Exhibit 10.1

 

Execution Version

 

 

 

$600,000,000

 

CREDIT AGREEMENT

 

among

 

MSC INDUSTRIAL DIRECT CO., INC.,

as Borrower,

 

The Several Lenders from Time to Time Parties Hereto,

 

CITIZENS BANK, N.A.,

KEYBANK NATIONAL ASSOCIATION

and

U.S. BANK NATIONAL ASSOCIATION,

as Co-Documentation Agents,

 

BANK OF AMERICA, N.A.

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Co-Syndication Agents,

 

and

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

Dated as of April 14, 2017

  

 

 

J.P. MORGAN SECURITIES LLC,

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

and

WELLS FARGO SECURITIES, LLC,

as Joint Lead Arrangers and Joint Bookrunners

 

 

 

 

TABLE OF CONTENTS

 

      Page         Section 1.    DEFINITIONS 1           1.1. Defined Terms 1  
1.2. Other Definitional Provisions 21         Section 2.    AMOUNTS AND TERMS OF
REVOLVING COMMITMENTS 22           2.1. Revolving Commitments 22   2.2.
Procedure for Revolving Loan Borrowing 23   2.3. Undrawn Fees, etc. 23   2.4.
Termination or Reduction of Revolving Commitments 23   2.5. L/C Commitment 23  
2.6. Procedure for Issuance of Letter of Credit 24   2.7. Fees and Other Charges
24   2.8. L/C Participations 24   2.9. Reimbursement Obligations of the Borrower
25   2.10. Obligations Absolute 26   2.11. Letter of Credit Payments 26   2.12.
Applications 26         Section 3.    GENERAL PROVISIONS APPLICABLE TO LOANS AND
LETTERS OF CREDIT 26           3.1. Optional Prepayments 26   3.2. Conversion
and Continuation Options 27   3.3. Limitations on Eurodollar Tranches 27   3.4.
Interest Rates and Payment Dates 27   3.5. Computation of Interest and Fees 28  
3.6. Inability to Determine Interest Rate 28   3.7. Pro Rata Treatment and
Payments 29   3.8. Requirements of Law 30   3.9. Taxes 31   3.10. Indemnity 34  
3.11. Change of Lending Office 35   3.12. Replacement of Lenders 35   3.13.
Borrower Repurchases 35   3.14. Defaulting Lenders 36   3.15. Incremental
Facilities. 37         Section 4.    REPRESENTATIONS AND WARRANTIES 39          
4.1. Financial Condition 39   4.2. No Change 40   4.3. Existence; Compliance
with Law 40   4.4. Power; Authorization; Enforceable Obligations 40   4.5. No
Legal Bar 40   4.6. Litigation 40   4.7. No Default 41   4.8. Ownership of
Property; Liens 41   4.9. Intellectual Property 41

 

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  4.10. Taxes 41   4.11. Federal Regulations 41   4.12. Labor Matters 41   4.13.
ERISA 42   4.14. Investment Company Act; Other Regulations 42   4.15.
Subsidiaries 42   4.16. Use of Proceeds 43   4.17. Environmental Matters 43  
4.18. Accuracy of Information, etc 44   4.19. Solvency 44   4.20.
Anti-Corruption Laws and Sanctions 44   4.21. EEA Financial Institutions 44    
    Section 5.    CONDITIONS PRECEDENT 44           5.1. Conditions to Initial
Extension of Credit 44   5.2. Conditions to Each Extension of Credit 45        
Section 6.    AFFIRMATIVE COVENANTS 46           6.1. Financial Statements 46  
6.2. Certificates; Other Information 46   6.3. Payment of Obligations 47   6.4.
Maintenance of Existence; Compliance 47   6.5. Maintenance of Property;
Insurance 47   6.6. Inspection of Property; Books and Records; Discussions 48  
6.7. Certain Notices 48   6.8. Environmental Laws 49   6.9. Additional
Subsidiary Guarantors 49         Section 7.    NEGATIVE COVENANTS 50          
7.1. Financial Condition Covenants 50   7.2. Indebtedness 50   7.3. Liens 51  
7.4. Fundamental Changes 53   7.5. Disposition of Property 53   7.6. Investments
54   7.7. Transactions with Affiliates 56   7.8. Changes in Fiscal Periods 56  
7.9. Clauses Restricting Subsidiary Distributions 56   7.10. Use of Proceeds 57
        Section 8.    EVENTS OF DEFAULT 57         Section 9.    THE AGENTS 59  
        9.1. Appointment 59   9.2. Delegation of Duties 60   9.3. Exculpatory
Provisions 60   9.4. Reliance by Administrative Agent 60   9.5. Notice of
Default 60   9.6. Non-Reliance on Agents and Other Lenders 61

 

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  9.7. Indemnification 61   9.8. Agent in Its Individual Capacity 61   9.9.
Successor Administrative Agent 62   9.10. Securitizations 62   9.11.
Co-Documentation Agents and Co-Syndication Agents; Issuing Lender 62        
Section 10.   MISCELLANEOUS 63           10.1. Amendments and Waivers 63   10.2.
Notices 64   10.3. No Waiver; Cumulative Remedies 65   10.4. Survival of
Representations and Warranties 65   10.5. Payment of Expenses and Taxes 66  
10.6. Successors and Assigns; Participations and Assignments 66   10.7.
Adjustments; Set-off 70   10.8. Counterparts 71   10.9. Severability 71   10.10.
Integration 71   10.11. Governing Law 71   10.12. Submission To Jurisdiction;
Waivers 71   10.13. Acknowledgements 72   10.14. Releases of Guarantees 72  
10.15. Confidentiality 73   10.16. WAIVERS OF JURY TRIAL 73   10.17. USA PATRIOT
Act. 73   10.18. Acknowledgement and Consent to Bail-In of EEA Financial
Institutions. 74

 

SCHEDULES:

 

1.1A Commitments 2.5 Existing Letters of Credit 4.1 Guarantee Obligations 4.4
Consents, Authorizations, Filings and Notices 4.6 Litigation 4.15 Subsidiaries
7.3(f) Existing Liens 7.6(e) Investments 7.7 Transactions with Affiliates

 

EXHIBITS:

 

A Form of Guarantee B Form of Compliance Certificate C Form of Closing
Certificate D Form of Assignment and Assumption E Form of U.S. Tax Certificate

 

iii

 

 

CREDIT AGREEMENT (this “Agreement”), dated as of April 14, 2017, among MSC
INDUSTRIAL DIRECT CO., INC., a New York corporation (the “Borrower”), the
several banks and other financial institutions or entities from time to time
parties to this Agreement (the “Lenders”) and JPMORGAN CHASE BANK, N.A., as
Administrative Agent.

 

The parties hereto hereby agree as follows:

 

Section 1.  DEFINITIONS

 

1.1.         Defined Terms. As used in this Agreement, the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.

 

“ABR”: for any day, a rate per annum equal to the greatest of (a) the Prime Rate
in effect on such day, (b) the New York Fed Bank Rate in effect on such day plus
½ of 1% and (c) the Eurodollar Rate that would be calculated as of such day (or,
if such day is not a Business Day, as of the next preceding Business Day) in
respect of a proposed Eurodollar Loan with a one-month Interest Period plus
1.0%. For purposes hereof: “Prime Rate” shall mean the rate of interest per
annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its
prime rate in effect at its principal office in New York City (the Prime Rate
not being intended to be the lowest rate of interest charged by JPMorgan Chase
Bank, N.A. in connection with extensions of credit to debtors). Any change in
the ABR due to a change in the Prime Rate, the New York Fed Bank Rate or the
Eurodollar Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate, the New York Fed Bank Rate or
the Eurodollar Rate, respectively.

 

“ABR Loans”: Loans the rate of interest applicable to which is based upon the
ABR.

 

“Administrative Agent”: JPMorgan Chase Bank, N.A., together with its affiliates,
as an arranger of the Commitments and as the administrative agent for the
Lenders under this Agreement and the other Loan Documents, together with any of
its successors.

 

“Affiliate”: as to any Person, any other Person that, directly or indirectly, is
in control of, is controlled by, or is under common control with, such Person.
For purposes of this definition, “control” of a Person means the power, directly
or indirectly, to direct or cause the direction of the management and policies
of such Person, whether by the ability to exercise voting power, contract or
otherwise.

 

“Agents”: the collective reference to the Co-Syndication Agents, the
Co-Documentation Agents and the Administrative Agent.

 

“Aggregate Exposure”: with respect to any Lender at any time, an amount equal to
(a) until the Closing Date, the aggregate amount of such Lender’s Commitments at
such time and (b) thereafter, the sum of (i) the aggregate then unpaid principal
amount of such Lender’s Incremental Term Loans and (ii) the amount of such
Lender’s Revolving Commitment then in effect or, if the Revolving Commitments
have been terminated, the amount of such Lender’s Revolving Extensions of Credit
then outstanding.

 

“Aggregate Exposure Percentage”: with respect to any Lender at any time, the
ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such
time to the Aggregate Exposure of all Lenders at such time.

 

“Agreement”: as defined in the preamble hereto.

 

1

 

 

“Applicable Margin”: for each Type of Loan, the rate per annum determined
pursuant to the Pricing Grid.

 

“Application”: an application, in such form as each Issuing Lender may specify
from time to time, requesting such Issuing Lender to open a Letter of Credit.

 

“Approved Fund”: as defined in Section 10.6(b).

 

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

 

“Assignee”: as defined in Section 10.6(b).

 

“Assignment and Assumption”: an Assignment and Assumption, substantially in the
form of Exhibit D.

 

“Available Revolving Commitment”: as to any Revolving Lender at any time, an
amount equal to the excess, if any, of (a) such Lender’s Revolving Commitment
then in effect over (b) such Lender’s Revolving Extensions of Credit then
outstanding.

 

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

 

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

 

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

 

“Benefitted Lender”: as defined in Section 10.7(a).

 

“Board”: the Board of Governors of the Federal Reserve System of the United
States (or any successor).

 

“Borrower”: as defined in the preamble hereto.

 

“Borrowing Date”: any Business Day specified by the Borrower as a date on which
the Borrower requests the relevant Lenders to make Loans hereunder.

 

2

 

 

“Business”: as defined in Section 4.17(b).

 

“Business Day”: a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close,
provided, that with respect to notices and determinations in connection with,
and payments of principal and interest on, Eurodollar Loans, such day is also a
day for trading by and between banks in Dollar deposits in the interbank
eurodollar market.

 

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

 

“Capital Stock”: any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.

 

“Cash Equivalents”: (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of twelve months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at least A-1 by S&P Global Ratings, a division of S&P Global Inc. (“S&P”) or P-1
by Moody’s Investors Service, Inc. (“Moody’s”), or carrying an equivalent rating
by a nationally recognized rating agency, if both of the two named rating
agencies cease publishing ratings of commercial paper issuers generally, and
maturing within six months from the date of acquisition; (d) repurchase
obligations of any Lender or of any commercial bank satisfying the requirements
of clause (b) of this definition, having a term of not more than 30 days, with
respect to securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least A
by S&P or A by Moody’s; (f) securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (b) of this
definition; (g) money market mutual or similar funds that invest exclusively in
assets satisfying the requirements of clauses (a) through (f) of this
definition; or (h) money market funds that (i) comply with the criteria set
forth in SEC Rule 2a-7 under the Investment Company Act of 1940, as amended,
(ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of
at least $5,000,000,000.

 

“Change in Law”: as defined in Section 3.8(a).

 

“Closing Date”: the date on which the conditions precedent set forth in Section
5.1 shall have been satisfied, which date is April 14, 2017.

 

“Co-Documentation Agents”: Citizens Bank, N.A., KeyBank National Association and
U.S. Bank National Association, each in its capacity as a co-documentation agent
in respect hereof.

 

3

 

 

“Co-Syndication Agents”: Bank of America, N.A. and Wells Fargo Bank, National
Association, each in its capacity as a co-syndication agent in respect hereof.

 

“Code”: the Internal Revenue Code of 1986, as amended.

 

“Commitment”: as to any Lender, the sum of the Incremental Term Loan Commitment
and Revolving Commitment of such Lender.

 

“Commonly Controlled Entity”: an entity, whether or not incorporated, that is
under common control with the Borrower or any Group Member within the meaning of
Section 4001 of ERISA or is part of a group that includes the Borrower or any
Group Member and that is treated as a single employer under Section 414 of the
Code.

 

“Compliance Certificate”: a certificate duly executed by a Responsible Officer
substantially in the form of Exhibit B.

 

“Conduit Lender”: any special purpose corporation organized and administered by
any Lender for the purpose of making Loans otherwise required to be made by such
Lender and designated by such Lender in a written instrument; provided, that the
designation by any Lender of a Conduit Lender shall not relieve the designating
Lender of any of its obligations to fund a Loan under this Agreement if, for any
reason, its Conduit Lender fails to fund any such Loan, and the designating
Lender (and not the Conduit Lender) shall have the sole right and responsibility
to deliver all consents and waivers required or requested under this Agreement
with respect to its Conduit Lender, and provided, further, that no Conduit
Lender shall (a) be entitled to receive any greater amount pursuant to Section
3.8, 3.9, 3.10 or 10.5 than the designating Lender would have been entitled to
receive in respect of the extensions of credit made by such Conduit Lender or
(b) be deemed to have any Commitment.

 

“Confidential Information Memorandum”: the Confidential Information Memorandum
dated February 2017 and furnished to certain Lenders.

 

“Consolidated EBITDA”: for any period:

 

(1) Consolidated Net Income for such period

 

plus,

 

(2) without duplication and to the extent reflected as a charge in the statement
of such Consolidated Net Income for such period, the sum of (a) income tax
expense, (b) interest expense, amortization or writeoff of debt discount and
debt issuance costs and commissions, discounts and other fees and charges
associated with Indebtedness (including the Loans), (c) depreciation and
amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any non-cash charges or
expenses (including for employee stock compensation) (excluding any non-cash
charges or expenses representing accruals or reserves in the ordinary course of
business for cash charges in a future period) and (f) any extraordinary, unusual
or non-recurring expenses or losses,

 

minus,

 

(3) to the extent included in the statement of such Consolidated Net Income for
such period, the sum of (i) interest income, (ii) any extraordinary, unusual or
non-recurring income or gains (including, whether or not otherwise includable as
a separate item in the statement of such Consolidated Net Income for such
period, gains on the sales of assets outside of the ordinary course of
business), (iii) income tax credits (to the extent not netted from income tax
expense) and (iv) any other non-cash income (including the reversal of any
reserve in respect of items described in clause (e) above subsequent to the
fiscal quarter in which the relevant non-cash expenses or losses were reflected
as a charge in the statement of Consolidated Net Income),

 

4

 

 

minus,

 

(4) any cash payments made during such period in respect of items described in
clause (2)(e) above subsequent to the fiscal quarter in which the relevant
non-cash expenses or losses were reflected as a charge in the statement of
Consolidated Net Income (but only to the extent the relevant non-cash expenses
or losses were added back to Consolidated Net Income in accordance with clause
(2)(e) above).

 

For the purposes of calculating Consolidated EBITDA for any Reference Period,
(i) if at any time during such Reference Period the Borrower or any Restricted
Subsidiary shall have made any Material Disposition, the Consolidated EBITDA for
such Reference Period shall be reduced by an amount equal to the Consolidated
EBITDA (if positive) attributable to the property that is the subject of such
Material Disposition for such Reference Period or increased by an amount equal
to the Consolidated EBITDA (if negative) attributable thereto for such Reference
Period and (ii) if during such Reference Period the Borrower or any Restricted
Subsidiary shall have made a Material Acquisition, Consolidated EBITDA for such
Reference Period shall be calculated after giving pro forma effect thereto as if
such Material Acquisition occurred on the first day of such Reference Period and
after giving pro forma effect to any adjustments (including, without limitation,
operating and expense reductions) as would be permitted to be reflected in pro
forma financial information complying with the requirements of Article 11 of
Regulation S-X under the Securities Act of 1933, as amended (and the
interpretations of the SEC thereunder).

 

“Consolidated Interest Coverage Ratio”: for any period, the ratio of (a)
Consolidated EBITDA for such period to (b) Consolidated Interest Expense for
such period.

 

“Consolidated Interest Expense”: for any period, total cash interest expense
(including that attributable to Capital Lease Obligations) of the Borrower and
the Restricted Subsidiaries for such period determined on a consolidated basis
in accordance with GAAP (including all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers’ acceptance financing
and Securitizations 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). For purposes of the foregoing, gross interest expense shall be
determined after giving effect to any net payments received or paid by the
Borrower or the Restricted Subsidiaries under interest rate protection
agreements, the effect of which is required to be reflected in the Borrower’s
income statement under “Interest Expense”.

 

“Consolidated Leverage Ratio”: as at the last day of any period, the ratio of
(a) Consolidated Total Debt on such day to (b) Consolidated EBITDA for such
period.

 

“Consolidated Net Income”: for any period, the consolidated net income (or loss)
of the Borrower and the Restricted Subsidiaries, determined on a consolidated
basis in accordance with GAAP; provided that (i) there shall be excluded (a)
except as provided in the definition of Consolidated EBITDA, the income (or
deficit) of any Person accrued prior to the date it becomes a Restricted
Subsidiary or is merged into or consolidated with the Borrower or any of the
Restricted Subsidiaries, (b) the income (or deficit) of any Person (other than a
Restricted Subsidiary) in which the Borrower or any of the Restricted
Subsidiaries has an ownership interest, except to the extent that any such
income is actually received by the Borrower or such Restricted Subsidiary in the
form of dividends or similar distributions and (c) the undistributed earnings of
any Restricted Subsidiary of the Borrower to the extent that the declaration or
payment of dividends or similar distributions by such Restricted Subsidiary is
not at the time permitted by the terms of any Contractual Obligation (other than
any such restrictions permitted pursuant to clause (vi) of Section 7.9 or
arising under any Loan Document) or Requirement of Law applicable to such
Restricted Subsidiary and (ii) there shall be no exclusion for the consolidated
net income attributable to the non-controlling interest (minority interest) in
any Joint Venture that is a Restricted Subsidiary.

 

5

 

 

“Consolidated Tangible Assets”: at any date, the total assets of the Borrower
and the Restricted Subsidiaries at such date, as determined on a consolidated
basis in accordance with GAAP, less the Intangible Assets of the Borrower and
the Restricted Subsidiaries. For purposes of this definition, “Intangible
Assets” means the amount of (i) all write-ups in the book value of any asset
owned by the Borrower or a Restricted Subsidiary and (ii) all unamortized debt
discount and expense, unamortized deferred charges, goodwill, patents,
trademarks, service marks, trade names, copyrights and other intangible assets
of the Borrower and the Restricted Subsidiaries, determined on a consolidated
basis in accordance with GAAP.

 

“Consolidated Total Debt”: at any date, the aggregate principal amount of all
Indebtedness of the Borrower and the Restricted Subsidiaries at such date,
determined on a consolidated basis in accordance with GAAP and set forth on the
consolidated balance sheet of the Borrower and its Restricted Subsidiaries
(excluding any items that appear solely in the footnotes thereto in accordance
with GAAP).

 

“Continuing Directors”: the directors of the Borrower on the Closing Date and
each other director, if, in each case, either (x) such other director’s
nomination for election to the board of directors of the Borrower was
recommended by at least a majority of the then Continuing Directors or (y) such
other director’s appointment to the board of directors of the Borrower was
approved by at least a majority of the then Continuing Directors.

 

“Contractual Obligation”: as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its property is bound.

 

“Credit Party”: the Administrative Agent, any Issuing Lender or any other
Lender.

 

“Default”: any of the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

 

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

 

6

 

 

“Disposition”: with respect to any property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof. The
terms “Dispose” and “Disposed of” shall have correlative meanings.

 

“Dollars” and “$”: dollars in lawful currency of the United States.

 

“Domestic Restricted Subsidiary”: any Restricted Subsidiary organized under the
laws of any jurisdiction within the United States.

 

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

 

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

 

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

 

“Environmental Laws”: any and all foreign, Federal, state, local or municipal
laws, rules, orders, regulations, statutes, ordinances, codes, decrees,
requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment.

 

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

 

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

 

“Eurocurrency Reserve Requirements”: for any day as applied to a Eurodollar
Loan, the aggregate (without duplication) of the maximum rates (expressed as a
decimal fraction) of reserve requirements in effect on such day (including
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of the
Board) maintained by a member bank of the Federal Reserve System.

 

7

 

 

“Eurodollar Base Rate”: with respect to any Eurodollar Loan 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 Dollars for a period equal in length
to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters
Screen that displays such rate (or, in the event such rate does not appear on
either of such Reuters pages, on any successor or substitute page on such screen
that displays such rate, or on the appropriate page of such other information
service that publishes such rate from time to time as selected by the
Administrative Agent in its reasonable discretion; in each case, the “Screen
Rate”) as of 11:00 A.M., London time, two Business Days prior to the beginning
of such Interest Period; provided that if the Screen Rate shall be less than
zero, such rate shall be deemed to be zero for purposes of this Agreement;
provided, further, that if the Screen Rate shall not be available at such time
for such Interest Period (an “Impacted Interest Period”) with respect to
Dollars, then the Eurodollar Base Rate shall be the Interpolated Rate at such
time (provided that if the Interpolated Rate shall be less than zero, such rate
shall be deemed to be zero for purposes of this Agreement).

