6.04, (d) any Indebtedness permitted under Section 6.01(c),
provided that Indebtedness owed to non-Loan Parties must be on terms and
conditions not less favorable to such Loan Party than could be obtained on an
arm’s length basis from unrelated third parties, (e) any Restricted Payment
permitted by Section 6.08, (f) loans or advances to officers, directors and
employees permitted under Section 6.04, (g) the payment of reasonable fees to
directors of any Borrower or any Restricted Subsidiary who are not employees of
such Borrower or Restricted Subsidiary, and compensation and employee benefit
arrangements paid to, and indemnities provided for the benefit of, directors,
officers or employees of the Borrowers or their Restricted Subsidiaries in the
ordinary course of business, and (h) any issuances of securities or other
payments, awards or grants in cash, securities or otherwise pursuant to, or the
funding of, employment agreements, stock options and stock ownership plans
approved by a Borrower’s board of directors.

SECTION 6.10 Restrictive Agreements. No Loan Party will, nor will it permit any
Restricted Subsidiary to, directly or indirectly, enter into, incur or permit to
exist any agreement or other arrangement that prohibits, restricts or imposes
any condition upon (a) the ability of such Loan Party or any Restricted
Subsidiary to create, incur or permit to exist any Lien upon any of its property
or assets, or (b) the ability of any Restricted Subsidiary to pay dividends or
other distributions with respect to any of its Equity Interests or to make or
repay loans or advances to any Borrower or any other Restricted Subsidiary or to
Guarantee Indebtedness of any Borrower or any other Restricted Subsidiary;
provided that (i) the foregoing shall not apply to restrictions and conditions
imposed by any Requirement of Law or by any Loan Document or any agreement
governing the Permitted Term Loan Indebtedness, (ii) the foregoing shall not
apply to restrictions and conditions existing on the date hereof identified on
Schedule 6.10 (but shall apply to any extension or renewal of, or any amendment
or modification expanding the scope of, any such restriction or condition),
(iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Restricted Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Restricted Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases restricting the assignment thereof.

SECTION 6.11 Amendment of Material Documents. No Loan Party will, nor will it
permit any Restricted Subsidiary to, amend, modify or waive any of its rights
under (a) any agreement relating to any Subordinated Indebtedness except as
permitted in accordance with the subordination terms thereof, (b) its charter,
articles or certificate of incorporation or organization, by-laws, operating,
management or partnership agreement or other organizational documents if such
amendments, modifications, or waivers,

 

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individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, (c) Material Indebtedness (other than on account of any
refinancing thereof otherwise permitted hereunder, or with respect to any
Permitted Term Loan Indebtedness) to the extent any such amendment, modification
or waiver would result in a Default or Event of Default under any of the Loan
Documents, would increase materially the obligations of the Loan Parties
thereunder, confer any additional material rights on the holders of such
Material Indebtedness, or otherwise materially and adversely affect the rights
or interests of the Lenders or (d) Permitted Term Loan Indebtedness, except as
permitted by the applicable Permitted Term Loan Intercreditor Agreement with
respect thereto; provided that in each case under this Section 6.11 the
Administrative Agent shall have received a copy, certified as true and complete,
of any proposed amendment at least five (5) Business Days (or as such time may
be extended in writing in the Administrative Agent’s sole discretion) prior to
the intended effectiveness thereof.

SECTION 6.12 Fixed Charge Coverage Ratio. The Company will not permit the Fixed
Charge Coverage Ratio, as of the end of any fiscal quarter, commencing with the
fiscal quarter ending immediately preceding the date on which Availability is
less than the Applicable Trigger Amount (Level I), to be less than 1.0 to 1.0.
Once such covenant is in effect, compliance with the covenant will be
discontinued: (i) on the first date thereafter that (A) no Default or Event of
Default exists and (B) Availability is greater than or equal to the Applicable
Trigger Amount (Level I) for a period of 90 consecutive days and (ii) no more
than once in any period of 12 consecutive months.

SECTION 6.13 Disqualified Stock. The Company will not, and will not permit any
Restricted Subsidiary to, issue any Disqualified Stock, other than, in the case
of the Restricted Subsidiaries, to the Company or a Restricted Subsidiary;
provided that any issuance of Equity Interests of any Restricted Subsidiary that
is not a Loan Party to any Loan Party shall be subject to Section 6.04.

ARTICLE VII

EVENTS OF DEFAULT

If any of the following events (“Events of Default”) shall occur:

(a) the Borrowers shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise; or

(b) the Borrowers shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in clause (a) of this Article)
payable under this Agreement or any other Loan Document, when and as the same
shall become due and payable, and such failure shall continue unremedied for a
period of five (5) Business Days; or

(c) any representation or warranty made or deemed made by or on behalf of any
Loan Party or any Restricted Subsidiary in, or in connection with, this
Agreement or any other Loan Document or any amendment or modification hereof or
thereof or waiver hereunder or thereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in connection
with this Agreement or any other Loan Document or any amendment or modification
hereof or thereof or waiver hereunder or thereunder, shall prove to have been
materially incorrect when made or deemed made (it being understood and agreed
that any representation or warranty which is subject to any materiality
qualifier shall be required to be true and correct in all respects); or

 

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(d) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02(a), Section 5.03 (with respect to a Loan
Party’s existence), 5.08, 5.18 or in Article VI of this Agreement; or

(e) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those which constitute a
default under another Section of this Article), and such failure shall continue
unremedied for a period of (i) five (5) days after the earlier of knowledge of a
Responsible Officer of the Borrower Representative of such breach or notice
thereof from the Administrative Agent (which notice will be given at the request
of any Lender) if such breach relates to terms or provisions of Section 5.01,
Section 5.02 (other than Section 5.02(a)), Section 5.03 (other than with respect
to a Loan Party’s existence) through Section 5.07, Section 5.10, Section 5.11 or
Section 5.13 of this Agreement or Article VII of the Security Agreement, or
(ii) 30 days after the earlier of knowledge of a Responsible Officer of the
Borrower Representative of such breach or notice thereof from the Administrative
Agent (which notice will be given at the request of any Lender) if such breach
relates to terms or provisions of any other Section of this Agreement; or

(f) any Loan Party or Subsidiary shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness (other than Specified L/C Obligations) or Permitted Term Loan
Indebtedness, when and as the same shall become due and payable; or

(g) (i) any event or condition occurs that results in any Material Indebtedness
(other than Specified L/C Obligations) or Permitted Term Loan Indebtedness of
any Loan Party or Subsidiary becoming due prior to its scheduled maturity or
that enables or permits (with or without the giving of notice, the lapse of time
or both) the holder or holders of any Material Indebtedness (other than
Specified L/C Obligations) or Permitted Term Loan Indebtedness or any trustee or
agent on its or their behalf to cause any Material Indebtedness or Permitted
Term Loan Indebtedness to become due, or to require the prepayment, repurchase,
redemption or defeasance thereof, prior to its scheduled maturity; provided that
this clause (g) shall not apply to secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing such
Indebtedness to the extent such sale or transfer is permitted by Section 6.05,
and (ii) any event or condition occurs that results in Specified L/C Obligations
that constitute Material Indebtedness becoming due or requiring cash
collateralization of any Specified L/C Obligation prior to its scheduled
maturity or termination date; or

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, reorganization or other relief in
respect of a Loan Party or Subsidiary or its debts, or of a substantial part of
its assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the appointment
of a receiver, interim receiver, monitor, trustee, custodian, sequestrator,
conservator or similar official for any Loan Party or Subsidiary or for a
substantial part of its assets, and, in any such case, such proceeding or
petition shall continue undismissed for sixty (60) days or an order or decree
approving or ordering any of the foregoing shall be entered; or

(i) any Loan Party or Subsidiary shall (i) voluntarily commence any proceeding
or proposal or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article, (iii) apply for or consent to
the appointment of a receiver, interim receiver, monitor, trustee, custodian,
sequestrator, conservator or similar official for such Loan Party or Subsidiary
or for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors or (vi) take any
action for the purpose of effecting any of the foregoing; or

 

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(j) any Loan Party or Subsidiary shall become unable, admit in writing its
inability, or publicly declare its intention not to, or fail generally to pay
its debts as they become due; or

(k) (i) one or more judgments for the payment of money in an aggregate amount in
excess of $15,000,000 (to the extent not covered by independent third-party
insurance as to which the insurer has been notified of such judgment and has not
denied coverage) shall be rendered against any Loan Party, any Subsidiary or any
combination thereof and the same shall remain undischarged for a period of
30 consecutive days during which execution shall not be effectively stayed, or
any action shall be legally taken by a judgment creditor to attach or levy upon
any assets of any Loan Party or Subsidiary to enforce any such judgment; or
(ii) any Loan Party or Subsidiary shall fail within thirty (30) days to
discharge one or more non-monetary judgments or orders which, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect,
which judgments or orders, in any such case, are not stayed on appeal or
otherwise being appropriately contested in good faith by proper proceedings
diligently pursued; or

(l) an ERISA Event or any event with respect to an employee benefit plan,
including a Foreign Plan, shall have occurred that, in the reasonable opinion of
the Required Lenders, when taken together with all other ERISA Events and events
related to an employee benefit plan, including a Foreign Plan, that have
occurred, could reasonably be expected to result in a Material Adverse Effect or
in the imposition of Liens securing an aggregate amount in excess of $5,000,000;
or

(m) a Change in Control shall occur; or

(n) the occurrence of any “default”, as defined in any Loan Document (other than
this Agreement) or the breach of any of the terms or provisions of any Loan
Document (other than this Agreement), which default or breach continues beyond
any period of notice or grace therein provided; or

(o) the Loan Guaranty shall fail to remain in full force or effect or any action
shall be taken to discontinue or to assert the invalidity or unenforceability of
the Loan Guaranty, or any Loan Party shall deny that it has any further
liability under the Loan Guaranty to which it is a party, or shall give notice
to such effect, including, but not limited to notice of termination delivered
pursuant to Section 10.08; or

(p) except as permitted by the terms of any Collateral Document or an
Intercreditor Agreement, (i) any Collateral Document shall for any reason fail
to create a valid security interest in any Collateral purported to be covered
thereby having an aggregate value in excess of $5,000,000, or (ii) any Lien
securing any Secured Obligation shall cease to be perfected and have the
priority required by the applicable Collateral Document; or

(q) any Collateral Document covering a portion of the Collateral having a value
in excess of $5,000,000 or any material provision of this Agreement or any other
Loan Document for any reason ceases to be valid, binding and enforceable in
accordance with its terms (or any Loan Party shall challenge the enforceability
of this Agreement or any other Loan Document or shall assert in writing, or
engage in any action that evidences its assertion, that any provision of any of
this Agreement or any other Loan Document has ceased to be or otherwise is not
valid, binding and enforceable in accordance with its terms); or

(r) (i) the subordination provisions of the documents evidencing or governing
any Subordinated Indebtedness in excess of the principal sum of $10,000,000, or
provisions of any

 

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Intercreditor Agreement (such provisions being referred to as the “Intercreditor
Provisions”), shall, in whole or in part, terminate, cease to be effective or
cease to be legally valid, binding and enforceable against any holder of the
applicable Indebtedness; or (ii) any Borrower or any other Loan Party shall,
directly or indirectly, disavow or contest in any manner (A) the effectiveness,
validity or enforceability of such Intercreditor Provisions, (B) that the
Intercreditor Provisions exist for the benefit of the Secured Parties, or (C) in
the case of Subordinated Indebtedness, that all payments of principal of or
premium and interest on the applicable Subordinated Indebtedness, or realized
from the liquidation of any property of any Loan Party, shall be subject to any
of the Intercreditor Provisions;

then, and in every such Event of Default (other than an Event of Default with
respect to the Loan Parties or any Subsidiary described in clause (h) or (i) of
this Article), and at any time thereafter during the continuance of such event,
the Administrative Agent may, and at the request of the Required Lenders shall,
by notice to the Borrower Representative, take either or both of the following
actions, at the same or different times: (i) terminate the Commitments,
whereupon the Commitments shall terminate immediately, and (ii) declare the
Loans then outstanding to be due and payable in whole (or in part, in which case
any principal not so declared to be due and payable may thereafter be declared
to be due and payable), whereupon the principal of the Loans so declared to be
due and payable, together with accrued interest thereon and all fees and other
obligations of the Loan Parties accrued hereunder, shall become due and payable
immediately, in each case without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Loan Parties; and in the case
of any event with respect to the Loan Parties and Subsidiaries described in
clause (h) or (i) of this Article, the Commitments shall automatically terminate
and the principal of the Loans then outstanding, together with accrued interest
thereon and all fees and other obligations of the Loan Parties accrued
hereunder, shall automatically become due and payable, in each case without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrowers. Upon the occurrence and during the continuance
of an Event of Default, the Administrative Agent may, and at the request of the
Required Lenders shall, increase the rate of interest applicable to the Loans
and other Obligations to the extent set forth in this Agreement and exercise any
rights and remedies provided to the Administrative Agent under the Loan
Documents or at law or equity, including all remedies provided under the UCC.

ARTICLE VIII

THE ADMINISTRATIVE AGENT

SECTION 8.01 Appointment. Each of the Lenders, on behalf of itself and any of
its Affiliates that are Secured Parties and the Issuing Bank hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf, including execution of the other Loan
Documents, and to exercise such powers as are delegated to the Administrative
Agent by the terms of the Loan Documents, together with such actions and powers
as are reasonably incidental thereto. In addition, to the extent required under
the laws of any jurisdiction other than the U.S., each of the Lenders and the
Issuing Bank hereby grants to the Administrative Agent any required powers of
attorney to execute any Collateral Document governed by the laws of such
jurisdiction on such Lender’s or Issuing Bank’s behalf. The provisions of this
Article are solely for the benefit of the Administrative Agent and the Lenders
(including the Swingline Lender and the Issuing Bank), and the Loan Parties
shall not have rights as a third party beneficiary of any of such provisions. It
is understood and agreed that the use of the term “agent” as used herein or in
any other Loan Documents (or any similar term) with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used as a matter of market custom, and is intended to
create or reflect only an administrative relationship between independent
contracting parties.

 

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SECTION 8.02 Rights as a Lender. The bank serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent, and such bank and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of business with any Loan Party
or any Subsidiary or any Affiliate thereof as if it were not the Administrative
Agent hereunder.

SECTION 8.03 Duties and Obligations. The Administrative Agent shall not have any
duties or obligations except those expressly set forth in the Loan Documents.
Without limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) the Administrative Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated by the Loan Documents that the Administrative Agent is required to
exercise as directed in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), (c) neither the Administrative Agent nor any other
agents hereunder or under any other Loan Document shall owe any duties to any
Secured Party in such Secured Parties’ capacity as a non-Lender, and the
Administrative Agent will no longer act as an agent in any capacity under the
Loan Documents for the Secured Parties after payment in full of the Obligations
and termination of the Commitments, and (d) except as expressly set forth in the
Loan Documents, the Administrative Agent shall not have any duty to disclose,
and shall not be liable for the failure to disclose, any information relating to
any Loan Party or any Subsidiary that is communicated to or obtained by the bank
serving as Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
willful misconduct as determined by a final nonappealable judgment of a court of
competent jurisdiction. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower Representative or a Lender, and the
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with any Loan Document, (ii) the contents of any certificate, report
or other document delivered hereunder or in connection with any Loan Document,
(iii) the performance or observance of any of the covenants, agreements or other
terms or conditions set forth in any Loan Document, (iv) the validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, (v) the creation, perfection or priority of
Liens on the Collateral or the existence of the Collateral, or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.

SECTION 8.04 Reliance. The Administrative Agent shall be entitled to rely upon,
and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Administrative Agent may consult
with legal counsel (who may be counsel for the Borrowers), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.

SECTION 8.05 Actions through Sub-Agents. The Administrative Agent may perform
any and all of its duties and exercise its rights and powers by or through any
one or more sub-agents appointed by the Administrative Agent. The Administrative
Agent and any such sub-agent may perform any and all of its duties and exercise
its rights and powers through their respective Related Parties, including
through its Toronto or London branches as applicable. The exculpatory provisions
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preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as the Administrative
Agent.

