Exhibit 10.2

 

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CONFIDENTIAL

 

May 29, 2015

 

Boot Barn, Inc.

15776 Laguna Canyon Road

Irvine, CA  92618

Attn:                    Mr. Greg Hackman, Chief Financial Officer

 

Boot Barn, Inc.
$200,000,000 Senior Secured Term Loan Facility

 

Ladies and Gentlemen:

 

Boot Barn, Inc. (“Boot Barn”, the “Borrower” or “you”) has advised GCI Capital
Markets LLC (“Golub” or the “Initial Lender”) that you intend to (a) acquire all
of the equity interests of Sheplers Holding Corporation, a Delaware corporation
(the “Target”), from Gryphon Partners III, L.P., affiliates thereof and the
other holders of equity interests in the Target (collectively, the “Seller”)
pursuant to a merger of the Target with and into Rodeo Acquisition Corp., a
Delaware corporation, a newly created merger subsidiary wholly-owned by you,
with the Target as the survivor (the “Merger”) and (b) consummate the other
Transactions (as defined below).  Each capitalized term used but not defined
herein shall have the meaning assigned to such term in the Summary of Principal
Terms and Conditions attached hereto as Exhibit A (the “Term Sheet”).

 

You have further advised Golub that, in connection therewith, the Borrower will
obtain (a) the senior secured term loan facility described in the Term Sheet in
an aggregate principal amount of $200,000,000 (the “Term Loan Facility”) and
(b) the senior secured asset-based revolving credit facility in an aggregate
principal amount of up to $125,000,000 pursuant to the terms of the ABL Facility
Commitment Letter (the “ABL Facility” and collectively with the Term Loan
Facility, the “Facilities”).  The Merger and the transactions described in this
paragraph are collectively referred to herein as the “Transactions”.

 

1.                                      Commitments.

 

In connection with the foregoing, the Initial Lender is pleased to advise you of
its commitment to provide the entire principal amount of the Term Loan Facility,
upon the terms set forth or referred to in this commitment letter (including the
Term Sheet and other attachments hereto, this “Commitment Letter”) and subject
solely to the conditions set forth in Section 6 below and Exhibit B hereto.

 

2.                                      Titles and Roles.

 

You hereby appoint (a) Golub to act, and Golub hereby agrees to act, as sole
bookrunner and sole lead arranger for the Term Loan Facility (Golub, in such
capacity, the “Arranger”), and (b) Golub to act,

 

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and Golub hereby agrees to act, as sole administrative agent for the Term Loan
Facility (Golub, in such capacity, the “Agent”; Golub, in its capacities as
Initial Lender, Arranger and Agent, is referred to herein at times as the
“Commitment Parties,” “we” or “us”), in each case upon the terms set forth or
referred to in this Commitment Letter and subject solely to the conditions set
forth in Section 6 below and Exhibit B hereto.  Each of the Arranger and the
Agent, in such capacities, will perform the duties and exercise the authority
customarily performed and exercised by it in such roles.

 

3.                                      Syndication.

 

The Arranger reserves the right, prior to and/or after the execution of the
Facilities Documentation, to syndicate up to 62.5% of the Initial Lender’s
commitment with respect to the Term Loan Facility to a group of banks, financial
institutions and other institutional lenders (together with the Initial Lender,
the “Lenders”) identified by us in consultation with you, and acceptable to you
(such acceptance not to be unreasonably withheld, delayed or conditioned), and
you agree to provide the Arranger with the Marketing Period (as defined in
Exhibit B attached hereto).  With respect to the commencement of the syndication
period referred to above, if you reasonably believe you have delivered the
Information Materials (as defined below), you may deliver to the Arranger
written notice to that effect, in which case the Marketing Period shall be
deemed to have commenced on the date of completion specified in such notice
unless the Arranger in good faith believes that such Information Materials are
not in final form and, within two business days after receipt of such notice
from you, the Arranger delivers a written notice to you to that effect and
stating in reasonable detail, the deficiencies of such Information Materials.

 

Notwithstanding the foregoing, the Arranger will not syndicate, assign or
participate to (i) those banks, financial institutions and other institutional
lenders and investors that have been separately identified in writing by you to
us prior to the date of this Commitment Letter and reasonably acceptable to the
Commitment Parties, (ii) those persons who are competitors of Boot Barn or the
Target or any of their respective subsidiaries that are separately identified in
writing by you to us prior to the date of this Commitment Letter and (iii) in
the case of each of clauses (i) and (ii), any of their affiliates that are
identified in writing by you to us prior to the date of this Commitment Letter
(clauses (i), (ii) and (iii) above, collectively, the “Disqualified Lenders”). 
Notwithstanding our right to syndicate the Term Loan Facility and receive
commitments with respect thereto, the Initial Lender will not be relieved of all
or any portion of its commitment hereunder prior to the initial funding on the
Closing Date as a result of such syndication, assignment or participation. 
Without limiting your obligations to assist with syndication as set forth below,
we agree that the Initial Lender’s commitment hereunder is not conditioned upon
the syndication of, or receipt of commitments in respect of, the Term Loan
Facility, and in no event shall the commencement or completion of syndication of
the Term Loan Facility constitute a condition to the availability of the Term
Loan Facility on the Closing Date.  We intend to commence syndication efforts
promptly upon the execution of this Commitment Letter, and until the earlier of
60 days after the Closing Date and the date on which the Initial Lender holds
loans and commitments of no more than $130,000,000 with respect to the Term Loan
Facility (a “Successful Syndication”), you agree to assist us in completing a
Successful Syndication.  Such assistance shall include: (a) your using
commercially reasonable efforts to ensure that any syndication efforts benefit
from your existing lending and investment banking relationships, (b) direct
contact between your senior management and your representatives and non-legal
advisors (and your using commercially reasonable efforts to arrange direct
contact between senior management and representatives of the Target) and the
proposed Lenders, in each case during regular business hours and upon reasonable
prior notice, (c) assistance by you (and your using commercially reasonable
efforts to cause the Target to assist) in the preparation (including, without
limitation, delivery of information customarily delivered by a borrower and
reasonably necessary for the preparation and delivery of a customary
Confidential Information Memorandum) of a customary Confidential Information
Memorandum for the Term Loan Facility (the “Information Materials”)

 

Commitment Letter

 

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and (d) to the extent necessary or required to achieve a Successful Syndication,
your using commercially reasonable efforts to obtain a private corporate credit
rating from Standard & Poor’s, a division of The McGraw-Hill Companies, Inc.
(“S&P”), and a private corporate family rating from Moody’s Investors
Service, Inc. (“Moody’s”), in each case with respect to the Borrower, and public
ratings for the Term Loan Facility from each of S&P and Moody’s; provided,
however that obtaining such ratings shall not be a condition to the closing of
the Term Loan Facility or the funding of the Term Loans on the Closing Date,
(e) your using commercially reasonable efforts to ensure that, until the earlier
of 60 days after the Closing Date and the achievement of a Successful
Syndication, there shall be no debt securities or commercial bank or other
credit facilities of Holdings, the Borrower, the Target or their respective
subsidiaries being offered, placed or arranged (other than the Facilities and
indebtedness expressly permitted under the Merger Agreement or that would not
(in the reasonable judgment of the Arranger), be reasonably expected to have a
material adverse effect on the syndication of the Term Loan Facility), and
(f) the hosting during regular business hours upon reasonable prior notice, with
the Arranger, of one (or if reasonably requested by the Arranger, a reasonable
number of additional) meetings of prospective Lenders.  Notwithstanding anything
to the contrary contained in this Commitment Letter or the Fee Letter, neither
the compliance with any of the provisions of this paragraph or the other
provisions of this Commitment Letter nor the commencement or the completion of
the syndication of the Term Loan Facility (but subject, in all respects, to the
satisfaction of the conditions set forth in Section 6 below and Exhibit B
hereto) shall constitute a condition precedent to the Closing Date.  For the
avoidance of doubt, your commercially reasonable efforts to cause the Target or
its management to do or assist with any of the provisions of this paragraph
shall not include actions or assistance to the extent the same would be in
contravention of the Merger Agreement or applicable laws or regulations.

 

You acknowledge that certain of the Lenders may be “public side” Lenders (i.e.
Lenders that do not wish to receive material non-public information (within the
meaning of the  United States federal securities laws, “MNPI”) with respect to
the Borrower and the Target, or their respective affiliates or any of their
respective securities) (each, a “Public Lender”).  You agree, at the request of
the Arranger, to assist in the preparation of a version of the Information
Materials to be used in connection with the syndication of the Term Loan
Facility, that does not contain material non-public information concerning the
Borrower and the Target or their respective affiliates or securities.  It is
understood that in connection with your assistance described above, you will
provide, and use commercially reasonable efforts to cause the Target to provide,
authorization letters authorizing the distribution of the Information Materials
to prospective Lenders and continuing a representation to the Arranger, in the
case of the public-side version, that such Information Materials do not contain
material non-public information about the Borrower, the Target or their
respective affiliates or their respective securities.  In addition, the Borrower
will use commercially reasonable efforts to identify that portion of the
Information Materials that may be distributed to Public Lenders as containing
only public Information (as defined below).  You acknowledge that the following
documents may be distributed to all prospective Lenders (unless you notify us
promptly prior to their intended distribution that any such document contains
MNPI; provided that you have been given a reasonable opportunity to review the
following documents): (1) drafts and final definitive documentation with respect
to the Term Loan Facility, including term sheets; (2) administrative materials
prepared by the Commitment Parties for prospective Lenders (such as a lender
meeting invitation, bank allocation, if any, and funding and closing memoranda);
(3) notification of changes in the terms of the Term Loan Facility; and
(4) other administrative materials (excluding the Projections (as defined
below)) intended for prospective Lenders after the initial distribution of
Information Materials.