 

“Eurodollar Loans”: Loans the rate of interest applicable to which is based upon
the Eurodollar Rate.

 

“Eurodollar Rate”: with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th
of 1%):

 

Eurodollar Base Rate 1.00 - Eurocurrency Reserve Requirements

 

“Eurodollar Tranche”: the collective reference to Eurodollar Loans under a
particular Facility the then current Interest Periods with respect to all of
which begin on the same date and end on the same later date (whether or not such
Loans shall originally have been made on the same day).

 

“Event of Default”: any of the events specified in Section 8, provided that any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

 

“Excess Extensions of Credit”: as defined in Section 3.14(c).

 

“Exchange Act”: as defined in Section 8(j).

 

“Excluded JV Subsidiary”: (a) any Joint Venture that would require the consent,
approval or authorization of any Joint Venture Partner in order to provide a
guarantee of the Obligations, unless the consent, approval or authorization of
each such Joint Venture Partner has been received and (b) any Person owned
directly or indirectly, in whole or in part, by any Joint Venture described in
the foregoing clause (a).

 

“Excluded Swap Obligation”: with respect to any Loan Party, any obligation (a
“Swap 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, if, and to the extent that, all or a portion of the
guarantee of such Loan Party of, or the grant by such Loan Party 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).

 

“Existing Credit Agreement”: the Credit Agreement, dated April 22, 2013, among
the Borrower, the lenders parties thereto from time to time and JPMorgan Chase
Bank, N.A., in its capacity as administrative agent thereunder.

 

“Existing Letters of Credit”: the letters of credit listed on Schedule 2.5.

 

8

 

 

“Facility”: each of (a) the Revolving Commitments and the extensions of credit
made thereunder (the “Revolving Facility”) and (b) the respective tranches of
Incremental Term Loan Commitments and the Incremental Term Loans made thereunder
(each an “Incremental Term Loan Facility”), if any.

 

“FATCA”: Sections 1471 through 1474 of the Code as of the date of this Agreement
(or any amended or successor version that is substantially comparable and not
materially more onerous to comply with) and any regulations issued thereunder or
official interpretations thereof.

 

“Federal Funds Effective Rate”: for any day, an interest rate per annum equal to
the rate calculated by the New York Fed based on such day’s (or, if such day is
not a Business Day, the most recently occurring Business Day’s) federal funds
transactions by depository institutions (as determined in such manner as the New
York Fed shall set forth on its public website from time to time) and published
on the next succeeding Business Day by the New York Fed as the federal funds
effective rate.

 

“Fee Payment Date”: (a) the third Business Day following the last day of each
March, June, September and December and (b) the last day of the Revolving
Commitment Period.

 

“Funding Office”: the office of the Administrative Agent specified in Section
10.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and
the Lenders.

 

“GAAP”: generally accepted accounting principles in the United States as in
effect from time to time.

 

“Governmental Authority”: any nation or government (including any supra-national
bodies such as the European Union or the European Central Bank) and any group or
body charged with setting financial accounting or regulatory capital rules or
standards (including, without limitation, the Financial Accounting Standards
Board, the Bank for International Settlements or the Basel Committee on Banking
Supervision or any successor or similar authority to any of the foregoing), any
state or other political subdivision thereof, any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative functions
of or pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).

 

“Group Members”: the collective reference to the Borrower and the Restricted
Subsidiaries.

 

“Guarantee”: the Guarantee to be executed and delivered by the Borrower and each
Subsidiary Guarantor, substantially in the form of Exhibit A.

 

9

 

 

“Guarantee Obligation”: as to any Person (the “guaranteeing Person”), any
obligation, including a reimbursement, counterindemnity or similar obligation,
of the guaranteeing Person that guarantees or in effect guarantees, or which is
given to induce the creation of a separate obligation by another Person
(including any bank under any letter of credit) that guarantees or in effect
guarantees, any Indebtedness, leases, dividends or other obligations (the
“primary obligations”) of any other third Person (the “primary obligor”) in any
manner, whether directly or indirectly, including any obligation of the
guaranteeing Person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security therefor,
(ii) to advance or supply funds (1) for the purchase or payment of any such
primary obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing Person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee Obligation is made and (b) the maximum amount
for which such guaranteeing Person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing Person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing Person’s maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith.

 

“Historical Financials”: as defined in Section 4.1.

 

“Honor Date”: as defined in Section 2.9.

 

“Immaterial Restricted Subsidiary”: any Restricted Subsidiary the revenues
(excluding intercompany revenues) of which for the Reference Period ended as of
the end of the most recently completed fiscal quarter for which financial
statements have been delivered pursuant to Section 6.1 do not exceed
$50,000,000.

 

“Impacted Interest Period”: as defined in the definition of “Eurodollar Base
Rate”.

 

“Incremental Amendment”: as defined in Section 3.15(d).

 

“Incremental Term Loan Commitments”: as to any Lender, the obligation of such
Lender, if any, to make an Incremental Term Loan to the Borrower in a principal
amount not to exceed the amount set forth in the applicable Incremental
Amendment governing such Incremental Term Loan.

 

“Incremental Term Loan Facility”: as defined in the definition of “Facility”.

 

“Incremental Term Loans”: as defined in Section 3.15(a).

 

“Indebtedness”: of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person’s
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of
credit, surety bonds or similar arrangements, (g) all Guarantee Obligations of
such Person in respect of obligations of the kind referred to in clauses (a)
through (f), (h) all obligations of the kind referred to in clauses (a) through
(g) above secured by (or for which the holder of such obligation has an existing
right, contingent or otherwise, to be secured by) any Lien on property
(including accounts and contract rights) owned by such Person, whether or not
such Person has assumed or become liable for the payment of such obligation, (i)
all Securitization Attributable Indebtedness incurred by such Person in
connection with any Securitization in which such Person participates, and (j)
for the purposes of Section 8(e) only, the Swap Termination Value (but in no
event to be an amount less than zero) in respect of Swap Agreements to which
such Person is a party; provided, however, that “Indebtedness” of the Borrower
and the Restricted Subsidiaries shall not include any amounts owed or other
obligations of the Borrower or any Restricted Subsidiary related to the Taxable
Special Obligation Development Lease Revenue Bonds (Sid Tool Co., Inc. Project)
dated December 4, 2012 in the aggregate principal amount of up to $35,000,000
pursuant to that certain Bond Advance Agreement and Assignment of Lease and
Rental Payments, dated as of December 4, 2012. 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 expressly provide that such Person is not liable therefor.

 

10

 

 

“Insolvent”: with respect to any Multiemployer Plan, the condition that such
plan is insolvent within the meaning of Section 4245 of ERISA.

 

“Intellectual Property”: the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.

 

“Interest Payment Date”: (a) as to any ABR Loan, the last day of each March,
June, September and December to occur while such Loan is outstanding and the
final maturity date of such Loan, (b) as to any Eurodollar Loan having an
Interest Period of three months or less, the last day of such Interest Period,
(c) as to any Eurodollar Loan having an Interest Period longer than three
months, each day that is three months, or a whole multiple thereof, after the
first day of such Interest Period and the last day of such Interest Period and
(d) as to any Loan (other than any Revolving Loan that is an ABR Loan), the date
of any repayment or prepayment made in respect thereof.

 

“Interest Period”: as to any Eurodollar Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurodollar Loan and ending one, two, three or six months thereafter (or
such other period as may be acceptable to all applicable Lenders), as selected
by the Borrower in its notice of borrowing or notice of conversion, as the case
may be, given with respect thereto; and (b) thereafter, each period commencing
on the last day of the next preceding Interest Period applicable to such
Eurodollar Loan and ending one, two, three or six months thereafter (or such
other period as may be acceptable to all applicable Lenders), as selected by the
Borrower by irrevocable notice to the Administrative Agent not later than 11:00
A.M., New York City time, on the date that is three Business Days prior to the
last day of the then current Interest Period with respect thereto; provided
that, all of the foregoing provisions relating to Interest Periods are subject
to the following:

 

(i)           if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such Interest
Period into another calendar month in which event such Interest Period shall end
on the immediately preceding Business Day;

 

(ii)          the Borrower may not select an Interest Period under a particular
Facility that would extend beyond the Revolving Termination Date or beyond the
date final payment is due on the relevant Incremental Term Loans, as the case
may be; and

 

11

 

 

(iii)         any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month.

 

“Interim Financials”: as defined in Section 4.1.

 

“Interpolated Rate”: at any time, the rate per annum (rounded to the same number
of decimal places as the Screen Rate) determined by the Administrative Agent
(which determination shall be conclusive and binding absent manifest error) to
be equal to the rate that results from interpolating on a linear basis between:
(a) the Screen Rate for the longest period for which that Screen Rate is
available in dollars that is shorter than the Impacted Interest Period and (b)
the Screen Rate for the shortest period for which that Screen Rate is available
for dollars that is longer the Impacted Interest Period, in each case, as of
11:00 a.m., London time (or as soon thereafter as practicable), two Business
Days before the first day of such Impacted Interest Period.

 

“Investments”: as defined in Section 7.6.

 

“IRS”: the United States Internal Revenue Service.

 

“IRS Form W-8BEN”: the IRS Form W-8BEN-E, for entities, or the IRS Form W-8BEN,
for individuals, as applicable.

 

“Issuing Lender”: each of JPMorgan Chase Bank, N.A., Bank of America, N.A.,
Wells Fargo Bank, National Association and any other Revolving Lender reasonably
satisfactory to the Administrative Agent and the Borrower that has agreed in its
sole discretion to act as an “Issuing Lender” hereunder, or any of their
respective affiliates, in each case, in its capacity as issuer of any Letter of
Credit. Each reference herein to “the Issuing Lender” shall be deemed to be a
reference to the relevant Issuing Lender.

 

“Joint Venture”: (a) a Subsidiary a portion of the Capital Stock of which is
owned by a Person or Persons other than (x) the Group Members and (y) Persons
holding directors’ qualifying shares or other similar interests and (b) any
Person owned directly or indirectly, in whole or in part, by any Subsidiary
described in the foregoing clause (a).

 

“Joint Venture Partner”: with respect to any Joint Venture at any time, any
Person (other than a Group Member or a Person holding directors’ qualifying
shares or other similar interests) that owns a portion of the Capital Stock of
such Joint Venture at such time.

 

“L/C Commitment”: as to any Issuing Lender, the amount agreed from time to time
by such Issuing Lender in its sole discretion and the Borrower (and notified to
the Administrative Agent) as the maximum amount of Letters of Credit that such
Issuing Lender is willing to issue at any time for the account of the Borrower
hereunder, with the amount of Letters of Credit issued by any Issuing Lender at
any time deemed to be equal to the amount of L/C Obligations at such time
attributable to Letters of Credit issued by such Issuing Lender. As of the
Closing Date, the L/C Commitment of (i) JPMorgan Chase Bank, N.A. is
$16,666,666.67, (ii) Bank of America, N.A. is $16,666,666.67 and (iii) Wells
Fargo Bank, National Association is $16,666,666.66.

 

“L/C Obligations”: at any time, an amount equal to the sum of (a) the aggregate
then undrawn and unexpired amount of the then outstanding Letters of Credit and
(b) the aggregate amount of drawings under Letters of Credit that have not then
been reimbursed pursuant to Section 2.9.

 

12

 

 

“L/C Participants”: with respect to any Letter of Credit, the collective
reference to all the Revolving Lenders other than the Issuing Lender that issued
such Letter of Credit.

 

“L/C Sublimit”: $50,000,000.

 

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

 

“Lenders”: as defined in the preamble hereto; provided, that unless the context
otherwise requires, each reference herein to the Lenders shall be deemed to
include any Conduit Lender.

 

“Letters of Credit”: as defined in Section 2.5(a).

 

“Leverage Ratio Step-Up”: as defined in Section 7.1(a).

 

“Leverage Ratio Step-Up Notice”: as defined in Section 7.1(a).

 

“Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge or other security interest or any
preference, priority or other security agreement or preferential arrangement in
the nature of a security interest of any kind or nature whatsoever (including
any conditional sale or other title retention agreement and any capital lease
having substantially the same economic effect as any of the foregoing).

 

“Loan”: any loan made by any Lender pursuant to this Agreement.

 

“Loan Documents”: this Agreement, the Guarantee, the Notes and any amendment,
waiver, supplement or other modification to any of the foregoing.

 

“Loan Parties”: each Group Member that is a party to a Loan Document.

 

“Majority Facility Lenders”: with respect to any Facility, the holders of more
than 50% of the aggregate unpaid principal amount of the Incremental Term Loans
or the Total Revolving Extensions of Credit, as the case may be, outstanding
under such Facility (or, in the case of the Revolving Facility, prior to any
termination of the Revolving Commitments, the holders of more than 50% of the
Total Revolving Commitments).

 

“Material Acquisition”: any acquisition of property or series of related
acquisitions of property that (a) constitutes assets comprising all or
substantially all of an operating unit of a business or constitutes all or
substantially all of the common stock of a Person and (b) involves the payment
of consideration by the Borrower and the Restricted Subsidiaries in excess of
$100,000,000.

 

“Material Adverse Effect”: a material adverse effect on (a) the business,
property, operations or condition (financial or otherwise) of the Borrower and
the Restricted Subsidiaries taken as a whole or (b) the validity or
enforceability of this Agreement or any of the other Loan Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.

 

“Material Disposition”: any Disposition of property or series of related
Dispositions of property that yields gross proceeds to the Borrower or any of
the Restricted Subsidiaries in excess of $100,000,000.

 

13

 

 

“Material Domestic Restricted Subsidiary”: (a) Sid Tool Co., Inc., MSC Contract
Management, Inc. and J&L America, Inc., (b) any other Domestic Restricted
Subsidiary designated by the Borrower as a Material Domestic Restricted
Subsidiary, and (c) each other Domestic Restricted Subsidiary (other than any
Excluded JV Subsidiary) the revenues (excluding intercompany revenues) of which
for the Reference Period ended as of the end of the most recently completed
fiscal quarter for which financial statements have been delivered pursuant to
Section 6.1 exceed $50,000,000; provided that the aggregate revenues (excluding
intercompany revenues) of all Domestic Restricted Subsidiaries (other than
Excluded JV Subsidiaries) that are not Material Domestic Restricted Subsidiaries
for any Reference Period shall not exceed 10% of the aggregate revenues
(excluding intercompany revenues) of the Borrower and its Domestic Restricted
Subsidiaries (other than Excluded JV Subsidiaries) for such Reference Period
(and the Borrower will designate in writing to the Administrative Agent from
time to time a Domestic Restricted Subsidiary (or Domestic Restricted
Subsidiaries) to be designated as a “Material Domestic Restricted Subsidiary” in
order to comply with the foregoing limitation (it being understood and agreed
that such designation may be included in, and satisfied by delivery of, a
supplement to the Guarantee substantially in the form of Annex A to the
Guarantee)).

 

“Materials of Environmental Concern”: any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes, defined or regulated as such in or under any
Environmental Law, including asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.

 

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

 

“New York Fed”: the Federal Reserve Bank of New York.

 

“New York Fed Bank Rate”: for any day, the greater of (a) the Federal Funds
Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in
effect on such day; provided that if neither of such rates is so published for
any day (or, if such day is not a Business Day, the most recently occurring
Business Day), the term “New York Fed Bank Rate” means the rate quoted for such
day (or, if such day is not a Business Day, the most recently occurring Business
Day) for a federal funds transaction at 11:00 a.m. New York City time on such
day (or Business Day, as the case may be) received by the Administrative Agent
from a Federal funds broker of recognized standing selected by it; provided,
further, that if any of the aforesaid rates shall be less than zero, such rate
shall be deemed to be zero for purposes of this Agreement.

 

“Non-Excluded Taxes”: as defined in Section 3.9(a).

 

“Non-U.S. Lender”: as defined in Section 3.9(d).

 

“Notes”: the collective reference to any promissory note evidencing Loans.

 

“Obligations”: the unpaid principal of and interest on (including interest
accruing after the maturity of the Loans and Reimbursement Obligations and
interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Loans and Reimbursement Obligations and all
other obligations and liabilities of the Borrower (or, in the case of any
Specified Swap Agreement, any Subsidiary Guarantor) to the Administrative Agent
or to any Lender (or, in the case of any Specified Swap Agreement, any affiliate
of any Lender), whether direct or indirect, absolute or contingent, due or to
become due, or now existing or hereafter incurred, which may arise under, out
of, or in connection with, this Agreement, any other Loan Document, any Letter
of Credit, any Specified Swap Agreement or any other document made, delivered or
given in connection herewith or therewith, in each case, whether on account of
principal, interest, reimbursement obligations, fees, indemnities, costs,
expenses (including all fees, charges and disbursements of counsel to the
Administrative Agent or to any Lender that are required to be paid by the
Borrower pursuant hereto) or otherwise.

 

14

 

 

“Other Taxes”: any and all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document, including
any interest, additions to tax or penalties applicable thereto.

 

“Overnight Bank Funding Rate”: for any day, the rate comprised of both overnight
federal funds and overnight eurodollar borrowings by U.S.–managed banking
offices of depository institutions (as such composite rate shall be determined
by the New York Fed as set forth on its public website from time to time) and
published on the next succeeding Business Day by the New York Fed as an
overnight bank funding rate (from and after such date as the New York Fed shall
commence to publish such composite rate).

 

“Participant”: as defined in Section 10.6(c).

 

“Participant Register”: as defined in Section 10.6(c).

 

“Patriot Act”: as defined in Section 10.17.

 

“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).

 

“Permitted Investors”: the collective reference to (a) Mitchell Jacobson, (b)
Marjorie Gershwind Fiverson, (c) Erik Gershwind, (d) Stacey Bennett, (e) the
heirs, executors, administrators, testamentary trustees, legatees or
beneficiaries of Mitchell Jacobson, Marjorie Gershwind Fiverson, Erik Gershwind
or Stacey Bennett including, but not limited to, such one or more organizations
to which transfers are deductible for Federal, estate, gift or income tax
purposes and (f) any trust, business trust, limited liability company or other
entity, the beneficiaries, beneficial owners or equity holders of which include
only Mitchell Jacobson, Marjorie Gershwind Fiverson, Erik Gershwind, Stacey
Bennett, their spouses, their lineal descendants and any other members of their
families, and such one or more organizations to which transfers are deductible
for Federal, estate, gift, or income tax purposes.

 

“Person”: an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, charitable organization,
unincorporated association, joint venture, Governmental Authority or other
entity of whatever nature.

 

“Plan”: at a particular time, any employee pension benefit plan (within the
meaning of Section 3(2) of ERISA, other than a Multiemployer Plan) that is
covered by ERISA and in respect of which the Borrower or any Group Member is, or
in the case of a Plan that is subject to Section 412 of the Code or Section 302
of ERISA, any Commonly Controlled Entity is (or, if such plan were terminated at
such time, would under Section 4069 of ERISA be deemed to be) an “employer” as
defined in Section 3(5) of ERISA.

 

“Pricing Grid”: the table set forth below.

 

15

 

 

Consolidated Leverage
Ratio  Applicable Margin for
Revolving Loans that are
Eurodollar Loans   Applicable Margin for
Revolving Loans that are ABR
Loans   Undrawn Fee Rate                Equal to or higher than 2.50 to 1.00 
 1.375%   0.375%   0.20%                  Less than 2.50 to 1.00, but equal to
or higher than 1.50 to 1.00   1.250%   0.250%   0.15%                  Less than
1.50 to 1.00, but equal to or higher than 0.75 to 1.00   1.125%   0.125% 
 0.125%                  Less than 0.75 to 1.00   1.00%   0.00%   0.100%

 

For the purposes of the Pricing Grid, changes in the Applicable Margin resulting
from changes in the Consolidated Leverage Ratio shall become effective on the
date that is three Business Days after the date on which financial statements
are delivered to the Lenders pursuant to Section 6.1 and shall remain in effect
until the next change to be effected pursuant to this paragraph. If any
financial statements pursuant to Section 6.1 are not delivered within the time
periods specified in Section 6.1, then, until the date that is three Business
Days after the date on which such financial statements are delivered, the
highest rate set forth in each column of the Pricing Grid shall apply. In
addition, at all times while an Event of Default shall have occurred and be
continuing, the highest rate set forth in each column of the Pricing Grid shall
apply. Each determination of the Consolidated Leverage Ratio pursuant to the
Pricing Grid shall be made in a manner consistent with the determination thereof
pursuant to Section 7.1.

 

“Priority Debt”: without duplication, (a) all Indebtedness of Restricted
Subsidiaries which are not Subsidiary Guarantors, (b) all Indebtedness of the
Borrower or any of the Restricted Subsidiaries secured by a Lien other than
Liens permitted by Section 7.3(a) through Section 7.3(o) and (c) all
Indebtedness of the Borrower or any of the Restricted Subsidiaries incurred in
connection with any Securitization.