SECTION 8.06 Resignation. Subject to the appointment and acceptance of a
successor Administrative Agent as provided in this paragraph, the Administrative
Agent may resign at any time by notifying the Lenders, the Issuing Bank and the
Borrower Representative. Upon any such resignation, the Required Lenders shall
have the right, in consultation with the Borrower Representative and with the
consent of the Borrower Representative (unless an Event of Default shall have
occurred and be continuing or unless such successor is an existing Lender), to
appoint a successor. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Administrative Agent which shall be a bank with an
office in New York, New York, or an Affiliate of any such bank. Upon the
acceptance of its appointment as Administrative Agent hereunder by its
successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents. The fees payable by
the Borrowers to a successor Administrative Agent shall be the same as those
payable to its predecessor, unless otherwise agreed by the Borrowers and such
successor. Notwithstanding the foregoing, in the event no successor
Administrative Agent shall have been so appointed and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its intent to resign, the retiring Administrative Agent may give notice of
the effectiveness of its resignation to the Lenders, the Issuing Banks and the
Borrowers, whereupon, on the date of effectiveness of such resignation stated in
such notice, (a) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents, provided
that, solely for purposes of maintaining any security interest granted to the
Administrative Agent under any Collateral Document for the benefit of the
Secured Parties, the retiring Administrative Agent shall continue to be vested
with such security interest as collateral agent for the benefit of the Secured
Parties and, in the case of any Collateral in the possession of the
Administrative Agent, shall continue to hold such Collateral, in each case until
such time as a successor Administrative Agent is appointed and accepts such
appointment in accordance with this paragraph (it being understood and agreed
that the retiring Administrative Agent shall have no duly or obligation to take
any further action under any Collateral Document, including any action required
to maintain the perfection of any such security interest), and (b) the Required
Lenders shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, provided that
(i) all payments required to be made hereunder or under any other Loan Document
to the Administrative Agent for the account of any Person other than the
Administrative Agent shall be made directly to such Person and (ii) all notices
and other communications required or contemplated to be given or made to the
Administrative Agent shall also directly be given or made to each Lender and
each Issuing Bank. Following the effectiveness of the Administrative Agent’s
resignation from its capacity as such, the provisions of this Article,
Section 2.17(d) and Section 9.03, as well as any exculpatory, reimbursement and
indemnification provisions set forth in any other Loan Document, shall continue
in effect for the benefit of such retiring Administrative Agent, its sub-agents
and their respective Related Parties in respect of any actions taken or omitted
to be taken by any of them while it was acting as Administrative Agent and in
respect of the matters referred to in the proviso under clause (a) above.

SECTION 8.07 Non-Reliance.

(a) Each Lender acknowledges and agrees that the extensions of credit made
hereunder are commercial loans and letters of credit and not investments in a
business enterprise or securities. Each Lender further represents that it is
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ordinary course of its business and has, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement as a Lender, and to make, acquire or hold
Loans hereunder. Each Lender shall, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information (which may contain material, non-public information within the
meaning of the United States securities laws concerning the Borrowers and their
Affiliates) as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document, any related agreement or any document furnished
hereunder or thereunder and in deciding whether or to the extent to which it
will continue as a Lender or assign or otherwise transfer its rights, interests
and obligations hereunder.

(b) Each Lender hereby agrees that (i) it has requested a copy of each Report
prepared by or on behalf of the Administrative Agent; (ii) the Administrative
Agent (A) makes no representation or warranty, express or implied, as to the
completeness or accuracy of any Report or any of the information contained
therein or any inaccuracy or omission contained in or relating to a Report and
(B) shall not be liable for any information contained in any Report; (iii) the
Reports are not comprehensive audits or examinations, and that any Person
performing any field examination will inspect only specific information
regarding the Loan Parties and will rely significantly upon the Loan Parties’
books and records, as well as on representations of the Loan Parties’ personnel
and that the Administrative Agent undertakes no obligation to update, correct or
supplement the Reports; (iv) it will keep all Reports confidential and strictly
for its internal use, not share the Report with any Loan Party or any other
Person except as otherwise permitted pursuant to this Agreement; and (v) without
limiting the generality of any other indemnification provision contained in this
Agreement, (A) it will hold the Administrative Agent and any such other Person
preparing a Report harmless from any action the indemnifying Lender may take or
conclusion the indemnifying Lender may reach or draw from any Report in
connection with any extension of credit that the indemnifying Lender has made or
may make to the Borrower, or the indemnifying Lender’s participation in, or the
indemnifying Lender’s purchase of, a Loan or Loans; and (B) it will pay and
protect, and indemnify, defend, and hold the Administrative Agent and any such
other Person preparing a Report harmless from and against, the claims, actions,
proceedings, damages, costs, expenses, and other amounts (including reasonable
attorneys’ fees) incurred by the Administrative Agent or any such other Person
as the direct or indirect result of any third parties who might obtain all or
part of any Report through the indemnifying Lender.

SECTION 8.08 Other Agency Titles. The joint bookrunners, joint lead arrangers,
co-syndication agents and documentation agent shall not have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders as such. Without limiting the foregoing, none of
such Lenders shall have or be deemed to have a fiduciary relationship with any
Lender. Each Lender hereby makes the same acknowledgments with respect to the
relevant Lenders in their respective capacities a joint bookrunner, joint lead
arranger, syndication agent or documentation agent, as applicable, as it makes
with respect to the Administrative Agent in the preceding paragraph.

SECTION 8.09 Not Partners or Co-Venturers; Administrative Agent as
Representative of the Secured Parties. (a) The Lenders are not partners or
co-venturers, and no Lender shall be liable for the acts or omissions of, or
(except as otherwise set forth herein in case of the Administrative Agent)
authorized to act for, any other Lender. The Administrative Agent shall have the
exclusive right on behalf of the Lenders to enforce the payment of the principal
of and interest on any Loan after the date such principal or interest has become
due and payable pursuant to the terms of this Agreement.

(b) In its capacity, the Administrative Agent is a “representative” of the
Secured Parties within the meaning of the term “secured party” as defined in the
New York Uniform Commercial Code.

 

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Each Lender authorizes the Administrative Agent to enter into each of the
Collateral Documents to which it is a party and to take all action contemplated
by such documents. Each Lender agrees that no Secured Party (other than the
Administrative Agent) shall have the right individually to seek to realize upon
the security granted by any Collateral Document, it being understood and agreed
that such rights and remedies may be exercised solely by the Administrative
Agent for the benefit of the Secured Parties upon the terms of the Collateral
Documents. In the event that any Collateral is hereafter pledged by any Person
as collateral security for the Secured Obligations, the Administrative Agent is
hereby authorized, and hereby granted a power of attorney, to execute and
deliver on behalf of the Secured Parties any Loan Documents necessary or
appropriate to grant and perfect a Lien on such Collateral in favor of the
Administrative Agent on behalf of the Secured Parties.

SECTION 8.10 Flood Laws. JPMCB has adopted internal policies and procedures that
address requirements placed on federally regulated lenders under the National
Flood Insurance Reform Act of 1994 and related legislation (the “Flood Laws”).
JPMCB, as administrative agent or collateral agent on a syndicated facility,
will post on the applicable electronic platform (or otherwise distribute to each
Lender in the syndicate) documents that it receives in connection with the Flood
Laws. However, JPMCB reminds each Lender and Participant in the facility that,
pursuant to the Flood Laws, each federally regulated Lender (whether acting as a
Lender or Participant in the facility) is responsible for assuring its own
compliance with the flood insurance requirements.

SECTION 8.11 Additional Secured Parties. The benefit of the provisions of the
Loan Documents directly relating to the Collateral or any Lien granted
thereunder shall extend to and be available to any Secured Party that is not a
Lender or Issuing Bank party hereto as long as, by accepting such benefits, such
Secured Party agrees, as among Administrative Agent and all other Secured
Parties, that such Secured Party is bound by (and, if requested by
Administrative Agent, shall confirm such agreement in a writing in form and
substance acceptable to Administrative Agent) this Article VIII and Sections
2.17, 2.18(d), 9.01, 9.03(c), 9.04, 9.06, 9.08, 9.12, 9.16 and 9.18 (and, solely
with respect to Issuing Banks, Section 2.06) and the decisions and actions of
Administrative Agent and the Required Lenders (or, where expressly required by
the terms of this Agreement, a greater proportion of the Lenders or other
parties hereto as required herein) to the same extent a Lender is bound;
provided, however, that, notwithstanding the foregoing, (a) such Secured Party
shall be bound by Sections 2.17(e), 8.06, 8.07 and 9.03(c) only to the extent of
all claims, actions, suits, judgments, damages, losses, liability, obligations,
responsibilities, fines, penalties, sanctions, costs, fees, Taxes, commissions,
charges, disbursements and expenses (including, without limitation, those
incurred upon any appeal or in connection with the preparation for and/or
response to any subpoena or request for document production relating thereto),
in each case of any kind or nature (including interest accrued thereon or as a
result thereto and fees, charges and disbursements of financial, legal and other
advisors and consultants), whether joint or several, whether or not indirect,
contingent, consequential, actual, punitive, treble or otherwise, costs and
expenses with respect to or otherwise relating to the Collateral held for the
benefit of such Secured Party, in which case the obligations of such Secured
Party thereunder shall not be limited by any concept of pro rata share or
similar concept, (b) each of Administrative Agent, the Lenders and the Issuing
Banks party hereto shall be entitled to act at its sole discretion, without
regard to the interest of such Secured Party, regardless of whether any
Obligation to such Secured Party thereafter remains outstanding, is deprived of
the benefit of the Collateral, becomes unsecured or is otherwise affected or put
in jeopardy thereby, and without any duty or liability to such Secured Party or
any such Obligation and (c) except as otherwise set forth herein, such Secured
Party shall not have any right to be notified of, consent to, direct, require or
be heard with respect to, any action taken or omitted in respect of the
Collateral or under any Loan Document.

 

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ARTICLE IX

MISCELLANEOUS

SECTION 9.01 Notices. (a) Except in the case of notices and other communications
expressly permitted to be given by telephone or Electronic Systems (and subject
in each case to paragraph (b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by
facsimile (where a fax number is indicated below), as follows:

(i) if to any Loan Party, to the Borrower Representative at:

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

Attention: Chief Financial Officer

Email: fconforti@urbn.com

With a copy to:

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

Attention: General Counsel

Email: azhayne@urbn.com

With a copy to (which shall not constitute notice):

Drinker Biddle & Reath LLP

105 College Road East

P.O. Box 627

Princeton, NJ 08542-0627

Attention: Judith E. Reich

Facsimile No: (609) 799-7000

Email: judith.reich@dbr.com

(ii) if to the Administrative Agent, the Issuing Bank or the Swingline Lender,
to JPMorgan Chase Bank, N.A. at:

JPMorgan Chase Bank, N.A.

277 Park Avenue, 22nd Floor

New York, NY 10172

Attention: Account Executive – Urban Outfitters

Facsimile No: (646) 534-2274

Email: donna.diforio@chase.com

With a copy to (which shall not constitute notice):

Winston & Strawn LLP

200 Park Avenue

New York, NY 10166-4193

Attention: Susan Berkwitt

Facsimile No: (212) 294-4700

Email: sberkwitt@winston.com

 

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(iii) in addition to notices pursuant to clause (ii) above, with respect to any
Borrowing in any currency (other than U.S. Dollars), to the Persons at the
address or facsimile number set forth on Schedule 9.01.

(iv) if to any other Lender, to it at its address or facsimile number set forth
in its Administrative Questionnaire.

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received, (ii) sent by facsimile shall be deemed to have been given
when sent, provided that if not given during normal business hours of the
recipient, such notice or communication shall be deemed to have been given at
the opening of business on the next Business Day of the recipient, or
(iii) delivered through Electronic Systems to the extent provided in paragraph
(b) below shall be effective as provided in such paragraph.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by Electronic Systems pursuant to procedures approved by the
Administrative Agent. Each of the Administrative Agent and the Borrower
Representative (on behalf of the Loan Parties) may, in its discretion, agree to
accept notices and other communications to it hereunder by Electronic Systems
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications. In the case of notices
from the Borrower Representative to the Administrative Agent or from the
Administrative Agent to the Borrower Representative, such acceptable and
approved Electronic Systems include email to the Administrative Agent and the
Borrower Representative at the email addresses identified above or as otherwise
designated in writing pursuant to Section 9.01(c) below. Unless the
Administrative Agent otherwise proscribes, all such notices and other
communications (i) sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient, at its e-mail
address as described in the foregoing clause (i), of notification that such
notice or communication is available and identifying the website address
therefor; provided that, for both clauses (i) and (ii) above, if such notice,
e-mail or other communication is not sent during the normal business hours of
the recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next Business Day of the recipient.

(c) Any party hereto may change its address, facsimile number or e-mail address
for notices and other communications hereunder by notice to the other parties
hereto.

(d) Electronic Systems.

(i) Each Loan Party agrees that the Administrative Agent may, but shall not be
obligated to, make Communications (as defined below) available to the Issuing
Bank and the other Lenders by posting the Communications on Debt Domain,
Intralinks, Syndtrak, ClearPar or a substantially similar Electronic System.

 

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(ii) Any Electronic System used by the Administrative Agent is provided “as is”
and “as available.” The Agent Parties (as defined below) do not warrant the
adequacy of such Electronic Systems and expressly disclaim liability for errors
or omissions in the Communications. No warranty of any kind, express, implied or
statutory, including any warranty of merchantability, fitness for a particular
purpose, non-infringement of third-party rights or freedom from viruses or other
code defects, is made by any Agent Party in connection with the Communications
or any Electronic System. In no event shall the Administrative Agent or any of
its Related Parties (collectively, the “Agent Parties”) have any liability to
the Borrowers or the other Loan Parties, any Lender, the Issuing Bank or any
other Person or entity for damages of any kind, including direct or indirect,
special, incidental or consequential damages, losses or expenses (whether in
tort, contract or otherwise) arising out of any Borrower’s, any Loan Party’s or
the Administrative Agent’s transmission of communications through an Electronic
System. “Communications” means, collectively, any notice, demand, communication,
information, document or other material provided by or on behalf of any Loan
Party pursuant to any Loan Document or the transactions contemplated therein
which is distributed by the Administrative Agent, any Lender or the Issuing Bank
by means of electronic communications pursuant to this Section, including
through an Electronic System.

SECTION 9.02 Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, the Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Bank and the Lenders
hereunder and under any other Loan Document are cumulative and are not exclusive
of any rights or remedies that they would otherwise have. No waiver of any
provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or the
Issuing Bank may have had notice or knowledge of such Default at the time.