 

The Arranger will manage all aspects of any syndication in consultation with
you, including decisions as to the selection of institutions to be approached
and when they will be approached, when their commitments will be accepted, which
institutions will participate, the allocation of the commitments among the
Lenders, any naming rights and the amount and distribution of fees among the
Lenders;

 

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provided that (i) selection of Lenders, naming rights, the amounts and
distribution of fees among the Lenders and the allocation of the commitments
thereto shall be subject to your approval, not to be unreasonably withheld,
delayed or conditioned and (ii) Disqualified Lenders shall not be part of the
syndication.

 

4.                                      Information.

 

You hereby represent and warrant (which representation and warranty is provided
to your knowledge insofar as it applies to information concerning the Target and
its subsidiaries and their business) that (a) all written information (other
than the financial projections (the “Projections”) and other forward-looking
information and information with respect to general economic or industry data)
(the “Information”) that has been or will be made available to any Commitment
Party by or on behalf of you or any of your representatives in connection with
the Transactions was or will be, when first furnished and taken as a whole,
complete and correct in all material respects and did not or will not, when
furnished and taken as a whole, 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 are made and (b) the Projections that have been or will be
made available to any Commitment Party by or on behalf of you or any of your
representatives have been or will be prepared in good faith based upon
assumptions that are believed by you to be reasonable at the time made or at the
time the related Projections are made available to such Commitment Party, as
applicable (it being understood that projections by their nature are inherently
uncertain, that actual results may differ significantly from the projected
results and that such differences may be material and no assurances are being
given that the results reflected in the Projections will be achieved).  You
agree that if at any time prior to the later of (i) the closing of the Term Loan
Facility and (ii) the earlier of (x) 60 days after the Closing Date and (y) the
completion of a Successful Syndication, any of the representations in the
preceding sentence would be incorrect (to your knowledge insofar as it applies
to information concerning the Target and its subsidiaries and their business) if
the Information and Projections were being furnished, and such representations
were being made, at such time, then you will (or, prior to the Closing Date,
with respect to Information and Projections relating to the Target and its
subsidiaries, you will use commercially reasonable efforts to) promptly
supplement the Information and the Projections so that such representations will
be correct, taken as a whole, under those circumstances.

 

5.                                      Fees.

 

As consideration for the Initial Lender’s commitment hereunder, and our
agreements to perform the services described herein, you agree to pay to the
Commitment Parties the fees set forth in this Commitment Letter and in the Fee
Letter dated the date hereof and delivered herewith with respect to the Term
Loan Facility (the “Fee Letter”).

 

6.                                      Conditions Precedent.

 

The Initial Lender’s commitments hereunder, and our agreements to perform the
services described herein, are subject only to (a) the condition that since
March 31, 2015, there shall not have occurred any Material Adverse Effect (as
defined in the Merger Agreement), and (b) the conditions set forth in this
Section 6 and (c) the other conditions set forth in Exhibit B hereto
(collectively, the conditions referred to in clauses (a) through (c) hereof, 
the “Exclusive Financing Conditions”).

 

Notwithstanding anything in this Commitment Letter (including each of the
exhibits hereto), the Fee Letter, the Facilities Documentation or any other
agreement or undertaking relating to the Term Loan Facility to the contrary,
(a) the only representations relating to the Target and its subsidiaries,
businesses and assets, the making and accuracy of which shall be a condition to
the availability of the Term Loan

 

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Facility on the Closing Date, shall be (i) such of the representations made by
or on behalf of the Target (or any of its affiliates or subsidiaries) in the
Merger Agreement as are material to the interests of the Lenders (as defined in
the Term Sheet), but only to the extent that you have (or any of your affiliates
or subsidiaries have) the right not to consummate the Merger or the right to
terminate (or cause the termination of) your (or its) obligations under the
Merger Agreement as a result of a breach of such representations in the Merger
Agreement (the “Specified Merger Agreement Representations”) and (ii) the
Specified Representations (as defined below) and (b) the terms of the Facilities
Documentation shall be in a form such that they do not impair the availability
of the Term Loan Facility on the Closing Date if the Exclusive Financing
Conditions are satisfied ((it being understood that (A) other than with respect
to any UCC Filing Collateral, Stock Certificates or Intellectual Property (each
as defined below), to the extent any Collateral cannot be delivered, or a
security interest therein cannot be perfected, on the Closing Date after your
use of commercially reasonable efforts to do so, the delivery of, or perfection
of a security interest in, such Collateral shall not constitute a condition
precedent to the availability of the Term Loan Facility on the Closing Date, but
such Collateral shall instead be required to be delivered, or a security
interest therein perfected, within 90 (or in the case of required deposit
account control agreements or securities account control agreements, 120) days
after the Closing Date (or such longer period as Agent may hereafter agree),
(B) with respect to perfection of security interests in UCC Filing Collateral,
your sole obligation shall be to deliver, or cause to be delivered, necessary
UCC financing statements to the Agent and to irrevocably authorize and to cause
the applicable guarantor to irrevocably authorize the Agent to file such UCC
financing statements, (C) with respect to perfection of security interests in
Stock Certificates, your sole obligation shall be to deliver to the Agent or its
legal counsel Stock Certificates together with undated stock powers executed in
blank and (D) with respect to perfection of security interests in Intellectual
Property, in addition to the actions required by clause (B), your sole
obligation shall be to execute and deliver, or cause to be executed and
delivered, necessary intellectual property security agreements to the Agent in
proper form for filing with the United States Patent and Trademark Office (the
“USPTO”) and the United States Copyright Office (the “USCO”) and to irrevocably
authorize, and to cause the applicable guarantor to irrevocably authorize, the
Agent to file such intellectual property security agreements with the USPTO and
USCO).  For purposes hereof, (1) “UCC Filing Collateral” means Collateral
consisting of assets of the Loan Parties (as defined in the Term Sheet) for
which a security interest can be perfected by filing a Uniform Commercial Code
financing statement, (2) “Stock Certificates” means Collateral consisting of
stock (or other) certificates representing capital stock or other equity
interests of the Loan Parties and their respective domestic subsidiaries
required to be pledged as Collateral pursuant to the Term Sheet,
(3) “Intellectual Property” means all patents, patent applications, trademarks,
trade names, service marks and copyrights registered with the USPTO or the USCO,
as applicable, and (4) “Specified Representations” means the representations and
warranties set forth in the Precedent Credit Agreement (as defined below)
relating to power and authority, due authorization, execution and delivery, in
each case as they relate to the entering into and performance of the Facilities
Documentation, corporate existence, the enforceability of the Facilities
Documentation, Federal Reserve margin regulations, the use of proceeds violating
the PATRIOT Act (as defined below) or OFAC, anti-money laundering regulations,
the Investment Company Act, no conflicts between the Facilities Documentation
and the organization documents of the Loan Parties, status of the Term Loan
Facility and the guarantees thereof as senior debt, solvency as of the Closing
Date (after giving effect to the Transactions) of Holdings and its Subsidiaries
on a consolidated basis (with solvency determined in a manner consistent with
Exhibit C attached hereto) and subject to the limitations set forth in the prior
sentence, creation, validity, perfection and priority of security interests, in
each case, subject to the Documentation Principles.  This paragraph, and the
provisions herein, shall be referred to as the “Limited Conditionality
Provisions.”