 

“Properties”: as defined in Section 4.17(a).

 

“Reference Period”: any period of four consecutive fiscal quarters.

 

“Register”: as defined in Section 10.6(b).

 

“Regulation U”: Regulation U of the Board as in effect from time to time.

 

“Reimbursement Obligation”: the obligation of the Borrower to reimburse each
Issuing Lender pursuant to Section 2.9 for amounts drawn under Letters of Credit
issued by such Issuing Lender.

 

“Replaced Incremental Term Loans”: as defined in Section 10.1(d).

 

“Replacement Term Loans”: as defined in Section 10.1(d).

 

“Reportable Event”: any of the events set forth in Section 4043(c) of ERISA,
other than those events as to which the thirty day notice period is waived under
subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.

 

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“Required Lenders”: at any time, the holders of more than 50% of (a) until the
Closing Date, the Commitments then in effect and (b) thereafter, the sum of (i)
the aggregate unpaid principal amount of the Incremental Term Loans then
outstanding and (ii) the Total Revolving Commitments then in effect or, if the
Revolving Commitments have been terminated, the Total Revolving Extensions of
Credit then outstanding.

 

“Requirement of Law”: as to any Person, the Certificate of Incorporation and
By-Laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.

 

“Responsible Officer”: the chief executive officer, president, chief operating
officer, vice president of finance and accounting, vice president of finance,
corporate controller or chief financial officer of the Borrower, but in any
event, with respect to financial matters, the vice president of finance and
accounting, vice president of finance, corporate controller or chief financial
officer of the Borrower.

 

“Restricted Payment”: any payment of dividends, any payment on account of the
purchase, redemption, defeasance, retirement or other acquisition of any Capital
Stock and any other distribution in respect thereof, either directly or
indirectly, whether in cash or property or in obligations of any Group Member.

 

“Restricted Subsidiary”: any Subsidiary of the Borrower other than an
Unrestricted Subsidiary.

 

“Revolving Commitment”: as to any Lender, the obligation of such Lender, if any,
to make Revolving Loans and participate in Letters of Credit in an aggregate
principal and/or face amount not to exceed the amount set forth under the
heading “Revolving Commitment” opposite such Lender’s name on Schedule 1.1A
(which amount may be increased pursuant to Section 3.15) or in the Assignment
and Assumption or Incremental Amendment pursuant to which such Lender became a
party hereto, as the same may be changed from time to time pursuant to the terms
hereof. The original amount of the Total Revolving Commitments is $600,000,000.

 

“Revolving Commitment Period”: the period from and including the Closing Date to
the Revolving Termination Date.

 

“Revolving Extensions of Credit”: as to any Revolving Lender at any time, an
amount equal to the sum of (a) the aggregate principal amount of all Revolving
Loans held by such Lender then outstanding and (b) such Lender’s Revolving
Percentage of the L/C Obligations then outstanding.

 

“Revolving Facility”: as defined in the definition of “Facility”.

 

“Revolving Lender”: each Lender that has a Revolving Commitment or that holds
Revolving Loans.

 

“Revolving Loans”: as defined in Section 2.1(a).

 

“Revolving Percentage”: as to any Revolving Lender at any time, the percentage
which such Lender’s Revolving Commitment then constitutes of the Total Revolving
Commitments or, at any time after the Revolving Commitments shall have expired
or terminated, the percentage which the aggregate amount of such Lender’s
Revolving Extensions of Credit then outstanding constitutes of the aggregate
amount of the Revolving Extensions of Credit then outstanding.

 

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“Revolving Termination Date”: April 14, 2022 or such earlier date on which the
Revolving Commitments may terminate pursuant to Section 8 or Section 2.4.

 

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

 

“Sanctioned Person”: 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 or the U.S. Department of State or by the
United Nations Security Council, the European Union, any European Union member
state or Her Majesty’s Treasury of the United Kingdom, (b) any Person operating,
organized or resident in a Sanctioned Country or (c) any Person owned or
controlled by any such Person or Persons described in the foregoing clauses (a)
or (b).

 

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

 

“Screen Rate”: as defined in the definition of “Eurodollar Base Rate”.

 

“SEC”: the Securities and Exchange Commission, any successor thereto and any
analogous Governmental Authority.

 

“Securitization”: any transaction or series of transactions entered into by the
Borrower or any Restricted Subsidiary pursuant to which the Borrower or such
Restricted Subsidiary, as the case may be, sells, conveys or otherwise transfers
to a Securitization Vehicle Securitization Assets of the Borrower or such
Restricted Subsidiary (or grants a security interest in such Securitization
Assets transferred or purported to be transferred to such Securitization
Vehicle), and which Securitization Vehicle finances the acquisition of such
Securitization Assets (i) with proceeds from the issuance or sale of Third Party
Interests, (ii) with Sellers’ Retained Interests and/or (iii) with proceeds from
the sale or collection of Securitization Assets previously purchased by such
Securitization Vehicle.

 

“Securitization Assets”: any accounts receivable owed to or owned by the
Borrower or any Restricted Subsidiary (whether now existing or arising or
acquired in the future) arising in the ordinary course of business from the sale
of goods or services, all collateral securing such accounts receivable, all
contracts and contract rights and all guarantees or other obligations in respect
of such accounts receivable, all proceeds of such accounts receivable and other
assets (including contract rights) which are of the type customarily transferred
in connection with securitizations of accounts receivable and which are sold,
transferred or otherwise conveyed by the Borrower or a Restricted Subsidiary to
a Securitization Vehicle in connection with a Securitization permitted by
Section 7.5.

 

“Securitization Attributable Indebtedness”: the amount of obligations
outstanding under the legal documents entered into as part of any accounts
receivable securitization or similar transaction relating to accounts receivable
originated by the Borrower or any Restricted Subsidiary on any date of
determination that corresponds to the outstanding net investment (including
loans) of, or cash purchase price paid by, the unaffiliated third party
purchasers or financial institutions participating in such transaction and, as
such, would be characterized as principal if such securitization were structured
as a secured lending transaction rather than as a purchase (or, to the extent
structured as a secured lending transaction, is principal). For the avoidance of
doubt, “Securitization Attributable Indebtedness” shall not include (a)
obligations that correspond to a deferred purchase price or other consideration
owing to the Borrower or any Restricted Subsidiary funded on a deferred basis
from the proceeds of the collections on such receivables, a subordinated
interest held by the Borrower or any Restricted Subsidiary or the reserve or
over-collateralization established or maintained for the benefit of the
unaffiliated third party purchasers or financial institutions participating in
such transaction, and (b) obligations arising under uncommitted factoring
arrangements and similar uncommitted sale transactions.

 

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“Securitization Vehicle”: a Person that is a direct wholly owned Subsidiary of
the Borrower or a Restricted Subsidiary formed for the purpose of effecting one
or more Securitizations to which the Borrower or any Restricted Subsidiary
transfers Securitization Assets and which, in connection therewith, issues or
sells Third Party Interests or Sellers’ Retained Interests; provided that such
Securitization Vehicle shall engage in no business other than the purchase of
Securitization Assets pursuant to Securitizations permitted by Section 7.5, the
issuance or sale of Third Party Interests or other funding of such
Securitizations and any activities reasonably related thereto, and provided
further that:

 

(x)          no portion of the Indebtedness or any other obligations (contingent
or otherwise) of such Securitization Vehicle (i) is guaranteed by the Borrower
or any Restricted Subsidiary (excluding guarantees of obligations (other than
the principal of and interest on Indebtedness) pursuant to Standard
Securitization Undertakings), (ii) is with recourse to or obligates the Borrower
or any Restricted Subsidiary (other than such Securitization Vehicle) in any way
other than pursuant to Standard Securitization Undertakings, or (iii) subjects
any property or asset of the Borrower or any Restricted Subsidiary (other than
such Securitization Vehicle), directly or indirectly, contingently or otherwise,
to the satisfaction thereof, other than pursuant to Standard Securitization
Undertakings;

 

(y)          neither the Borrower nor any Restricted Subsidiary has any material
contract, agreement, arrangement or understanding with such Securitization
Vehicle other than on terms which the Borrower reasonably believes to be no less
favorable to the Borrower or such Restricted Subsidiary than those that might be
obtained at the time from Persons that are not Affiliates of the Borrower and
other than Standard Securitization Undertakings; and

 

(z)          neither the Borrower nor any Restricted Subsidiary has any
obligation to maintain or preserve such Securitization Vehicle’s financial
condition or cause such Securitization Vehicle to achieve certain levels of
operating results.

 

“Sellers’ Retained Interests”: the debt or equity interests held by or deferred
purchase price payable to the Borrower or any Restricted Subsidiary in a
Securitization Vehicle to which Securitization Assets have been transferred in a
Securitization permitted by Section 7.5, including any such debt, equity or
deferred purchase price received in consideration for the Securitization Assets
transferred.

 

“Single Employer Plan”: any Plan that is covered by Title IV of ERISA.

 

“Solvent”: when used with respect to any Person, means that, as of any date of
determination, (a) the amount of the “present fair saleable value” of the assets
of such Person will, as of such date, exceed the amount of all “liabilities of
such Person, contingent or otherwise”, as of such date, as such quoted terms are
determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable value
of the assets of such Person will, as of such date, be greater than the amount
that will be required to pay the liability of such Person on its debts as such
debts become absolute and matured, (c) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its
business, and (d) such Person will be able to pay its debts as they mature. For
purposes of this definition, (i) “debt” means liability on a “claim”, and (ii)
“claim” means any (x) right to payment, whether or not such a right is reduced
to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an
equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.

 

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“Specified Swap Agreement”: any Swap Agreement between the Borrower or any
Subsidiary Guarantor and any Lender or affiliate thereof in respect of interest
rates, currency exchange rates or commodity prices.

 

“Standard Securitization Undertakings”: representations, warranties, covenants,
indemnities and guarantees of payment and performance entered into by the
Borrower or any Restricted Subsidiary which the Borrower has determined in good
faith to be customary in a Securitization, including those relating to the
servicing of the assets of a Securitization Vehicle.

 

“Subsidiary”: as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries,
or both, by such Person. Unless otherwise qualified, all references to a
“Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Borrower.

 

“Subsidiary Guarantor”: each Material Domestic Restricted Subsidiary, other than
any Securitization Vehicle.

 

“Swap Agreement”: any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, 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 Borrower or any of
its Subsidiaries shall be a “Swap Agreement”.

 

“Swap Obligation”: as defined in the definition of “Excluded Swap Obligation”.

 

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

 

“Third Party Interests”: with respect to any Securitization, notes, bonds or
other debt instruments, beneficial interests in a trust, undivided ownership
interests in receivables or other securities issued or sold for cash
consideration by the relevant Securitization Vehicle to banks, financing
conduits, investors or other financing sources (other than the Borrower and the
Restricted Subsidiaries) the proceeds of which are used to finance, in whole or
in part, the purchase by such Securitization Vehicle of Securitization Assets in
a Securitization. The amount of any Third Party Interests shall be deemed to
equal the aggregate principal, stated or invested amount of such Third Party
Interests which are outstanding at such time.

 

20

 

 

“Total Revolving Commitments”: at any time, the aggregate amount of the
Revolving Commitments then in effect.

 

“Total Revolving Extensions of Credit”: at any time, the aggregate amount of the
Revolving Extensions of Credit of the Revolving Lenders outstanding at such
time.

 

“Transferee”: any Assignee or Participant.

 

“Type”: as to any Loan, its nature as an ABR Loan or a Eurodollar Loan.

 

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

 

“Undrawn Fee Rate”: the rate per annum determined pursuant to the Pricing Grid.

 

“United States”: the United States of America.

 

“Unrestricted Subsidiary”: (a) any Subsidiary of the Borrower listed as an
Unrestricted Subsidiary on Schedule 4.15 hereto and (b) any Subsidiary of the
Borrower designated by the board of directors of the Borrower as an Unrestricted
Subsidiary pursuant to Section 6.10 after the Closing Date.

 

“Withholding Agents”: the Loan Parties and the Administrative Agent.

 

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

 

1.2.         Other Definitional Provisions. (a)  Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the other Loan Documents or any certificate or other document made
or delivered pursuant hereto or thereto.

 

(b)          As used herein and in the other Loan Documents, and any certificate
or other document made or delivered pursuant hereto or thereto, (i) accounting
terms relating to any Group Member not defined in Section 1.1 and accounting
terms partly defined in Section 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP (provided that, notwithstanding
anything to the contrary herein, all accounting or financial terms used herein
shall be construed, and all financial computations pursuant hereto shall be
made, without giving effect to any election under Statement of Financial
Accounting Standards 159 (or any other Financial Accounting Standard having a
similar effect) to value any Indebtedness or other liabilities of any Group
Member at “fair value”, as defined therein), (ii) the words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”, (iii) the word “incur” shall be construed to mean incur, create,
issue, assume, become liable in respect of or suffer to exist (and the words
“incurred” and “incurrence” shall have correlative meanings), (iv) 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, Capital Stock, securities, revenues, accounts, leasehold
interests and contract rights, and (v) references to agreements or other
Contractual Obligations shall, unless otherwise specified, be deemed to refer to
such agreements or other Contractual Obligations as amended, supplemented,
restated or otherwise modified from time to time.

 

21

 

 

(c)          The words “hereof”, “herein” and “hereunder” and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.

 

(d)          The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

 

(e)          Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with GAAP;
provided that, if the Borrower notifies the Administrative Agent that the
Borrower requests an amendment to any provision hereof to eliminate the effect
of any change occurring after the date hereof in GAAP or in the application
thereof on the operation of such provision (or if the Administrative Agent
notifies the Borrowers 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; provided, further that for purposes of calculating the ratios,
requirements or covenants under this Agreement or any other Loan Document, any
obligations of a Person under a lease (whether existing on the Closing Date or
entered into thereafter) that is not (or would not be) required to be classified
and accounted for as a Capital Lease Obligation on a balance sheet of such
Person prepared in accordance with GAAP as in effect on the Closing Date shall
not be treated as a Capital Lease Obligation or Indebtedness pursuant to this
Agreement or the other Loan Documents solely as a result of changes in the
application of GAAP that become effective after the Closing Date (including the
avoidance of doubt, any changes as set forth in the FASB ASU 2016-2, Leases
(Topic 842)).

 

Section 2.  AMOUNTS AND TERMS OF REVOLVING COMMITMENTS

 

2.1.         Revolving Commitments. (a)  Subject to the terms and conditions
hereof, each Revolving Lender severally agrees to make revolving credit loans
(“Revolving Loans”) to the Borrower from time to time during the Revolving
Commitment Period in an aggregate principal amount at any one time outstanding
which, when added to such Lender’s Revolving Percentage of the L/C Obligations
then outstanding, does not exceed the amount of such Lender’s Revolving
Commitment. During the Revolving Commitment Period the Borrower may use the
Revolving Commitments by borrowing, prepaying the Revolving Loans in whole or in
part, and reborrowing, all in accordance with the terms and conditions hereof.
The Revolving Loans may from time to time be Eurodollar Loans or ABR Loans, as
determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.2 and 3.2.

 

(b)          The Borrower shall repay all outstanding Revolving Loans on the
Revolving Termination Date.

 

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2.2.         Procedure for Revolving Loan Borrowing. The Borrower may borrow
under the Revolving Commitments during the Revolving Commitment Period on any
Business Day, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which notice must be received by the Administrative Agent
prior to (a) 11:00 A.M., New York City time, three Business Days prior to the
requested Borrowing Date, in the case of Eurodollar Loans, or (b) 1:00 P.M., New
York City time, on the requested Borrowing Date, in the case of ABR Loans),
specifying (i) the amount and Type of Revolving Loans to be borrowed, (ii) the
requested Borrowing Date and (iii) in the case of Eurodollar Loans, the
respective amounts of each such Type of Loan and the respective lengths of the
initial Interest Period therefor. Each borrowing under the Revolving Commitments
shall be in an amount equal to (x) in the case of ABR Loans, $1,000,000 or a
whole multiple thereof (or, if the then aggregate Available Revolving
Commitments are less than $1,000,000, such lesser amount) and (y) in the case of
Eurodollar Loans, $3,000,000 or a whole multiple of $1,000,000 in excess
thereof. Upon receipt of any such notice from the Borrower, the Administrative
Agent shall promptly notify each Revolving Lender thereof. Each Revolving Lender
will make the amount of its pro rata share of each borrowing available to the
Administrative Agent for the account of the Borrower at the Funding Office prior
to 2:00 P.M., New York City time, on the Borrowing Date requested by the
Borrower in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the Administrative
Agent crediting the account of the Borrower on the books of such office with the
aggregate of the amounts made available to the Administrative Agent by the
Revolving Lenders and in like funds as received by the Administrative Agent.

 

2.3.         Undrawn Fees, etc. (a)   The Borrower agrees to pay to the
Administrative Agent for the account of each Revolving Lender an undrawn fee for
the period from and including the date hereof to the last day of the Revolving
Commitment Period, computed at the Undrawn Fee Rate on the average daily amount
of the unused Revolving Commitment of such Lender during the period for which
payment is made. Undrawn fees shall be payable quarterly in arrears on each Fee
Payment Date, commencing on the first such date to occur after the date hereof.

 

(b)          The Borrower agrees to pay to the Administrative Agent the fees in
the amounts and on the dates as set forth in any fee agreements with the
Administrative Agent and to perform any other obligations contained therein.

 

2.4.         Termination or Reduction of Revolving Commitments. The Borrower
shall have the right, upon not less than three Business Days’ notice to the
Administrative Agent, to terminate the Revolving Commitments or, from time to
time, to reduce the amount of the Revolving Commitments; provided that no such
termination or reduction of Revolving Commitments shall be permitted if, after
giving effect thereto and to any prepayments of the Revolving Loans made on the
effective date thereof, the Total Revolving Extensions of Credit would exceed
the Total Revolving Commitments. Any such reduction shall be in an amount equal
to $1,000,000, or a whole multiple thereof, and shall reduce permanently the
Revolving Commitments then in effect.

 

2.5.         L/C Commitment. (a)  The Existing Letters of Credit issued under
the Existing Credit Agreement prior to the Closing Date, if any, will, from and
after the Closing Date, be deemed to be Letters of Credit issued under this
Agreement on the Closing Date. Subject to the terms and conditions hereof, each
Issuing Lender, in reliance on the agreements of the other Revolving Lenders set
forth in Section 2.8(a), agrees to issue letters of credit (together with the
Existing Letters of Credit, the “Letters of Credit”) for the account of the
Borrower on any Business Day during the Revolving Commitment Period in such form
as may be approved from time to time by such Issuing Lender; provided that no
Issuing Lender shall have any obligation to issue any Letter of Credit if, after
giving effect to such issuance, (i) the L/C Obligations would exceed the L/C
Sublimit, (ii) the aggregate amount of the Available Revolving Commitments would
be less than zero or (iii) the amount of L/C Obligations at such time
attributable to Letters of Credit issued by such Issuing Lender would exceed the
L/C Commitment of such Issuing Lender. Each Letter of Credit shall (i) be
denominated in Dollars and (ii) expire no later than the earlier of (x) the
first anniversary of its date of issuance and (y) the date that is five Business
Days prior to the Revolving Termination Date, provided that any Letter of Credit
with a one-year term may provide for the renewal thereof for additional one-year
periods (which shall in no event extend beyond the date referred to in clause
(y) above, unless on or prior to such date, such Letter of Credit is cash
collateralized in an amount equal to 105% of the face amount of such Letter and
Credit and on such other terms reasonably satisfactory to the Administrative
Agent and the applicable Issuing Lender, it being understood and agreed that if
the Administrative Agent and the applicable Issuing Lender agree to permit a
Letter of Credit to expire after the Revolving Termination Date, notwithstanding
any provision of this Agreement to the contrary, each L/C Participant’s
participation in such Letter of Credit will terminate on the Revolving
Termination Date and such L/C Participants will have no further obligations to
the Issuing Lenders after the Revolving Termination Date).

 

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(b)          No Issuing Lender shall be obligated to issue any Letter of Credit
if such issuance would conflict with, or cause such Issuing Lender or any L/C
Participant to exceed any limits imposed by, any applicable Requirement of Law.

 

2.6.         Procedure for Issuance of Letter of Credit. The Borrower may from
time to time request that an Issuing Lender issue a Letter of Credit by
delivering to such Issuing Lender at its address for notices specified herein an
Application therefor, completed to the satisfaction of such Issuing Lender, and
such other certificates, documents and other papers and information as such
Issuing Lender may request. Upon receipt of any Application, an Issuing Lender
will process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall any Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by such
Issuing Lender and the Borrower. The applicable Issuing Lender shall furnish a
copy of such Letter of Credit to the Borrower promptly following the issuance
thereof. Each Issuing Lender shall promptly furnish to the Administrative Agent,
which shall in turn promptly furnish to the Lenders, notice of the issuance of
each Letter of Credit issued by it (including the amount thereof).