(b) Except as provided in the first sentence of Section 2.09(f) (with respect to
any commitment increase), neither this Agreement nor any other Loan Document nor
any provision hereof or thereof may be waived, amended or modified except (x) in
the case of this Agreement, pursuant to an agreement or agreements in writing
entered into by the Borrowers and the Required Lenders or (y) in the case of any
other Loan Document, pursuant to an agreement or agreements in writing entered
into by the Administrative Agent and the Loan Party or Loan Parties that are
parties thereto, with the consent of the Required Lenders; provided that no such
agreement shall (i) increase the Commitment of any Lender without the written
consent of such Lender (including any such Lender that is a Defaulting Lender),
(ii) reduce or forgive the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce or forgive any interest or fees
payable hereunder, without the written consent of each Lender (including any
such Lender that is a Defaulting Lender) directly affected thereby (except
(1) in connection with the waiver of applicability of any post-default increase
in interest rates, which waiver shall be effective with the consent of the
Required Lenders and (2) that any amendment or modification of defined terms
used in the determination of the Adjusted Leverage Ratio or the Borrowing Base
shall not constitute a reduction in the rate of interest or fees for purposes of
this clause (ii)), (iii) postpone any scheduled date of payment of the principal
amount of any Loan or LC Disbursement, or any date for the payment of any
interest, fees or other Obligations payable hereunder, or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date of expiration
of any Commitment, without the

 

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written consent of each Lender (including any such Lender that is a Defaulting
Lender) directly affected thereby (except (1) in connection with the waiver of
applicability of any post-default increase in interest rates, which waiver shall
be effective with the consent of the Required Lenders and (2) that any amendment
or modification of defined terms used in the determination of the Adjusted
Leverage Ratio or the Borrowing Base shall not constitute a reduction in the
rate of interest or fees for purposes of this clause (iii)), (iv) change
Section 2.18(b) or (d) in a manner that would alter the manner in which payments
are shared, without the written consent of each Lender (other than any
Defaulting Lender), (v) increase the advance rates set forth in the definition
of Borrowing Base or add new categories of eligible assets, without the written
consent of each Lender (other than any Defaulting Lender), (vi) change any of
the provisions of this Section or the definition of “Required Lenders” or any
other provision of any Loan Document specifying the number or percentage of
Lenders required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (other than any Defaulting Lender) directly affected thereby,
(vii) change Section 2.20, without the consent of each Lender (other than any
Defaulting Lender), (viii) release any Borrower from the Obligations or Loan
Party from its obligation under its Loan Guaranty (except as otherwise permitted
herein or in the other Loan Documents), without the written consent of each
Lender (other than any Defaulting Lender), or (ix) except as provided in clause
(c) of this Section or in any Collateral Document, release all or substantially
all of the Collateral, without the written consent of each Lender (other than
any Defaulting Lender); provided further that no such agreement shall amend,
modify or otherwise affect the rights or duties of the Administrative Agent, any
Issuing Bank or the Swingline Lender hereunder without the prior written consent
of the Administrative Agent, such Issuing Bank or the Swingline Lender, as the
case may be (it being understood that any amendment to Section 2.20 shall
require the consent of the Administrative Agent, the Issuing Banks and the
Swingline Lender). The Administrative Agent may also amend the Commitment
Schedule to reflect assignments entered into pursuant to Section 9.04, and this
Agreement may be amended without any additional consents to provide for
increased Commitments in the manner contemplated by Section 2.09.

(c) The Secured Parties hereby irrevocably authorize the Administrative Agent,
at its option and in its sole discretion, (i) to release any Liens granted to
the Administrative Agent by the Loan Parties on any Collateral (A) upon the
termination of all the Commitments, payment and satisfaction in full in cash of
all Obligations (other than Unliquidated Obligations) and the Cash
Collateralization (or, at the discretion of the Administrative Agent, the
providing of a backup standby letter of credit satisfactory to the
Administrative Agent and the Issuing Banks) of all outstanding Letters of
Credit, (B) 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 Equity Interest of a Subsidiary, the Administrative
Agent is authorized to release any Loan Guaranty provided by such Subsidiary,
(C) constituting property leased to a Loan Party under a lease which has expired
or been terminated in a transaction not prohibited under this Agreement, (D) 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 Article VII, and (E) constituting property of a Loan Party
that is being released as a Loan Party as provided below, and (ii) to release
any Loan Guaranty provided by any Loan Party that is (A) dissolved pursuant to
Section 6.03(a)(v) in connection with a voluntary liquidation or dissolution
thereof permitted by such Section or (B) upon the disposition of all of the
outstanding Equity Interests of a Subsidiary of the Borrower to a Person other
than a Borrower or a Subsidiary in a transaction permitted by Section 6.05 and,
in connection therewith, to release any Liens granted to the Administrative
Agent by such Subsidiary on any Collateral, if the Company certifies to the
Administrative Agent that such liquidation or dissolution is made in compliance
with the terms of this Agreement (and the Administrative Agent may rely
conclusively on any such certificate, without further inquiry). The Lenders and
the Issuing Banks hereby further irrevocably authorize the Administrative

 

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Agent to enter into a Permitted Term Loan Intercreditor Agreement in connection
with the incurrence by the Company of any Permitted Term Loan Indebtedness and
pursuant to such Permitted Term Loan Intercreditor Agreement, to establish,
maintain and subordinate any Lien, for the benefit of the Lenders and the other
Secured Parties, on real property, Equity Interests and intellectual property of
the Loan Parties; provided that, for the avoidance of doubt, nothing in this
sentence shall authorize the Administrative Agent to release or subordinate any
Lien on assets of the type included in the Borrowing Base (other than real
property) or assets related thereto described in any Security Agreement as of
the date hereof. 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. Any execution and delivery by the
Administrative Agent of documents in connection with any such release shall be
without recourse to or warranty by the Administrative Agent.

(d) If, in connection with any proposed amendment, waiver or consent requiring
the consent of “each Lender” or “each Lender affected thereby,” the consent of
the Required Lenders is obtained, but the consent of other necessary Lenders is
not obtained (any such Lender whose consent is necessary but has not been
obtained being referred to herein as a “Non-Consenting Lender”), then the
Borrowers may elect to replace a Non-Consenting Lender as a Lender party to this
Agreement, provided that, concurrently with such replacement, (i) another bank
or other entity which is reasonably satisfactory to the Borrowers, the
Administrative Agent and the Issuing Bank shall agree, as of such date, to
purchase for cash the Loans and other Obligations due to the Non-Consenting
Lender pursuant to an Assignment and Assumption and to become a Lender for all
purposes under this Agreement and to assume all obligations of the
Non-Consenting Lender to be terminated as of such date and to comply with the
requirements of clause (b) of Section 9.04, and (ii) the Borrowers shall pay to
such Non-Consenting Lender in same day funds on the day of such replacement
(1) all interest, fees and other amounts then accrued but unpaid to such
Non-Consenting Lender by the Borrowers hereunder to and including the date of
termination, including without limitation payments due to such Non-Consenting
Lender under Section 2.15 and Section 2.17, and (2) an amount, if any, equal to
the payment which would have been due to such Lender on the day of such
replacement under Section 2.16 had the Loans of such Non-Consenting Lender been
prepaid on such date rather than sold to the replacement Lender.

(e) Notwithstanding anything to the contrary herein the Administrative Agent
may, with the consent of the Borrower Representative only, amend, modify or
supplement this Agreement or any of the other Loan Documents to cure any
ambiguity, omission, mistake, defect or inconsistency.

SECTION 9.03 Expenses; Indemnity; Damage Waiver. (a) Except as otherwise
provided in this Agreement, the Loan Parties shall, jointly and severally, pay
all (i) reasonable and documented out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable and documented
fees, charges and disbursements of counsel (in each case limited to one primary
law firm and one law firm in each relevant jurisdiction, except in the case of
actual or perceived conflicts of interest, in which case, such additional
counsel for the affected persons) for the Administrative Agent, in connection
with the syndication and distribution (including, without limitation, via the
internet or through an Electronic System) of the credit facilities provided for
herein, the preparation and administration of the Loan Documents and any
amendments, modifications or waivers of the provisions of the Loan Documents
(whether or not the transactions contemplated hereby or thereby shall be
consummated), (ii) reasonable and documented out-of-pocket expenses incurred by
the Issuing Bank in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder and
(iii) out-of-pocket expenses incurred by the Administrative Agent, the Issuing
Bank or any Lender, including the fees, charges and disbursements of any counsel
(in each case limited to one primary law firm and one law firm in each relevant
jurisdiction, except in the case of actual or perceived conflicts of interest,
in which case, such additional counsel for the affected persons) for the
Administrative Agent, the

 

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Issuing Bank or any Lender, in connection with the enforcement, collection or
protection of its rights in connection with the Loan Documents, including its
rights under this Section, or in connection with the Loans made or Letters of
Credit issued hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans or
Letters of Credit (in each case limited to one primary law firm and one law firm
in each relevant jurisdiction, except in the case of actual or perceived
conflicts of interest, in which case, such additional counsel for the affected
persons). Such reasonable and documented (if applicable) out-of-pocket expenses
being reimbursed by the Loan Parties under this Section include, without
limiting the generality of the foregoing, fees, costs and expenses incurred in
connection with:

(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;

(iii) background checks regarding senior management, as deemed necessary or
appropriate in the sole discretion of the Administrative Agent;

(iv) Taxes, fees and other charges for (A) lien searches and (B) 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 fees, costs and expenses may be charged to the Borrowers as
Revolving Loans or to another deposit account, all as described in
Section 2.18(c).

(b) The Loan Parties shall, jointly and severally, indemnify the Administrative
Agent, the Issuing Bank and each Lender, and each Related Party of any of the
foregoing Persons (each such Person being called an “Indemnitee”) against, and
hold each Indemnitee harmless from, any and all losses, claims, damages,
penalties, incremental taxes, liabilities and related expenses, including the
reasonable and documented fees, charges and disbursements of any counsel for any
Indemnitee (in each case limited to one primary law firm and one law firm in
each relevant jurisdiction, except in the case of actual or perceived conflicts
of interest, in which case, such additional counsel for the affected persons),
incurred by or asserted against any Indemnitee arising out of, in connection
with, or as a result of (i) the execution or delivery of the Loan Documents or
any agreement or instrument contemplated thereby, the performance by the parties
hereto of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
the Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
Release of Hazardous Materials on or from any property owned or operated by a
Loan Party or a Subsidiary, or any Environmental Liability related in any way to
a Loan Party or a Subsidiary, (iv) the failure of a Loan Party to deliver to the
Administrative Agent the required receipts or other required documentary
evidence with respect to a payment made by a Loan Party for Taxes pursuant to
Section 2.17, or (v) any actual or prospective claim,

 

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litigation, investigation or proceeding relating to any of the foregoing,
whether or not such claim, litigation, investigation or proceeding is brought by
any Loan Party or their respective equity holders, Affiliates, creditors or any
other third Person and whether based on contract, tort or any other theory and
regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, penalties, liabilities or related expenses are
determined by a court of competent jurisdiction by final and non-appealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee. This Section 9.03(b) shall not apply with respect to Taxes
other than any Taxes that represent losses or damages arising from any non-Tax
claim.

(c) To the extent that any Loan Party fails to pay any amount required to be
paid by it to the Administrative Agent (or any sub-agent thereof), the Swingline
Lender or the Issuing Bank (or any Related Party of any of the foregoing) under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent, the Swingline Lender or the Issuing Bank (or any Related
Party of any of the foregoing), as the case may be, such Lender’s Applicable
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount (it being understood that
the Loan Parties’ failure to pay any such amount shall not relieve any Loan
Party of any default in the payment thereof); provided that the unreimbursed
expense or indemnified loss, claim, damage, penalty, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent, the Swingline Lender or the Issuing Bank in its capacity
as such.

(d) To the extent permitted by applicable law, no Loan Party shall assert, and
each Loan Party hereby waives, any claim against any Indemnitee (i) for any
damages arising from the use by others of information or other materials
obtained through telecommunications, electronic or other information
transmission systems (including the Internet) or (ii) on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit
or the use of the proceeds thereof; provided that, nothing in this paragraph
(d) shall relieve any Loan Party of any obligation it may have to indemnify an
Indemnitee against special, indirect, consequential or punitive damages asserted
against such Indemnitee by a third party.

(e) All amounts due under this Section shall be payable promptly after written
demand therefor.

SECTION 9.04 Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) no Borrower
may assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (and any attempted assignment
or transfer by any Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more Persons (other than an Ineligible Institution)
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment, participations in Letters

 

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of Credit and the Loans at the time owing to it) with the prior written consent
(such consent not to be unreasonably withheld) of:

(A) the Borrower Representative, provided that the Borrower Representative shall
be deemed to have consented to any such assignment unless it shall object
thereto by written notice to the Administrative Agent within 10 Business Days
after having received notice thereof, and provided further that no consent of
the Borrower Representative shall be required for an assignment to a Lender, an
Affiliate of a Lender, an Approved Fund or, if an Event of Default has occurred
and is continuing, any other assignee;

(B) the Administrative Agent (such consent not to be unreasonably withheld or
delayed) shall be required for assignments in respect of the Revolving Loans if
such assignment is to a Person that is not a Lender with a Commitment in respect
of such Revolving Loan, an Affiliate of such Lender or an Approved Fund with
respect to such Lender;

(C) each Issuing Bank; and

(D) the Swingline Lender.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitment or Loans, the amount of the Commitment or Loans of
the assigning Lender subject to each such assignment (determined as of the date
the Assignment and Assumption with respect to such assignment is delivered to
the Administrative Agent) shall not be less than $5,000,000 unless each of the
Borrower Representative and the Administrative Agent otherwise consent, provided
that no such consent of the Borrower Representative shall be required if an
Event of Default has occurred and is continuing;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement
(including its obligations to fund the Loans and other products under the
Foreign Currency Sublimit);

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption or to the extent applicable,
an agreement incorporating an Assignment and Assumption by reference pursuant to
a Platform as to which the Administrative Agent and the parties to the
Assignment and Assumption are participants, together with a processing and
recordation fee of $3,500 and the tax forms required by Section 2.17(f); and

(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Company, the other
Loan Parties and their Related Parties or their respective securities) will be
made available and who may receive such information in accordance with the
assignee’s compliance procedures and applicable laws, including Federal and
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(E) each assignee Lender shall acquire an equal proportionate share (as
determined by the assigned Commitments in relation to all other Commitments of
other Lenders), either directly, or through an Affiliate or a branch, of the
Foreign Currency Sublimit.

For the purposes of this Section 9.04(b), the terms “Approved Fund” and
“Ineligible Institution” have the following meanings:

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

“Ineligible Institution” means a (a) natural person, (b) a Defaulting Lender or
its Parent, (c) holding company, investment vehicle or trust for, or owned and
operated for the primary benefit of, a natural person or relative(s) thereof;
provided that, such holding company, investment vehicle or trust shall not
constitute an Ineligible Institution if it (x) has not been established for the
primary purpose of acquiring any Loans or Commitments, (y) is managed by a
professional advisor, who is not such natural person or a relative thereof,
having significant experience in the business of making or purchasing commercial
loans, and (z) has assets greater than $25,000,000 and a significant part of its
activities consist of making or purchasing commercial loans and similar
extensions of credit in the ordinary course of its business; provided that upon
the occurrence of an Event of Default, any Person (other than a Lender) shall be
an Ineligible Institution if after giving effect to any proposed assignment to
such Person, such Person would hold more than 25% of the then outstanding
Aggregate Credit Exposure or Commitments, as the case may be or (d) a Loan Party
or a Subsidiary or other Affiliate of a Loan Party.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption, the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Section 2.15, Section 2.16, Section 2.17 and Section 9.03). Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not
comply with this Section 9.04 shall be treated for purposes of this Agreement as
a sale by such Lender of a participation in such rights and obligations in
accordance with paragraph (c) of this Section.

(iv) The Administrative Agent, acting for this purpose as a non-fiduciary agent
of the Borrowers, shall maintain at one of its offices a copy of each Assignment
and Assumption delivered to it and a register for the recordation of the names
and addresses of the Lenders, and the Commitment of, and principal amount of and
stated interest on the Loans and LC Disbursements owing to, each Lender pursuant
to the terms hereof from time to time (the “Register”). The entries in the
Register shall be conclusive, and the Borrowers, the Administrative Agent, the
Issuing Bank and the Lenders shall treat each Person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all purposes
of

 

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this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrowers, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of (x) a duly completed Assignment and Assumption executed
by an assigning Lender and an assignee or (y) to the extent applicable, an
agreement incorporating an Assignment and Assumption by reference pursuant to a
Platform as to which the Administrative Agent and the parties to the Assignment
and Assumption are participants, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption
and record the information contained therein in the Register; provided that if
either the assigning Lender or the assignee shall have failed to make any
payment required to be made by it pursuant to Section 2.05, Section 2.06(d) or
(e), Section 2.07(b), Section 2.18(d) or Section 9.03(c), the Administrative
Agent shall have no obligation to accept such Assignment and Assumption and
record the information therein in the Register unless and until such payment
shall have been made in full, together with all accrued interest thereon. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

(c) Any Lender may, without the consent of the Borrowers, the Administrative
Agent, the Issuing Bank or the Swingline Lender, sell participations to one or
more banks or other entities (a “Participant”) other than an Ineligible
Institution in all or a portion of such Lender’s rights and obligations under
this Agreement (including all or a portion of its Commitment and 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 Borrowers,
the Administrative Agent, the Issuing Bank and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
The Borrowers agree that each Participant shall be entitled to the benefits of
Section 2.15, Section 2.16 and Section 2.17 (subject to the requirements and
limitations therein, including the requirements under Section 2.17(f) and
Section 2.17(g) (it being understood that the documentation required under
Section 2.17(f) shall be delivered to the participating Lender and the
information and documentation required under Section 2.17(g) will be delivered
to the Borrowers and the Administrative Agent)) to the same extent as if it were
a Lender and had acquired its interest by assignment pursuant to paragraph (b)
of this Section; provided that such Participant (A) agrees to be subject to the
provisions of Section 2.18 and Section 2.19 as if it were an assignee under
paragraph (b) of this Section; and (B) shall not be entitled to receive any
greater payment under Section 2.15 or Section 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 a Change in Law that occurs after the Participant acquired the
applicable participation.