 

Notwithstanding anything to the contrary contained herein, the definitive
documentation for the Facilities (the “Facilities Documentation”) shall: (a) be
consistent with the Term Sheet and with Exhibit D, (b) except as otherwise
specified in this Commitment Letter, the Term Sheet or Exhibit D, be

 

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substantially consistent with, and give due regard to, that certain Credit
Agreement, dated as of February 23, 2015, by and among Boot Barn Holdings, Inc.
(“Holdings”), the Borrower, the lenders from time to time parties thereto and
Wells Fargo Bank, National Association, as administrative agent thereunder (the
“Precedent Credit Agreement”), and each of the “Loan Documents” referred to
therein (the “Precedent Ancillary Documents” and collectively with the Precedent
Credit Agreement, the “Precedent Loan Documents”) and (c) except as otherwise
set forth in the this Commitment Letter, the Term Sheet or Exhibit D, contain
only the representations, warranties, affirmative covenants, negative covenants,
financial covenants, events of default, financial reporting requirements,
remedies, yield protection, indemnification and expense reimbursement
provisions, mandatory prepayments and voluntary prepayments as are contained in
the Precedent Loan Documents, with only such amendments thereto as shall be
specifically set forth herein or in the Term Sheet and as are usual and
customary for financings of this type and with such adjustments to the
applicable qualifications, thresholds, exceptions for materiality or otherwise,
“baskets”, and grace and cure periods as shall (together with any other terms
not expressly set forth in this Commitment Letter, the Term Sheet or Exhibit D,
but are instead to be determined in accordance with a specified standard or
principle, it being understood and agreed that except as otherwise specified in
this this Commitment Letter, the Term Sheet or Exhibit D, the Precedent Credit
Agreement shall be modified to reflect the Agent’s standard loan administration
and funding terms, conditions (other than with respect to the initial Term Loan
funded on the Closing Date) and mechanics for a transaction of this size and
type for borrowers substantially similar to Borrower), (i) be mutually agreed,
(ii) be negotiated in good faith in accordance with such standard or principle
to finalize such documentation, giving effect to the Limited Conditionality
Provisions, as promptly as practicable after the acceptance of this Commitment
Letter (it being understood that the only conditions precedent to fund the Term
Loan Facility on the Closing Date are the Exclusive Financing Conditions) and
(iii) give due regard to the (A) the status of the Term Loan Facility as a
credit facility separate from the ABL Facility, (B) increases in the size of the
Term Loan Facility and the ABL Facility compared to the term loan and revolving
credit facilities under the Precedent Credit Agreement, (C) the most recent
model delivered to the Arranger and (D) the operational and strategic
requirements of the Borrower, the Guarantors, the Target and their respective
subsidiaries in light of their consolidated capital structure, size, industry
and practices (including, without limitation, the leverage profile and
projections and matters disclosed in the Merger Agreement), in each case, after
giving effect to the Transactions.  This paragraph and the provisions herein are
referred to as the “Documentation Principles”.

 

7.                                      Indemnification; Expenses.

 

You agree (a) to indemnify and hold harmless each Commitment Party and its
respective officers, affiliates, directors, employees, agents, advisors,
representatives, controlling persons, members and successors and assigns (each,
an “Indemnified Person”) from and against any and all losses, claims, damages,
liabilities and reasonable and documented expenses, joint or several, to which
any such Indemnified Person may become subject arising out of or in connection
with this Commitment Letter, the Fee Letter, the Transactions, the Merger
Agreement, the Term Loan Facility or any related transaction or any claim,
litigation, investigation or proceeding relating to any of the foregoing,
regardless of whether any such Indemnified Person is a party thereto (and
regardless of whether such matter is initiated by a third party or by the
Borrower, the Target or any of their respective affiliates or equity holders),
and to reimburse each such Indemnified Person upon demand for any reasonable and
documented legal or other expenses incurred in connection with investigating or
defending any of the foregoing; provided that the foregoing indemnity will not,
as to any Indemnified Person, apply to losses, claims, damages, liabilities or
related expenses to the extent they are found in a final, non-appealable
judgment of a court of competent jurisdiction to have resulted from (i) the
willful misconduct, bad faith or gross negligence of such Indemnified Person or
any of its officers, directors, employees, and controlled affiliates, (ii) the
material breach of the obligations of such Indemnified Person under this
Commitment Letter or the Fee Letter or (iii) any proceeding that does not
involve an act or omission by you or any of your affiliates and that is

 

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brought by an Indemnified Person against any other Indemnified Person other than
an Indemnified Person acting in its capacity as arranger, agent, bookrunner or
similar capacity, (b) if the Closing Date occurs, to reimburse each Commitment
Party from time to time, upon presentation of a summary statement, for all
reasonable and documented out-of-pocket expenses (including, but not limited to,
expenses of the Commitment Parties’ due diligence investigation, appraisals and
other third party expenses incurred in connection with the audit examinations
and inventory appraisals, consultants’ fees, syndication expenses, travel
expenses and fees, disbursements and other charges of counsel; provided that,
fees of counsel to be paid on the Closing Date incurred in connection with the
Term Loan Facility and the preparation and negotiation of this Commitment
Letter, the Fee Letter, the Facilities Documentation and any ancillary documents
and security arrangements in connection therewith shall not exceed the amount
set forth in the Fee Letter), and (c) regardless of whether the Closing Date
occurs, to reimburse each Commitment Party from time to time, upon presentation
of a summary statement, for all reasonable and documented out-of-pocket expenses
(including, but not limited to, consultants’ fees, travel expenses and fees,
disbursements and other charges of counsel), incurred in connection with the
enforcement of this Commitment Letter, the Fee Letter, the Facilities
Documentation and any ancillary documents and security arrangements in
connection therewith.  Notwithstanding the foregoing, in no event will you be
liable for the costs and expenses of more than one firm of legal counsel for all
Indemnified Persons selected by the Agent and/or Arranger (and one additional
firm of local counsel in each applicable jurisdiction and, as reasonably
determined by Agent or Arranger to be necessary, one special regulatory counsel)
unless representation by one such firm would present actual or potential
conflicts of interest, in which case you will be liable for the costs and
expenses of one firm of legal counsel for each affected party (and, if
reasonably necessary, one additional firm of local counsel in each applicable
jurisdiction and one special regulatory counsel for each such affected party). 
Each of the parties hereto agrees that, notwithstanding any other provision of
this Commitment Letter, none of you (or any of your subsidiaries or affiliates),
the Target (or any of its subsidiaries or affiliates), or any Indemnified Person
shall have any liability (whether direct or indirect, in contract or tort or
otherwise) arising out of, related to or in connection with any aspect of the
Transactions, except to the extent of direct, as opposed to special, indirect,
consequential or punitive, damages.

 

8.                                      Sharing Information; Absence of
Fiduciary Relationship; Affiliate Activities.

 

You acknowledge that each Commitment Party may be providing debt financing,
equity capital or other services (including financial advisory services) to
other companies in respect of which you or Target or your or its respective
subsidiaries or affiliates may have conflicting interests regarding the
transactions described herein or otherwise.  You also acknowledge that we do not
have any obligation to use in connection with the transactions contemplated by
this Commitment Letter, or to furnish to you, confidential information obtained
by us from other companies.

 

You further acknowledge and agree that (a) no fiduciary or advisory relationship
between you and any Commitment Party is intended to be or has been created in
respect of any of the transactions contemplated by this Commitment Letter,
irrespective of whether such Commitment Party has advised or is advising you on
other matters, (b) each Commitment Party, on the one hand, and you, on the other
hand, have an arm’s-length business relationship that does not directly or
indirectly give rise to, nor do you rely on, any fiduciary duty on the part of
such Commitment Party, (c) you are capable of evaluating and understanding, and
you understand and accept, the terms, risks and conditions of the transactions
contemplated by this Commitment Letter, (d) you have been advised that each
Commitment Party is engaged in a broad range of transactions that may involve
interests that differ from your interests and those of the Target and that no
Commitment Party has any obligation to disclose such interests and transactions
to you by virtue of any fiduciary, advisory or agency relationship and (e) you
waive, to the fullest extent permitted by law, any claims you may have against
any Commitment Party for breach of fiduciary duty or alleged breach of fiduciary
duty and agree that no Commitment Party shall have any

 

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liability (whether direct or indirect) to you in respect of such a fiduciary
duty claim or to any person asserting a fiduciary duty claim on behalf of or in
right of you, including your  equity holders, employees or creditors. 
Additionally, you acknowledge and agree that no Commitment Party is advising you
as to any legal, tax, investment, accounting or regulatory matters in any
jurisdiction (including, without limitation, with respect to any consents needed
in connection with the transactions contemplated hereby).  You shall consult
with your own advisors concerning such matters and shall be responsible for
making your own independent investigation and appraisal of the transactions
contemplated hereby (including, without limitation, with respect to any consents
needed in connection therewith), and no Commitment Party shall have any
responsibility or liability to you with respect thereto.  Any review by any
Commitment Party of Holdings, the Borrower, the Target, the Transactions, the
other transactions contemplated hereby or other matters relating to such
transactions will be performed solely for the benefit of such Commitment Party
and shall not be on behalf of you or any of your affiliates.

 

You further acknowledge that each Commitment Party is a full-service securities
firm engaged in securities trading and brokerage activities as well as providing
investment banking and other financial services.  In the ordinary course of
business, each Commitment Party may provide investment banking and other
financial services to, and/or acquire, hold or sell, for its own accounts and
the accounts of customers, equity, debt and other securities and financial
instruments (including bank loans and other obligations) of you, the Target and
other companies with which you or the Target may have commercial or other
relationships.  With respect to any securities and/or financial instruments so
held by any Commitment Party or any of its customers, all rights in respect of
such securities and financial instruments, including any voting rights, will be
exercised by the holder of the rights, in its sole discretion.