 

2.7.         Fees and Other Charges. (a)  The Borrower will pay a fee on all
outstanding Letters of Credit at a per annum rate equal to the Applicable Margin
then in effect with respect to Eurodollar Loans under the Revolving Facility,
shared ratably among the Revolving Lenders and payable quarterly in arrears on
each Fee Payment Date after the issuance date. In addition, the Borrower shall
pay to each Issuing Lender for its own account a fronting fee of 0.125% per
annum on the undrawn and unexpired amount of each Letter of Credit issued by
such Issuing Lender, payable quarterly in arrears on each Fee Payment Date after
the issuance date.

 

(b)           In addition to the foregoing fees, the Borrower shall pay or
reimburse each Issuing Lender for such normal and customary costs and expenses
as are incurred or charged by such Issuing Lender in issuing, negotiating,
effecting payment under, amending or otherwise administering any Letter of
Credit.

 

2.8.         L/C Participations. (a)  Each Issuing Lender irrevocably agrees to
grant and hereby grants to each L/C Participant, and, to induce the Issuing
Lenders to issue Letters of Credit, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from each Issuing Lender,
on the terms and conditions set forth below, for such L/C Participant’s own
account and risk an undivided interest equal to such L/C Participant’s Revolving
Percentage in each Issuing Lender’s obligations and rights under and in respect
of each Letter of Credit issued by such Issuing Lender and the amount of each
draft paid by such Issuing Lender thereunder. Each L/C Participant agrees with
each Issuing Lender that, if a draft is paid by such Issuing Lender under any
Letter of Credit for which such Issuing Lender is not reimbursed in full by the
Borrower in accordance with the terms of this Agreement, such L/C Participant
shall pay to such Issuing Lender upon demand at such Issuing Lender’s address
for notices specified herein an amount equal to such L/C Participant’s Revolving
Percentage of the amount of such draft, or any part thereof, that is not so
reimbursed. Each L/C Participant’s obligation to pay such amount shall be
absolute and unconditional and shall not be affected by any circumstance,
including (i) any setoff, counterclaim, recoupment, defense or other right that
such L/C Participant may have against such Issuing Lender, the Borrower or any
other Person for any reason whatsoever, (ii) the occurrence or continuance of a
Default or an Event of Default or the failure to satisfy any of the other
conditions specified in Section 5, (iii) any adverse change in the condition
(financial or otherwise) of the Borrower, (iv) any breach of this Agreement or
any other Loan Document by the Borrower, any other Loan Party or any other L/C
Participant or (v) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.

 

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(b)          If any amount required to be paid by any L/C Participant to any
Issuing Lender pursuant to Section 2.8(a) in respect of any unreimbursed portion
of any payment made by such Issuing Lender under any Letter of Credit is paid to
such Issuing Lender within three Business Days after the date such payment is
due, such L/C Participant shall pay to such Issuing Lender on demand an amount
equal to the product of (i) such amount, times (ii) the daily average New York
Fed Bank Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to such
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to Section
2.8(a) is not made available to the applicable Issuing Lender by such L/C
Participant within three Business Days after the date such payment is due, such
Issuing Lender shall be entitled to recover from such L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to ABR Loans under the Revolving Facility. A
certificate of an Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this Section shall be conclusive in the absence of
manifest error.

 

(c)          Whenever, at any time after an Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with Section 2.8(a), such Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by such Issuing Lender), or any payment of interest on account thereof, such
Issuing Lender will distribute to such L/C Participant its pro rata share
thereof; provided, however, that in the event that any such payment received by
such Issuing Lender shall be required to be returned by such Issuing Lender,
such L/C Participant shall return to such Issuing Lender the portion thereof
previously distributed by such Issuing Lender to it.

 

2.9.         Reimbursement Obligations of the Borrower. If any draft is paid
under any Letter of Credit, the Borrower shall reimburse the applicable Issuing
Lender for the amount of (a) the draft so paid and (b) any taxes, fees, charges
or other costs or expenses incurred by such Issuing Lender in connection with
such payment, not later than 12:00 Noon, New York City time, on (i) the Business
Day that the Borrower receives notice of such draft, if such notice is received
on such day prior to 10:00 A.M., New York City time, or (ii) if clause (i) above
does not apply, the Business Day immediately following the day that the Borrower
receives such notice (each such date, an “Honor Date”). Each such payment shall
be made to the applicable Issuing Lender at its address for notices referred to
herein in Dollars and in immediately available funds. Interest shall be payable
on any such amounts (except to the extent deemed converted to a Revolving Loan
as provided below) from the date on which the relevant draft is paid until
payment in full at the rate set forth in (x) until the Business Day next
succeeding the date of the relevant notice, Section 3.4(b) and (y) thereafter,
Section 3.4(c). If the Borrower fails to so reimburse any Issuing Lender by the
Honor Date, the Administrative Agent shall promptly notify each Revolving Lender
of the Honor Date, the amount of the unreimbursed drawing and the amount of such
Revolving Lender’s Revolving Percentage thereof. In such event, the Borrower
shall be deemed to have requested a Revolving Loan of ABR Loans to be disbursed
on the Honor Date in an amount equal to the unreimbursed drawing, without regard
to the minimums and multiples specified in Section 2.2 for the principal amount
of ABR Loans, but subject to the amount of unutilized portion of the aggregate
Available Revolving Commitment and the conditions set forth in Section 5.2
(other than delivery of a notice of borrowing); provided, that if the conditions
set forth in Section 5.2 are not satisfied at such time, then no Revolving Loan
shall be deemed requested and the Borrower shall not be relieved from its
Reimbursement Obligations.

 

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2.10.       Obligations Absolute. The Borrower’s obligations under this Section
2 shall be absolute and unconditional under any and all circumstances and
irrespective of any setoff, counterclaim or defense to payment that the Borrower
may have or have had against any Issuing Lender, any beneficiary of a Letter of
Credit or any other Person. The Borrower also agrees with each Issuing Lender
that such Issuing Lender shall not be responsible for, and the Borrower’s
Reimbursement Obligations under Section 2.9 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or any dispute between or among the Borrower and any
beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or any claims whatsoever of the Borrower against any
beneficiary of such Letter of Credit or any such transferee. No Issuing Lender
shall be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit, except for errors or omissions found by a
final and nonappealable decision of a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of such Issuing Lender.
The Borrower agrees that any action taken or omitted by any Issuing Lender under
or in connection with any Letter of Credit or the related drafts or documents,
if done in the absence of gross negligence or willful misconduct, shall be
binding on the Borrower and shall not result in any liability of such Issuing
Lender to the Borrower.

 

2.11.       Letter of Credit Payments. If any draft shall be presented for
payment under any Letter of Credit, the applicable Issuing Lender shall promptly
notify the Borrower of the date and amount thereof. The responsibility of the
applicable Issuing Lender to the Borrower in connection with any draft presented
for payment under any Letter of Credit shall, in addition to any payment
obligation expressly provided for in such Letter of Credit, be limited to
determining that the documents (including each draft) delivered under such
Letter of Credit in connection with such presentment are substantially in
conformity with such Letter of Credit.

 

2.12.       Applications. To the extent that any provision of any Application
related to any Letter of Credit is inconsistent with the provisions of this
Section 2, the provisions of this Section 2 shall apply.

  

Section 3.  GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT

 

3.1.         Optional Prepayments. The Borrower may at any time and from time to
time prepay the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Administrative Agent no later than 11:00
A.M., New York City time, three Business Days prior thereto, in the case of
Eurodollar Loans, and no later than 11:00 A.M., New York City time, one Business
Day prior thereto, in the case of ABR Loans, which notice shall specify the date
and amount of prepayment and whether the prepayment is of Eurodollar Loans or
ABR Loans; provided, that if a Eurodollar Loan is prepaid on any day other than
the last day of the Interest Period applicable thereto, the Borrower shall also
pay any amounts owing pursuant to Section 3.10. Upon receipt of any such notice
the Administrative Agent shall promptly notify each relevant Lender thereof. If
any such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with (except in the case of
Revolving Loans that are ABR Loans) accrued interest to such date on the amount
prepaid. Partial prepayments of Revolving Loans shall be in an aggregate
principal amount of $1,000,000 or a whole multiple thereof. Prepayments of any
tranche of Incremental Term Loans will be in such minimum principal amounts, and
shall be applied, as specified in the applicable Incremental Amendment governing
such tranche.

 

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3.2.         Conversion and Continuation Options. (a)   The Borrower may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the Business Day preceding the proposed
conversion date, provided that any such conversion of Eurodollar Loans may only
be made on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert ABR Loans to Eurodollar Loans by giving
the Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the third Business Day preceding the proposed
conversion date (which notice shall specify the length of the initial Interest
Period therefor), provided that no ABR Loan under a particular Facility may be
converted into a Eurodollar Loan when any Event of Default has occurred and is
continuing and the Administrative Agent or the Majority Facility Lenders in
respect of such Facility have determined in its or their sole discretion not to
permit such conversions. Upon receipt of any such notice the Administrative
Agent shall promptly notify each relevant Lender thereof.

 

(b)          Any Eurodollar Loan may be continued as such upon the expiration of
the then current Interest Period with respect thereto by the Borrower giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term “Interest Period” set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such Loans, provided
that no Eurodollar Loan under a particular Facility may be continued as such
when any Event of Default has occurred and is continuing and the Administrative
Agent has or the Majority Facility Lenders in respect of such Facility have
determined in its or their sole discretion not to permit such continuations, and
provided, further, that if the Borrower shall fail to give any required notice
as described above in this paragraph or if such continuation is not permitted
pursuant to the preceding proviso such Loans shall be automatically converted to
ABR Loans on the last day of such then expiring Interest Period. Upon receipt of
any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof.

 

3.3.         Limitations on Eurodollar Tranches. Notwithstanding anything to the
contrary in this Agreement, all borrowings, conversions and continuations of
Eurodollar Loans and all selections of Interest Periods shall be in such amounts
and be made pursuant to such elections so that, (a) after giving effect thereto,
the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to $3,000,000 or a whole multiple of
$1,000,000 in excess thereof and (b) no more than twenty Eurodollar Tranches
shall be outstanding at any one time.

 

3.4.         Interest Rates and Payment Dates. (a)  Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin.

 

(b)          Each ABR Loan shall bear interest at a rate per annum equal to the
ABR plus the Applicable Margin.

 

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(c)          (i) If all or a portion of the principal amount of any Loan or
Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum equal to (x) in the case of the Loans, the rate that would
otherwise be applicable thereto pursuant to the foregoing provisions of this
Section plus 2% or (y) in the case of Reimbursement Obligations, the rate
applicable to ABR Loans under the Revolving Facility plus 2%, and (ii) if all or
a portion of any interest payable on any Loan or Reimbursement Obligation or any
undrawn fee or other amount payable hereunder shall not be paid when due
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall bear interest at a rate per annum equal to the rate then applicable
to ABR Loans under the relevant Facility plus 2% (or, in the case of any such
other amounts that do not relate to a particular Facility, the rate then
applicable to ABR Loans under the Revolving Facility plus 2%), in each case,
with respect to clauses (i) and (ii) above, from the date of such nonpayment
until such amount is paid in full (as well after as before judgment).

 

(d)          Interest shall be payable in arrears on each Interest Payment Date,
provided that interest accruing pursuant to paragraph (c) of this Section shall
be payable from time to time on demand.

 

3.5.         Computation of Interest and Fees. (a)  Interest and fees payable
pursuant hereto shall be calculated on the basis of a 360-day year for the
actual days elapsed, except that, with respect to ABR Loans the rate of interest
on which is calculated on the basis of the Prime Rate, the interest thereon
shall be calculated on the basis of a 365- (or 366-, as the case may be) day
year for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of each determination
of a Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.

 

(b)          Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 3.4(a).

 

3.6.         Inability to Determine Interest Rate. If prior to the first day of
any Interest Period:

 

(a)          the Administrative Agent shall have determined (which determination
shall be conclusive and binding absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Eurodollar Base Rate or the
Eurodollar Rate, as applicable, for such Interest Period, or

 

(b)          the Administrative Agent shall have received notice from the
Majority Facility Lenders in respect of the relevant Facility that the
Eurodollar Base Rate or the Eurodollar Rate, as applicable, determined or to be
determined for such Interest Period will not adequately and fairly reflect the
cost to such Lenders (as conclusively certified by such Lenders) of making or
maintaining their affected Loans during such Interest Period,

 

the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans under the relevant Facility requested
to be made on the first day of such Interest Period shall be made as ABR Loans,
(y) any Loans under the relevant Facility that were to have been converted on
the first day of such Interest Period to Eurodollar Loans shall be continued as
ABR Loans and (z) any outstanding Eurodollar Loans under the relevant Facility
shall be converted, on the last day of the then-current Interest Period, to ABR
Loans. Until such notice has been withdrawn by the Administrative Agent, no
further Eurodollar Loans under the relevant Facility shall be made or continued
as such, nor shall the Borrower have the right to convert Loans under the
relevant Facility to Eurodollar Loans.

 

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3.7.         Pro Rata Treatment and Payments. (a)  Each borrowing by the
Borrower from the Revolving Lenders hereunder, each payment by the Borrower on
account of any undrawn fee and any reduction or termination of the Revolving
Commitments of the Revolving Lenders shall be made pro rata according to the
respective Revolving Percentages of the Revolving Lenders, except as otherwise
permitted in Sections 3.14(e) and 10.1(b).

 

(b)          Each payment (including each prepayment) by the Borrower on account
of principal of and interest on the Incremental Term Loans shall be applied as
set forth in the applicable Incremental Amendment governing such tranche of
Incremental Term Loans paid.

 

(c)          Each payment (including each prepayment) by the Borrower on account
of principal of and interest on the Revolving Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving Loans
then held by the Revolving Lenders, except as otherwise permitted in Sections
3.14(e) and 10.1(b).

 

(d)          All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without setoff or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to each
relevant Lender promptly upon receipt in like funds as received net of any
amounts owing by such Lender pursuant to Section 9.7. If any payment hereunder
(other than payments on the Eurodollar Loans) becomes due and payable on a day
other than a Business Day, such payment shall be extended to the next succeeding
Business Day. If any payment on a Eurodollar Loan becomes due and payable on a
day other than a Business Day, the maturity thereof shall be extended to the
next succeeding Business Day unless the result of such extension would be to
extend such payment into another calendar month, in which event such payment
shall be made on the immediately preceding Business Day. In the case of any
extension of any payment of principal pursuant to the preceding two sentences,
interest thereon shall be payable at the then applicable rate during such
extension.

 

(e)          Unless the Administrative Agent shall have been notified in writing
by any Lender prior to a borrowing that such Lender will not make the amount
that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon, at a
rate equal to the greater of (i) the New York Fed Bank Rate and (ii) a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation, for the period until such Lender makes such amount
immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this paragraph shall be conclusive in the absence of manifest error. If
such Lender’s share of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days after such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to ABR Loans under
the relevant Facility, on demand, from the Borrower.

 

29

 

  

(f)           Unless the Administrative Agent shall have been notified in
writing by the Borrower prior to the date of any payment due to be made by the
Borrower hereunder that the Borrower will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such payment, and the Administrative Agent may, but shall not be required
to, in reliance upon such assumption, make available to the Lenders their
respective pro rata shares of a corresponding amount. If such payment is not
made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount which was made available pursuant
to the preceding sentence, such amount with interest thereon at the rate per
annum equal to the daily average New York Fed Bank Rate. Nothing herein shall be
deemed to limit the rights of the Administrative Agent or any Lender against the
Borrower.

 

(g)          If any Lender shall fail to make any payment required to be made by
it pursuant to Section 2.8(a), 3.7(e), 3.7(f) or 9.7, then the Administrative
Agent may, in its discretion and notwithstanding any contrary provision hereof,
(i) apply any amounts thereafter received by the Administrative Agent for the
account of such Lender for the benefit of the Administrative Agent or any
Issuing Lender to satisfy such Lender’s obligations to it under such Sections
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 under any such Section, in the case of
each of clauses (i) and (ii) above, in any order as determined by the
Administrative Agent in its discretion.

 

3.8.         Requirements of Law. (a)  If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender or other Credit Party with any request or directive (whether or
not having the force of law) from any central bank or other Governmental
Authority (any such occurrence, a “Change in Law”) made subsequent to the date
hereof:

 

(i)          shall subject any Credit Party to any tax of any kind whatsoever
with respect to this Agreement, any Letter of Credit, any Application or any
Eurodollar Loan made by it, or change the basis of taxation of payments to such
Lender or Issuing Lender in respect thereof, in each case except for
Non-Excluded Taxes covered by Section 3.9 and taxes described in any of Section
3.9(a)(i) through (iv);

 

(ii)         shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by, deposits
or other liabilities in or for the account of, advances, loans or other
extensions of credit by, or any other acquisition of funds by, any office of
such Lender that is not otherwise included in the determination of the
Eurodollar Rate; or

 

(iii)        shall impose on such Lender any other condition;

 

and the result of any of the foregoing is to increase the cost to such Lender
(or, in the case of (i), to such Lender or Issuing Lender), by an amount that
such Lender (or, in the case of (i), such Lender or Issuing Lender) deems to be
material, of making, converting into, continuing or maintaining Eurodollar Loans
or issuing or participating in Letters of Credit, or to reduce any amount
receivable hereunder in respect thereof, then, in any such case, the Borrower
shall promptly pay such Lender (or, in the case of (i), such Lender or Issuing
Lender), upon its demand, any additional amounts necessary to compensate such
Lender (or, in the case of (i), such Lender or Issuing Lender), for such
increased cost or reduced amount receivable. If any Lender or Issuing Lender
becomes entitled to claim any additional amounts pursuant to this paragraph, it
shall promptly notify the Borrower (with a copy to the Administrative Agent) of
the event by reason of which it has become so entitled.

 

30

 

 

(b)          If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or liquidity
requirements or in the interpretation or application thereof or compliance by
such Lender or any corporation controlling such Lender with any request or
directive regarding capital adequacy or liquidity (whether or not having the
force of law) from any Governmental Authority made subsequent to the date hereof
shall have the effect of reducing the rate of return on such Lender’s or such
corporation’s capital as a consequence of its obligations hereunder or under or
in respect of any Letter of Credit to a level below that which such Lender or
such corporation could have achieved but for such adoption, change or compliance
(taking into consideration such Lender’s or such corporation’s policies with
respect to capital adequacy or liquidity) by an amount deemed by such Lender to
be material, then from time to time, after submission by such Lender to the
Borrower (with a copy to the Administrative Agent) of a written request
therefor, the Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such corporation for such reduction.

 

(c)          Notwithstanding anything herein to the contrary, (i) all requests,
rules, guidelines, requirements and directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor or similar authority) or by United States or foreign regulatory
authorities, in each case pursuant to or by way of implementing Basel III, and
(ii) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all
requests, rules, guidelines, requirements and directives thereunder or issued in
connection therewith or in implementation thereof, shall in each case be deemed
to be a change in law, regardless of the date enacted, adopted, issued or
implemented.

 

(d)          A certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error.
Notwithstanding anything to the contrary in this Section, the Borrower shall not
be required to compensate a Lender pursuant to this Section for any amounts
incurred more than nine months prior to the date that such Lender notifies the
Borrower of such Lender’s intention to claim compensation therefor; provided
that, if the circumstances giving rise to such claim have a retroactive effect,
then such nine-month period shall be extended to include the period of such
retroactive effect. The obligations of the Borrower pursuant to this Section
shall survive the termination of this Agreement and the payment of the Loans and
all other amounts payable hereunder.

 

3.9.         Taxes. (a)  All payments made by or on behalf of any Loan Party
under this Agreement or any other Loan Document shall be made free and clear of,
and without deduction or withholding for or on account of, any present or future
income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions
or withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, excluding (i) net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on the
Administrative Agent or any Lender as a result of a present or former connection
between the Administrative Agent or such Lender and the jurisdiction of the
Governmental Authority imposing such tax or any political subdivision or taxing
authority thereof or therein (other than any such connection arising solely from
the Administrative Agent or such Lender having executed, delivered or performed
its obligations or received a payment under, or enforced, this Agreement or any
other Loan Document), (ii) any branch profits taxes imposed by a jurisdiction
referred to in clause (i) of this Section 3.9(a), (iii) taxes that are
attributable to a Lender’s failure to comply with the requirements of paragraph
(d) of this Section, or (iv) withholding taxes resulting from any Requirement of
Law (including FATCA) in effect on the date such Lender becomes a party to this
Agreement (or designates a new lending office), except to the extent that such
Lender (or its assignor, if any) was entitled, at the time of designation of a
new lending office (or assignment), to receive additional amounts from a Loan
Party with respect to such taxes pursuant to this Section 3.9(a); provided, if
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions
or withholdings (“Non-Excluded Taxes”) or Other Taxes are required to be
withheld from any amounts payable to the Administrative Agent or any Lender
hereunder or under any other Loan Document, as determined in good faith by the
applicable Withholding Agent, such amounts shall be paid to the relevant
Governmental Authority in accordance with applicable law, and the amounts so
payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) the amounts it would have
received had no such withholding or deduction been made.