Each Lender that sells a participation agrees, at the Borrowers’ request and
expense, to use reasonable efforts to cooperate with the Borrowers to effectuate
the provisions of Section 2.19(b) with respect to any Participant. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.08 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.18(d) as though it were a Lender. Each Lender that sells a
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this purpose as a non-fiduciary agent of the Borrowers, maintain a register on
which it enters the name and address of each Participant and the principal
amounts (and stated interest) of each Participant’s interest in the Loans or
other obligations under this Agreement or any other Loan Document (the
“Participant Register”); provided that no Lender shall have any obligation to
disclose all or any portion of the Participant Register (including the identity
of any Participant or any information relating to a Participant’s interest in
any Commitments, Loans, Letters of Credit or its other obligations under any
Loan Document) to any Person except to the extent that such disclosure is
necessary to establish that such Commitment, Loan, Letter of Credit or other
obligation is in registered form under Section 5f.103-1(c) of the United States
Treasury Regulations. The entries in the Participant Register shall be
conclusive absent manifest error, and such Lender shall treat each Person whose
name is recorded in the Participant Register as the owner of such participation
for all purposes of this Agreement notwithstanding any notice to the contrary.
For the avoidance of doubt, the Administrative Agent (in its capacity as
Administrative Agent) shall have no responsibility for maintaining a Participant
Register.

(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

SECTION 9.05 Survival. All covenants, agreements, representations and warranties
made by the Loan Parties in the Loan Documents and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement or any
other Loan Document shall be considered to have been relied upon by the other
parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that the Administrative Agent, the Issuing Bank or any
Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Section 2.15, Section 2.16, Section 2.17 and Section 9.03 and Article VIII shall
survive and remain in full force and effect regardless of the consummation of
the transactions contemplated hereby, the repayment of the Loans, the expiration
or termination of the Letters of Credit and the Commitments or the termination
of this Agreement or any other Loan Document or any provision hereof or thereof.

SECTION 9.06 Counterparts; Integration; Effectiveness; Electronic Execution.
(a) This Agreement may be executed in counterparts (and by different parties
hereto on different counterparts), each of which shall constitute an original,
but all of which when taken together shall constitute a single contract. This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Administrative Agent constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating to
the subject matter hereof. Except as provided in Section 4.01, this Agreement
shall become effective when it shall have been executed by the Administrative
Agent and when the Administrative Agent shall have received counterparts hereof
which, when taken together, bear the signatures of each of the other parties
hereto, and thereafter shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

(b) Delivery of an executed counterpart of a signature page of this Agreement by
telecopy, emailed pdf. or any other electronic means that reproduces an image of
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shall be effective as delivery of a manually executed counterpart of this
Agreement. The words “execution,” “signed,” “signature,” “delivery,” and words
of like import in or relating to any document to be signed in connection with
this Agreement and the transactions contemplated hereby or thereby shall be
deemed to include Electronic Signatures, deliveries or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature, physical delivery thereof or
the use of a paper-based recordkeeping system, as the case may be, to the extent
and as provided for in any applicable law, including the Federal Electronic
Signatures in Global and National Commerce Act, the New York State Electronic
Signatures and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act.

SECTION 9.07 Severability. Any provision of any Loan Document held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

SECTION 9.08 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of any Loan Party
against any of and all the Obligations held by such Lender, irrespective of
whether or not such Lender shall have made any demand under the Loan Documents
and although such obligations may be unmatured; provided that the foregoing
authorization shall not entitle any Lender to apply any deposits to the extent
that such deposit constitutes an Excluded Asset. The applicable Lender shall
notify the Borrower Representative and the Administrative Agent of such set-off
or application, provided that any failure to give or any delay in giving such
notice shall not affect the validity of any such set-off or application under
this Section. The rights of each Lender under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Lender
may have. NOTWITHSTANDING THE FOREGOING, NO LENDER, NO ISSUING BANK AND NO
PARTICIPANT SHALL EXERCISE ANY RIGHT OF SETOFF, BANKER’S LIEN, OR THE LIKE
AGAINST ANY DEPOSIT ACCOUNT OR PROPERTY OF ANY LOAN PARTY HELD OR MAINTAINED BY
SUCH LENDER WITHOUT THE WRITTEN CONSENT OF THE ADMINISTRATIVE AGENT.

SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process. (a) The
Loan Documents (other than those containing a contrary express choice of law
provision) shall be governed by and construed in accordance with the internal
laws (and not the law of conflicts) of the State of New York, but giving effect
to federal laws applicable to national banks; provided, however, that if the
laws of any jurisdiction other than New York shall govern in regard to the
validity, perfection or effect of perfection of any lien or in regard to
procedural matters affecting enforcement of any liens in collateral, such laws
of such other jurisdictions shall continue to apply to that extent.

(b) Each Loan Party hereby irrevocably and unconditionally submits, for itself
and its property, to the exclusive jurisdiction of any U.S. Federal or New York
State court sitting in New York, New York in any action or proceeding arising
out of or relating to any Loan Documents, or for recognition or enforcement of
any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
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Agent, the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against any
Loan Party or its properties in the courts of any jurisdiction.

(c) Each Loan Party hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any other Loan Document in any
court referred to in paragraph (b) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Nothing in this Agreement or
any other Loan Document will affect the right of any party to this Agreement to
serve process in any other manner permitted by law.

SECTION 9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, OTHER AGENT (INCLUDING ANY
ATTORNEY) OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.

SECTION 9.11 Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 9.12 Confidentiality. Each of the Administrative Agent, the Issuing Bank
and the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent required or requested by any Governmental Authority (including any
self-regulatory authority, such as the National Association of Insurance
Commissioners), (c) to the extent required by any Requirement of Law or by any
subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies under this Agreement or any
other Loan Document or any suit, action or proceeding relating to this Agreement
or any other Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Loan Parties and
their obligations, (g) with the consent of the Borrower Representative or (h) to
the extent such Information (i) becomes publicly available or (ii) becomes
available to the Administrative Agent, the Issuing Bank or any Lender on a
non-confidential basis from a source other than any Loan Party other than as a
result of a breach of this Section or of, as far as such recipient is aware, a
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information. For the purposes of this Section, “Information” means all
information received from the Borrowers relating to the Borrowers or their
business, other than any such information that is available to the
Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis
prior to disclosure by the Borrowers and other than information pertaining to
this Agreement routinely provided by arrangers to date service providers,
including league table providers, that serve the lending industry; provided
that, in the case of information received from the Borrowers after the date
hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12 FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION
CONCERNING THE COMPANY, AND ITS AFFILIATES, THE OTHER LOAN PARTIES AND THEIR
RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS
DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC
INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN
ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE
SECURITIES LAWS.

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
LOAN PARTIES 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 COMPANY, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE LOAN PARTIES AND THE ADMINISTRATIVE AGENT THAT IT HAS
IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE
INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH
ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE
SECURITIES LAWS.

SECTION 9.13 Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder shall
not relieve any other Lender from any of its obligations hereunder. Each Lender
hereby represents that it is not relying on or looking to any margin stock (as
defined in Regulation U of the Board) for the repayment of the Borrowings
provided for herein. Anything contained in this Agreement to the contrary
notwithstanding, neither the Issuing Bank nor any Lender shall be obligated to
extend credit to the Borrowers in violation of any Requirement of Law.

SECTION 9.14 USA PATRIOT Act. Each Lender that is subject to the requirements of
the USA PATRIOT Act hereby notifies each Loan Party that pursuant to the
requirements of the USA PATRIOT Act, it is required to obtain, verify and record
information that identifies such Loan Party, which information includes the name
and address of such Loan Party and other information that will allow such Lender
to identify such Loan Party in accordance with the USA PATRIOT Act.

SECTION 9.15 Disclosure. Each Loan Party, each Lender and the Issuing Bank
hereby acknowledges and agrees that the Administrative Agent and/or its
Affiliates from time to time may hold investments in, make other loans to or
have other relationships with any of the Loan Parties and their respective
Affiliates.

 

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SECTION 9.16 Appointment for Perfection. Each Lender hereby appoints each other
Lender as its agent for the purpose of perfecting Liens, for the benefit of the
Administrative Agent and the other Secured Parties, in assets which, in
accordance with Article 9 of the UCC or any other applicable law can be
perfected only by possession or control. Should any Lender (other than the
Administrative Agent) obtain possession or control of any such Collateral, such
Lender shall notify the Administrative Agent thereof, and, promptly upon the
Administrative Agent’s request therefor shall deliver such Collateral to the
Administrative Agent or otherwise deal with such Collateral in accordance with
the Administrative Agent’s instructions.

SECTION 9.17 Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

SECTION 9.18 No Advisory or Fiduciary Responsibility. In connection with all
aspects of each transaction contemplated hereby (including in connection with
any amendment, waiver or other modification hereof or of any other Loan
Document), each Loan Party acknowledges and agrees that: (i) (A) the arranging
and other services regarding this Agreement provided by the Lenders are
arm’s-length commercial transactions between such Borrower and its Affiliates,
on the one hand, and the Lenders and their Affiliates, on the other hand,
(B) such Loan Party has consulted its own legal, accounting, regulatory and tax
advisors to the extent it has deemed appropriate, and (C) such Loan Party is
capable of evaluating, and understands and accepts, the terms, risks and
conditions of the transactions contemplated hereby and by the other Loan
Documents; (ii) (A) each of the Lenders and their Affiliates is and has been
acting solely as a principal and, except as expressly agreed in writing by the
relevant parties, has not been, is not, and will not be acting as an advisor,
agent or fiduciary for such Loan Party or any of its Affiliates, or any other
Person and (B) no Lender or any of its Affiliates has any obligation to such
Loan Party or any of its Affiliates with respect to the transactions
contemplated hereby except, in the case of a Lender, those obligations expressly
set forth herein and in the other Loan Documents; and (iii) each of the Lenders
and their respective Affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of such Loan Party and its
Affiliates, and no Lender or any of its Affiliates has any obligation to
disclose any of such interests to such Loan Party or its Affiliates. To the
fullest extent permitted by law, each Loan Party hereby waives and releases any
claims that it may have against each of the Lenders and their Affiliates with
respect to any breach or alleged breach of agency or fiduciary duty in
connection with any aspect of any transaction contemplated hereby.

SECTION 9.19 Marketing Consent. The Borrowers hereby authorize JPMCB, Wells
Fargo, Bank of America, N.A., and HSBC Bank USA, National Association, and each
of their respective affiliates (including without limitation J.P. Morgan
Securities LLC and Wells Fargo Securities, LLC), at their respective sole
expense, but without any prior approval by the Borrowers, to publish such
tombstones and give such other customary publicity to this Agreement as each may
from time to time determine in its sole discretion provided that no non-public,
sensitive or trade information shall be included in any such tombstone,
publication, press release or other form of publicity and no consent is hereby
given to the release of non-public, sensitive or trade information. The
foregoing authorization shall remain in effect unless and until the Borrower
Representative notifies each of the foregoing parties in writing that such
authorization is revoked.

 

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SECTION 9.20 Authorization to Distribute Certain Materials to Public-Siders.

(a) If the Borrowers do not file this Agreement with the SEC, then the Borrowers
hereby authorize the Administrative Agent to distribute the execution version of
this Agreement and the Loan Documents to all Lenders, including their
Public-Siders. Each Borrower acknowledges its understanding that Public-Siders
and their firms may be trading in any of the Loan Parties’ respective securities
while in possession of the Loan Documents.

(b) Each Borrower represents and warrants that none of the information in the
Loan Documents constitutes or contains material non-public information within
the meaning of federal and state securities laws. To the extent that any of the
executed Loan Documents constitutes at any time material non-public information
within the meaning of the federal and state securities laws after the date
hereof, each Borrower agrees that it will promptly make such information
publicly available by press release or public filing with the SEC.

SECTION 9.21 Judgment Currency. If for the purpose of obtaining judgment in any
court it is necessary to convert an amount due hereunder in the currency in
which it is due (the “Original Currency”) into another currency (the “Second
Currency”), the rate of exchange applied shall be that at which, in accordance
with normal banking procedures, the Administrative Agent could purchase the
Original Currency with the Second Currency at the Spot Rate on the date two
Business Days preceding that on which judgment is given. Each Loan Party agrees
that its obligation in respect of any Original Currency due from it hereunder
shall, notwithstanding any judgment or payment in such other currency, be
discharged only to the extent that, on the Business Day following the date the
Administrative Agent receives payment of any sum so adjudged to be due hereunder
in the Second Currency, the Administrative Agent may, in accordance with normal
banking procedures, purchase, in the New York foreign exchange market, the
Original Currency with the amount of the Second Currency so paid; and if the
amount of the Original Currency so purchased or could have been so purchased is
less than the amount originally due in the Original Currency, each Loan Party
agrees as a separate obligation and notwithstanding any such payment or judgment
to indemnify the Administrative Agent against such loss. The term “rate of
exchange” in this Section means the Spot Rate at which the Administrative Agent,
in accordance with normal practices, is able on the relevant date to purchase
the Original Currency with the Second Currency, and includes any premium and
costs of exchange payable in connection with such purchase.

ARTICLE X

LOAN GUARANTY

SECTION 10.01 Guaranty. Each Loan Party hereby agrees that it is jointly and
severally liable for, and, as a primary obligor and not merely as surety,
absolutely, unconditionally and irrevocably guarantees to the Secured Parties,
the prompt payment and performance when due, whether at stated maturity, upon
acceleration or otherwise, and at all times thereafter, of the Secured
Obligations and all costs and expenses, including, without limitation, all court
costs and attorneys’ and paralegals’ fees (including allocated costs of in-house
counsel and paralegals) and expenses paid or incurred by the Administrative
Agent, the Issuing Bank and the Lenders in endeavoring to collect all or any
part of the Secured Obligations from, or in prosecuting any action against, any
Borrower, any other Loan Party or any other guarantor of all or any part of the
Secured Obligations (such costs and expenses, together with the Secured
Obligations, collectively the “Guaranteed Obligations”; provided, however, that
the definition of “Guaranteed Obligations” shall not create any guarantee by any
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interest by any Loan Party to support, as applicable) any Excluded Swap
Obligations of such Loan Party for purposes of determining any obligations of
any Loan Party). Each Loan Party further agrees that the Guaranteed Obligations
may be extended or renewed in whole or in part without notice to or further
assent from it, and that it remains bound upon its guarantee notwithstanding any
such extension or renewal. All terms of this Loan Guaranty apply to and may be
enforced by or on behalf of any domestic or foreign branch or Affiliate of any
Lender or Issuing Bank that extended any portion of the Guaranteed Obligations.

SECTION 10.02 Guaranty of Payment. This Loan Guaranty is a guaranty of payment
and not of collection. Each Loan Party waives any right to require the
Administrative Agent, the Issuing Bank or any Lender to sue any Borrower, any
other Loan Party, any other guarantor of, or any other Person obligated for, all
or any part of the Guaranteed Obligations (each, an “Obligated Party”), or to
enforce its rights against any collateral securing all or any part of the
Guaranteed Obligations.