 

9.                                      Assignments; Amendments; Etc.

 

This Commitment Letter shall not be assignable by you without the prior written
consent of each Commitment Party (and any attempted assignment without such
consent shall be null and void), is intended to be solely for the benefit of the
parties hereto (and Indemnified Persons), and is not intended to confer any
benefits upon, or create any rights in favor of, any person other than the
parties hereto (and Indemnified Persons).  Any and all obligations of, and
services to be provided by, any Commitment Party hereunder (including, without
limitation, the Initial Lender’s commitment) may be performed and any and all
rights of any Commitment Party hereunder may be exercised by or through any of
its respective affiliates or branches (provided that the Initial Lender shall
not be relieved of all or any portion of its commitment hereunder as a result of
any such action) and, in connection with such performance or exercise, such
Commitment Party may on a confidential basis exchange (subject to Section 12
hereof) with such affiliates or branches information concerning you and your
affiliates that may be the subject of the transactions contemplated hereby and,
to the extent so employed, such affiliates and branches shall be entitled to the
benefits afforded to such Commitment Party hereunder.  This Commitment Letter
may not be amended or any provision hereof waived or modified except by an
instrument in writing signed by each Commitment Party and you.  This Commitment
Letter may be executed in any number of counterparts, each of which shall be an
original and all of which, when taken together, shall constitute one agreement. 
Delivery of an executed counterpart of a signature page of this Commitment
Letter by facsimile or other electronic transmission shall be effective as
delivery of a manually executed counterpart hereof.  Section headings used
herein are for convenience of reference only, are not part of this Commitment
Letter and are not to affect the construction of, or to be taken into
consideration in interpreting, this Commitment Letter. This Commitment Letter
and the Fee Letter supersede all prior understandings, whether written or oral,
between us with respect to the Term Loan Facility.

 

You acknowledge that information and documents relating to the Term Loan
Facility may be transmitted through SyndTrak, Intralinks, the Internet, e-mail
or similar electronic transmission systems,

 

8

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and that no Commitment Party shall be liable for any damages arising from the
unauthorized use by others of information or documents transmitted in such
manner except to the extent such damages are found in a final, non-appealable
judgment of a court of competent jurisdiction to have resulted primarily from
the willful misconduct or gross negligence of such Commitment Party (it being
understood that actions consistent with industry practice in the leveraged
lending market shall not constitute gross negligence or willful misconduct).

 

10.                               Jurisdiction; Governing Law.

 

Each of the parties hereto hereby irrevocably and unconditionally (a) submits,
for itself and its property, to the exclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in the Borough of
Manhattan in New York City, and any appellate court from any thereof, in any
suit, action or proceeding arising out of or relating to this Commitment Letter,
the Fee Letter or the transactions contemplated hereby or thereby, and agrees
that all claims in respect of any such suit, action or proceeding may be heard
and determined only in such New York State court or, to the extent permitted by
law, in such Federal court, (b) 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 Commitment Letter, the Fee Letter or the transactions contemplated hereby
or thereby in any New York State court or in any such Federal court, (c) waives,
to the fullest extent permitted by law, the defense of an inconvenient forum to
the maintenance of such suit, action or proceeding in any such court and
(d) agrees that a final judgment in any such suit, 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.  Service of any process, summons, notice or
document by registered mail addressed to you at the address above shall be
effective service of process against you for any suit, action or proceeding
brought in any such court.

 

THIS COMMITMENT LETTER AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR
RELATED TO THIS COMMITMENT LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.  NOTWITHSTANDING THE
FOREGOING, THE INTERPRETATION OF THE DEFINITION OF “MATERIAL ADVERSE EFFECT” AS
DEFINED IN THE MERGER AGREEMENT, ANY DETERMINATION AS TO OCCURRENCE OR
NON-OCCURRENCE OF SUCH A “MATERIAL ADVERSE EFFECT,”  AND ANY DETERMINATION AS TO
WHETHER ANY SPECIFIED MERGER AGREEMENT REPRESENTATION SHALL HAVE BEEN BREACHED
SHALL, IN EACH CASE, BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES WHICH WOULD RESULT IN THE APPLICATION OF THE LAW OF ANY OTHER
STATE.

 

11.                               Waiver of Jury Trial.

 

EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY
SUIT, ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY
PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER, THE FEE LETTER OR THE
PERFORMANCE OF SERVICES HEREUNDER OR THEREUNDER.

 

12.                               Confidentiality.

 

This Commitment Letter is delivered to you on the understanding that neither
this Commitment Letter nor the Fee Letter nor any of their terms or substance,
nor the activities of any Commitment Party

 

9

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pursuant hereto, shall be disclosed, directly or indirectly, to any other person
except (a) to your affiliates, officers, directors, employees, attorneys,
accountants and advisors on a confidential and need-to-know basis, (b) in the
case of this Commitment Letter, to Moody’s and S&P in connection with their
review of the Term Loan Facility or the Borrower, (c) upon the request or demand
of any regulatory body having jurisdiction over you (in which case, you agree,
to the extent permitted by law, to use commercially reasonable efforts inform us
promptly in advance thereof), (d) this Commitment Letter but not the Fee Letter,
in any required filings with the Securities and Exchange Commission and other
applicable regulatory authorities and stock exchanges, (e) as required by
applicable law or compulsory legal process (in which case you agree, to the
extent permitted by applicable law or such compulsory legal process, to use
commercially reasonable efforts to inform us promptly thereof prior to such
disclosure), (f) the aggregate fee amounts contained in the Fee Letter and the
Term Sheet may be disclosed as part of Projections, pro forma information or a
generic disclosure of aggregate sources and uses related to fee amounts related
to the Transactions to the extent customary or required in offering, marketing
or other disclosure materials for the Term Loan Facility and/or the Facilities
Documentation or in any public filing relating to the Transactions, (g) this
Commitment Letter (but not the Fee Letter) may be filed in any public record in
which you are required by applicable law or regulation on the advice of your
counsel to file it, and (h) the Term Sheet may be disclosed in any offering
memoranda or registration statements relating to the  offering or in any
syndication or other marketing materials in connection with the Term Loan
Facility or the Facilities Documentation or in any proxy statement or similar
public filing related to the Transactions or in connection with any public
filing requirement; provided that you may disclose this Commitment Letter and
the contents hereof and the Fee Letter or the contents thereof (solely to the
extent the Fee Letter is redacted as to economic terms set forth therein
(including, without limitation, fees and economic  provisions), in a manner
reasonably satisfactory to us) to the Target and the Seller and their respective
officers, directors, employees, attorneys, accountants and advisors on a
confidential and need-to-know basis.

 

We will treat as confidential, and will not disclose or use in connection with
services provided by us to parties other than you or your affiliates, any and
all non-public information provided to us by or on behalf of you or your
affiliates hereunder; provided that nothing herein shall prevent us from
disclosing any such information (a) pursuant to the order of any court or
administrative agency or in any legal or administrative proceeding, or otherwise
as required by applicable law or compulsory legal process (in which case we
agree, to the extent permitted by applicable law, rule, regulation (including,
without limitation, in connection with filings, submissions and any other
similar documentation required or customary to comply Securities and Exchange
Commission filing requirements) or such compulsory legal process, to use
commercially reasonable efforts to inform you promptly thereof prior to such
disclosure), (b) upon the request or demand of any regulatory authority having
jurisdiction over us or any of our affiliates or managed funds (in which case we
agree, to the extent permitted by applicable law, to use commercially reasonable
efforts to inform you promptly thereof prior to such disclosure), (c) to the
extent that such information (i) becomes publicly available other than by reason
of disclosure by us in violation of this paragraph or any other agreement to
which both you and we are party, (ii) becomes available to us on a
non-confidential basis from a source other than you or on your behalf and, to
our knowledge, not in violation of any confidentiality agreement or obligation
owed to you, (iii) was available to us on a non-confidential basis prior to its
disclosure to us by you or (iv) was independently developed by us without
reliance on confidential information, (d) to our affiliates and managed funds
and to our and their respective shareholders, directors, officers, employees,
legal counsel, lenders, investors, professionals, advisors, independent auditors
and other experts or agents who need to know such information, to the extent
such persons are informed of the confidential nature of such information and are
either subject to customary confidentiality obligations of employment or
professional practice or agree to comply with the provisions of this paragraph,
(e) to actual or potential lenders, assignees, participants or derivative
investors in the Term Loan Facility who agree (including by “click-through”
acceptance of confidentiality terms on electronic transmission systems) to be
bound by the terms of this paragraph or substantially

 

10

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similar confidentiality provisions (or confidentiality provisions customarily
used in connection with the syndication of credit facilities), (f) to the extent
permitted by Section 9, (g) for purposes of establishing a “due diligence”
defense, (h) to Moody’s and S&P as required by the terms of this Commitment
Letter, (i) to industry trade organizations, information with respect to the
Term Loan Facility (limited to the names of any of you or your affiliates, and
the amount, type of credit facility, title and closing date of the Term Loan
Facility) for inclusion in league table measurements or (j) in protecting and
enforcing our rights with respect to this Commitment Letter and the Term Sheet
(in which case we agree, to the extent permitted by applicable law, to use
commercially reasonable efforts to inform you promptly thereof prior to such
disclosure).  The Commitment Parties’ obligations under this paragraph shall
automatically terminate and be superseded by the confidentiality provisions in
the Facilities Documentation.