 

31

 

 

(b)          In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law, unless such Other
Taxes are excluded under 3.9(a)(iii).

 

(c)          Whenever any Non-Excluded Taxes or Other Taxes are payable by a
Loan Party, as promptly as possible thereafter such Loan Party shall send to the
Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original official receipt
received by such Loan Party showing payment thereof, a copy of the return
reporting such payment or other evidence of payment reasonably satisfactory to
the Administrative Agent. If (i) a Loan Party fails to pay any Non-Excluded
Taxes or Other Taxes when due to the appropriate taxing authority, (ii) a Loan
Party fails to remit to the Administrative Agent the required receipts or other
required documentary evidence or (iii) any Non-Excluded Taxes or Other Taxes are
imposed directly upon the Administrative Agent or any Lender, the applicable
Loan Party shall indemnify the Administrative Agent and the Lenders for such
amounts and for any incremental taxes, interest or penalties that may become
payable by the Administrative Agent or any Lender as a result of any such
failure, in the case of (i) and (ii), or any such direct imposition, in the case
of (iii).

 

(d)          (i)           Any Lender that is entitled to an exemption from, or
reduction of, any applicable withholding tax with respect to any payments under
any Loan Document shall deliver to the Borrower and the Administrative Agent, at
the time or times reasonably requested by the Borrower or the Administrative
Agent, such properly completed and executed documentation reasonably requested
by the Borrower or the Administrative Agent as will permit such payments to be
made without, or at a reduced rate of, withholding. In addition, any Lender, if
requested by the Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by law or reasonably requested by the Borrower or the
Administrative Agent as will enable the Borrower or the Administrative Agent to
determine whether or not such Lender is subject to any withholding (including
backup withholding) or information reporting requirements. Notwithstanding
anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Sections 3.9(d)(ii)(A) through (F) and 3.9(d)(iii) below) shall not
be required if in the Lender's judgment such completion, execution or submission
would subject such Lender to any material unreimbursed cost or expense (or, in
the case of a change in any Requirement of Law, any incremental material
unreimbursed cost or expense) or would materially prejudice the legal or
commercial position of such Lender. Upon the reasonable request of such Borrower
or the Administrative Agent, any Lender shall update any form or certification
previously delivered pursuant to this Section 3.9(d). If any form or
certification previously delivered pursuant to this Section expires or becomes
obsolete or inaccurate in any respect with respect to a Lender, such Lender
shall promptly (and in any event within 10 days after such expiration,
obsolescence or inaccuracy) notify such Borrower and the Administrative Agent in
writing of such expiration, obsolescence or inaccuracy and update the form or
certification if it is legally eligible to do so.

 

(ii)         Without limiting the generality of the foregoing, if the Borrower
is a U.S. Person, any Lender with respect to such Borrower shall, if it is
legally eligible to do so, deliver to such Borrower and the Administrative Agent
(in such number of copies reasonably requested by such Borrower and the
Administrative Agent) on or prior to the date on which such Lender becomes a
party hereto, duly completed and executed copies of whichever of the following
is applicable:

 

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(A)in the case of a Lender that is a U.S. Person, IRS Form W-9 (or successor
form) certifying that such Lender is exempt from U.S. federal backup withholding
tax;

 

(B)in the case of a Lender that is not a U.S. Person (a “Non-U.S. Lender”)
claiming the benefits of an income tax treaty to which the United States is a
party (1) with respect to payments of interest under any Loan Document, IRS Form
W-8BEN (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 (2) with respect to any other applicable payments under any Loan Document,
IRS Form W-8BEN (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;

 

(C)in the case of a Non-U.S. Lender for whom payments under any Loan Document
constitute income that is effectively connected with such Lender's conduct of a
trade or business in the United States, IRS Form W-8ECI (or successor form);

 

(D)in the case of a Non-U.S. Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code both (1) IRS Form W-8BEN (or
successor form) and (2) a certificate substantially in the form of Exhibit E (a
"U.S. Tax Certificate") to the effect that such Lender is not (a) a "bank"
within the meaning of Section 881(c)(3)(A) of the Code, (b) a "10 percent
shareholder" of the Borrower within the meaning of Section 881(c)(3)(B) of the
Code or (c) a "controlled foreign corporation" described in Section 881(c)(3)(C)
of the Code;

 

(E)in the case of a Non-U.S. Lender that is not the beneficial owner of payments
made under any Loan Document (including a partnership or a participating Lender)
(1) an IRS Form W-8IMY (or successor form) on behalf of itself and (2) the
relevant forms prescribed in clauses (A), (B), (C), (D) and (F) of this
paragraph (d)(ii) that would be required of each such beneficial owner or
partner of such partnership if such beneficial owner or partner were a Lender;
provided, however, that if the Lender is a partnership and one or more of its
partners are claiming the exemption for portfolio interest under Section 881(c)
of the Code, such Lender may provide a U.S. Tax Certificate on behalf of such
partners; or

 

(F)any other form prescribed by law as a basis for claiming exemption from, or a
reduction of, U.S. federal withholding tax together with such supplementary
documentation necessary to enable the Borrower or the Administrative Agent to
determine the amount of tax (if any) required by law to be withheld.

 

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(iii)        If a payment made to a Lender under any Loan Document would be
subject to U.S. federal withholding tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
Lender shall deliver to the Withholding Agent, at the time or times prescribed
by law and at such time or times reasonably requested by the Withholding Agent,
such documentation prescribed by applicable law (including as prescribed by
Section 1471(b)(3)(C)(i) of the Code) and such additional documentation
reasonably requested by the Withholding Agent as may be necessary for the
Withholding Agent to comply with its obligations under FATCA, to determine that
such Lender has or has not complied with such Lender's obligations under FATCA
or to determine the amount to deduct and withhold from such payment. Solely for
purposes of this Section 3.9(d)(iii), “FATCA” shall include any amendments made
to FATCA after the date of this Agreement.

 

(e)          Each Lender shall indemnify the Administrative Agent for the full
amount of any taxes, levies, imposts, duties, charges, fees, deductions,
withholdings or similar charges imposed by any Governmental Authority that are
attributable to such Lender and that are payable or paid by the Administrative
Agent, together with all interest, penalties, reasonable costs and expenses
arising therefrom or with respect thereto, as determined by the Administrative
Agent in good faith. 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.

 

(f)           If the Administrative Agent or any Lender determines, in its sole
discretion, that it has received a refund of any Non-Excluded Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to this Section 3.9, it
shall pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
3.9 with respect to the Non-Excluded Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that the
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event and to the extent of the amount
the Administrative Agent or such Lender is required to repay such refund to such
Governmental Authority. This paragraph shall not be construed to require the
Administrative Agent or any Lender to make available its tax returns (or any
other information relating to its taxes which it deems confidential) to the
Borrower or any other Person.

 

(g)          The agreements in this Section shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.

 

3.10.       Indemnity. The Borrower agrees to indemnify each Lender for, and to
hold each Lender harmless from, any loss or expense that such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of, conversion into or continuation of Eurodollar Loans after the Borrower has
given a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment of or conversion
from Eurodollar Loans after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans on a day that is not the last day of an Interest
Period with respect thereto (whether such prepayment is voluntary, mandatory,
automatic, by reason of acceleration (including as a result of a bankruptcy
filing) or otherwise). Such indemnification may include an amount equal to the
excess, if any, of (i) the amount of interest that would have accrued on the
amount so prepaid, or not so borrowed, converted or continued, for the period
from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Loans provided for herein (excluding, however, the lost profits included
therein, if any) over (ii) the amount of interest (as reasonably determined by
such Lender) that would have accrued to such Lender on such amount by placing
such amount on deposit for a comparable period with leading banks in the
interbank eurodollar market. A certificate as to any amounts payable pursuant to
this Section submitted to the Borrower by any Lender shall be conclusive in the
absence of manifest error. This covenant shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.

 

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3.11.       Change of Lending Office. Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 3.8 or 3.9(a)
with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the reasonable judgment of such Lender,
cause such Lender and its lending office(s) to suffer no economic, legal or
regulatory disadvantage for which it is not indemnified by Borrower, and
provided, further, that nothing in this Section shall affect or postpone any of
the obligations of the Borrower or the rights of any Lender pursuant to Section
3.8 or 3.9(a).

 

3.12.       Replacement of Lenders. The Borrower shall be permitted to replace
any Lender that (a) requests reimbursement for amounts owing pursuant to Section
3.8 or 3.9(a) or (b) becomes a Defaulting Lender, with a replacement financial
institution; provided that (i) such replacement does not conflict with any
Requirement of Law, (ii) no Event of Default shall have occurred and be
continuing at the time of such replacement, (iii) prior to any such replacement,
such Lender shall have taken no action under Section 3.11 so as to eliminate the
continued need for payment of amounts owing pursuant to Section 3.8 or 3.9(a),
(iv) the replacement financial institution shall purchase, at par, all Loans and
other amounts owing to such replaced Lender on or prior to the date of
replacement, (v) the Borrower shall be liable to such replaced Lender under
Section 3.10 if any Eurodollar Loan owing to such replaced Lender shall be
purchased other than on the last day of the Interest Period relating thereto,
(vi) the replacement financial institution shall be reasonably satisfactory to
the Administrative Agent, (vii) the replaced Lender shall be obligated to make
such replacement in accordance with the provisions of Section 10.6 (provided
that the Borrower shall be obligated to pay the registration and processing fee
referred to therein), (viii) until such time as such replacement shall be
consummated, the Borrower shall pay all additional amounts (if any) required
pursuant to Section 3.8 or 3.9(a), as the case may be, and (ix) any such
replacement shall not be deemed to be a waiver of any rights that the Borrower,
the Administrative Agent or any other Lender shall have against the replaced
Lender.

 

3.13.       Borrower Repurchases. So long as no Default or Event of Default has
occurred and is continuing, the Borrower (or an Affiliate of the Borrower) may
from time to time purchase, in accordance with this Section 3.13, Incremental
Term Loans from one or more Lenders on a non-pro rata basis pursuant to a Dutch
auction or other similar process (open to all Lenders on a pro rata basis), on
terms to be agreed between the Borrower (or such Affiliate) and the Lenders
agreeing to sell their Incremental Term Loans in such Dutch auction or other
similar process; provided that (i) the procedures with respect to any such Dutch
auction or other similar process shall be approved by the Administrative Agent
(such approval not to be unreasonably withheld), (ii) the principal amount of
Incremental Term Loans purchased by the Borrower (or such Affiliate) shall be
cancelled and such Incremental Term Loans shall no longer be outstanding for all
purposes of this Agreement and the other Loan Documents and (iii) no proceeds of
the Revolving Facility shall be used to consummate such purchase. By initiating
a Dutch auction or other similar process and repurchasing Incremental Term Loans
pursuant to this Section 3.13, the Borrower shall be deemed to represent as of
the date of such notice and purchase that the Borrower is not in possession of
any information regarding any Loan Party, its assets, its ability to perform its
Obligations or any other matter that may be material to a decision by any Lender
to participate in such Dutch auction or other similar process or participate in
any of the transactions contemplated thereby, that has not previously been
disclosed to the Administrative Agent and the Lenders.

 

35

 

 

3.14.       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 unused Commitment of such
Defaulting Lender pursuant to Section 2.3;

 

(b)          the Revolving Commitment and Revolving Extensions of Credit of such
Defaulting Lender shall not be included in determining whether the Required
Lenders have taken or may take any action hereunder (including any consent to
any amendment, waiver or other modification pursuant to Section 10.1); provided,
that this clause (b) shall not apply to the vote of a Defaulting Lender in the
case of an amendment, waiver or other modification requiring the consent of such
Lender or each Lender affected thereby;

 

(c)          if any L/C Obligations exist at the time such Lender becomes a
Defaulting Lender then:

 

(i)          all or any part of the L/C Obligations of such Defaulting Lender
shall be reallocated among the non-Defaulting Lenders in accordance with their
respective Revolving Percentage but only to the extent the sum of all
non-Defaulting Lenders’ Revolving Extensions of Credit does not exceed the total
of all non-Defaulting Lenders’ Revolving Commitments (any such excess, the
“Excess Extensions of Credit”);

 

(ii)         if the reallocation described in clause (i) above cannot, or can
only partially, be effected, the Borrower shall, within one Business Day
following notice by the Administrative Agent, cash collateralize for the benefit
of the Issuing Lenders only the Borrower’s obligations corresponding to such
Defaulting Lender’s L/C Obligations (after giving effect to any partial
reallocation pursuant to clause (i) above) for so long as such L/C Obligations
are outstanding, in each case only to the extent of the Excess Extensions of
Credit;

 

(iii)        if the Borrower cash collateralizes any portion of such Defaulting
Lender’s L/C Obligations pursuant to clause (ii) above, the Borrower shall not
be required to pay any fees to such Defaulting Lender pursuant to Section 2.7(a)
with respect to such Defaulting Lender’s L/C Obligations during the period such
Defaulting Lender’s L/C Obligations are cash collateralized;

 

(iv)        if the L/C Obligations of the non-Defaulting Lenders are reallocated
pursuant to clause (i) above, then the fees payable to the Lenders pursuant to
Section 2.3 and Section 2.7 shall be adjusted in accordance with such
non-Defaulting Lenders’ Revolving Percentages; and

 

(v)         if all or any portion of such Defaulting Lender’s L/C Obligations is
neither reallocated nor cash collateralized pursuant to clause (i) or (ii)
above, then, without prejudice to any rights or remedies of any Issuing Lender
or any other Lender hereunder, and letter of credit fees payable under Section
2.7 with respect to such Defaulting Lender’s L/C Obligations shall be payable to
the Issuing Lenders until and to the extent that such L/C Obligations are
reallocated and/or cash collateralized; and

 

36

 

  

(d)          so long as such Lender is a Defaulting Lender, no Issuing Lender
shall be required to issue, amend or increase any Letter of Credit, unless it is
satisfied that the related exposure and the Defaulting Lender’s then outstanding
L/C Obligations will be 100% covered by the Revolving Commitments of the
non-Defaulting Lenders and/or cash collateral will be provided by the Borrower
in accordance with Section 3.14(c), and participating interests in any newly
issued or increased Letter of Credit shall be allocated among non-Defaulting
Lenders in a manner consistent with Section 3.14(c)(i) (and such Defaulting
Lender shall not participate therein).

 

(e)          Notwithstanding anything to the contrary in Section 3.7, the
Borrower may (x) terminate the unused amount of the Revolving Commitment of a
Defaulting Lender or (y) repay the principal of and interest on the Revolving
Loans then held by the Defaulting Lender, in each case upon not less than three
Business Days’ prior notice to the Administrative Agent (which will promptly
notify the Lenders thereof); provided that the Revolving Commitments shall be
permanently reduced by the principal amount of any such repayment; provided
further, such termination or repayment will not be deemed to be a waiver or
release of any claim the Borrower, the Administrative Agent, any Issuing Lender
or any Lender may have against such Defaulting Lender.

 

If (i) a Bankruptcy Event or Bail-In Action with respect to any Lender Parent
shall occur following the date hereof and for so long as such event shall
continue or (ii) any Issuing Lender has a good faith belief that any Lender has
defaulted in fulfilling its obligations under one or more other agreements in
which such Lender commits to extend credit, such Issuing Lender shall not be
required to issue, amend or increase any Letter of Credit, unless such Issuing
Lender shall have entered into arrangements with the Borrower or such Lender,
satisfactory to such Issuing Lender to defease any risk to it in respect of such
Lender hereunder.

 

In the event that the Administrative Agent, the Borrower and the Issuing Lenders
each agree that a Defaulting Lender has adequately remedied all matters that
caused such Lender to be a Defaulting Lender, then the L/C Obligations of the
Lenders shall be readjusted to reflect the inclusion of such Lender’s Revolving
Commitment as the Administrative Agent shall determine may be necessary in order
for such Lender to hold such Loans in accordance with its Revolving Percentage.

 

3.15.        Incremental Facilities.

 

(a)          The Borrower may at any time or from time to time after the Closing
Date, by notice to the Administrative Agent (whereupon the Administrative Agent
shall promptly deliver a copy to each of the Lenders), request (x) one or more
tranches of term loans (each such tranche, an “Incremental Term Loan” and
collectively, the “Incremental Term Loans”) or (y) one or more increases in the
amount of the Revolving Commitments (each such increase, a “Revolving Commitment
Increase” and, together with the “Incremental Term Loans, the “Incremental
Loans”); provided that:

 

(i)          both at the time of any such request and upon the effectiveness of
any Incremental Amendment referred to below (an “Incremental Loan Closing
Date”), no Default or Event of Default shall exist after giving effect to the
extension of credit contemplated on the Incremental Loan Closing Date;

 

37

 

  

(ii)         each of the representations and warranties made by any Loan Party
in or pursuant to the Loan Documents shall be true and correct in all material
respects on and as of the Incremental Loan Closing Date, as if made on and as of
such date (except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct in all material respects as of such earlier date); and

 

(iii)        the Borrower shall be in compliance with the covenants set forth in
Section 7.1 determined on a pro forma basis as of the most recently ended
Reference Period as if (x) the Incremental Term Loans or (y) the additional
Revolving Loans, as applicable, proposed to be borrowed on such Incremental
Closing Date had been outstanding and fully borrowed on the first day of such
Reference Period of the Borrower for testing compliance therewith (bearing
interest throughout the Reference Period at the rate applicable on the relevant
Incremental Loan Closing Date).

 

Each Incremental Term Loan shall be in an aggregate principal amount that is not
less than $50,000,000 and each Revolving Commitment Increase shall be in an
aggregate principal amount that is not less than $50,000,000 (provided that such
amount may be less than $50,000,000 if such amount represents all remaining
availability under the limit set forth in the next sentence). Notwithstanding
anything to the contrary herein, the aggregate amount of any Incremental Loans,
when taken together with all other Incremental Loans to date, shall not exceed
$300,000,000.

 

(b)          The Incremental Loans shall rank pari passu in right of payment
with the Revolving Loans. The Incremental Term Loans (i) shall not mature
earlier than the Revolving Termination Date and (ii) shall otherwise be on
terms, including with respect to interest rate and amortization, and pursuant to
documentation, to be determined by the Borrower, the Administrative Agent and
the lenders thereunder. Other than with respect to the Applicable Margin or
Undrawn Fee Rate, the terms of the Revolving Commitments and Revolving Loans
made pursuant to a Revolving Commitment Increase shall be identical to the terms
of the existing Revolving Commitments and Revolving Loans.

 

(c)          Each notice from the Borrower pursuant to this Section shall set
forth the requested amount and proposed terms of the relevant Incremental Loans.
Incremental Term Loans may be made, and Revolving Commitment Increases may be
provided, by any existing Lender or by any other bank or other financial
institution as determined by the Borrower (any such other bank or other
financial institution being called an “Additional Lender”); provided that (i) no
Lender shall have any obligation to provide any Incremental Loan or commitment
in respect thereof unless it agrees to do so in its sole discretion and (ii) the
Administrative Agent shall have consented (not to be unreasonably withheld) to
such Additional Lender.

 

(d)          Commitments in respect of Incremental Term Loans and Revolving
Commitment Increases shall become Commitments (or in the case of a Revolving
Commitment Increase to be provided by an existing Revolving Lender, an increase
in such Lender’s applicable Revolving Commitment) under this Agreement pursuant
to an amendment (an “Incremental Amendment”) to this Agreement and, as
appropriate, the other Loan Documents, executed by the Borrower, each Lender
agreeing to provide such Commitment, if any, each Additional Lender, if any, and
the Administrative Agent. The Incremental Amendment may, without the consent of
any other Lenders, effect such amendments to this Agreement and the other Loan
Documents as may be necessary or appropriate, in the reasonable opinion of the
Administrative Agent and the Borrower, to effect the provisions of this Section.
Each Additional Lender executing an Incremental Amendment shall become a Lender
for all purposes and to the same extent as if originally a party hereto and
shall be bound by and entitled to the benefits of this Agreement. The Borrower
will use the proceeds of the Incremental Term Loans and Revolving Commitment
Increases for any purpose not prohibited by this Agreement.

 

38

 

 

(e)          Upon each increase in the Revolving Commitments pursuant to this
Section, (i) each Revolving Lender immediately prior to such increase will
automatically and without further act be deemed to have assigned to each Lender
providing a portion of the Revolving Commitment Increase (each a “Revolving
Commitment Increase Lender”) in respect of such increase, and each such
Revolving Commitment Increase Lender will automatically and without further act
be deemed to have assumed, a portion of such Revolving Lender’s participations
hereunder in outstanding Letters of Credit such that, after giving effect to
each such deemed assignment and assumption of participations, the percentage of
the aggregate outstanding participations hereunder in Letters of Credit held by
each Revolving Lender (including each such Revolving Commitment Increase Lender)
will equal the percentage of the aggregate Revolving Commitments of all
Revolving Lenders represented by such Revolving Lender’s Revolving Commitment
and (ii) if on the date of such increase, there are any Revolving Loans
outstanding, such Revolving Loans shall on or prior to the effectiveness of such
Revolving Commitment Increase be prepaid from the proceeds of additional
Revolving Loans made hereunder (reflecting such increase in Revolving
Commitments), which prepayment shall be accompanied by accrued interest on the
Revolving Loans being prepaid and any costs incurred by any Lender in accordance
with Section 3.10. The Administrative Agent and the Lenders hereby agree that
the minimum borrowing, pro rata borrowing and pro rata payment requirements
contained elsewhere in this Agreement shall not apply to the transactions
effected pursuant to the immediately preceding sentence.