SECTION 10.03 No Discharge or Diminishment of Loan Guaranty. (a) Except as
otherwise provided for herein, the obligations of each Loan Party hereunder are
unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than the indefeasible payment in
full in cash of the Guaranteed Obligations), including: (i) any claim of waiver,
release, extension, renewal, settlement, surrender, alteration or compromise of
any of the Guaranteed Obligations, by operation of law or otherwise; (ii) any
change in the corporate existence, structure or ownership of any Loan Party or
any other Obligated Party liable for any of the Guaranteed Obligations;
(iii) any insolvency, bankruptcy, reorganization or other similar proceeding
affecting any Obligated Party or their assets or any resulting release or
discharge of any obligation of any Obligated Party; or (iv) the existence of any
claim, setoff or other rights which any Loan Party may have at any time against
any Obligated Party, the Administrative Agent, the Issuing Bank, any Lender or
any other Person, whether in connection herewith or in any unrelated
transaction.

(b) The obligations of each Loan Party hereunder are not subject to any defense
or setoff, counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality or unenforceability of any of the Guaranteed Obligations
or otherwise, or any provision of applicable law or regulation purporting to
prohibit payment by any Obligated Party, of the Guaranteed Obligations or any
part thereof.

(c) Further, the obligations of any Loan Party hereunder are not discharged or
impaired or otherwise affected by: (i) the failure of the Administrative Agent,
the Issuing Bank or any Lender to assert any claim or demand or to enforce any
remedy with respect to all or any part of the Guaranteed Obligations; (ii) any
waiver or modification of or supplement to any provision of any agreement
relating to the Guaranteed Obligations; (iii) any release, non-perfection or
invalidity of any indirect or direct security for the obligations of any Loan
Party for all or any part of the Guaranteed Obligations or any obligations of
any other Obligated Party liable for any of the Guaranteed Obligations; (iv) any
action or failure to act by the Administrative Agent, the Issuing Bank or any
Lender with respect to any collateral securing any part of the Guaranteed
Obligations; or (v) any default, failure or delay, willful or otherwise, in the
payment or performance of any of the Guaranteed Obligations, or any other
circumstance, act, omission or delay that might in any manner or to any extent
vary the risk of such Loan Party or that would otherwise operate as a discharge
of any Loan Party as a matter of law or equity (other than the indefeasible
payment in full in cash of the Guaranteed Obligations).

SECTION 10.04 Defenses Waived. To the fullest extent permitted by applicable
law, each Loan Party hereby waives any defense based on or arising out of any
defense of any Loan Party or the unenforceability of all or any part of the
Guaranteed Obligations from any cause, or the cessation from any cause of the
liability of any Loan Party or any other Obligated Party, other than the
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payment in full in cash of the Guaranteed Obligations. Without limiting the
generality of the foregoing, each Loan Party irrevocably waives acceptance
hereof, presentment, demand, protest and, to the fullest extent permitted by
law, any notice not provided for herein, as well as any requirement that at any
time any action be taken by any Person against any Obligated Party or any other
Person. Each Loan Party confirms that it is not a surety under any state law and
shall not raise any such law as a defense to its obligations hereunder. The
Administrative Agent may, at its election, foreclose on any Collateral held by
it by one or more judicial or nonjudicial sales, accept an assignment of any
such Collateral in lieu of foreclosure or otherwise act or fail to act with
respect to any collateral securing all or a part of the Guaranteed Obligations,
compromise or adjust any part of the Guaranteed Obligations, make any other
accommodation with any Obligated Party or exercise any other right or remedy
available to it against any Obligated Party, without affecting or impairing in
any way the liability of such Loan Party under this Loan Guaranty except to the
extent the Guaranteed Obligations have been fully and indefeasibly paid in cash.
To the fullest extent permitted by applicable law, each Loan Party waives any
defense arising out of any such election even though that election may operate,
pursuant to applicable law, to impair or extinguish any right of reimbursement
or subrogation or other right or remedy of any Loan Party against any Obligated
Party or any security.

SECTION 10.05 Rights of Subrogation. No Loan Party will assert any right, claim
or cause of action, including, without limitation, a claim of subrogation,
contribution or indemnification, that it has against any Obligated Party or any
Collateral, until the Loan Parties have fully performed all their obligations to
the Administrative Agent, the Issuing Bank, the Lenders, and the other Secured
Parties.

SECTION 10.06 Reinstatement; Stay of Acceleration. If at any time any payment of
any portion of the Guaranteed Obligations (including a payment effected through
exercise of a right of setoff) is rescinded, or must otherwise be restored or
returned upon the insolvency, bankruptcy or reorganization of any Loan Party or
otherwise (including pursuant to any settlement entered into by a Secured Party
in its discretion), each Loan Party’s obligations under this Loan Guaranty with
respect to that payment shall be reinstated at such time as though the payment
had not been made and whether or not the Administrative Agent, the Issuing Bank,
the Lenders, or the other Secured Parties are in possession of this Loan
Guaranty. If acceleration of the time for payment of any of the Guaranteed
Obligations is stayed upon the insolvency, bankruptcy or reorganization of any
Loan Party, all such amounts otherwise subject to acceleration under the terms
of any agreement relating to the Guaranteed Obligations shall nonetheless be
payable by the Loan Parties forthwith on demand by the Administrative Agent.

SECTION 10.07 Information. Each Loan Party assumes all responsibility for being
and keeping itself informed of the Loan Parties’ financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations and the nature, scope and extent of the risks that each
Loan Party assumes and incurs under this Loan Guaranty, and agrees that none of
the Administrative Agent, the Issuing Bank or any Lender shall have any duty to
advise any Loan Party of information known to it regarding those circumstances
or risks.

SECTION 10.08 Termination. Each of the Lenders and the Issuing Bank may continue
to make loans or extend credit to the Borrowers based on this Loan Guaranty
until five (5) days after it receives written notice of termination from any
Loan Party of this Loan Guaranty. Notwithstanding receipt of any such notice,
each Loan Party will continue to be liable to the Lenders for any Guaranteed
Obligations created, assumed or committed to prior to the fifth day after
receipt of the notice, and all subsequent renewals, extensions, modifications
and amendments with respect to, or substitutions for, all or any part of such
Guaranteed Obligations. Nothing in this Section 10.08 shall be deemed to
constitute a waiver of, or eliminate, limit, reduce or otherwise impair any
rights or remedies the Administrative Agent or any Lender may have in respect
of, any Default or Event of Default that shall exist under Article VII hereof as
a result of any such notice of termination.

 

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SECTION 10.09 Taxes. Each payment of the Guaranteed Obligations will be made by
each Loan Party without withholding for any Taxes, unless such withholding is
required by law. If any Loan Party determines, in its sole discretion exercised
in good faith, that it is so required to withhold Taxes, then such Loan Party
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), the
Administrative Agent, Lender or Issuing Bank (as the case may be) receives the
amount it would have received had no such withholding been made, and
Section 2.17(g) shall apply to the extent relevant.

SECTION 10.10 Maximum Liability. Notwithstanding any other provision of this
Loan Guaranty, the amount guaranteed by each Loan Party hereunder shall be
limited to the extent, if any, required so that its obligations hereunder shall
not be subject to avoidance under Section 548 of the Bankruptcy Code or under
any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent
Conveyance Act or similar statute or common law. In determining the limitations,
if any, on the amount of any Loan Party’s obligations hereunder pursuant to the
preceding sentence, it is the intention of the parties hereto that any rights of
subrogation, indemnification or contribution which such Loan Party may have
under this Loan Guaranty, any other agreement or applicable law shall be taken
into account.

SECTION 10.11 Contribution.

(a) To the extent that any Loan Party shall make a payment under this Loan
Guaranty (a “Guarantor Payment”) which, taking into account all other Guarantor
Payments then previously or concurrently made by any other Loan Party, exceeds
the amount which otherwise would have been paid by or attributable to such Loan
Party if each Loan Party had paid the aggregate Guaranteed Obligations satisfied
by such Guarantor Payment in the same proportion as such Loan Party’s “Allocable
Amount” (as defined below) (as determined immediately prior to such Guarantor
Payment) bore to the aggregate Allocable Amounts of each of the Loan Parties as
determined immediately prior to the making of such Guarantor Payment, then,
following indefeasible payment in full in cash of the Guarantor Payment and the
Guaranteed Obligations (other than Unliquidated Obligations that have not yet
arisen), and all Commitments and Letters of Credit have terminated or expired
or, in the case of all Letters of Credit, are fully collateralized on terms
reasonably acceptable to the Administrative Agent and the Issuing Bank, and this
Agreement, the Swap Agreement Obligations and the Banking Services Obligations
have terminated, such Loan Party shall be entitled to receive contribution and
indemnification payments from, and be reimbursed by, each other Loan Party for
the amount of such excess, pro rata based upon their respective Allocable
Amounts in effect immediately prior to such Guarantor Payment.

(b) As of any date of determination, the “Allocable Amount” of any Loan Party
shall be equal to the excess of the fair saleable value of the property of such
Loan Party over the total liabilities of such Loan Party (including the maximum
amount reasonably expected to become due in respect of contingent liabilities,
calculated, without duplication, assuming each other Loan Party that is also
liable for such contingent liability pays its ratable share thereof), giving
effect to all payments made by other Loan Parties as of such date in a manner to
maximize the amount of such contributions.

(c) This Section 10.11 is intended only to define the relative rights of the
Loan Parties, and nothing set forth in this Section 10.11 is intended to or
shall impair the obligations of the Loan Parties, jointly and severally, to pay
any amounts as and when the same shall become due and payable in accordance with
the terms of this Loan Guaranty.

 

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(d) The parties hereto acknowledge that the rights of contribution and
indemnification hereunder shall constitute assets of the Loan Party or Loan
Parties to which such contribution and indemnification is owing.

(e) The rights of the indemnifying Loan Parties against other Loan Parties under
this Section 10.11 shall be exercisable upon the full and indefeasible payment
of the Guaranteed Obligations in cash (other than Unliquidated Obligations that
have not yet arisen) and the termination or expiry (or, in the case of all
Letters of Credit, full cash collateralization), on terms reasonably acceptable
to the Administrative Agent and the Issuing Bank, of the Commitments and all
Letters of Credit issued hereunder and the termination of this Agreement, the
Swap Agreement Obligations and the Banking Services Obligations.

SECTION 10.12 Liability Cumulative. The liability of each Loan Party as a Loan
Party under this Article X is in addition to and shall be cumulative with all
liabilities of each Loan Party to the Administrative Agent, the Issuing Bank and
the Lenders under this Agreement and the other Loan Documents to which such Loan
Party is a party or in respect of any obligations or liabilities of the other
Loan Parties, without any limitation as to amount, unless the instrument or
agreement evidencing or creating such other liability specifically provides to
the contrary.

SECTION 10.13 Keepwell. Each Qualified ECP Guarantor hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by each other Loan
Party to honor all of its obligations under this Loan Guaranty in respect of a
Swap Obligation (provided, however, that each such Qualified ECP Guarantor shall
only be liable under this Section 10.13 for the maximum amount of such liability
that can be hereby incurred without rendering its obligations under this
Section 10.13 or otherwise under this Loan Guaranty voidable under applicable
law relating to fraudulent conveyance or fraudulent transfer, and not for any
greater amount). Except as otherwise provided herein, the obligations of each
such Qualified ECP Guarantor under this Section 10.13 shall remain in full force
and effect until the termination of all Swap Obligations. Each such Qualified
ECP Guarantor intends that this Section 10.13 constitute, and this Section 10.13
shall be deemed to constitute, a “keepwell, support, or other agreement” for the
benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of
the Commodity Exchange Act.

ARTICLE XI

THE BORROWER REPRESENTATIVE

SECTION 11.01 Appointment; Nature of Relationship. The Company is hereby
appointed by each of the Borrowers as its contractual representative (herein
referred to as the “Borrower Representative”) hereunder and under each other
Loan Document, and each of the Borrowers irrevocably authorizes the Borrower
Representative to act as the contractual representative of such Borrower with
the rights and duties expressly set forth herein and in the other Loan
Documents. The Borrower Representative agrees to act as such contractual
representative upon the express conditions contained in this Article XI.
Additionally, the Borrowers hereby appoint the Borrower Representative as their
agent to receive all of the proceeds of the Loans in the Funding Account(s), at
which time the Borrower Representative shall promptly disburse such Loans to the
appropriate Borrower(s), provided that, in the case of a Revolving Loan, such
amount shall not result in a violation of the Revolving Exposure Limitations.
The Administrative Agent and the Lenders, and their respective officers,
directors, agents or employees, shall not be liable to the Borrower
Representative or any Borrower for any action taken or omitted to be taken by
the Borrower Representative or the Borrowers pursuant to this Section 11.01.

 

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SECTION 11.02 Powers. The Borrower Representative shall have and may exercise
such powers under the Loan Documents as are specifically delegated to the
Borrower Representative by the terms of each thereof, together with such powers
as are reasonably incidental thereto. The Borrower Representative shall have no
implied duties to the Borrowers, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents
to be taken by the Borrower Representative.

SECTION 11.03 Employment of Agents. The Borrower Representative may execute any
of its duties as the Borrower Representative hereunder and under any other Loan
Document by or through authorized officers.

SECTION 11.04 Notices. Each Borrower shall immediately notify the Borrower
Representative of the occurrence of any Default or Event of Default hereunder
referring to this Agreement describing such Default or Event of Default and
stating that such notice is a “notice of default”. In the event that the
Borrower Representative receives such a notice, the Borrower Representative
shall give prompt notice thereof to the Administrative Agent and the Lenders.
Any notice provided to the Borrower Representative hereunder shall constitute
notice to each Borrower on the date received by the Borrower Representative.

SECTION 11.05 Successor Borrower Representative. Upon the prior written consent
of the Administrative Agent, the Borrower Representative may resign at any time,
such resignation to be effective upon the appointment of a successor Borrower
Representative. The Administrative Agent shall give prompt written notice of
such resignation to the Lenders.

SECTION 11.06 Execution of Loan Documents; Borrowing Base Certificate. The
Borrowers hereby empower and authorize the Borrower Representative, on behalf of
the Borrowers, to execute and deliver to the Administrative Agent and the
Lenders the Loan Documents and all related agreements, certificates, documents,
or instruments as shall be necessary or appropriate to effect the purposes of
the Loan Documents, including, without limitation, the Borrowing Base
Certificates and the Compliance Certificates. Each Borrower agrees that any
action taken by the Borrower Representative or the Borrowers in accordance with
the terms of this Agreement or the other Loan Documents, and the exercise by the
Borrower Representative of its powers set forth therein or herein, together with
such other powers that are reasonably incidental thereto, shall be binding upon
all of the Borrowers.

SECTION 11.07 Reporting. Each Borrower hereby agrees that such Borrower shall
furnish promptly after each fiscal month to the Borrower Representative a copy
of its Borrowing Base Certificate and any other certificate or report required
hereunder or requested by the Borrower Representative on which the Borrower
Representative shall rely to prepare the Borrowing Base Certificates and
Compliance Certificate required pursuant to the provisions of this Agreement.