 

Notwithstanding anything herein to the contrary, (a) any party to this
Commitment Letter (and any employee, representative or other agent of such
party) may disclose to any and all persons, without limitation of any kind, the
tax treatment and tax structure of the transactions contemplated by this
Commitment Letter and the Fee Letter and all materials of any kind (including
opinions or other tax analyses) that are provided to it relating to such tax
treatment and tax structure, except that (i) tax treatment and tax structure
shall not include the identity of any existing or future party (or any affiliate
of such party) to this Commitment Letter or the Fee Letter and (ii) no party
shall disclose any information relating to such tax treatment and tax structure
to the extent nondisclosure is reasonably necessary in order to comply with
applicable securities laws.  For this purpose, the tax treatment of the
transactions contemplated by this Commitment Letter and the Fee Letter is the
purported or claimed U.S. Federal income tax treatment of such transactions and
the tax structure of such transactions is any fact that may be relevant to
understanding the purported or claimed U.S. Federal income tax treatment of such
transactions; and (b) after the closing of the Transactions and at such
Commitment Party’s expense, each Commitment Party may (i) with your prior
approval (such approval not to be unreasonably withheld or delayed), place
advertisements in periodicals and on the Internet as it may choose and (ii) on a
confidential basis and, in the case of public promotional materials such as
“tombstones”, with your prior approval (such approval not to be unreasonably
withheld or delayed), circulate promotional materials in the form of a
“tombstone” or “case study” (and, in each case, otherwise describe the names of
any of you or your affiliates and any other general economic terms relating to
the Transactions, including the amount, type and closing date of the Term Loan
Facility).

 

13.                               Surviving Provisions.

 

The compensation, reimbursement, indemnification, confidentiality, syndication,
jurisdiction, governing law and waiver of jury trial provisions contained herein
and in the Fee Letter and the provisions of Section 8 of this Commitment Letter
shall remain in full force and effect regardless of whether definitive financing
documentation shall be executed and delivered and (other than in the case of the
syndication provisions) notwithstanding the termination of this Commitment
Letter or the Initial Lender’s commitment hereunder and our agreements to
perform the services described herein; provided that your obligations under this
Commitment Letter, other than those relating to confidentiality, compensation
and to the syndication of the Term Loan Facility (which shall remain in full
force and effect), shall, to the extent covered by the Facilities Documentation,
automatically terminate and be superseded by the applicable provisions contained
in such Facilities Documentation upon the occurrence of the Closing Date.

 

Each of the parties hereto agrees that (i) this Commitment Letter is a binding
and enforceable agreement (subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization and other similar laws relating to or
affecting creditor’s rights generally and general principles of equity (whether
considered in a proceeding in equity or law)) with respect to the subject matter
contained herein, including an agreement to negotiate the terms of the
Facilities Documentation in good faith in a manner

 

11

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consistent with this Commitment Letter, it being acknowledged and agreed that
the funding of the Term Loan Facility is subject to the Exclusive Financing
Conditions and (ii) the Fee Letter is a binding and enforceable agreement
(subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization and other similar laws relating to or affecting creditors’ rights
generally and general principles of equity (whether considered in a proceeding
in equity or law)) of the parties thereto with respect to the subject matter set
forth herein.

 

14.                               PATRIOT Act Notification.

 

Each Commitment Party hereby notifies you that, pursuant to the requirements of
the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26,
2001) (the “PATRIOT Act”), each Commitment Party and each Lender is required to
obtain, verify and record information that identifies the Borrower and each
guarantor, which information includes the name, address, tax identification
number and other information regarding the Borrower and each guarantor that will
allow such Commitment Party or such Lender to identify the Borrower and each
guarantor in accordance with the PATRIOT Act.  This notice is given in
accordance with the requirements of the PATRIOT Act and is effective as to each
Commitment Party and each Lender.  You hereby acknowledge and agree that each
Commitment Party shall be permitted to share any or all such information with
the Lenders.

 

15.                               Acceptance and Termination.

 

If the foregoing correctly sets forth our agreement with you, please indicate
your acceptance of the terms of this Commitment Letter and of the Fee Letter by
returning to us executed counterparts hereof and of the Fee Letter not later
than 5:00 p.m., New York City time, on June 5, 2015.  The Initial Lender’s offer
hereunder, and our agreements to perform the services described herein, will
expire automatically and without further action or notice and without further
obligation to you at such time in the event that the Commitment Parties have not
received such executed counterparts in accordance with the immediately preceding
sentence. This Commitment Letter will become a binding commitment on the Initial
Lender only after it and the Fee Letter has been duly executed and delivered by
you in accordance with the first sentence of this Section 15.  In the event that
the Closing Date does not occur on or before 5:00 p.m., New York City time, on
August 26, 2015 (or such earlier date on which the Merger Agreement terminates
pursuant to its terms), then this Commitment Letter and the Initial Lender’s
commitment hereunder, and our agreements to perform the services described
herein, shall automatically terminate without further action or notice and
without further obligation to you unless the Commitment Parties shall, in their
sole discretion, agree to an extension.

 

[Remainder of this page intentionally left blank]

 

12

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We are pleased to have been given the opportunity to assist you in connection
with the financing for the Merger.

 

 

Very truly yours,

 

 

 

GCI CAPITAL MARKETS LLC

 

 

 

 

 

By

/s/ Andrew Steuerman

 

 

Name:

Andrew Steuerman

 

 

Title:

Head of Middle Market Lending

 

 

 

 

 

Accepted and agreed to as of

 

the date first above written:

 

 

 

 

 

BOOT BARN, INC.

 

 

 

 

 

By

/s/ Greg Hackman

 

 

 

Greg Hackman

 

 

Chief Financial Officer

 

 

13

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EXHIBIT A

 

BOOT BARN, INC.
$200,000,000 Senior Secured Term Loan Facility

 

Summary of Principal Terms and Conditions(1)

 

Borrower:

 

Boot Barn, Inc. (“Boot Barn” or the “Borrower”).

 

 

 

Agent:

 

GCI Capital Markets LLC acting through one or more of its branches or affiliates
(“Golub”), will act as sole administrative agent (in such capacity, the “Agent”)
for a syndicate of banks, financial institutions and other institutional lenders
selected as provided in the Commitment Letter (the “Lenders”), and will perform
the duties customarily associated with such roles.

 

 

 

Sole Bookrunner and Sole Lead Arranger:

 

Golub will act as sole bookrunner and sole lead arranger for the Term Loan
Facility described below (collectively, in such capacities, the “Arranger”), and
will perform the duties customarily associated with such roles.

 

 

 

Term Loan Facility:

 

A senior secured term loan facility (the “Term Loan Facility”) in an aggregate
principal amount of $200,000,000 (the loans thereunder, the “Term Loans”).

 

 

 

Purpose:

 

Proceeds of the Term Loan Facility will be used to (i) refinance certain
indebtedness of Borrower, its subsidiaries and the Target (other than certain
indebtedness to be mutually agreed), (ii) pay a portion of the consideration
under the Merger Agreement, (iii) provide for working capital, capital
expenditures, permitted acquisitions and for other general corporate purposes of
Borrower and its subsidiaries, (iv) fund the fees, costs, premiums and expenses
associated with the closing of Transactions (including, without limitation,
amounts required pursuant to the Fee Letter), (v) for other purposes not
prohibited by the Facilities Documentation, and (vi) on the Closing Date, to
cash collateralize letters of credit.

 

Any Incremental Term Facility (as defined below) will be used for working
capital and general corporate purposes of the Borrower and its subsidiaries and
any other transaction set forth above with respect to a Term Loan.

 

 

 

Availability:

 

The full amount of the Term Loan Facility must be drawn in a single drawing on
the Closing Date. Amounts borrowed under the Term Loan Facility that are repaid
or prepaid may not be reborrowed.

 

 

 

Incremental Term Facility:

 

The Facilities Documentation will permit the Borrower from time to time, on one
or more occasions, after the Closing Date to add one or more incremental term
loan facilities to the Term Loan Facility (each, an “Incremental Term Loan
Facility” and collectively referred to as the “Incremental Term Loan
Facilities”) in a manner and amounts substantially consistent with the Precedent
Credit Agreement; provided, however, that if any Incremental Term Loan Facility
is incurred for purposes of financing an acquisition, conditionality may be
(i) limited to bankruptcy and payment defaults, and (ii) subject to customary
“SunGard” provisions; including, without limitation, provisions substantively
identical to the Limited Conditionality Provision.

 

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(1)  All capitalized terms used but not defined herein shall have the meanings
given to them in the Commitment Letter to which this Term Sheet is attached,
including the other Exhibits thereto.

 

B-1

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Refinancing Facilities:

 

The Facilities Documentation will permit the Borrower to refinance loans under
the Term Loan Facility and any Incremental Term Loan Facility from time to time,
in whole or in part, with one or more new term facilities (each, a “Term Loan
Refinancing Facility” and, collectively, the “Term Loan Refinancing Facilities”)
in a manner and amounts substantially consistent with the Precedent Credit
Agreement.

 

 

 

Interest Rates and Fees:

 

As set forth in Annex I to this Exhibit A.

 

 

 

Default Rate:

 

Substantially consistent with the Precedent Credit Agreement.