 

Section 4.  REPRESENTATIONS AND WARRANTIES

 

To induce the Administrative Agent and the Lenders to enter into this Agreement
and to make the Loans and issue or participate in the Letters of Credit, the
Borrower hereby represents and warrants to the Administrative Agent and each
Lender that:

 

4.1.         Financial Condition. The audited consolidated balance sheets of the
Borrower and its consolidated Subsidiaries as at August 30, 2014, August 29,
2015 and September 3, 2016, and the related consolidated statements of income,
comprehensive income, shareholders’ equity and cash flows for the fiscal years
ended on such dates (collectively, the “Historical Financials”), reported on by
and accompanied by an unqualified report from Ernst & Young LLP, present fairly
the consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of its operations and
its consolidated cash flows for the respective fiscal years then ended. The
unaudited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at December 3, 2016, and the related unaudited consolidated
statements of income, comprehensive income, shareholders’ equity and cash flows
for the 3-month period ended on such date (collectively, the “Interim
Financials”), present fairly in all material respects the consolidated financial
condition of the Borrower and its consolidated Subsidiaries as at such date, and
the consolidated results of its operations and its consolidated cash flows for
the 3-month period then ended (subject to normal year-end audit adjustments).
All such financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm
of accountants and disclosed therein) and the omission in unaudited consolidated
financial statements of the information and footnotes not required under GAAP to
be included in interim unaudited financial information. As of the Closing Date,
except as set forth on Schedule 4.1, no Group Member has any material Guarantee
Obligations, contingent liabilities and liabilities for taxes, or any long-term
leases or unusual forward or long-term commitments, including any interest rate
or foreign currency swap or exchange transaction or other obligation in respect
of derivatives, that are not reflected in the most recent financial statements
referred to in this paragraph. During the period from September 3, 2016 to and
including the date hereof there has been no Disposition by any Group Member of
any material part of its business or property.

 

39

 

  

4.2.         No Change. Since September 3, 2016, there has been no development
or event that has had or could reasonably be expected to have a Material Adverse
Effect.

 

4.3.         Existence; Compliance with Law. Each Group Member (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, except, with respect to any Restricted
Subsidiary that is not a Loan Party, where the failure to be in good standing
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect, (b) has the power and authority, and the legal right, to own and operate
its property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation or other organization and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification, except where the failure to so
qualify or be in good standing could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect and (d) is in compliance with all
Requirements of Law except to the extent that the failure to comply therewith
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.

 

4.4.         Power; Authorization; Enforceable Obligations. Each Loan Party has
the power and authority, and the legal right, to make, deliver and perform the
Loan Documents to which it is a party and, in the case of the Borrower, to
obtain extensions of credit hereunder. Each Loan Party has taken all necessary
organizational action to authorize the execution, delivery and performance of
the Loan Documents to which it is a party and, in the case of the Borrower, to
authorize the extensions of credit on the terms and conditions of this
Agreement. No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the extensions of credit hereunder or with the execution,
delivery, performance, validity or enforceability of this Agreement or any of
the Loan Documents, except consents, authorizations, filings and notices
described in Schedule 4.4, which consents, authorizations, filings and notices
have been obtained or made and are in full force and effect. Each Loan Document
has been duly executed and delivered on behalf of each Loan Party party thereto.
This Agreement constitutes, and each other Loan Document upon execution will
constitute, a legal, valid and binding obligation of each Loan Party party
thereto, enforceable against each such Loan Party in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

 

4.5.         No Legal Bar. The execution, delivery and performance of this
Agreement and the other Loan Documents, the issuance of Letters of Credit, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or any material Contractual Obligation of any Group Member
and will not result in, or require, the creation or imposition of any Lien on
any of their respective properties or revenues pursuant to any Requirement of
Law or any such Contractual Obligation. No Requirement of Law or Contractual
Obligation applicable to the Borrower or any Restricted Subsidiary could
reasonably be expected to have a Material Adverse Effect.

 

4.6.         Litigation. Except as set forth on Schedule 4.6 attached hereto, no
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the Borrower,
threatened by or against any Group Member or against any of their respective
properties or revenues (a) with respect to any of the Loan Documents or any of
the transactions contemplated hereby or thereby, or (b) that is reasonably
likely to be determined adversely and, if so adversely determined, could
reasonably be expected to have a Material Adverse Effect.

 

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4.7.         No Default. No Group Member is in default under or with respect to
any of its Contractual Obligations in any respect that could reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.

 

4.8.         Ownership of Property; Liens. Each Group Member has title in fee
simple to, or a valid leasehold interest in, all its real property, and good
title to, or a valid leasehold interest in, all its other property, in each case
material to its business and except for minor defects in title that do not
interfere with its ability to conduct its business as currently conducted or to
utilize such properties for their intended purposes, and none of such property
is subject to any Lien except as permitted by Section 7.3.

 

4.9.         Intellectual Property. Each Group Member owns, or is licensed to
use, all Intellectual Property necessary for the conduct of its business as
currently conducted. As of the Closing Date, no material claim has been asserted
and is pending by any Person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such Intellectual
Property. The use of such Intellectual Property by each Group Member does not
infringe on the rights of any Person in any material respect, except where such
infringement, individually or in the aggregate, does not have a Material Adverse
Effect.

 

4.10.       Taxes. Each Group Member has filed or caused to be filed all
Federal, state and other material tax returns that are required to be filed and
has paid all taxes shown to be due and payable on said returns or on any
assessments made against it or any of its property and all other taxes, fees or
other charges imposed on it or any of its property by any Governmental
Authority, except (a) the amount or validity of which are currently being
contested in good faith by appropriate proceedings and with respect to which
reserves in conformity with GAAP have been provided on the books of the relevant
Group Member or (b) to the extent that the failure to do so could not reasonably
be expected to have a Material Adverse Effect; no material tax Lien has been
filed (other than a tax Lien described in Section 7.3(a)), and, to the knowledge
of the Borrower, no claim is being asserted, with respect to any such tax, fee
or other charge, other than any such tax, fee or other charge described in
clauses (a) or (b) above.

 

4.11.       Federal Regulations. No part of the proceeds of any Loans, and no
other extensions of credit hereunder, will be used (a) for “buying” or
“carrying” any “margin stock” within the respective meanings of each of the
quoted terms under Regulation U as now and from time to time hereafter in effect
for any purpose that violates the provisions of the Regulations of the Board or
(b) for any purpose that violates the provisions of the Regulations of the
Board. If requested by any Lender or the Administrative Agent, the Borrower will
furnish to the Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.

 

4.12.       Labor Matters. Except as, in the aggregate, could not reasonably be
expected to have a Material Adverse Effect: (a) there are no strikes or other
labor disputes against any Group Member pending or, to the knowledge of the
Borrower, threatened; (b) hours worked by and payment made to employees of each
Group Member have not been in violation of the Fair Labor Standards Act or any
other applicable Requirement of Law dealing with such matters; and (c) all
payments due from any Group Member on account of employee health and welfare
insurance have been paid or accrued as a liability on the books of the relevant
Group Member.

 

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4.13.       ERISA. Except as, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect, (a) each Plan has
complied in all respects with the applicable provisions of ERISA and the Code;
(b) neither a Reportable Event (in the case of any Single Employer Plan) nor, in
the case of a Plan subject to Section 412 of the Code or Section 302 of ERISA,
any failure to satisfy the minimum funding standards (within the meaning of
Section 412 of the Code or Section 302 of ERISA), whether or not waived, has
occurred with respect to any such Plan during the five-year period prior to the
date on which this representation is made or deemed made; and (c) neither the
Borrower, any Group Member, nor any Commonly Controlled Entity has filed,
pursuant to Section 412(c) of the Code or Section 302(c) of ERISA, an
application for a waiver of the minimum funding standard with respect to any
Plan, or failed to make by its due date a required installment to any Single
Employer Plan under Section 430(j) of the Code, and there has been no
determination that any Single Employer Plan is, or is expected to be, in “at
risk” status (within the meaning of Section 430 of the Code or Section 303 of
ERISA). No termination of a Single Employer Plan or Multiemployer Plan has
occurred that has resulted or is likely to result in material liability to the
Group Members, and no Lien in favor of the PBGC or such a Plan has arisen with
respect to any Single Employer Plan during the five-year period prior to the
date on which this representation is made or deemed made. The present value of
all accrued benefits under each Single Employer Plan (based on those assumptions
used to fund such Plans) did not, as of the last annual valuation date prior to
the date on which this representation is made or deemed made, exceed the value
of the assets of such Plan allocable to such accrued benefits by an amount that
is material to the Group Members. Neither the Borrower, any Group Member nor any
Commonly Controlled Entity has failed to make any required contribution to a
Multiemployer Plan when due or had a complete or partial withdrawal from any
Single Employer Plan or Multiemployer Plan that has resulted or could reasonably
be expected to result in a material liability under ERISA with respect to the
Group Members, and the Group Members would not become subject to any material
liability under ERISA if the Borrower, any Group Member or any Commonly
Controlled Entity were to withdraw completely from all Single Employer Plans
and, to the Borrower’s knowledge, all Multiemployer Plans, as of the valuation
date most closely preceding the date on which this representation is made or
deemed made. Neither Borrower, any Group Member nor any Commonly Controlled
Entity has received any notice (i) concerning the imposition of liability as a
result of a complete or partial withdrawal from a Multiemployer Plan or that any
Multiemployer Plan is, or is expected to be, Insolvent, or terminated (within
the meaning of Section 4041A of ERISA), or in “endangered” or “critical” status
(within the meaning of Section 432 of the Code or Section 305 of ERISA), or (ii)
from the PBGC or a Plan administrator relating to an intention to terminate any
Plan or to appoint a trustee to administer any Plan under Section 4042 of ERISA.

 

4.14.       Investment Company Act; Other Regulations. No Loan Party is an
“investment company”, or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board and applicable insolvency law after the commencement
of an insolvency proceeding) that limits its ability to incur Indebtedness.

 

4.15.       Subsidiaries. Except as disclosed to the Administrative Agent by the
Borrower in writing from time to time after the Closing Date to reflect changes
after the Closing Date, (a) Schedule 4.15 sets forth the name and jurisdiction
of incorporation of each Subsidiary and, as to each such Subsidiary, the
percentage of each class of Capital Stock owned by any Loan Party and whether
such Subsidiary is a Restricted Subsidiary or an Unrestricted Subsidiary, and
(b) there are no outstanding subscriptions, options, warrants, calls, rights or
other agreements or commitments (other than (i) stock options, restricted stock
units, restricted stock, stock appreciation rights and other rights and equity
incentive awards granted to employees, consultants or directors pursuant to any
equity incentive plan, savings plan or employee stock purchase plan of the
Borrower and (ii) directors’ qualifying shares) of any nature relating to any
Capital Stock of the Borrower or any Subsidiary, except as created by the Loan
Documents.

 

42

 

 

4.16.       Use of Proceeds.

 

The proceeds of the Revolving Loans and the Letters of Credit shall be used to
(a) repay amounts owed under the Existing Credit Agreement and (b) provide for
the working capital needs and general corporate purposes of the Borrower and its
Subsidiaries, including acquisitions and other Investments permitted by the
terms of this Agreement.

 

4.17.       Environmental Matters. Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect:

 

(a)          the facilities and properties owned, leased or operated by any
Group Member (the “Properties”) do not contain, and have not previously
contained, any Materials of Environmental Concern in amounts or concentrations
or under circumstances that constitute or constituted a violation of, or could
give rise to liability under, any Environmental Law;

 

(b)          no Group Member has received or is aware of any notice of
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of the Properties or the business operated by any Group Member
(the “Business”), nor does the Borrower have knowledge or reason to believe that
any such notice will be received or is being threatened;

 

(c)          Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
that could give rise to liability under, any Environmental Law, nor have any
Materials of Environmental Concern been generated, treated, stored or disposed
of at, on or under any of the Properties in violation of, or in a manner that
could give rise to liability under, any applicable Environmental Law;

 

(d)          no judicial proceeding or governmental or administrative action is
pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which any Group Member is or will be named as a party with
respect to the Properties or the Business, nor are there any consent decrees or
other decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any Environmental Law
with respect to the Properties or the Business;

 

(e)          there has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of any Group Member in connection with the Properties or
otherwise in connection with the Business, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws;

 

(f)           the Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, with all
applicable Environmental Laws, and there is no contamination at, under or about
the Properties or violation of any Environmental Law with respect to the
Properties or the Business; and

 

(g)          no Group Member has assumed any liability of any other Person under
Environmental Laws.

 

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4.18.       Accuracy of Information, etc. No statement or information contained
in this Agreement, any other Loan Document, the Confidential Information
Memorandum or any other document, certificate or statement furnished in writing
by or on behalf of any Loan Party to the Administrative Agent or the Lenders, or
any of them, for use in connection with the transactions contemplated by this
Agreement or the other Loan Documents, contained as of the date such statement,
information, document or certificate was so furnished (or, in the case of the
Confidential Information Memorandum, as of the date of this Agreement), any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements contained herein or therein not misleading in
light of the circumstances under which they were made; provided, however, that
the projections and pro forma financial information contained in the materials
referenced above are based upon good faith estimates and assumptions believed by
management of the Borrower to be reasonable at the time made, it being
recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount.

 

4.19.       Solvency. Each Loan Party is, and after giving effect to the
incurrence of all Indebtedness and obligations being incurred in connection
herewith will be and will continue to be, Solvent.

 

4.20.       Anti-Corruption Laws and Sanctions. The Borrower has implemented and
maintains in effect policies and procedures designed to ensure compliance by the
Borrower, its Subsidiaries and their respective directors, officers, employees
and agents with Anti-Corruption Laws and applicable Sanctions, and the Borrower,
its Subsidiaries and their respective officers and employees, and to the
knowledge of the Borrower its directors and agents, are in compliance with
Anti-Corruption Laws and applicable Sanctions in all material respects and are
not knowingly engaged in any activity that would reasonably be expected to
result in the Borrower being designated as a Sanctioned Person. None of (a) the
Borrower, any Subsidiary or any of their respective directors, officers or
employees or (b) to the knowledge of the Borrower, any agent of the Borrower 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 Loan or
Letter of Credit, use of proceeds or other transaction contemplated by this
Agreement will violate any Anti-Corruption Law or applicable Sanctions.

 

4.21.       EEA Financial Institutions. No Loan Party is an EEA Financial
Institution.

 

Section 5.  CONDITIONS PRECEDENT

 

5.1.         Conditions to Initial Extension of Credit. The agreement of each
Lender to make the initial extension of credit requested to be made by it is
subject to the satisfaction (or waiver), prior to or concurrently with the
making of such extension of credit on the Closing Date, of the following
conditions precedent:

 

(a)          Credit Agreement; Notes; Guarantee. The Administrative Agent shall
have received (i) this Agreement, executed and delivered by the Administrative
Agent, the Borrower and each Person listed on Schedule 1.1A, (ii) a Note in
favor of each Lender that has requested a Note at least two Business Days prior
to the Closing Date, executed and delivered by the Borrower, and (iii) the
Guarantee, executed and delivered by the Borrower and each Subsidiary Guarantor.

 

(b)          Existing Credit Agreement. All amounts outstanding under the
Existing Credit Agreement shall be simultaneously paid in full, all outstanding
commitments thereunder shall be terminated and any liens securing the
obligations thereunder shall be released; provided that, each Lender hereto that
is a lender under the Existing Credit Agreement hereby waives the notice
requirements set forth in Sections 2.9 and 3.1 of the Existing Credit Agreement
with respect to the repayment of the Existing Credit Agreement contemplated by
this clause (b).

 

(c)          Financial Statements. The Lenders shall have received the
Historical Financials and Interim Financials described in Section 4.1.

 

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(d)          Approvals. All governmental and third party approvals necessary in
connection with the continuing operations of the Group Members and the
transactions contemplated hereby shall have been obtained and be in full force
and effect, and all applicable waiting periods shall have expired without any
action being taken or threatened by any competent authority that would restrain,
prevent or otherwise impose adverse conditions on the financing contemplated
hereby.

 

(e)          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 Closing Date.

 

(f)           Closing Certificate; Certified Certificate of Incorporation; Good
Standing Certificates. The Administrative Agent shall have received (i)
certificates of each Loan Party, dated the Closing Date, substantially in the
form of Exhibit C, with appropriate insertions and attachments, including the
certificate of incorporation or articles of incorporation, as applicable, of
each Loan Party, certified by the relevant authority of the jurisdiction of
organization of such Loan Party and (ii) a good standing certificate for each
Loan Party from its jurisdiction of organization.

 

(g)          Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions:

 

(i)  the legal opinion of Curtis, Mallet-Prevost, Colt & Mosle LLP, counsel to
the Borrower and its Subsidiaries, in form and substance reasonably satisfactory
to the Administrative Agent; and

 

(ii) the legal opinion of local counsel to the Borrower and its Subsidiaries in
each jurisdiction as the Administrative Agent may reasonably require.

 

Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.

 

(h)          Patriot Act. The Administrative Agent shall have received all
documentation and other information with respect to the Borrower and its
Subsidiaries that is required by regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including the
Patriot Act.

 

5.2.         Conditions to Each Extension of Credit. The agreement of each
Lender to make any extension of credit requested to be made by it on any date
(including its initial extension of credit) is subject to the satisfaction of
the following conditions precedent:

 

(a)          Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of such date as if made on
and as of such date (except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be
true and correct in all material respects as of such earlier date).

 

(b)          No Default. No Default or Event of Default shall have occurred and
be continuing on such date or after giving effect to the extensions of credit
requested to be made on such date.

 

Each borrowing by and each issuance, renewal or extension of a Letter of Credit
on behalf of the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date of such extension of credit that the
conditions contained in this Section 5.2 have been satisfied.

 

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Section 6.  AFFIRMATIVE COVENANTS

 

The Borrower hereby agrees that, so long as the Commitments remain in effect,
any Letter of Credit remains outstanding (except to the extent cash
collateralized in the manner set forth in Section 2.5(a)) or any Loan or other
amount is owing to any Lender or the Administrative Agent hereunder (other than
unmatured contingent reimbursement and indemnification obligations), the
Borrower shall and shall cause each of its Restricted Subsidiaries to:

 

6.1.         Financial Statements. Furnish to the Administrative Agent and each
Lender:

 

(a)          as soon as available, but in any event within 90 days (or such
shorter period as the SEC shall specify for the filing of annual reports on Form
10-K) after the end of each fiscal year of the Borrower plus the term of any
extensions permitted to be taken by the Borrower in accordance with SEC rules
and regulations in respect of such annual reports, a copy of the audited
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
at the end of such year and the related audited consolidated statements of
income, comprehensive income, shareholders’ equity and cash flows for such year,
setting forth in each case in comparative form the figures for the previous
year, reported on without a “going concern” or like qualification or exception,
or qualification arising out of the scope of the audit, by Ernst & Young LLP or
other independent certified public accountants of nationally recognized
standing; and

 

(b)          as soon as available, but in any event not later than 45 days (or
such shorter period as the SEC shall specify for the filing of quarterly reports
on Form 10-Q) after the end of each of the first three quarterly periods of each
fiscal year of the Borrower plus the term of any extensions permitted to be
taken by the Borrower in accordance with SEC rules and regulations in respect of
such quarterly reports, the unaudited consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income, comprehensive income, shareholders’
equity and cash flows for such quarter and the portion of the fiscal year
through the end of such quarter, setting forth in each case in comparative form
the figures for the previous year, certified by a Responsible Officer as
presenting fairly in all material respects the consolidated financial condition
of the Borrower and its Subsidiaries as at such date, and the consolidated
results of their operations and their cash flows for the period then ended
(subject to normal year-end audit adjustments).

 

All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied (except as approved by such accountants or officer, as the case may be,
and disclosed in reasonable detail therein) consistently throughout the periods
reflected therein and with prior periods.

 

Information required to be delivered pursuant to this Section 6.1 shall be
deemed to have been delivered to the Lenders on the date on which such
information has been posted on the Borrower’s website on the Internet at
www.mscdirect.com or is available on the website of the SEC at www.sec.gov (to
the extent such information has been posted or is available as described in such
notice). Information required to be delivered pursuant to this Section 6.1 may
also be delivered by electronic communication pursuant to procedures approved by
the Administrative Agent pursuant to Section 10.2.