(Signature Pages Follow)

 

137

--------------------------------------------------------------------------------

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

 

BORROWERS: URBAN OUTFITTERS, INC. By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer TERRAIN EAST LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer J. FRANKLIN STYER
NURSERIES, INC. By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer ANTHROPOLOGIE, INC. By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer URBAN OUTFITTERS
WHOLESALE, INC. By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer URBAN OUTFITTERS WEST
LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

FREE PEOPLE OF PA LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer URBN PUERTO RICO RETAIL
LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

OTHER LOAN PARTIES: U. O. REAL ESTATE HOLDING I LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer U. O. REAL ESTATE
HOLDING II LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer U. O. REAL ESTATE LLC By
 

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer UO FENWICK, INC. By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer URBN PR HOLDING, INC. By
 

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer TERRAIN MERCHANDISING
LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer URBN HOLDING, INC. By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

UO US LLC By  

/s/ Frank Conforti

Name:   Frank Conforti Title:   Chief Financial Officer

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

JPMORGAN CHASE BANK, N.A., individually as a Lender and as Administrative Agent,
an Issuing Bank and Swingline Lender By  

/s/ Donna DiForio

Name:   Donna DiForio Title:   Authorized Officer

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

WELLS FARGO BANK, NATIONAL ASSOCIATION, individually as a Lender and as an
Issuing Bank By  

/s/ Michael Stavrakos

Name:   Michael Stavrakos Title:   Assistant Vice President

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

WELLS FARGO BANK NA, LONDON BRANCH, individually as a Lender and as an Issuing
Bank By  

/s/ N B Hogg

Name:   N B Hogg Title:   Authorised Signatory

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

BANK OF AMERICA, N.A., individually as a Lender and as an Issuing Bank By  

/s/ Joseph Becker

Name:   Joseph Becker Title:   Managing Director

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

HSBC BANK USA, NATIONAL ASSOCIATION, individually as a Lender By  

/s/ Darren Pinsker

Name:   Darren Pinsker Title:   SVP

 

Signature Page to Credit Agreement

--------------------------------------------------------------------------------

SCHEDULES

to the

CREDIT AGREEMENT

dated as of

July 1, 2015

among

URBAN OUTFITTERS, INC.,

as the Company

The Subsidiaries from time to time party hereto,

as Subsidiary Borrowers

The other LOAN PARTIES party hereto

The LENDERS party hereto

and

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

 

J.P. MORGAN SECURITIES LLC and WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Joint Bookrunners and Joint Lead Arrangers

BANK OF AMERICA, N.A. and WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Co-Syndication Agents

HSBC BANK USA, NATIONAL ASSOCIATION,

as Documentation Agent

--------------------------------------------------------------------------------

The following schedules (the “Schedules”) are delivered pursuant to that Credit
Agreement dated as of the date hereof by and among the parties listed above (the
“Agreement”). The sections of the Schedules correspond to the principal sections
of the Agreement to which such schedule relates.

The following Schedules are qualified in their entirety by reference to the
specific provisions of the Agreement, and are not intended to constitute, and
shall not be construed as constituting, representations or warranties of the
Loan Parties, except as and to the extent provided in the Agreement.

Matters reflected in the following Schedules are not necessarily limited to
matters required by the Agreement to be reflected in the Schedules. Such
additional matters are set forth for informational purposes only. In no event
shall any disclosure of such additional matters be deemed or interpreted to
broaden or otherwise amend any of the covenants or representations and
warranties in the Agreement.

Headings have been inserted on the Sections of the Schedules for convenience of
reference only and shall to no extent have the effect of amending or changing
the express description of the Sections as set forth in the Agreement.
Capitalized terms used but not otherwise defined herein shall have the
respective meanings set forth in the Agreement.

 

Commitment Schedule       Schedule 3.06   –    Disclosed Matters   
Schedule 3.15   –    Capitalization and Subsidiaries    Schedule 3.23   –   
Credit Card Agreements    Schedule 5.18   –    Post-Closing Matters    Schedule
6.01   –    Existing Indebtedness    Schedule 6.02   –    Existing Liens   
Schedule 6.04   –    Existing Investments    Schedule 6.10   –    Existing
Restrictions    Schedule 9.01   –    Foreign Currency Notice Address   

--------------------------------------------------------------------------------

COMMITMENT SCHEDULE

 

Lender

   Commitment      LC Individual Sublimit  

JPMorgan Chase Bank, N.A.

   $ 175,000,000       $ 10,937,500   

Wells Fargo Bank, National Association

   $ 100,000,000       $ 15,000,000   

Bank of America, N.A.

   $ 75,000,000       $ 4,687,500   

HSBC Bank USA, National Association

   $ 50,000,000       $ 3,125,000   

Total

   $ 400,000,000       $ 25,000,000   

--------------------------------------------------------------------------------

SCHEDULE 3.06

DISCLOSED MATTERS

None.

--------------------------------------------------------------------------------

SCHEDULE 3.15

CAPITALIZATION AND SUBSIDIARIES

(a) List of the Company’s Subsidiaries:

 

Subsidiary Legal Names

  

Relationship to Company

DOMESTIC SUBSIDIARIES:

  

Terrain Merchandising LLC

   Direct Wholly Owned Subsidiary

Terrain East LLC

   Direct Wholly Owned Subsidiary

J. Franklin Styer Nurseries, Inc.

   Indirect Wholly Owned Subsidiary (through Terrain East LLC)

U. O. Real Estate Holding I, LLC

   Direct Wholly Owned Subsidiary

U. O. Real Estate Holding II, LLC

   Indirect Wholly Owned Subsidiary (through U. O. Real Estate Holding I LLC)

U. O. Real Estate LLC

   Indirect Wholly Owned Subsidiary (through U. O. Real Estate Holding II LLC)

URBN Holding, Inc.

   Direct Wholly Owned Subsidiary

UO US LLC

   Indirect Wholly Owned Subsidiary (through URBN Holding, Inc.)

Anthropologie, Inc.

   Direct Wholly Owned Subsidiary

Urban Outfitters Wholesale, Inc.

   Indirect Wholly Owned Subsidiary (through Anthropologie, Inc.)

UO Fenwick, Inc.

   Indirect Wholly Owned Subsidiary (through Urban Outfitters Wholesale, Inc.)

Urban Outfitters West LLC

   Indirect Wholly Owned Subsidiary (through Urban Outfitters Wholesale, Inc.)

Free People of PA LLC

   Indirect Wholly Owned Subsidiary (through Urban Outfitters Wholesale, Inc.)

URBN PR Holding, Inc.

   Direct Wholly Owned Subsidiary

URBN Puerto Rico Retail LLC

   Indirect Wholly Owned Subsidiary (through URBN PR Holding, Inc.)

NON-US SUBSIDIARIES:

  

URBN Canada Retail, Inc.

   Indirect Wholly Owned Subsidiary (through UO US LLC)

URBN NL Holding CV

   Indirect Wholly Owned Subsidiary (90% owned through URBN Holding, Inc. and
10% owned through UO Fenwick, Inc.)

UO Netherlands Holding BV

   Indirect Wholly Owned Subsidiary (through URBN NL Holding CV)

UO Netherlands BV

   Indirect Wholly Owned Subsidiary (through UO Netherlands Holding BV)

UO Bermuda Limited

   Indirect Wholly Owned Subsidiary (95% owned through URBN NL Holding CV)

--------------------------------------------------------------------------------

Subsidiary Legal Names

  

Relationship to Company

HK Sourcing Limited

   Indirect Wholly Owned Subsidiary (through UO Bermuda Limited)

URBN Bermuda Holding Ltd

   Indirect Wholly Owned Subsidiary (through URBN NL Holding CV)

URBN Bermuda Holding Partners LP

   Indirect Wholly Owned Subsidiary (99.5% through URBN NL Holding CV and 0.5%
through URBN Bermuda Holding Ltd.)

URBN UK Limited

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

Urban Outfitters Ireland Limited

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

Urban Outfitters Belgium BVBA

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

Urban Outfitters Germany GmbH

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

URBN Japan GK

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

URBN France Retail SARL

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

URBN Italy Retail SRL

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

URBN HK Trading Limited

   Indirect Wholly Owned Subsidiary (through URBN Bermuda Holding Partners LP)

Urban Outfitters Denmark

   Indirect Wholly Owned Subsidiary (through URBN UK Limited)

Urban Outfitters i Sverige AB

   Indirect Wholly Owned Subsidiary (through Urban Outfitters Ireland)

URBN Ireland Retail Ltd

   Indirect Wholly Owned Subsidiary (through Urban Outfitters Ireland)

URBN Netherlands Retail BV

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

URBN Spain Retail S.L.

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

URBN Hong Kong Retail Limited

   Indirect Wholly Owned Subsidiary (through UO Netherlands BV)

Urban Outfitters UK Limited

   Indirect Wholly Owned Subsidiary (through URBN UK Limited)

Anthropologie UK Limited

   Indirect Wholly Owned Subsidiary (through URBN UK Limited)

--------------------------------------------------------------------------------

(b) List of each class of authorized Equity Interests owned by the Company or
any Subsidiary in each Subsidiary:

 

Corporation

  

Wholly Owned By (or %)

   Shares (Common)      Par Value  

Anthropologie, Inc.

   Urban Outfitters, Inc.      100       $ 0.10   

Urban Outfitters Wholesale, Inc.

   Anthropologie, Inc.      1,000       $ 0.10   

UO Fenwick, Inc.

   Urban Outfitters Wholesale, Inc.      1,000       $ 1.00   

URBN Holding, Inc.

   Urban Outfitters, Inc.      100       $ 0.01   

URBN PR Holding, Inc.

   Urban Outfitters, Inc.      100       $ 0.01   

J. Franklin Styer Nurseries, Inc.

   Terrain East LLC      5,000         None   

URBN Canada Retail, Inc.

   UO US LLC      43,868,655         None   

 

Limited Liability Company

  

Member Corporation

   Ownership %  

Urban Outfitters West, LLC

   Urban Outfitters Wholesale, Inc.      100 % 

Free People of PA, LLC

   Urban Outfitters Wholesale, Inc.      100 % 

UO US LLC

   URBN Holding, Inc.      100 % 

U. O. Real Estate Holding I LLC

   Urban Outfitters, Inc.      100 % 

U. O. Real Estate Holding II LLC

   U. O. Real Estate Holding I LLC      100 % 

U. O. Real Estate LLC

   U. O. Real Estate Holding II LLC      100 % 

URBN Puerto Rico Retail LLC

   URBN PR Holding, Inc.      100 % 

Terrain Merchandising LLC

   Urban Outfitters, Inc.      100 % 

Terrain East LLC

   Urban Outfitters, Inc.      100 % 

(continued on next page)

--------------------------------------------------------------------------------

(b) List of each class of authorized Equity Interests owned by the Company or
any Subsidiary in each Subsidiary (continued):

 

Non-US Subsidiaries

  

Wholly-owned by (or %)

  

Ownership %/Shares/Par Value

(if applicable)

URBN Canada Retail, Inc.

   UO US LLC    100%/43,868,655 shares of common stock without par value

UO Netherlands Holding BV

   URBN NL Holding CV    100%/180 Shares/€100

UO Netherlands BV

   UO Netherlands Holding BV    100%/180 Shares/€100

UO Bermuda Limited

   URBN NL Holding CV    95% owned by URBN NL Holding CV1/9,500 Shares/$1.00

HK Sourcing Limited

   UO Bermuda Limited    100%/100 Shares/HKD1.00

URBN Bermuda Holding Ltd

   URBN NL Holding CV    100%/1 Share/$0.01

URBN UK Limited

   UO Netherlands BV    100%/76,182,120 Shares/£1.00

Urban Outfitters Ireland Limited

   UO Netherlands BV    100%/2 Shares/€2.54

Urban Outfitters Belgium BVBA

   UO Netherlands BV    100%/302 Shares/none.

Urban Outfitters Germany GmbH

   UO Netherlands BV    100%/1 Share/none.

URBN Japan GK

   UO Netherlands BV    100%/none/none

URBN France Retail SARL

   UO Netherlands BV    100%/943,500/€1.00

URBN Italy Retail SRL

   UO Netherlands BV    100%/100,000 Shares/none.

URBN HK Trading Limited

   URBN Bermuda Holding Partners LP    100%/100 Shares/HKD1.00

Urban Outfitters Denmark (branch)

   URBN UK Limited    100%/n.a./n.a.

Urban Outfitters i Sverige AB

   Urban Outfitters Ireland    100%/1,000 shares/none.

URBN Ireland Retail Ltd

   Urban Outfitters Ireland    100%/2 Shares/€2.00

URBN Netherlands Retail BV

   UO Netherlands BV    100%/180 Shares/€100

URBN Spain Retail S.L.

   UO Netherlands BV    100%/300 Shares/€10

URBN Hong Kong Retail Limited

   UO Netherlands BV    100%/1,472,000/HKD1.00

Urban Outfitters UK Limited

   URBN UK Limited    100%/1 Share/£1.00

Anthropologie UK Limited

   URBN UK Limited    100%/1 Share/£1.00

(Continued on Next Page)

 

1  NOTE: Need to identify 5% owner.

--------------------------------------------------------------------------------

(b) List of each class of authorized Equity Interests owned by the Company or
any Subsidiary in each Subsidiary (continued):

 

Partnership

  

Partners

  

Partnership %

URBN NL Holding CV

   URBN Holding, Inc. and UO Fenwick, Inc.    90% owned by URBN Holding, Inc.
and 10% owned by UO Fenwick, Inc.

URBN Bermuda Holding Partners LP

   URBN NL Holding CV and URBN Bermuda Holding Ltd.    99.5% through URBN NL
Holding CV and 0.5% through URBN Bermuda Holding Ltd.

(c) Type of entity of the Company and each of its Subsidiaries:

 

Domestic Entities

   Type of Entity

Urban Outfitters, Inc.

   Pennsylvania Corporation

Terrain Merchandising LLC

   Delaware Limited Liability Company

Terrain East LLC

   Pennsylvania Limited Liability Company

J. Franklin Styer Nurseries, Inc.

   Pennsylvania Corporation

U. O. Real Estate Holding I LLC

   Pennsylvania Limited Liability Company

U. O. Real Estate Holding II LLC

   Pennsylvania Limited Liability Company

U. O. Real Estate LLC

   Pennsylvania Limited Liability Company

URBN Holding, Inc.

   Delaware Corporation

UO US LLC

   Delaware Limited Liability Company

Anthropologie, Inc.

   Pennsylvania Corporation

Urban Outfitters Wholesale, Inc.

   Pennsylvania Corporation

UO Fenwick, Inc.

   Delaware Corporation

Urban Outfitters West LLC

   California Limited Liability Company

Free People of PA LLC

   Pennsylvania Limited Liability Company

URBN PR Holding, Inc.

   Delaware Corporation

URBN Puerto Rico Retail LLC

   Puerto Rican Limited Liability Company

Foreign Entities

   Type of Entity

URBN Canada Retail, Inc.

   Canadian Corporation

URBN NL Holding CV

   Netherlands Partnership

UO Netherlands Holding BV

   Netherlands Company

UO Netherlands BV

   Netherlands Company

UO Bermuda Limited

   Bermuda Exempted Company

HK Sourcing Limited

   Hong Kong Private Limited Company

URBN Bermuda Holding Ltd

   Bermuda Exempted Company

URBN Bermuda Holding Partners LP

   Bermuda Limited Partnership

URBN UK Limited

   United Kingdom Private Limited Company

--------------------------------------------------------------------------------

(c) Type of entity of the Company and each of its Subsidiaries (continued):

 

Foreign Entities (continued)

   Type of Entity (continued)

Urban Outfitters Ireland Limited

   Irish Company

Urban Outfitters Belgium BVBA

   Belgian Company

Urban Outfitters Germany GmbH

   German Company

URBN Japan GK

   Japanese Limited Liability Company

URBN France Retail SARL

   French Limited Liability Company

URBN Italy Retail SRL

   Italian Limited Liability Company

URBN HK Trading Limited

   Hong Kong Company

Urban Outfitters Denmark

   Danish Branch

Urban Outfitters i Sverige AB

   Swedish Limited Company

URBN Ireland Retail Ltd

   Irish Company

URBN Netherlands Retail BV

   Netherlands Company

URBN Spain Retail S.L.

   Spanish Limited Liability Company

URBN Hong Kong Retail Limited

   Hong Kong Private Limited Company

Urban Outfitters UK Limited

   United Kingdom Private Limited Company

Anthropologie UK Limited

   United Kingdom Private Limited Company

(d) Designation of Subsidiaries as Restricted or Unrestricted.

All Subsidiaries are Restricted Subsidiaries.

--------------------------------------------------------------------------------

SCHEDULE 3.23

CREDIT CARD AGREEMENTS

 

1. Agreement for American Express® Card Acceptance, dated as of July 1, 2003, by
and between American Express Travel Related Services Company, Inc. and Urban
Outfitters, Inc., as amended by that certain Addendum to American Express Card
Acceptance Agreement, dated as of July 1, 2008.