 

 

 

Final Maturity and Amortization:

 

The Term Loans will mature on the date that is six years after the date (the
“Term Loan Maturity Date”) on which the definitive credit agreement evidencing
the Term Loan Facility (the “Credit Agreement”) becomes effective in accordance
with the terms thereof (the “Closing Date”); provided that the Facilities
Documentation shall provide the right for individual Lenders to agree to extend
the maturity date of their outstanding Term Loans (or any tranche thereof) upon
the request of the Borrower and without the consent of any other Lender (subject
to customary terms and conditions, including that the terms and consideration
applicable to such extension are offered to all Lenders holding the tranche of
Term Loans subject to such extension). The Term Loans shall be payable in equal
quarterly installments in an aggregate annual amount equal to 1.0% of the
original principal amount of the Term Loan Facility with the balance payable on
the Term Loan Maturity Date.

 

 

 

Guarantees:

 

Subject to the Limited Conditionality Provision and the limitations set forth in
the Precedent Loan Documents, substantially consistent with the Precedent Loan
Documents; provided that the Target, each guarantor of the ABL Facility and any
Borrower under the ABL Facility, in each case, to the extent not a Borrower
hereunder, shall also be a guarantor under the Term Loan Facility (the
“Guarantors”; and together with the Borrower, the “Loan Parties”).

 

B-2

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Security:

 

Subject to the Limited Conditionality Provision and the limitations set forth in
the Precedent Loan Documents (including, without limitation, the provisions for
excluded collateral and limitations on perfection requirements), the obligations
of the Borrower and the Guarantors in respect of the Term Loan Facility shall be
secured by (a) a first priority perfected security interest (subject as to
priority to Permitted Liens (as defined in the Precedent Credit Agreement)) in
the Term Priority Collateral and (b) a second priority perfected security
interest (subject as to priority to Permitted Liens (as defined in the Precedent
Credit Agreement)) in the ABL Priority Collateral.

 

“ABL Priority Collateral” shall have the meaning set forth in the Precedent
Intercreditor Agreement with such changes (i) as shall be consistent with the
Documentation Principles and (ii) as otherwise agreed by the parties.

 

“Term Priority Collateral” shall have the meaning set forth in the Precedent
Intercreditor Agreement with such changes (i) as shall be consistent with the
Documentation Principles and (ii) as otherwise agreed by the parties.

 

The obligations secured may include hedging and bank product obligations of a
Loan Party where a Lender or an affiliate of a Lender is a counterparty.

 

For the avoidance of doubt, no landlord waivers or collateral access agreements
with respect to leased locations of Boot Barn, the Target or their respective
subsidiaries shall be required as a condition to closing of or funding under the
Term Loan Facility. Any such landlord waivers or collateral access agreements
shall be delivered on a post-closing basis substantially consistent with the
terms of the Precedent Loan Documents and no such landlord waiver or collateral
access agreement shall be delivered in favor of the agent and/or lenders under
the ABL Facility without a substantially comparable landlord waiver or
collateral access agreement in favor of Agent and the Lenders also being
delivered.

 

 

 

Intercreditor Agreement:

 

The lien priority, relative rights and other creditors’ rights issues in respect
of the ABL Facility and the Term Loan Facility shall be subject to an
intercreditor agreement substantially consistent with the intercreditor
agreement dated May 1, 2013, between Wells Fargo Bank, National Association and
GCI Capital Markets LLC, executed by the Borrower, the Agent and the
administrative agent with respect to the ABL Facility (the “Precedent
Intercreditor Agreement”), with such changes (i) as shall be consistent with the
Documentation Principles, (ii) to the definition of “Maximum ABL Principal
Amount” to limit clause (a) to $150,000,000(2) and (iii) as otherwise agreed by
the parties (the “Intercreditor Agreement”).

 

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(2)  To be inclusive of all protective advances, overadvances, and incremental
facilities

 

B-3

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Mandatory Prepayments:

 

Term Loans shall be prepaid and applied in a manner and amounts substantially
consistent with the mandatory prepayments of Term Loans in the Precedent Credit
Agreement; provided, in any event, such mandatory prepayments shall
include, commencing with the fiscal year ending March 31, 2017 and continuing
for each fiscal year thereafter, 50% of Excess Cash Flow (definition to be
mutually agreed), with step-downs to 25% and 0% upon achievement of a leverage
ratio to be mutually agreed; provided that, for any fiscal year, (x) any
voluntary prepayments of the Term Loans or and voluntary prepayments of the ABL
Facility (or any incremental ABL Facility or other revolving credit facility)
(to the extent commitments thereunder are permanently reduced by the amount of
such prepayments) made during such fiscal year or, without giving duplicative
effect, after year-end and prior to the time such Excess Cash Flow prepayment is
due, and (y) such other amounts as shall be mutually agreed shall be credited
against Excess Cash Flow prepayment obligations on a dollar-for-dollar basis for
such fiscal year (without duplication of any such credit in any prior or
subsequent fiscal year). Excess Cash Flow shall be reduced for, among other
things, prepayment premiums, cash used for unfinanced capital expenditures,
permitted investments, changes in working capital, permitted acquisitions and
certain restricted payments to be agreed.

 

Mandatory prepayments with respect to Excess Cash Flow and applicable asset sale
proceeds, to the extent attributable to foreign subsidiaries, will be subject to
permissibility under applicable local law; provided that the Borrower agrees to
cause the applicable foreign subsidiary to promptly take all commercially
reasonable actions required by the applicable local law to permit the
repatriation of the relevant amounts. Further, if the Borrower or its
subsidiaries would incur an adverse tax consequence as reasonably determined by
the Borrower and the Agent, if all or a portion of the funds required to make a
mandatory prepayment were upstreamed or transferred as a distribution or
dividend (a “Restricted Amount”), the amount the Borrower will be required to
mandatorily prepay shall be reduced by the Restricted Amount until such time as
it may upstream or transfer such Restricted Amount without incurring such
adverse tax consequence, provided that, if not previously repatriated and
applied to such prepayment within twelve months, an amount equal to the affected
portion of Excess Cash Flow or asset sale proceeds shall, at the Borrower’s
election, be applied to prepay the term loans or to other local indebtedness of
subsidiaries organized in the relevant jurisdiction and such repayment of
indebtedness shall reduce, without duplication, the obligations of such foreign
subsidiary to repay the loans pursuant to this paragraph.

 

 

 

Voluntary Prepayments:

 

Voluntary prepayments of loans under the Term Loan Facility and any Incremental
Term Facilities will be permitted, and shall be applied, in a manner and in
amounts substantially consistent with voluntary prepayment of Term Loans in the
Precedent Credit Agreement.

 

B-4

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Call Premium:

 

In the event that, prior to the six month anniversary of the Closing Date, the
Borrower (x) prepays, refinances, substitutes or replaces all or any portion of
the Term Loans pursuant to a Refinancing Transaction (including, for avoidance
of doubt, any mandatory prepayment that constitutes a Refinancing Transaction)
or (y) effects any amendment, amendment and restatement or other modification of
the Facilities Documentation resulting in a Refinancing Transaction, the
Borrower shall pay to the Agent, for the ratable account of each applicable
Lender, (I) in the case of clause (x), a prepayment premium of one percent
(1.0%) of the aggregate principal amount of the Term Loans so prepaid,
refinanced, substituted or replaced and (II) in the case of clause (y), a fee
equal to one percent (1.0%) of the aggregate principal amount of the applicable
Term Loans outstanding immediately prior to such amendment that are subject to
such Refinancing Transaction. If, prior to the six month anniversary of the
Closing Date, any non-consenting Lender is replaced by way of the “yank-a-bank”
provisions of the Facilities Documentation in connection with any amendment,
amendment and restatement or other modification of the Facilities Documentation
resulting in a Refinancing Transaction, such Lender (and not any Person who
replaces such Lender) shall receive its pro rata portion (as determined
immediately prior to it being so replaced) of the prepayment premium or fee
described in the preceding sentence. Such premium and fees described in this
paragraph shall be due and payable on the date of effectiveness of such
Refinancing Transaction and shall be referred to herein as the “Prepayment
Premium”. On and after the six month anniversary of the Closing Date, no
Prepayment Premium shall be payable in connection with any Refinancing
Transaction other than LIBOR funding breakage costs, if any, as required under
the terms of the Credit Documentation. For purposes hereof, “Refinancing
Transaction” shall mean (i) the incurrence by Holdings, Borrower or any other
Subsidiary of Holdings of any new or additional loans (whether issued pursuant
to an amendment to the Facilities Documentation or pursuant to a separate
financing) the proceeds of which are used to prepay, refinance, substitute or
replace in full or in part the outstanding principal balance of the Term Loans,
but only so long as such new or additional loans have an all-in yield less than
the all-in yield applicable to the Term Loans so repaid, refinanced, substituted
or replaced and (ii) any amendment to the Facilities Documentation to reduce the
all-in yield applicable to all or any portion of the Term Loans.

 

 

 

Representations and Warranties:

 

Subject to the Limited Conditionality Provision, limited to those contained in
the Precedent Credit Agreement with only such modifications as are consistent
with the Documentation Principles.

 

 

 

Conditions Precedent to Borrowing:

 

The availability of borrowings under the Term Loan Facility will be subject
solely to the Exclusive Financing Conditions.

 

B-5

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Affirmative Covenants:

 

Limited to those contained in the Precedent Credit Agreement with only such
modifications as are consistent with the Documentation Principles, but which
shall include, in any event, commencing 120 days after the Closing Date,
maintenance of ratings from S&P and Moody’s.