 

6.2.         Certificates; Other Information. Furnish to the Administrative
Agent and each Lender (or, in the case of clause (c), to the relevant Lender):

 

46

 

 

(a) concurrently with the delivery of any financial statements pursuant to
Section 6.1, (i) a certificate of a Responsible Officer stating that, to the
best of such Responsible Officer’s knowledge, each Loan Party during such period
has observed or performed all of its covenants and other agreements, and
satisfied every condition contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any Default or
Event of Default except as specified in such certificate and (ii) a Compliance
Certificate containing all information and calculations necessary for
determining compliance by each Group Member with the provisions of this
Agreement referred to therein as of the last day of the fiscal quarter or fiscal
year of the Borrower, as the case may be;

 

(b) simultaneously with the delivery of each set of consolidated financial
statements referred to in Sections 6.1(a) and 6.1(b) above, the related
consolidating financial statements reflecting the adjustments necessary to
eliminate the accounts of Unrestricted Subsidiaries (if any) from such
consolidated financial statements;

 

(c) within five days after the same are sent, copies of all financial statements
and reports that the Borrower sends to the holders of any class of its debt
securities or public equity securities and, within five days after the same are
filed, copies of all financial statements and reports that the Borrower may make
to, or file with, the SEC (it being understood that information required to be
delivered pursuant to this Section 6.2(c) (i) shall be deemed to have been
delivered to the Lenders on the date on which such information has been posted
on the Borrower’s website on the Internet at www.mscdirect.com or is available
on the website of the SEC at www.sec.gov (to the extent such information has
been posted or is available as described in such notice) and (ii) may also be
delivered by electronic communication pursuant to procedures approved by the
Administrative Agent pursuant to Section 10.2); and

 

(d) promptly, such additional financial and other information as any Lender may
from time to time reasonably request.

 

6.3.          Payment of Obligations. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations (including taxes) of whatever nature, except where the
amount or validity thereof is currently being contested in good faith by
appropriate proceedings and reserves in conformity with GAAP with respect
thereto have been provided on the books of the relevant Group Member or where
such failure to pay, discharge or otherwise satisfy could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

6.4.          Maintenance of Existence; Compliance. (a)(i) Preserve, renew and
keep in full force and effect its organizational existence and (ii) take all
reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business, except, in each case, as
otherwise permitted by Section 7.4 and except to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect; (b)
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith could not, in the aggregate, reasonably
be expected to have a Material Adverse Effect; and (c) maintain in effect and
enforce policies and procedures designed to promote and achieve compliance by
the Borrower, its Subsidiaries and their respective directors, officers,
employees and agents with Anti-Corruption Laws and applicable Sanctions.

 

6.5.          Maintenance of Property; Insurance. (a)  Keep all property useful
and necessary in its business in good working order and condition, ordinary wear
and tear excepted, except to the extent that failure to comply therewith could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect,
and (b) maintain with financially sound and reputable insurance companies
insurance on all its property in at least such amounts and against at least such
risks (but including in any event public liability, product liability and
business interruption) as are usually insured against in the same general area
by companies engaged in the same or a similar business.

 

47

 

 

6.6.          Inspection of Property; Books and Records; Discussions. (a) Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law, in each case in all material
respects, shall be made of all dealings and transactions in relation to its
business and activities and (b) permit representatives of any Lender, upon
reasonable prior notice and during normal business hours, to visit and inspect
any of its properties and examine and make abstracts from any of its books and
records as often as may reasonably be desired and to discuss the business,
operations, properties and financial and other condition of the Group Members
with officers and employees of the Group Members and with their independent
certified public accountants.

 

6.7.          Certain Notices. Promptly (and in any event within five Business
Days, except as set forth in clause (e) below) give notice to the Administrative
Agent and each Lender (with respect to clauses (a) through (c) and (f)) and to
the Administrative Agent (with respect to clauses (d) and (e)) after any
Responsible Officer obtains knowledge of:

 

(a) the occurrence of any Default or Event of Default;

 

(b) any (i) default or event of default under any Contractual Obligation of any
Group Member or (ii) litigation, investigation or proceeding that may exist at
any time between any Group Member and any Governmental Authority, that in either
case, if not cured or if adversely determined, as the case may be, could
reasonably be expected to have a Material Adverse Effect;

 

(c) any litigation or proceeding affecting any Group Member (i) which is
reasonably likely to be adversely decided and, if adversely decided,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, (ii) in which any material injunctive or similar relief
is sought or (iii) which relates to any Loan Document;

 

(d) the following events, as soon as possible and in any event within 30 days
after the Borrower knows or has reason to know thereof: (i) the occurrence of
any Reportable Event with respect to any Single Employer Plan that is likely to
result in material liability to the Group Members; the failure of Borrower, any
Group Member or any Commonly Controlled Entity to make any required contribution
to a Plan; the determination that any Single Employer Plan is in “at risk”
status; the creation of any Lien against Borrower, any Group Member or any
Commonly Controlled Entity with respect to a Single Employer Plan in favor of
the PBGC or such a Plan; or any withdrawal by Borrower, any Group Member or any
Commonly Controlled Entity from, or the termination of, any Single Employer
Plan; (ii) the failure of Borrower, any Group Member or any Commonly Controlled
Entity to make any required contribution to a Multiemployer Plan; any withdrawal
of Borrower, any Group Member or any Commonly Controlled Entity from, or
termination of, any Multiemployer Plan; or the receipt by Borrower, any Group
Member, or any Commonly Controlled Entity of (A) any notice concerning the
Insolvency of, any Multiemployer Plan or (B) a determination that any such
Multiemployer Plan is in “endangered” or “critical” status; or (iii) the
institution of proceedings or the taking of any other action by the PBGC against
the Borrower, any Group Member, any Commonly Controlled Entity, or any
Multiemployer Plan with respect to (A) any withdrawal from, or termination of,
any Plan or Multiemployer Plan or (B) the Insolvency of any Multiemployer Plan;

 

(e) upon reasonable request of the Administrative Agent and promptly following
receipt thereof from the administrator or sponsor of the applicable
Multiemployer Plan, copies of any documents or notices described in Sections
101(k) or 101(l) of ERISA that Borrower, any Group Member or any Commonly
Controlled Entity may request with respect to any Multiemployer Plan; and

 

48

 

 

(f) any development or event that has had or could reasonably be expected to
have a Material Adverse Effect.

 

Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the relevant Group Member proposes to take with
respect thereto.

 

6.8.          Environmental Laws. (a)  Comply in all material respects with, and
use its commercially reasonable efforts to ensure compliance in all material
respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws, and obtain and comply in all material respects with and
maintain, and use its commercially reasonable efforts to ensure that all tenants
and subtenants obtain and comply in all material respects with and maintain, any
and all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, in each case except to the extent failure to do
so could not reasonably be expected to have a Material Adverse Effect.

 

(b)          Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws, in each case except to the extent failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

6.9.          Additional Subsidiary Guarantors. With respect to any Subsidiary
(other than a Securitization Vehicle) that becomes a Material Domestic
Restricted Subsidiary after the Closing Date or any new Material Domestic
Restricted Subsidiary (other than a Securitization Vehicle) created or acquired
after the Closing Date, promptly (i) cause such Material Domestic Restricted
Subsidiary (A)  to execute and deliver to the Administrative Agent a supplement
to the Guarantee substantially in the form of Annex A to the Guarantee and (B)
to deliver to the Administrative Agent a certificate of such Domestic Restricted
Subsidiary, substantially in the form of Exhibit C, with appropriate insertions
and attachments, and (ii) if requested by the Administrative Agent, deliver to
the Administrative Agent a legal opinion relating to the matters described
above, which opinion shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.

 

6.10.        Designation of Subsidiaries. By action of its board of directors,
the Borrower may at any time after the Closing Date designate any Restricted
Subsidiary or any newly created or acquired Subsidiary of the Borrower as an
Unrestricted Subsidiary or any Unrestricted Subsidiary as a Restricted
Subsidiary; provided that (i) immediately before and after such designation on a
pro forma basis, no Default or Event of Default shall have occurred and be
continuing, (ii) immediately after giving effect to such designation, the
Borrower shall be in compliance, on a pro forma basis, with the financial
covenants set forth in Section 7.1, (iii) the Borrower shall have delivered to
the Administrative Agent a certificate of a Responsible Officer certifying as to
the satisfaction of the conditions in clauses (i) and (ii) above and setting
forth in reasonable detail the calculations necessary to determine compliance
with the condition in clause (ii) above, (iv) no Restricted Subsidiary may be
designated as an Unrestricted Subsidiary if it was previously designated as an
Unrestricted Subsidiary and (v) no Subsidiary of an Unrestricted Subsidiary may
be a Restricted Subsidiary. The designation of any Subsidiary as an Unrestricted
Subsidiary after the Closing Date shall constitute an Investment by the Borrower
therein at the date of designation in an amount equal to the fair market value
of the Borrower’s or its Restricted Subsidiary’s (as applicable) Investment
therein. The designation of any Unrestricted Subsidiary as a Restricted
Subsidiary shall constitute (a) the incurrence at the time of such designation
of any Investment, Indebtedness or Liens of such Subsidiary existing at such
time and (b) a return on any Investment by the Borrower in Unrestricted
Subsidiaries pursuant to the preceding sentence in an amount equal to the fair
market value at the date of such designation of the Borrower’s or its Restricted
Subsidiary’s (as applicable) Investment in such Subsidiary.

 

49

 

 

Section 7. NEGATIVE COVENANTS

 

The Borrower hereby agrees that, so long as the Commitments remain in effect,
any Letter of Credit remains outstanding (except to the extent cash
collateralized in the manner set forth in Section 2.5(a)) or any Loan or other
amount is owing to any Lender or the Administrative Agent hereunder (other than
unmatured contingent reimbursement and indemnification obligations), the
Borrower shall not, and shall not permit any of its Restricted Subsidiaries to,
directly or indirectly:

 

7.1.         Financial Condition Covenants.

 

(a)           Consolidated Leverage Ratio. As of the last day of any fiscal
quarter (commencing with the fiscal quarter ended on or about December 3, 2016),
permit the Consolidated Leverage Ratio for the Reference Period ending on such
day to exceed 3.00 to 1.00; provided that, in the event that (i) the Borrower or
any of its Restricted Subsidiaries completes a Material Acquisition and (ii) on
or prior to the date of the consummation of such Material Acquisition, the
Borrower delivers written notice to the Administrative Agent of its intention to
(A) consummate such Material Acquisition and (B) activate a Leverage Ratio
Step-Up in connection therewith (any such written notice, a “Leverage Ratio
Step-Up Notice”), the Consolidated Leverage Ratio set forth above shall be
temporarily increased to 3.50 to 1.00 for the succeeding four consecutive fiscal
quarters, commencing with the fiscal quarter in which such Material Acquisition
occurs (each such temporary increase, a “Leverage Ratio Step-Up”); provided that
the Borrower shall not deliver more than one Leverage Ratio Step-Up Notice
during any period of eight consecutive fiscal quarters (and any Leverage Ratio
Step-Up Notice delivered in violation of this proviso shall be deemed to be null
and void).

 

(b)          Consolidated Interest Coverage Ratio. As of the last day of any
fiscal quarter (commencing with the fiscal quarter ended on or about December 3,
2016), permit the Consolidated Interest Coverage Ratio for the Reference Period
ending on such day to be less than 3.00 to 1.00.

 

7.2.          Indebtedness. (a)  Create, issue, incur, assume, become liable in
respect of or suffer to exist any Indebtedness of the Borrower or any Subsidiary
Guarantor if, after giving effect thereto, on a pro forma basis, the Borrower
would not be in compliance with Section 7.1(a) as of the last day of the
immediately preceding fiscal quarter for which financial statements have been
delivered pursuant to Section 6.1; provided that (i) if such Indebtedness is
incurred in connection with a Material Acquisition permitted under this
Agreement, for purposes of complying with the Consolidated Leverage Ratio in
Section 7.1(a), (x) Consolidated EBITDA of the Borrower and the Restricted
Subsidiaries shall be calculated on a pro forma basis to give effect to such
Material Acquisition in the manner set forth in clause (ii) of the last
paragraph of the definition of “Consolidated EBITDA” hereunder and (y) if the
Borrower has delivered a Leverage Ratio Step-Up Notice in connection with such
Material Acquisition in accordance with Section 7.1(a) above, the maximum
Consolidated Leverage Ratio for purposes of such compliance shall be 3.50 to
1.00 and (ii) subject to Section 7.6(g), the Borrower and the Subsidiary
Guarantors shall be permitted to create, issue, incur, assume, become liable in
respect of and suffer to exist Indebtedness owing to the Borrower or any
Subsidiary of the Borrower.

 

(b)          Create, issue, assume, become liable in respect of or suffer to
exist any Priority Debt, except:

 

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(i)          Indebtedness incurred in connection with Securitizations permitted
by Section 7.5;

 

(ii)         subject to the limitations set forth in Section 7.6(g), (A)
Indebtedness of the Borrower or any Subsidiary Guarantor owing to the Borrower
or any Subsidiary of the Borrower, (B) Indebtedness of any Restricted Subsidiary
that is not a Guarantor owing to the Borrower or any Subsidiary Guarantor and
(C) Indebtedness of any Restricted Subsidiary that is not a Subsidiary Guarantor
owing to any other Restricted Subsidiary that is not a Subsidiary Guarantor; and

 

(iii)        other Priority Debt, provided that, at the time of creation,
issuance, incurrence, assumption, becoming liable in respect thereof or
existence thereof and after giving effect thereto, the sum of (x) the aggregate
amount of Priority Debt (other than Priority Debt permitted by clauses (i) and
(ii) of this Section 7.2(b)) then outstanding plus (y) the aggregate amount of
Investments made pursuant to Section 7.6(g) by the Borrower and the Subsidiary
Guarantors in Restricted Subsidiaries that are not Subsidiary Guarantors plus
(z) the aggregate amount of Investments made pursuant to Section 7.6(g) by the
Borrower and the Restricted Subsidiaries in Unrestricted Subsidiaries does not
exceed the greater of $500,000,000 and 20% of Consolidated Tangible Assets as of
the last day of the immediately preceding fiscal quarter for which financial
statements have been delivered pursuant to Section 6.1.

 

7.3.          Liens. Create, incur, assume or suffer to exist any Lien upon any
of its property, whether now owned or hereafter acquired, except:

 

(a) Liens for taxes or other governmental charges or assessments not yet due or
that are being contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books of the
Borrower or the Restricted Subsidiaries, as the case may be, in conformity with
GAAP;

 

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, landlord’s,
repairmen’s or other like Liens arising in the ordinary course of business that
are not overdue for a period of more than 30 days or that are being contested in
good faith by appropriate proceedings;

 

(c) pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security legislation;

 

(d) deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, obligations in favor of utility
companies, surety and appeal bonds, performance bonds and other obligations of a
like nature incurred in the ordinary course of business;

 

(e) easements, rights-of-way, restrictions, defects and irregularities in title
and other similar encumbrances incurred in the ordinary course of business that,
in the aggregate, are not substantial in amount and that do not in any case
materially detract from the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of the Borrower or any of
the Restricted Subsidiaries;

 

(f) Liens in existence on the date hereof listed on Schedule 7.3(f), provided
that no such Lien is spread to cover any additional property after the Closing
Date and that the amount of Indebtedness secured thereby is not increased above
the original principal amount thereof;

 

51

 

 

(g) Liens securing Indebtedness of the Borrower or any Restricted Subsidiary
(including, without limitation, Capital Lease Obligations) permitted under
Section 7.2(a) to finance the acquisition, construction or improvement of fixed
or capital assets or to secure the purchase price of fixed or capital assets,
provided that (i) such Liens shall be created within 90 days of the acquisition,
construction or improvement of such fixed or capital assets, (ii) such Liens do
not at any time encumber any property other than such fixed or capital assets
and (iii) the amount of Indebtedness or purchase price obligation secured
thereby is not increased above the original principal amount thereof;

 

(h) any interest or title of a lessor under any lease entered into by the
Borrower or any Restricted Subsidiary in the ordinary course of its business and
covering only the assets so leased, and licenses and sublicenses granted by the
Borrower or any Restricted Subsidiary in the ordinary course of business;

 

(i) Liens in favor of the Administrative Agent for the benefit of the Lenders
and the Administrative Agent under the Loan Documents;

 

(j) 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;

 

(k) Liens in favor of collecting banks arising by operation of law under the
Uniform Commercial Code covering only the items being collected upon and Liens
(including the right of set-off) in favor of a bank or other depository
institution arising in the ordinary course of business as a matter of law
encumbering deposits;

 

(l) Liens arising from the filing of UCC financing statements solely as a
precautionary measure in connection with operating leases or consignments of
goods;

 

(m) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for sales of goods (including Article 2 of the UCC), and
Liens that are contractual rights of set-off relating to purchase orders and
other similar agreements, in each case entered into in the ordinary course of
business;

 

(n) Liens created pursuant to attachment, garnishee orders or other process in
connection with pre-judgment court proceedings, and Liens securing judgments for
the payment of money not constituting an Event of Default under Section 8(h);

 

(o) Liens on assets subject to, and incurred under, merger agreements, stock or
asset purchase agreements and similar purchase agreements in respect of the
Disposition of such assets by the Borrower or any Restricted Subsidiary in a
Disposition permitted hereunder;

 

(p) Liens on any asset at the time the Borrower or any Restricted Subsidiary
acquired such asset and Liens on the assets of a Person existing at the time
such Person was acquired by the Borrower or any Restricted Subsidiary, including
any acquisition by means of a merger, amalgamation or consolidation with or into
the Borrower or any Restricted Subsidiary; subject to the condition that (i) any
such Lien may not extend to any other asset of the Borrower or any Restricted
Subsidiary; and (ii) any such Lien shall not have been created in contemplation
of or in connection with the transaction or series of transactions pursuant to
which such asset or Person was acquired by the Borrower or any Restricted
Subsidiary;

 

52

 

 

(q) Liens on Securitization Assets in connection with Securitizations permitted
by Section 7.5;

 

(r) Liens securing Priority Debt permitted to be incurred by Section 7.2(b);

 

(s) Liens that secure Swap Agreements to which the Borrower or any Restricted
Subsidiary is a party, provided that the aggregate fair market value of all
assets subject to such Liens does not at any time exceed $30,000,000 in the
aggregate; and

 

(t) Liens not otherwise permitted under this Section 7.3, provided that the
aggregate fair market value of all assets subject to such Liens does not at any
time exceed $30,000,000 in the aggregate.

 

7.4.          Fundamental Changes. Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of all or substantially all of its
property or business, except that:

 

(a) (i) any Subsidiary of the Borrower may be merged or consolidated with or
into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any Subsidiary Guarantor (provided that a
Subsidiary Guarantor shall be the continuing or surviving corporation), (ii) any
Restricted Subsidiary that is not a Subsidiary Guarantor may be merged or
consolidated with or into any other Restricted Subsidiary that is not a
Subsidiary Guarantor and (iii) any Unrestricted Subsidiary may be merged or
consolidated with or into any Restricted Subsidiary that is not a Subsidiary
Guarantor (provided that the Restricted Subsidiary shall be the continuing or
surviving corporation);

 

(b) (i) any Subsidiary of the Borrower may Dispose of any or all of its assets
(A) to the Borrower or any Subsidiary Guarantor (upon voluntary liquidation or
otherwise) or (B) pursuant to a Disposition permitted by Section 7.5 and (ii)
any Restricted Subsidiary that is not a Subsidiary Guarantor may Dispose of any
or all of its assets to any other Restricted Subsidiary that is not a Loan
Party;

 

(c) any Disposition permitted by Section 7.5 may be effected through a merger,
consolidation or amalgamation;

 

(d) any Investment expressly permitted by Section 7.6 may be effected through a
merger, consolidation or amalgamation; and

 

(e) any Restricted Subsidiary (other than a Subsidiary Guarantor) may liquidate,
wind up or dissolve if the Borrower determines in good faith that such
liquidation, winding-up or dissolution is in the best interest of the Borrower
and is not materially disadvantageous to the Lenders.