 

2. Merchant Services Agreement by and between Discover Financial Services LLC
and Urban Outfitters, Inc.

 

3. Merchant Agreement, dated as of August 10, 2010, by and among Urban
Outfitters, Inc., Paypal, Inc. and Bill Me Later, Inc., including all schedules
and exhibits thereto (which are incorporated herein by reference).

 

4. Bank Card Merchant Agreement, dated as of November 1, 2000, by and among The
Fifth Third Bank, its processing agent Midwest Payment Systems, Inc., and Urban
Outfitters, Inc., as amended by that certain Amendment No. 1 to the Bank Card
Merchant Agreement, dated as of August 3, 2001, as further amended by that
certain Amendment No. 2 to the Bank Card Merchant Agreement, dated as of
September 20, 2005, as further amended by that Amendment No. 3 to the Bank Card
Merchant Agreement, dated as of September 7, 2006, and as further amended by
that certain Amendment No. 4 to the Bank Card Merchant Agreement, dated as of
October 28, 2011 (which acknowledged the assignment of the agreement to Vantiv,
LLC).

--------------------------------------------------------------------------------

SCHEDULE 5.18

POST-CLOSING MATTERS

(a) Control Agreements

No later than the 30th day following the Closing Date (or such later date as may
be agreed to by the Administrative Agent in its sole discretion), the Borrowers
shall provide to the Administrative Agent fully executed Control Agreements with
respect to each of the following deposit, securities, commodity or similar
accounts:

 

Credit Party

  

Financial Institution

  

Account Number

Urban Outfitters, Inc.

   Wells Fargo Bank, N.A.   

############# (deposit account)

########## (deposit account)

Urban Outfitters, Inc.

   JPMorgan Chase Bank, N.A.    ######### (deposit account)

Urban Outfitters, Inc.

   Bank of America, N.A.    ########## (deposit account)

UO Fenwick, Inc.

   JPMorgan Chase Bank, N.A.    ##### (securities account)

UO Fenwick, Inc.

   Oppenheimer & Co.    ####### (securities account)

(b) Insurance Endorsements. No later than the 30th day following the Closing
Date (or such later date as may be agreed to by the Administrative Agent in its
sole discretion), the Borrowers shall provide to the Administrative Agent
insurance certificates, lender loss payee endorsements and additional insured
endorsements, in each case in form and substance reasonably satisfactory to the
Administrative Agent and satisfying the terms of the Credit Agreement and the
other Loan Documents.

(c) Pledged Intercompany Notes. No later than the 30th day following the Closing
Date (or such later date as may be agreed to by the Administrative Agent in its
sole discretion), the Borrowers shall provide to the Administrative Agent fully
executed originals of each promissory note (or replacement notes thereof)
pledged and required to be delivered to the Collateral Agent pursuant to
Section 4.4 of the Pledge and Security Agreement endorsed (without recourse) in
blank (or accompanied by an executed transfer form in blank) by the pledgor
thereof.

(d) Collateral Access Agreements. Each Credit Party shall use commercially
reasonable efforts for not less than sixty days following the Closing Date to
obtain a Collateral Access Agreement with respect to each of the following
properties:

 

Location

  

Address

  

Relationship

Reno Distribution Center

  

6640 Echo Ct., Reno, NV 89431

(Lessor: FRE LEAR 429, LLC)

   Leased Property

Metropolitan Warehouse

  

811 Sentous Street

City of Industry, CA 91648

   Bailor

Metropolitan Warehouse

  

741 West Ward Avenue

High Point, NC 27260

   Bailor

Metropolitan Warehouse

  

2565 Brunswick Avenue

Linden, NJ 07036

   Bailor

--------------------------------------------------------------------------------

(e) Continuing Agreement for Commercial & Standby Letters of Credit. No later
than the 30th day following the Closing Date (or such later date as may be
agreed to by JPMCB in its sole discretion), the Borrowers shall provide to JPMCB
a fully executed Continuing Agreement for Commercial & Standby Letters of Credit
between Urban Outfitters, Inc. and JPMorgan Chase Bank, N.A. and a fully
executed Certification of Authority, in each case in form and substance
reasonably satisfactory to JPMCB; provided that until such time as the foregoing
requirement is satisfied, JPMCB shall have no obligation to issue any Letter of
Credit under the Credit Agreement.

(f) Good Standing Certificates. No later than the 30th day following the Closing
Date (which requirement may be waived in full or in part by the Administrative
Agent in its sole discretion), the Borrowers shall provide to the Administrative
Agent with good standing certificates from each jurisdiction set forth opposite
each Credit Party’s name below:

 

Credit Party

  

Jurisdiction

Urban Outfitters, Inc.    Delaware    Kansas    Rhode Island    Wisconsin
Anthropologie, Inc.    Delaware    Missouri    New Mexico    Wisconsin Urban
Outfitters Wholesale, Inc.    South Carolina Free People of PA LLC   
Massachusetts    North Carolina    New York    Washington

--------------------------------------------------------------------------------

SCHEDULE 6.01

EXISTING INDEBTEDNESS

 

1. Promissory Note of URBN Canada Retail, Inc. (as successor to 0930395 B.C.
Unlimited Liability Company), dated as of February 29, 2012, in favor of URBN
Holding, Inc. in the amount of $62,500,000.

 

2. Promissory Note of U. O. Real Estate LLC, dated as of April 13, 2006, in
favor of UO Fenwick, Inc. in the amount of $70,000,000.

 

3. Promissory Note of Urban Outfitters, Inc., Anthropologie, Inc. and Urban
Outfitters Wholesale, Inc., dated as of December 19, 2002, in favor of UO
Fenwick, Inc. in the amount of $800,000,000.

--------------------------------------------------------------------------------

SCHEDULE 6.02

EXISTING LIENS

 

Debtor

(as shown on statement)

 

Secured Party

(as shown on statement)

 

Jurisdiction

  UCC File No.   File Date

Urban Outfitters Inc.

5000 South Broad Street

Bldg. 12

Philadelphia, PA 19112

 

Canon Financial Services

158 Gaither Drive, #200

Mt. Laurel, NJ 08054

  PA – SOS   2010081104391   08/11/10

Urban Outfitters Inc.

5000 South Broad Street

Bldg. 12

Philadelphia, PA 19112

 

Canon Financial Services

158 Gaither Drive, #200

Mt. Laurel, NJ 08054

  PA – SOS   2010111904039   11/19/10

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Dell Financial Services L.L.C.

One Dell Way

Round Rock, TX 78682

  PA – SOS   2011011110277   01/11/11

Urban Outfitters Inc.

5000 South Broad Street

Bldg. 1

Philadelphia, PA 19112

 

Canon Financial Services

158 Gaither Drive, #200

Mt. Laurel, NJ 08054

  PA – SOS   2012052107497   05/21/12

Urban Outfitters Inc.

5000 South Broad Street

Bldg. 12

Philadelphia, PA 19112

 

Canon Financial Services

158 Gaither Drive, #200

Mt. Laurel, NJ 08054

  PA – SOS   2012052107512   05/21/12

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

TimePayment Corporation

16 New England Executive Park

Suite 200

Burlington, MA 01803

  PA – SOS   2012110801363   11/05/12

Urban Outfitters Inc.

12055 Moya Blvd.

Reno, NV 89506

 

Canon Financial Services

158 Gaither Drive, #200

Mt. Laurel, NJ 08054

  PA – SOS   2012111605217   11/16/12

Urban Outfitters Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

TimePayment Corporation

16 New England Executive Park

Suite 200

Burlington, MA 01803

  PA – SOS   2013042304887   04/22/13

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2013120307004   12/03/13

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2013120307028   12/03/13

--------------------------------------------------------------------------------

Debtor

(as shown on statement)

 

Secured Party

(as shown on statement)

 

Jurisdiction

  UCC File No.   File Date

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014043003135   04/30/14

Urban Outfitters, Inc.

755 Brackbill Rd.

Gap, PA 17527

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014043008921   04/30/14

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014051404666   05/14/14

Urban Outfitters, Inc.

98 N. 6th St.

Brooklyn, NY 11211

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014061109333   06/11/14

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014110702254   11/07/14

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014111802574   11/18/14

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014112103991   11/21/14

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014120905066   12/09/14

Urban Outfitters, Inc.

30 Industrial Park Blvd.

Trenton, SC 29847

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2014121202752   12/12/14

Urban Outfitters, Inc.

5000 South Broad Street

Philadelphia, PA 19112

 

Wells Fargo Financial Leasing, Inc.

800 Walnut Street

Des Moines, IA 50309

  PA – SOS   2015012606164   01/26/15

--------------------------------------------------------------------------------

SCHEDULE 6.04

EXISTING INVESTMENTS

Urban Outfitters, Inc. has an arrangement with Pizzeria V Holdings, LLC
(“Pizzeria V”) to allow for the investment of up to $3MM dollars through Jan 31,
2016, to fund the expansion of up to 4 new locations. The loan advances
accumulate interest through December 31, 2017, when Pizzeria V Holdings, LLC is
required to pay back the investment or Urban Outfitters can convert the amounts
owed by Pizzeria V to an equity interest in Pizzeria V.

--------------------------------------------------------------------------------

SCHEDULE 6.10

EXISTING RESTRICTIONS

 

1. Shareholder Agreement of UO (Bermuda) Limited (“UO Bermuda”), dated as of
July 15, 2009, by and between Urban Outfitters, Inc. or its assignee and Coddy
BVI, which contains prohibitions on UO Bermuda’s ability to (a) pledge its
assets; (b) incur debt; or (c) guarantee or become obligated for the debts of
any other Person (as defined therein).

 

2. Bye-Laws of UO (Bermuda) Limited, dated as of July 28, 2009, which contains
prohibitions on UO Bermuda’s ability to give any financial assistance, whether
directly or indirectly, for the purpose of the acquisition or proposed
acquisition by any person of any Shares in the Company, whether by means of
loan, guarantee, provision or security or otherwise.

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SCHEDULE 9.01

FOREIGN CURRENCY NOTICE ADDRESS

Same Notice Address as set forth in Section 9.01(i) of the Credit Agreement.

--------------------------------------------------------------------------------

FINAL

EXHIBIT A

[FORM OF] ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
receipt of a copy of which is hereby acknowledged by the Assignee. The Standard
Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to
and incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including any letters of credit, guarantees and swingline
loans included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and other
rights of the Assignor (in its capacity as a Lender) against any Person, whether
known or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including contract claims, tort claims, malpractice claims, statutory
claims and all other claims at law or in equity related to the rights and
obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned pursuant to clauses (i) and (ii) above being
referred to herein collectively as the “Assigned Interest”). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided
in this Assignment and Assumption, without representation or warranty by the
Assignor.

 

1.    Assignor:   

 

   2.    Assignee:   

 

         [and is an Affiliate/Approved Fund of [identify Lender]1]

3.

   Borrowers:   

 

  

4.

   Administrative Agent:    JPMorgan Chase Bank, N.A., as the administrative
agent under the Credit Agreement

5.

   Credit Agreement:    The $400,000,000 Credit Agreement dated as of July 1,
2015 among Urban Outfitters, Inc. and certain of its subsidiaries (collectively,
the “Borrowers”), the other Loan Parties party thereto, the Lenders parties
thereto and JPMorgan Chase Bank, N.A., as Administrative Agent

 

1  Select as applicable.

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6.         Assigned Interest:

Facility Assigned2

   Aggregate Amount of
Commitment/Loans for
all Lenders      Amount of
Commitment/Loans
Assigned      Percentage Assigned of
Commitment/Loans3      $         $                %     $         $          
     %     $         $                % 

Effective Date:                  , 20     [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]

The Assignee agrees to deliver to the Administrative Agent a completed
Administrative Questionnaire in which the Assignee designates one or more Credit
Contacts to whom all syndicate-level information (which may contain material
non-public information about the Company, the other Loan Parties and their
Related Parties or their respective securities) will be made available and who
may receive such information in accordance with the Assignee’s compliance
procedures and applicable laws, including Federal and state securities laws.

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR [NAME OF ASSIGNOR] By:  

 

Title:   ASSIGNEE [NAME OF ASSIGNEE] By:  

 

Title:  

 

2  Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g. “Revolving
Commitment,” etc.)

3  Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

--------------------------------------------------------------------------------

Consented to and Accepted:

 

JPMORGAN CHASE BANK, N.A., as

Administrative Agent, Issuing Bank and Swingline Lender By  

 

Title:   [Consented to and Accepted: [                    ], as Issuing Bank By
 

 

Title:]4   [Consented to:]5 URBAN OUTFITTERS, INC., as Borrower Representative
By  

 

Title:  

 

4  To be added only if there are additional Issuing Banks under the Credit
Agreement

5  To be added only if the consent of the Borrower Representative is required by
the terms of the Credit Agreement.

--------------------------------------------------------------------------------

ANNEX 1

ASSIGNMENT AND ASSUMPTION

$400,000,000 Credit Agreement dated as of July 1, 2015 among Urban

Outfitters, Inc. and certain of its subsidiaries, the other Loan Parties party

thereto, the Lenders parties thereto and JPMorgan Chase Bank, N.A., as

Administrative Agent

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of any
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by any
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the
requirements, if any, specified in the Credit Agreement that are required to be
satisfied by it in order to acquire the Assigned Interest and become a Lender,
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 5.01 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the
Administrative Agent or any other Lender, and (v) if it is a Foreign Lender,
attached to the Assignment and Assumption is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor 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 decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts which
have accrued to but excluding the Effective Date and to the Assignee for amounts
which have accrued from and after the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument.

--------------------------------------------------------------------------------

Acceptance of the terms of this Assignment and Assumption by the Assignee and
the Assignor by Electronic Signature or delivery of an executed counterpart of a
signature page of this Assignment and Assumption by any Electronic System shall
be effective as delivery of a manually executed counterpart of this Assignment
and Assumption. This Assignment and Assumption shall be governed by, and
construed in accordance with, the law of the State of New York.

--------------------------------------------------------------------------------

EXHIBIT B

[FORM OF] BORROWING BASE CERTIFICATE

 

LOGO [g118719g95h85.jpg]

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LOGO [g118719iiiimage2.jpg]

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LOGO [g118719g30k92.jpg]

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LOGO [g118719iimage004.jpg]

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EXHIBIT C

RESERVED

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EXHIBIT D

[FORM OF] COMPLIANCE CERTIFICATE

 

To: The Lenders parties to the

Credit Agreement Described Below

This Compliance Certificate is furnished pursuant to that certain Credit
Agreement dated as of July 1, 2015 (as amended, modified, renewed or extended
from time to time, the “Agreement”) among Urban Outfitters, Inc. (the “Company”)
and certain of its subsidiaries (collectively, the “Borrowers”), the other Loan
Parties, the Lenders party thereto and JPMorgan Chase Bank, N.A., as
Administrative Agent for the Lenders. Unless otherwise defined herein,
capitalized terms used in this Compliance Certificate have the meanings ascribed
thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES, ON ITS BEHALF AND ON BEHALF OF THE BORROWERS,
THAT:

1. I am the duly elected                      of the Borrower Representative;

2. I have reviewed the terms of the Agreement and I have made, or have caused to
be made under my supervision, a detailed review of the transactions and
conditions of the Company and its Subsidiaries during the accounting period
covered by the attached financial statements [for quarterly or monthly financial
statements add: and such financial statements present fairly in all material
respects the financial condition and results of operations of the Company and
its consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes];

3. The examinations described in paragraph 2 did not disclose, except as set
forth below, and I have no knowledge of (i) the existence of any condition or
event which constitutes a Default during the accounting period covered by the
attached financial statements or as of the date of this Compliance Certificate
or (ii) any change in GAAP or in the application thereof that has occurred since
the date of the audited financial statements referred to in Section 3.04 of the
Agreement;

4. I hereby certify that the full legal name of each Loan Party and its
jurisdiction of organization is:

 

Loan Party

  

Jurisdiction

        

and further hereby certify that no Loan Party has changed (i) its name, (ii) its
chief executive office, (iii) the type of entity it is, (iv) its organization
identification number or (v) its state of incorporation or organization without
having given the Administrative Agent the notice required by Section 6.03(c) of
the Agreement;

5. Schedule I attached hereto sets forth financial data and computations
evidencing [when Availability is equal to or greater than the Applicable Trigger
Amount (Level I) add: the Fixed Charge Coverage Ratio] [when Availability is
less than the Applicable Trigger Amount (Level I) add: the Borrowers’ compliance
with the covenant set forth in Section 6.12 of the Agreement], all of which data
and computations are true, complete and correct; and

--------------------------------------------------------------------------------

6. Schedule II hereto sets forth the financial data and computations necessary
to determine the Applicable Rate for the Determination Date to which the
financial statements attached hereto relate, all of which data and computations
are true, complete and correct.