 

 

 

Negative Covenants:

 

Limited to those contained in the Precedent Credit Agreement with only such
modifications as are consistent with the Documentation Principles.

 

 

 

Financial Covenants:

 

Maximum Consolidated Total Net Leverage Ratio with the definition to be mutually
agreed and covenant levels reflecting not less than a 30% cushion from the
Borrower’s model.

 

 

 

Events of Default:

 

Limited to those contained in the Precedent Credit Agreement with only such
modifications as are consistent with the Documentation Principles; provided,
however, that the definition of Change of Control contained in the Precedent
Credit Agreement shall be revised to delete the clause “that so long as the
Permitted Investors own at least forty-five percent (45%) of the Equity
Interests of Holdings,” from the proviso in which it appears.

 

 

 

Voting:

 

Limited to those contained in the Precedent Credit Agreement and consistent with
the Documentation Principles, including, without limitation, provisions relating
to Defaulting Lenders.

 

 

 

 

 

The Facilities Documentation will contain customary “amend and extend”
provisions (on terms to be mutually agreed by the Agent and the Borrower)
pursuant to which the Borrower may extend commitments and/or outstandings
pursuant to one or more tranches with only the consent of the respective
extending Lenders; provided that it is understood that no existing Lender will
have any obligation to commit to any such extension and all Lenders will be
offered the ratable opportunity to participate in such extension.

 

 

 

Cost and Yield Protection:

 

Limited to those contained in the Precedent Credit Agreement and consistent with
the Documentation Principles.

 

 

 

Assignments and Participations:

 

Limited to those contained in the Precedent Credit Agreement and consistent with
the Documentation Principles.

 

 

 

Defaulting Lenders:

 

Limited to those contained in the Precedent Credit Agreement and consistent with
the Documentation Principles.

 

 

 

Expenses and Indemnification:

 

Limited to those contained in the Precedent Credit Agreement and consistent with
the Documentation Principles.

 

 

 

Replacement of Lenders:

 

Limited to those contained in the Precedent Credit Agreement and consistent with
the Documentation Principles.

 

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Governing Law and Forum:

 

New York.

 

 

 

Counsel to Agent and Arranger:

 

Katten Muchin Rosenman LLP

 

B-7

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ANNEX I
to Exhibit A

 

Interest Rates:

 

At the Borrower’s option, Term Loans will bear interest based on the Base Rate
or LIBOR, as described below:

 

A. Base Rate Option

 

Interest will be at the Base Rate plus the applicable Interest Margin (as
described below). The “Base Rate” is defined as the highest of (a) the Federal
Funds Rate, as published by the Federal Reserve Bank of New York, plus 1/2 of
1%, (b) the prime commercial lending rate of the Agent, as established from time
to time at its principal U.S. office (which such rate is an index or base rate
and will not necessarily be its lowest or best rate charged to its customers or
other banks) and (c) the daily LIBOR (as defined below) for a one month Interest
Period (as defined below) (for purposes of clarity, not less than 1% per annum)
plus the difference between the Interest Margin for LIBOR Rate Loans and the
Interest Margin for Base Rate Loans. Interest shall be payable quarterly in
arrears on the last day of each calendar quarter and (i) with respect to Base
Rate Loans based on the Federal Funds Rate and LIBOR, shall be calculated on the
basis of the actual number of days elapsed in a year of 360 days and (ii) with
respect to Base Rate Loans based on the prime commercial lending rate of the
Agent, shall be calculated on the basis of the actual number of days elapsed in
a year of 365/366 days. Any loan bearing interest at the Base Rate is referred
to herein as a “Base Rate Loan”.

 

Base Rate Loans will be made on same day notice and will be in minimum amounts
to be agreed upon.

 

B. LIBOR Option

 

Interest will be determined for periods (“Interest Periods”) of one, two, three
or six months or, if approved by all Lenders (such approval not to be
unreasonably withheld), twelve months, as selected by the Borrower and will be
at an annual rate for Eurocurrency deposits for the corresponding deposits of
U.S. dollars appearing on Reuters Screen LIBOR01 Page (“LIBOR”) plus the
applicable Interest Margin (as described below). In no event shall LIBOR be less
than 1% per annum. LIBOR will be determined by the Agent at the start of each
Interest Period and, other than in the case of LIBOR used in determining the
Base Rate, will be fixed through such period. Interest will be paid on the last
day of each Interest Period or, in the case of Interest Periods longer than
three months, quarterly, and will be calculated on the basis of the actual
number of days elapsed in a year of 360 days. LIBOR will be adjusted for maximum
statutory reserve requirements (if any). Any loan bearing interest at LIBOR
(other than a Base Rate Loan for which interest is determined by reference to
LIBOR) is referred to herein as a “LIBOR Rate Loan”.

 

B-I-1

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LIBOR Rate Loans will be made on three business days’ prior notice and, in each
case, will be in minimum amounts to be agreed upon.

 

 

 

Interest Margins:

 

The applicable Interest Margin for the Term Loan Facility will be 4.50% for
LIBOR Rate Loans and 3.50% for Base Rate Loans.

 

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CONFIDENTIAL

EXHIBIT B

 

BOOT BARN, INC.

 

$200,000,000 Senior Secured Term Loan Facility

Summary of Additional Conditions Precedent(3)

 

The initial borrowing under the Term Loan Facility shall be subject to
satisfaction or waiver by the Borrower and the Lenders of the following
additional conditions precedent:

 

1.                                      The Merger and the other Transactions
shall be consummated simultaneously with the closing under the Term Loan
Facility in accordance with applicable law (in all material respects) and on the
terms described in the Term Sheet and in the Agreement and Plan of Merger, made
and entered into as of May 29, 2015, by and among Borrower, Rodeo Acquisition
Corp., a Delaware corporation, Sheplers Holding Corporation, a Delaware
corporation and Gryphon Partners III, L.P., a Delaware limited partnership,
individually solely in its capacity as a guarantor for purposes of
Section 8.1(a)(i) set forth therein, and otherwise solely in its capacity as the
sellers’ representative (as the same may be amended or waived from time to time
to the extent that such amendments and waivers are not prohibited by the
Commitment Letter or Term Sheet, the “Merger Agreement”).  The Merger Agreement
(as in effect on the date hereof) shall not be amended, modified or any
provision thereof waived or any consent thereunder provided to the extent such
amendment, modification or waiver thereof or any consent thereunder is
materially adverse to the Lenders or the Arranger for the Term Loan Facility
without the prior written consent (such consent not to be unreasonably delayed
or withheld) of the Agent (it being understood and agreed that (i) any change to
the definition of “Material Adverse Effect” contained in the Merger Agreement
shall be deemed to be materially adverse to the Arranger and the Lenders,
(ii) working capital adjustments contained in the Merger Agreement as in effect
on the date hereof shall not be deemed to be materially adverse to the Lenders,
(iii) any increase in the cash merger consideration (the “Merger Consideration”)
of less than 10% shall be deemed to be not materially adverse to the interests
of the Lenders and any increases in the Merger Consideration in excess of 10%
shall be deemed to be not materially adverse to the interests of the Lenders to
the extent funded with the net cash proceeds of equity, (iv) any reduction in
Merger Consideration (after giving effect to any adjustment provided in clause
(ii)) of less than 15% in the aggregate shall be deemed not to be materially
adverse to the interests of the Lenders; provided that the amount of the Term
Loan Facility and amount of cash provided by the Loan Parties in connection with
the Merger shall be reduced by such decrease dollar for dollar on a pro rata
basis, (v) any reduction in the Merger Consideration in excess of the amounts
set forth in clause (iv) but less than 20% in the aggregate shall not be deemed
to be materially adverse to the interests of the Lenders to the extent it
reduces the amount of the Term Loan Facility on a dollar for dollar basis to the
extent of such excess, and (vi) any change in the third party beneficiary rights
applicable to the Lead Arranger and the Lenders or the governing law shall be
deemed to be materially adverse to the interests of the Lenders unless approved
by the Agent.  The Specified Merger Agreement Representations and the Specified
Representations shall be true and correct in all material respects as of the
Closing Date except to the extent such representations and warranties are made
on and as of a specified date (and not required to be brought down to the
Closing Date), in which case the same shall continue on the Closing Date to be
true and correct as of the specified date  (or, in the event such
representations and warranties are qualified by materiality or material adverse
effect or language of similar import, such representations shall be true and
correct in all respects as of the Closing Date).  All amounts due or outstanding
in respect of the

 

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(3)  All capitalized terms used but not defined herein shall have the meanings
given to them in the Commitment Letter to which this Exhibit B is attached,
including the other Exhibits thereto.

 

B-1

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existing indebtedness of the Target and the Borrower (other than such amounts as
shall be permitted to remain outstanding pursuant to the terms of the Facilities
Documentation) shall have been (or substantially simultaneously with the closing
under the Term Loan Facility shall be) paid in full, all commitments (if any) in
respect thereof terminated and all guarantees (if any) thereof and security (if
any) therefor discharged and released.

 

2.                                      The Agent shall have received a
certificate from the chief financial officer of the Borrower in substantially
the form attached hereto as Exhibit C, certifying that Holdings and its
subsidiaries, on a consolidated basis after giving effect to the Transactions
and the other transactions contemplated hereby, are solvent.