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the (i) nature of the condition or event, the period during which it has
existed and the action which the Borrowers have taken, are taking, or propose to
take with respect to each such condition or event or (ii) the change in GAAP or
the application thereof and the effect of such change on the attached financial
statements:

 

 

 

 

The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this      day of
            ,     .

 

URBAN OUTFITTERS, INC., as

Borrower Representative

By:  

 

Name:  

 

Title:  

 

--------------------------------------------------------------------------------

SCHEDULE I

Fixed Charge Coverage Ratio Calculation

 

   For the period of four fiscal quarters ended [                    ]:      
Consolidated Net Income:       Consolidated net income (loss) in accordance with
GAAP    $   [    ,    ,    ]       Excluding :       (a) Extraordinary gains and
extraordinary losses    $ [    ,    ,    ]       (b) Income (deficit) accrued
prior to date it becomes a Subsidiary or is consolidated with Company or any
Subsidiary    $ [    ,    ,    ]       (c) Income (deficit) of any Person (other
than a Subsidiary) in which the Company or any Subsidiaries has an ownership
interest, except to the extent that income is received by the Company or such
Subsidiary as dividends or similar distributions    $ [    ,    ,    ]       (d)
undistributed earnings of any Subsidiary to the extent that the declaration or
payment of dividends or similar distributions 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    $ [    ,    ,    ]       (e)
Any cancellation of Indebtedness income for such period:    $ [    ,    ,    ]
  

1.

   Consolidated Net Income    $ [    ,    ,    ]   

Plus:

         (a) Interest Expense on all Indebtedness (including Capital Leases)
including commissions, discounts, fees and charges on letters of credit and net
costs under interest rate Swap Agreements in respect of interest rates to the
extent such net costs are allocable to such period in accordance with GAAP    $
[    ,    ,    ]       (b) Federal, state, local and foreign income taxes
(excluding Federal, state, local and foreign income tax credits )    $
[    ,    ,    ]       (c) depreciation and amortization expense    $
[    ,    ,    ]       (d) non-cash compensation expenses       (e)
non-recurring non-cash charges (including asset impairment charges, unrealized
foreign currency losses or other unrealized hedge agreement losses, but
excluding non-recurring non-cash charges that relate to the write down/write off
of inventory    $ [    ,    ,    ]   

--------------------------------------------------------------------------------

   (f) other non-recurring losses, costs, charges or cash expenses (including
without limitation, restructuring, business optimization costs, charges or
reserves (including any unusual or non-recurring operating expenses directly
attributable to implementation of cost savings initiatives), and non-recurring
severance, relocation, consolidation, transition, integration or other similar
charges and expenses in an amount not to exceed $25,000,000 in the aggregate   
$   [    ,    ,    ]       (g) costs, fees, expenses, premiums or penalties in
connection with Acquisitions (whether or not consummated) and permitted asset
sales (whether or not consummated) in an amount not to exceed $5,000,000 in the
aggregate (other than asset sales effected in the ordinary course of business)
   $ [    ,    ,    ]       (h) Costs, fees and expenses incurred in connection
with the Transactions    $ [    ,    ,    ]   

Minus:

         (i) Federal, state, local and foreign income tax credits    $
[    ,    ,    ]       (j) non-recurring non-cash items increasing Net Income
(including without limitation foreign currency gains but excluding normal
accruals in the ordinary course of business)    $ [    ,    ,    ]       (k)
non-recurring cash gains of the Company and its Subsidiaries increasing Net
Income for such period:    $ [    ,    ,    ]       (l) Interest income    $
[    ,    ,    ]       (m) Cash payments that were deducted from Net Income and
added back in determining EBITDA in the testing period or a previous testing
period shown above    $ [    ,    ,    ]   

2.

   EBITDA   

Plus:

   Rentals    $ [    ,    ,    ]       The aggregate fixed amounts payable under
any operating leases    $ [    ,    ,    ]   

3.

   EBITDAR    $ [    ,    ,    ]   

4.

   Unfinanced Capital Expenditures   

5.

   EBITDAR less Unfinanced Capital Expenditures    $ [    ,    ,    ]   

6.

   Fixed Charges:       (i) cash Interest Expense, plus    $ [    ,    ,    ]   
   (ii) Rentals, plus    $ [    ,    ,    ]       (iii) scheduled principal
payments on Indebtedness, actually made, plus    $ [    ,    ,    ]       (iv)
expenses for taxes paid in cash, plus    $ [    ,    ,    ]   

--------------------------------------------------------------------------------

   (v) Restricted Payments paid in cash during such period (other than pursuant
to Section 6.08(a)(ii) of the Agreement) plus    $ [    ,    ,    ]       (vi)
Capital Lease Obligations paid in cash for such period       Total Fixed Charges
   $ [    ,    ,    ]   

7.

   Fixed Charge Coverage Ratio: (5/6)=      [    ] to [    ]       Fixed Charge
Coverage Covenant   

--------------------------------------------------------------------------------

SCHEDULE II

Applicable Rate Calculation

 

1.

   Adjusted Leverage Ratio:       (i) Total Funded Indebtedness on such date:   
$ [    ,    ,    ]   

Plus:

   (ii) Rent Liability (8 x Rentals)    $ [    ,    ,    ]   

Less:

   (iii) the aggregate amount of unrestricted cash and Cash Equivalents of
Company and its Subsidiaries (other than the cash proceeds of any Indebtedness
being incurred on such date) in excess of $50,000,000:    $ [    ,    ,    ]   
   EBITDAR for the period of four (4) consecutive fiscal quarters    $
[    ,    ,    ]       Adjusted Leverage Ratio      [    ] to [    ]   

2.

   Applicable Rate Tier: [    ]2   

3.

   Average Quarterly Availability: ((i)-(ii))/(iii)=    $ [    ,    ,    ]      
(i) lesser of Aggregate Commitments and Borrowing Base at such time:    $
[    ,    ,    ]       (ii) the Aggregate Credit Exposure at such time:    $
[    ,    ,    ]       (iii) days in applicable fiscal quarter:      [    ]   

5.

   Applicable Rate Level:      [    ] 3 

6.

   Applicable Rate:       (i) LIBOR / CDOR / EURIBOR Margin:      [    ] %    
(ii) ABR / CABROVER Margin:      [    ] %     (iii) Commitment Fee:      [    ]
% 

 

2  If Adjusted Leverage Ratio < 4.5 to 1.0, indicate “Tier I”. If Adjusted
Leverage Ratio ³ 4.5 to 1.0, indicate “Tier II”.

3  If Average Quarterly Availability is ³ 66% of the Aggregate Commitments,
indicate “Level I”. If Average Quarterly Availability is < 66% of the Aggregate
Commitments but ³ 33% of the Aggregate Commitments, indicate “Level II”. If
Average Quarterly Availability is < 33% of the Aggregate Commitments, indicate
“Level III”.

--------------------------------------------------------------------------------

EXHIBIT E

RESERVED

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EXHIBIT F

[FORM OF] JOINDER AGREEMENT

THIS JOINDER AGREEMENT (this “Agreement”), dated as of             , 20    , is
entered into between                     , a                     (the “New
Subsidiary”) and JPMORGAN CHASE BANK, N.A., in its capacity as administrative
agent (the “Administrative Agent”) under that certain Credit Agreement dated as
of July 1, 2015 (as the same may be amended, modified, extended or restated from
time to time, the “Credit Agreement”) among Urban Outfitters, Inc. and certain
of its subsidiaries (collectively, the “Borrowers”), the other Loan Parties
party thereto, the Lenders party thereto and the Administrative Agent for the
Lenders. All capitalized terms used herein and not otherwise defined herein
shall have the meanings set forth in the Credit Agreement.

The New Subsidiary and the Administrative Agent, for the benefit of the Lenders,
hereby agree as follows:

1. The New Subsidiary hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the New Subsidiary will be deemed to be a Loan
Party under the Credit Agreement and a “Guarantor” pursuant to the Loan Guaranty
contained therein for all purposes of the Credit Agreement and shall have all of
the obligations of a Loan Party and a Guarantor thereunder as if it had executed
the Credit Agreement. The New Subsidiary hereby ratifies, as of the date hereof,
and agrees to be bound by, all of the terms, provisions and conditions contained
in the Credit Agreement, including without limitation (a) all of the
representations and warranties of the Loan Parties set forth in Article III of
the Credit Agreement, (b) all of the covenants set forth in Articles V and VI of
the Credit Agreement and (c) all of the guaranty obligations set forth in
Article X of the Credit Agreement. Without limiting the generality of the
foregoing terms of this paragraph 1, the New Subsidiary, subject to the
limitations set forth in Sections 10.10 and 10.13 of the Credit Agreement,
hereby guarantees, jointly and severally with the other Loan Parties, to the
Administrative Agent and the Lenders, as provided in Article X of the Credit
Agreement, the prompt payment and performance of the Guaranteed Obligations in
full when due (whether at stated maturity, as a mandatory prepayment, by
acceleration or otherwise) strictly in accordance with the terms thereof and
agrees that if any of the Guaranteed Obligations are not paid or performed in
full when due (whether at stated maturity, as a mandatory prepayment, by
acceleration or otherwise), the New Subsidiary will, jointly and severally
together with the other Loan Parties, promptly pay and perform the same, without
any demand or notice whatsoever, and that in the case of any extension of time
of payment or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, as a mandatory
prepayment, by acceleration or otherwise) in accordance with the terms of such
extension or renewal.

2. If required, the New Subsidiary is, simultaneously with the execution of this
Agreement, executing and delivering such Collateral Documents (and such other
documents and instruments) as requested by the Administrative Agent in
accordance with the Credit Agreement.

3. The New Subsidiary hereby waives acceptance by the Administrative Agent and
the Lenders of the guaranty by the New Subsidiary upon the execution of this
Agreement by the New Subsidiary.

4. This Agreement may be executed in any number of counterparts, each of which
when so executed and delivered shall be an original, but all of which shall
constitute one and the same instrument.

--------------------------------------------------------------------------------

5. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.

IN WITNESS WHEREOF, the New Subsidiary has caused this Agreement to be duly
executed by its authorized officer, and the Administrative Agent, for the
benefit of the Lenders, has caused the same to be accepted by its authorized
officer, as of the day and year first above written.

 

[NEW SUBSIDIARY] By:  

 

Name:  

 

Title:  

 

Acknowledged and accepted: JPMORGAN CHASE BANK, N.A., as Administrative Agent
By:  

 

Name:  

 

Title:  

 

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EXHIBIT G-1

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the Credit Agreement dated as of July 1, 2015 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”) among Urban Outfitters, Inc. and certain of its subsidiaries
(collectively, the “Borrowers”), the other Loan Parties party thereto, the
Lenders party thereto and JPMorgan Chase Bank, N.A., in its capacity as
Administrative Agent for the Lenders.

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the Loan(s) (as well as any promissory note(s) evidencing such Loan(s)) in
respect of which it is providing this certificate, (ii) it is not a bank within
the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent
shareholder of any Borrower within the meaning of Section 871(h)(3)(B) of the
Code and (iv) it is not a controlled foreign corporation related to any Borrower
as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower
Representative with a certificate of its non-U.S. Person status on IRS Form
W-8BEN. By executing this certificate, the undersigned agrees that (1) if the
information provided on this certificate changes, the undersigned shall promptly
so inform the Borrower Representative and the Administrative Agent, and (2) the
undersigned shall have at all times furnished the Borrower Representative and
the Administrative Agent with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER] By:  

 

Name:   Title:   Date:             ,     , 20[    ]

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EXHIBIT G-2

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the Credit Agreement dated as of July 1, 2015 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”) among Urban Outfitters, Inc. and certain of its subsidiaries
(collectively, the “Borrowers”), the other Loan Parties party thereto, the
Lenders party thereto and JPMorgan Chase Bank, N.A., in its capacity as
Administrative Agent for the Lenders.

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and beneficial owner
of the participation in respect of which it is providing this certificate,
(ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code,
(iii) it is not a ten percent shareholder of any Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign
corporation related to any Borrower as described in Section 881(c)(3)(C) of the
Code.

The undersigned has furnished its participating Lender with a certificate of its
non-U.S. Person status on IRS Form W-8BEN. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform such Lender in writing, and
(2) the undersigned shall have at all times furnished such Lender with a
properly completed and currently effective certificate in either the calendar
year in which each payment is to be made to the undersigned, or in either of the
two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT] By:  

 

Name:   Title:   Date:             ,     , 20[    ]

--------------------------------------------------------------------------------

EXHIBIT G-3

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to the Credit Agreement dated as of July 1, 2015 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”) among Urban Outfitters, Inc. and certain of its subsidiaries
(collectively, the “Borrowers”), the other Loan Parties party thereto, the
Lenders party thereto and JPMorgan Chase Bank, N.A., in its capacity as
Administrative Agent for the Lenders.

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the
participation in respect of which it is providing this certificate, (ii) its
direct or indirect partners/members are the sole beneficial owners of such
participation, (iii) with respect such participation, neither the undersigned
nor any of its direct or indirect partners/members is a bank extending credit
pursuant to a loan agreement entered into in the ordinary course of its trade or
business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of
its direct or indirect partners/members is a ten percent shareholder of any
Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of
its direct or indirect partners/members is a controlled foreign corporation
related to any Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an
IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such
partner’s/member’s beneficial owners that is claiming the portfolio interest
exemption. By executing this certificate, the undersigned agrees that (1) if the
information provided on this certificate changes, the undersigned shall promptly
so inform such Lender and (2) the undersigned shall have at all times furnished
such Lender with a properly completed and currently effective certificate in
either the calendar year in which each payment is to be made to the undersigned,
or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT] By:  

 

Name:   Title:   Date:            ,     , 20[    ]

--------------------------------------------------------------------------------

EXHIBIT G-4

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Credit Agreement dated as of July 1, 2015 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”) among Urban Outfitters, Inc. and certain of its subsidiaries
(collectively, the “Borrowers”), the other Loan Parties party thereto, the
Lenders party thereto and JPMorgan Chase Bank, N.A., in its capacity as
Administrative Agent for the Lenders.

Pursuant to the provisions of Section 2.17 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the Loan(s)
(as well as any promissory note(s) evidencing such Loan(s)) in respect of which
it is providing this certificate, (ii) its direct or indirect partners/members
are the sole beneficial owners of such Loan(s) (as well as any promissory
note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit
pursuant to the Credit Agreement or any other Loan Document, neither the
undersigned nor any of its direct or indirect partners/members is a bank
extending credit pursuant to a loan agreement entered into in the ordinary
course of its trade or business within the meaning of Section 881(c)(3)(A) of
the Code, (iv) none of its direct or indirect partners/members is a ten percent
shareholder of any Borrower within the meaning of Section 871(h)(3)(B) of the
Code and (v) none of its direct or indirect partners/members is a controlled
foreign corporation related to any Borrower as described in Section 881(c)(3)(C)
of the Code.

The undersigned has furnished the Administrative Agent and the Borrower
Representative with IRS Form W-8IMY accompanied by one of the following forms
from each of its partners/members that is claiming the portfolio interest
exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an
IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is
claiming the portfolio interest exemption. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform the Borrower Representative
and the Administrative Agent, and (2) the undersigned shall have at all times
furnished the Borrower Representative and the Administrative Agent with a
properly completed and currently effective certificate in either the calendar
year in which each payment is to be made to the undersigned, or in either of the
two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER] By:  

 

Name:   Title:   Date:             ,     , 20[    ]