 

3.                                      The Agent shall have received, at least
five business days prior to the Closing Date, all documentation and other
information required by regulatory authorities under applicable “know your
customer” and anti-money laundering rules and regulations, including, without
limitation, the PATRIOT Act, to the extent requested at least ten business days
prior to the Closing Date.

 

4.                                      Subject in all respects to the Limited
Conditionality Provision and the limitations described under the caption
“Security” in Exhibit A to the Commitment Letter, all documents and instruments
required to create and perfect the security interest of the Agent in the Term
Priority Collateral and the ABL Priority Collateral shall have been executed, if
applicable, and delivered and, if applicable, be in proper form for filing with
such filing having been duly authorized.

 

5.                                      The execution and delivery of the
Facilities Documentation by all parties thereto, in each case, which shall be in
accordance with the terms of the Commitment Letter and subject to the Limited
Conditionality Provision and Documentation Principles set forth in the
Commitment Letter and (b) delivery to the Arranger of customary legal opinions,
customary officer’s closing certificates, organizational documents, customary
evidence of authorization, good standing certificates in jurisdictions of
formation/organization, in each case of the Borrower and the Guarantors (to the
extent applicable), customary notices of borrowing, and customary insurance
certificates and endorsements for insurance customary for companies in the same
industry and engaged in similar business activities (to the extent such
certificates and endorsements are available).

 

6.                                      All fees required to be paid on the
Closing Date pursuant to the Commitment Letter and the Fee Letter and reasonable
and documented out-of-pocket expenses required to be paid on the Closing Date
pursuant to the Commitment Letter, to the extent invoiced at least three
business days prior to the Closing Date, shall, upon the initial borrowing under
the Term Loan Facility, have been paid (which amounts may be offset against the
proceeds of the Term Loan Facilities).

 

7.                                      The ABL facility shall have closed (or
shall close substantially concurrently with the funding of the Term Loan
Facility on the Closing Date) on the terms set forth in the Commitment Letter
(the “ABL Facility Commitment Letter”), dated as of May 29, 2015, by and between
Wells Fargo Bank, National Association and Borrower as in effect on the date
hereof and, after giving effect to the Transactions and any amount to be funded
under the ABL Facility on the Closing Date, Borrower shall have not less than
$25,000,000 of Excess Availability (as defined in the ABL Facility Commitment
Letter), and Agent and the agent for the ABL Facility shall have entered into
the Intercreditor Agreement.

 

8.                                      The Arranger shall have been afforded a
period of at least twenty-one (21) consecutive calendar days (excluding July 3,
2015 and July 4, 2015) prior to the Closing Date (the “Marketing Period”), which
period shall commence on the date when the Information Materials and a customary
authorization letter from Borrower with respect thereto has been delivered to
the Arranger.

 

B-2

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9.                                      There shall be no order, injunction or
decree of any governmental authority restraining or prohibiting the funding
under the Term Loan Facility unless such order, injunction or decree resulted
from the willful misconduct, bad faith or gross negligence of the Agent or the
Lenders or any of their officers, directors, employees, and controlled
affiliates.

 

B-3

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EXHIBIT C

 

[Form of] Solvency Certificate

 

[        ], 2015

 

This Solvency Certificate is being executed and delivered pursuant to
[(a) Section [  ] of that certain Credit Agreement, dated as of the date hereof,
by and among Boot Barn Holdings, Inc., a Delaware corporation (“Holdings”), Boot
Barn, Inc., a Delaware corporation (the “Borrower”), the other Loan Parties
party thereto, [            ], as administrative agent, the Lenders from time to
time party thereto and the other parties thereto (the “Credit Agreement”). 
Capitalized terms used in this Solvency Certificate and not otherwise defined
herein having the respective meanings given to them in the Credit Agreement.

 

I, [                ], the Chief Financial Officer of the Borrower, in such
capacity and not in an individual capacity, hereby certify that I am the Chief
Financial Officer of the Borrower and that I am familiar with the financial
statements, business and assets of Holdings and its Subsidiaries, I have made
such other investigations and inquiries as I have deemed appropriate, and I am
duly authorized to execute this Solvency Certificate on behalf of the Borrower
pursuant to the Credit Agreement.

 

I further certify, in my capacity as Chief Financial Officer of the Borrower,
and not in my individual capacity, as of the date hereof and after giving effect
to the Transactions and the other transactions contemplated by the Credit
Agreements and the other Loan Documents (including, without limitation, the
Merger and the incurrence of the Indebtedness and the other obligations being
incurred in connection with the Credit Agreement and the [ABL Credit Agreement],
that: (i) the sum of the liabilities (including contingent liabilities) of
Holdings and its Subsidiaries, taken as a whole, does not exceed the present
fair saleable value or the fair value, in each case on a going concern basis, of
the assets of Holdings and its Subsidiaries, taken as a whole; (ii) the present
fair saleable value of the assets of Holdings and its Subsidiaries, taken as a
whole, is greater than the total amount that will be required to pay the
probable liabilities (including contingent liabilities) of Holdings and its
Subsidiaries as they become absolute and matured; (iii) the capital of Holdings
and its Subsidiaries, taken as a whole, is not unreasonably small in relation to
the business of Holdings and its Subsidiaries, taken as a whole, contemplated as
of the date hereof; and (iv) Holdings and its Subsidiaries, on a consolidated
basis, are “solvent” within the meaning given to that term and similar terms
under applicable laws relating to fraudulent transfers and conveyances. For the
purposes hereof, the amount of any contingent liability at any time shall be
computed as the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability (irrespective of whether such contingent
liabilities meet the criteria for accrual under Statement of Financial
Accounting Standard No. 5).

 

[Remainder of page intentionally left blank]

 

C-1

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IN WITNESS WHEREOF, I have executed this Solvency Certificate on the date first
written above.

 

 

 

[                                          ]

 

 

 

 

 

By:

 

 

 

Name: [                              ]

 

 

Title: Chief Financial Officer

 

D-2

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EXHIBIT D

 

Modifications to Documentation Principles

 

Notwithstanding anything to the contrary set forth in the Commitment Letter
(including, but not limited to, the Term Sheet) or the Precedent Credit
Agreement, the following additional terms, provisions and conditions are to be
included in the Facilities Documentation:

 

1.                                      the terms and conditions applicable to
Incremental Term Loan Commitments, Incremental Term Loans and Permitted
Acquisitions (each as defined in the Precedent Credit Agreement) shall also
include a Consolidated Total Net Leverage Ratio governor equal to the
Consolidated Total Net Leverage Ratio as in effect on the Closing Date; provided
that the cap on the total Permitted Acquisition Consideration (as defined in the
Precedent Credit Agreement) set forth in clause (g)(x) of the definition of
“Permitted Acquisition” in the Precedent Credit Agreement will be increased by
an amount to be mutually agreed and will be subject to a customary “available
amount” basket;

 

2.                                      the negative covenants regarding
indebtedness of the type described in Sections 9.1(i) and 9.1(w) of the
Precedent Credit Agreement shall be modified to (i) provide for a dollar cap on
the aggregate outstanding amount of such indebtedness permitted thereunder equal
to $10,000,000 and $10,000,000, respectively and (ii) with respect to
Section 9.1(w) of the Precedent Credit Agreement, remove the Consolidated Total
Lease Adjusted Net Leverage Ratio (as defined in the Precedent Credit Agreement)
incurrence test;

 

3.                                      the negative covenants regarding
intercompany indebtedness and investments set forth in Sections 9.1(g)(ii) and
9.3(a)(v) of the Precedent Credit Agreement shall be modified to provide for a
dollar cap on the aggregate outstanding amount of such indebtedness and
investments permitted thereunder equal to $7,500,000 (applicable collectively to
all such indebtedness and investments) in respect of loans made by subsidiaries
that are not Loan Parties to Loan Parties;

 

4.                                      earn-outs and other similar deferred
contingent consideration payments and seller notes, in each case, incurred in
connection with Permitted Acquisitions (as defined in the Precedent Credit
Agreement) shall, in each case, be (i) subject to a dollar cap (y) in respect of
earn-outs and other similar deferred contingent consideration payments, equal to
$5,000,000 in respect of the maximum aggregate amount of payments in respect
thereof to be made in any fiscal year and (z) in respect of seller notes, equal
to an amount to be mutually agreed in respect of the maximum aggregate
outstanding amount thereof and (ii) excluded from the calculation of the
Consolidated Total Net Leverage Ratio;

 

5.                                      the Credit Agreement shall include a
customary “available amount” basket (definition to be mutually agreed),
calculated commencing with the fiscal year ending March 31, 2017, which may be
used on terms and conditions to be mutually agreed; and

 

6.                                      each of the “Excluded Deposit Accounts”
and “Excluded Securities Account” definitions contained in the Collateral
Agreement (which is a part of the Precedent Loan Documents) shall be modified to
provide for a dollar cap on the aggregate amount on deposit in the deposit
accounts or securities accounts not subject to control agreements (other than
those accounts described in clauses (a) through (d) and (a) through (c) in each
defined term, respectively) to $500,000.

 

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