 

7.5.          Disposition of Property. Dispose of any of its property, whether
now owned or hereafter acquired, or, in the case of any Restricted Subsidiary,
issue or sell any shares of such Subsidiary’s Capital Stock to any Person,
except:

 

(a) the Disposition of obsolete or worn out property in the ordinary course of
business;

 

(b) the sale of inventory in the ordinary course of business;

 

53

 

 

(c) Dispositions permitted by clauses (i)(A) and (ii) of Section 7.4(b);

 

(d) the sale or issuance of any Restricted Subsidiary’s Capital Stock to the
Borrower or any Subsidiary Guarantor;

 

(e) sales of Securitization Assets in Securitizations, provided that (i) each
such Securitization is effected on market terms as reasonably determined by the
management of the Borrower and (ii) the aggregate amount of Third Party
Interests in respect of all such Securitizations does not exceed $100,000,000 at
any time outstanding;

 

(f) a sale-leaseback by the Borrower or any Restricted Subsidiary of fixed
assets for fair market value in a transaction not otherwise prohibited
hereunder, provided that (x) such assets were first acquired by the Borrower or
any Restricted Subsidiary no earlier than 180 days prior to the date of such
sale-leaseback and (y) the fair market value of assets Disposed of pursuant to
this paragraph (f) shall not exceed $10,000,000 in the aggregate in any fiscal
year;

 

(g) the payment of cash dividends to the holders of the Borrower’s outstanding
Capital Stock and the payment of cash dividends to the holders of any Restricted
Subsidiary’s outstanding Capital Stock on a pro rata basis;

 

(h) Dispositions of Cash Equivalents and marketable securities for a purchase
price that is not less than fair market value of the Investments being sold in
connection with the cash management operations of the Borrower and the
Restricted Subsidiaries in the ordinary course of business;

 

(i) the sale or issuance of the Borrower’s or any Restricted Subsidiary’s
Capital Stock under compensation arrangements and employee benefits plans
approved by the board of directors of the Borrower or such Restricted
Subsidiary;

 

(j) Dispositions of property by the Borrower or any Restricted Subsidiary to the
Borrower or any Subsidiary Guarantor;

 

(k) Dispositions of property by any Restricted Subsidiary that is not a
Subsidiary Guarantor to any other Restricted Subsidiary that is not a Subsidiary
Guarantor; and

 

(l) the Disposition of other property, provided that, at the time of such
Disposition, the fair market value of the property so Disposed, together with
the fair market value of all other property Disposed under this Section 7.5(l)
during such fiscal year of the Borrower, shall not exceed 25% of Consolidated
Tangible Assets (determined as of the last day of the immediately preceding
fiscal quarter for which financial statements have been delivered pursuant to
Section 6.1).

 

7.6.          Investments. Make any advance, loan, extension of credit (by way
of guaranty or otherwise) or capital contribution to, or purchase any Capital
Stock, bonds, notes, debentures or other debt securities of, or any assets
constituting a business unit of, or make any other investment in, any Person
(all of the foregoing, “Investments”), except:

 

(a) extensions of trade credit in the ordinary course of business;

 

(b) Investments in Cash Equivalents;

 

54

 

 

(c) Guarantee Obligations permitted by Section 7.2;

 

(d) Investments consisting of Sellers’ Retained Interests in Securitizations
permitted by Section 7.5;

 

(e) Investments listed in Schedule 7.6(e) committed on the Closing Date;

 

(f) Investments received by the Borrower or any Restricted Subsidiary in
connection with the bankruptcy or reorganization of customers and suppliers and
in settlement of delinquent obligations of, and other disputes with, customers
and suppliers arising in the ordinary course of business;

 

(g) Investments by the Borrower or any Restricted Subsidiary in the Borrower or
any of its Subsidiaries; provided that, (i) the sum of (x) the aggregate amount
of Investments made pursuant to this Section 7.6(g) by the Borrower and the
Subsidiary Guarantors in Restricted Subsidiaries that are not Subsidiary
Guarantors plus (y) the aggregate amount of Investments made pursuant to this
Section 7.6(g) by the Borrower and the Restricted Subsidiaries in Unrestricted
Subsidiaries plus (z) the aggregate amount of Priority Debt created, issued
assumed or incurred by the Borrower and the Restricted Subsidiaries pursuant to
Section 7.2(b)(iii) does not exceed the greater of $500,000,000 and 20% of
Consolidated Tangible Assets as of the last day of the immediately preceding
fiscal quarter for which financial statements have been delivered pursuant to
Section 6.1 and (ii) such Investments pursuant to this Section 7.6(g) by the
Borrower and the Subsidiary Guarantors in Restricted Subsidiaries that are not
Subsidiary Guarantors and such Investments pursuant to this Section 7.6(g) by
the Borrower and the Restricted Subsidiaries in Unrestricted Subsidiaries may
only be made so long as no Default or Event of Default shall then exist or would
exist after giving effect thereto; provided, further, that sum of (i) the
aggregate principal amount of Indebtedness of the Unrestricted Subsidiaries
outstanding at any time with respect to which the Borrower and the Restricted
Subsidiaries have Guarantee Obligations that were incurred pursuant to this
Section 7.6(g) plus (ii) the aggregate principal amount of Indebtedness of the
Unrestricted Subsidiaries outstanding at such time with respect to which the
Borrower and the Restricted Subsidiaries have Guarantee Obligations that were
incurred pursuant to Section 7.6(i) does not exceed $300,000,000;

 

(h) Investments consisting of loans to employees and officers for travel,
housing, relocation and other similar expenses incurred in the ordinary course
of business not to exceed $5,000,000 at any time outstanding (so long as such
loans do not violate the Sarbanes-Oxley Act of 2002 or any other Requirement of
Law); and

 

(i) other Investments, provided that (i) no Default or Event of Default shall
have occurred and be continuing or would result therefrom, (ii) the Borrower
shall be in compliance with the covenants set forth in Section 7.1 as of the
last day of the immediately preceding fiscal quarter for which financial
statements have been delivered pursuant to Section 6.1 after giving effect, on a
pro forma basis, to such Investment as if it had occurred on the first day of
the relevant period, (iii) in the case of Investments in excess of $100,000,000,
the Borrower shall have delivered to the Administrative Agent a certificate of a
Responsible Officer certifying the satisfaction of the foregoing conditions and
setting forth in reasonable detail the calculations necessary to determine
compliance with clause (ii) above and (iv) the sum of (A) the aggregate
principal amount of Indebtedness of the Unrestricted Subsidiaries outstanding at
such time with respect to which the Borrower and the Restricted Subsidiaries
have Guarantee Obligations that were incurred pursuant to this Section 7.6(i)
plus (B) the aggregate principal amount of Indebtedness of the Unrestricted
Subsidiaries outstanding at such time with respect to which the Borrower and the
Restricted Subsidiaries have Guarantee Obligations that were incurred pursuant
to Section 7.6(g) does not exceed $300,000,000.

 

55

 

 

7.7.          Transactions with Affiliates. Enter into any transaction,
including any purchase, sale, lease or exchange of property, the rendering of
any service or the payment of any management, advisory or similar fees, with any
Affiliate (other than the Borrower or any Subsidiary Guarantor) unless such
transaction is (a)(i) not otherwise prohibited hereunder and (ii) upon fair and
reasonable terms no less favorable to the relevant Group Member than it could
obtain in a comparable arm’s length transaction with a Person that is not an
Affiliate; (b) disclosed or reflected on Schedule 7.7, (c) compensation
arrangements, indemnification agreements and employee benefits plans for
officers and directors duly approved by the board of directors of the Borrower
or such Restricted Subsidiary, or (d) in connection with transactions made in
accordance with Section 7.4 or 7.6, provided that this Section 7.7 shall not
prohibit any sale of Securitization Assets and other transactions effected as
part of Securitizations permitted by Section 7.5.

 

7.8.          Changes in Fiscal Periods. Except as may be required by GAAP,
permit the fiscal year of the Borrower to end on a day other than the Saturday
closest to August 31 or change the Borrower’s method of determining fiscal
quarters, except, in each case, where (i) the Borrower has given not less than
six months prior written notice to the Administrative Agent of any such change
and (ii) at the time of such change and immediately after giving effect thereto,
no Default or Event of Default has occurred and is continuing (it being
understood that, if any such change shall cause any fiscal year to be shorter or
longer than 12 months or any fiscal quarter to be shorter or longer than three
months, any monetary limitations per fiscal year or per fiscal quarter, as
applicable, set forth in this Agreement shall be adjusted ratably for such
shorter or longer period).

 

7.9.          Clauses Restricting Subsidiary Distributions. Enter into or suffer
to exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to (a) make Restricted Payments in respect
of any Capital Stock of such Restricted Subsidiary held by, or pay any
Indebtedness owed to, the Borrower or any other Restricted Subsidiary, (b) make
loans or advances to, or other Investments in, the Borrower or any other
Restricted Subsidiary or (c) transfer any of its assets to the Borrower or any
other Restricted Subsidiary, except for such encumbrances or restrictions
existing under or by reason of (i) any restrictions existing under the Loan
Documents, (ii) any restrictions or conditions imposed by any law, rule,
regulation, ordinance, order, code, interpretation, judgment, decree, directive,
guidelines, policy or similar form of decision of any Governmental Authority,
(iii) customary restrictions and conditions contained in licenses, leases and
franchise agreements, (iv) restrictions or conditions in respect of transfers or
distributions affecting property or assets subject to a Lien permitted under
Section 7.3, (v) restrictions or conditions contained in instruments and
agreements evidencing Indebtedness for borrowed money permitted to be incurred
under Section 7.2, that are taken as a whole no more restrictive than such
restrictions and conditions contained in this Agreement, (vi) restrictions or
conditions contained in (A) any joint venture agreements, partnership agreements
and other agreements relating to any Joint Venture, provided such restrictions
or conditions apply only to the assets or property owned by such Joint Venture
or (B) any instruments or agreements evidencing third party Indebtedness for
borrowed money incurred by any Joint Venture, provided that such restrictions
apply only to the assets or property owned by such Joint Venture and such
Indebtedness is not otherwise prohibited by this Agreement, (vii) any
restrictions with respect to a Restricted Subsidiary imposed pursuant to an
agreement that has been entered into in connection with the Disposition of all
or substantially all of the Capital Stock or assets of such Restricted
Subsidiary and (viii) customary restrictions contained in any documents relating
to any Securitizations, provided such restrictions only apply to the applicable
Securitization Vehicle and its assets or the Securitization Assets.

 

56

 

 

7.10.         Use of Proceeds. Request any Loan or Letter of Credit, and the
Borrower shall not use, and shall procure that its Subsidiaries and its or their
respective directors, officers, employees and agents shall not use, the proceeds
of any Loan or Letter of Credit (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, to
the extent such activities, businesses or transaction would be prohibited by
Sanctions if conducted by a corporation incorporated in the United States or in
a European Union member state or (c) in any manner that would result in the
violation of any Sanctions applicable to any party hereto.

 

Section 8. EVENTS OF DEFAULT

 

If any of the following events shall occur and be continuing:

 

(a) the Borrower shall fail to pay any principal of any Loan or Reimbursement
Obligation when due in accordance with the terms hereof; or the Borrower shall
fail to pay any interest on any Loan or Reimbursement Obligation, or any other
amount payable hereunder or under any other Loan Document, within five days
after any such interest or other amount becomes due in accordance with the terms
hereof; or

 

(b) any representation or warranty made or deemed made by any Loan Party herein
or in any other Loan Document or that is contained in any certificate, document
or financial or other statement furnished in writing by it at any time under or
in connection with this Agreement or any such other Loan Document shall prove to
have been inaccurate in any material respect on or as of the date made or deemed
made; or

 

(c) any Loan Party shall default in the observance or performance of any
agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to the
Borrower only), Section 6.7(a) or Section 7 of this Agreement; or

 

(d) any Loan Party shall default in the observance or performance of any other
agreement contained in this Agreement or any other Loan Document (other than as
provided in paragraphs (a) through (c) of this Section), and such default shall
continue unremedied for a period of 30 days after notice to the Borrower from
the Administrative Agent or the Required Lenders; or

 

(e) any Group Member shall (i) default in making any payment of any principal of
any Indebtedness (including any Guarantee Obligation in respect of Indebtedness,
but excluding the Loans) on the scheduled or original due date with respect
thereto; or (ii) default in making any payment of any interest on any such
Indebtedness beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness was created; or (iii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or beneficiary of such Indebtedness (or a trustee or agent on
behalf of such holder or beneficiary) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or (in
the case of any such Indebtedness constituting a Guarantee Obligation) to become
payable; provided, that a default, event or condition described in clause (i),
(ii) or (iii) of this paragraph (e) shall not at any time constitute an Event of
Default unless, at such time, one or more defaults, events or conditions of the
type described in clauses (i), (ii) and (iii) of this paragraph (e) shall have
occurred and be continuing with respect to Indebtedness the outstanding
principal amount of which exceeds in the aggregate $50,000,000; or

 

57

 

 

(f) (i) any Group Member (other than an Immaterial Restricted Subsidiary that is
not a Loan Party) shall commence any case, proceeding or other action (A) under
any existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or any Group Member (other than an Immaterial
Restricted Subsidiary that is not a Loan Party) shall make a general assignment
for the benefit of its creditors; or (ii) there shall be commenced against any
Group Member (other than an Immaterial Restricted Subsidiary that is not a Loan
Party) any case, proceeding or other action of a nature referred to in clause
(i) above that (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed or undischarged for a
period of 60 days; or (iii) there shall be commenced against any Group Member
(other than an Immaterial Restricted Subsidiary that is not a Loan Party) any
case, proceeding or other action seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any substantial part of
its assets that results in the entry of an order for any such relief that shall
not have been vacated, discharged, or stayed or bonded pending appeal within 60
days from the entry thereof; or (iv) any Group Member (other than an Immaterial
Restricted Subsidiary that is not a Loan Party) shall take any action in
furtherance of, or indicating its consent to, approval of, or acquiescence in,
any of the acts set forth in clause (i), (ii), or (iii) above; or (v) any Group
Member (other than an Immaterial Restricted Subsidiary that is not a Loan Party)
shall generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or

 

(g) (i) the occurrence of any non-exempt “prohibited transaction” (as defined in
Section 406 and 408 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any failure to meet the minimum funding standards (within the meaning of
Section 412 of the Code or Section 302 of ERISA), whether or not waived, shall
exist with respect to any Plan, any Plan shall be determined to be in “at risk”
status (within the meaning of Section 430 of the Code or Section 303 of ERISA),
or any Lien in favor of the PBGC or a Plan shall arise on the assets of any
Group Member or any Commonly Controlled Entity, (iii) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate, any
Single Employer Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is likely to result in the termination of such Plan for
purposes of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA, (v) any Group Member or any Commonly Controlled
Entity shall incur any liability in connection with (A) a withdrawal from any
Single Employer Plan or Multiemployer Plan, or (B) the Insolvency or termination
(within the meaning of Section 4041A of ERISA) of any Multiemployer Plan or
determination that any Multiemployer Plan is in “endangered” or “critical”
status; or (vi) any other event or condition shall occur or exist with respect
to a Plan or Multiemployer Plan; and in each case in clauses (i) through (vi)
above, such event or condition, together with all other such events or
conditions, if any, could reasonably be expected to have a Material Adverse
Effect; or

 

(h) one or more judgments or decrees shall be entered against any Group Member
involving in the aggregate a liability (not paid or fully covered by insurance
as to which the relevant insurance company has acknowledged coverage) of
$50,000,000 or more, and all such judgments or decrees shall not have been paid,
satisfied, vacated, discharged, stayed or bonded pending appeal within 30 days
from the entry thereof;

 

58

 

 

(i) this Agreement or the guarantee of the Borrower or any Subsidiary Guarantor
contained in the Guarantee shall cease, for any reason, to be in full force and
effect or any Loan Party or any Affiliate of any Loan Party shall so assert; or

 

(j) (i) any “person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)),
excluding the Permitted Investors, shall become, or obtain rights to become, the
“beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange
Act), directly or indirectly, of voting stock of the Borrower representing more
than 35% of the combined voting power of the Borrower’s outstanding voting stock
ordinarily having the power to vote for the election of directors of the
Borrower or (ii) the board of directors of the Borrower shall cease to consist
of a majority of Continuing Directors;

 

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans (with
accrued interest thereon) and all other amounts owing under this Agreement and
the other Loan Documents (including all amounts of L/C Obligations, whether or
not the beneficiaries of the then outstanding Letters of Credit shall have
presented the documents required thereunder) shall immediately become due and
payable, and (B) if such event is any other Event of Default, either or both of
the following actions may be taken: (i) with the consent of the Required
Lenders, the Administrative Agent may, or upon the request of the Required
Lenders, the Administrative Agent shall, by notice to the Borrower declare the
Revolving Commitments to be terminated forthwith, whereupon the Revolving
Commitments shall immediately terminate; and (ii) with the consent of the
Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans (with accrued interest thereon) and all other amounts owing
under this Agreement and the other Loan Documents (including all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
Credit shall have presented the documents required thereunder) to be due and
payable forthwith, whereupon the same shall immediately become due and payable.
With respect to all Letters of Credit with respect to which presentment for
honor shall not have occurred at the time of an acceleration pursuant to this
paragraph, the Borrower shall at such time deposit in a cash collateral account
opened by the Administrative Agent an amount equal to the aggregate then undrawn
and unexpired amount of such Letters of Credit. Amounts held in such cash
collateral account shall be applied by the Administrative Agent to the payment
of drafts drawn under such Letters of Credit, and the unused portion thereof
after all such Letters of Credit shall have expired or been fully drawn upon, if
any, shall be applied to repay other obligations of the Borrower hereunder and
under the other Loan Documents. After all such Letters of Credit shall have
expired or been fully drawn upon, all Reimbursement Obligations shall have been
satisfied and all other obligations of the Borrower hereunder and under the
other Loan Documents shall have been paid in full, the balance, if any, in such
cash collateral account shall be returned to the Borrower (or such other Person
as may be lawfully entitled thereto). Except as expressly provided above in this
Section, presentment, demand, protest and all other notices of any kind are
hereby expressly waived by the Borrower.

 

Section 9. THE AGENTS

 

9.1.          Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.

 

59

 

 

9.2.          Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.

 

9.3.          Exculpatory Provisions. Neither any Agent nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted from its or such Person’s own gross negligence or willful misconduct)
or (ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any Loan Party or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agents under or in connection with, this Agreement or any
other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of any Loan Party a party thereto to perform its obligations
hereunder or thereunder. The Agents shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.

 

9.4.          Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any
instrument, writing, resolution, notice, consent, certificate, affidavit,
letter, telecopy, telex, email or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders (or, if so specified
by this Agreement, all Lenders) as it deems appropriate or it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take any
such action. The Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the other Loan
Documents in accordance with a request of the Required Lenders (or, if so
specified by this Agreement, all Lenders), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.

 

9.5.          Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent has received notice from a Lender or the
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default”. In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders (or, if so specified by this Agreement, all
Lenders); provided that unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.

 

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9.6.          Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.

 

9.7.          Indemnification. The Lenders agree to indemnify each Agent and its
officers, directors, employees, affiliates, agents, advisors and controlling
persons (each, an “Agent Indemnitee”) in its capacity as such (to the extent not
reimbursed by the Borrower and without limiting the obligation of the Borrower
to do so), ratably according to their respective Aggregate Exposure Percentages
in effect on the date on which indemnification is sought under this Section (or,
if indemnification is sought after the date upon which the Commitments shall
have terminated and the Loans shall have been paid in full, ratably in
accordance with such Aggregate Exposure Percentages immediately prior to such
date), from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind whatsoever that may at any time (whether before or after the payment of the
Loans) be imposed on, incurred by or asserted against such Agent Indemnitee in
any way relating to or arising out of, the Commitments, this Agreement, any of
the other Loan Documents or any documents contemplated by or referred to herein
or therein or the transactions contemplated hereby or thereby or any action
taken or omitted by such Agent Indemnitee under or in connection with any of the
foregoing; provided that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements that are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from such Agent Indemnitee’s gross negligence or willful misconduct. The
agreements in this Section shall survive the termination of this Agreement and
the payment of the Loans and all other amounts payable hereunder.

 

9.8.          Agent in Its Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with any Loan Party as though such Agent were not an Agent. With
respect to its Loans made or renewed by it and with respect to any Letter of
Credit issued or participated in by it, each Agent shall have the same rights
and powers under this Agreement and the other Loan Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms “Lender” and
“Lenders” shall include each Agent in its individual capacity.

 

61

 

 

9.9.          Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days’ notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or Section
8(f) with respect to the Borrower shall have occurred and be continuing) be
subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
“Administrative Agent” shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent’s rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. If no successor agent
has accepted appointment as Administrative Agent by the date that is 10 days
following a retiring Administrative Agent’s notice of resignation, the retiring
Administrative Agent’s resignation shall nevertheless thereupon become
effective, and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above. After any retiring
Administrative Agent’s resignation as Administrative Agent, the provisions of
this Section 9 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement and the
other Loan Documents.

 

9.10.        Securitizations. Each party hereto authorizes the Administrative
Agent to enter into customary intercreditor agreements not inconsistent with the
provisions hereof, in connection with Securitizations permitted under this
Agreement.

 

9.11.        Co-Documentation Agents and Co-Syndication Agents; Issuing Lenders.
(a) None of the Co-Documentation Agents or Co-Syndication Agents shall have any
duties or responsibilities hereunder in its capacity as such.

 

(b)           Each Issuing Lender shall be entitled to the benefits of this
Section and have equivalent rights, as are applicable to the Administrative
Agent.

 

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Section 10. MISCELLANEOUS

 

10.1.        Amendments and Waivers. (a)  Neither this Agreement, any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party party to the relevant Loan Document may,
or, with the written consent of the Required Lenders, the Administrative Agent
and each Loan Party party to the relevant Loan Document may, from time to time,
(a) enter into written amendments, supplements or modifications hereto and to
the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Lenders or of the Loan Parties hereunder or thereunder or (b) waive, on such
terms and conditions as the Required Lenders or the Administrative Agent, as the
case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall: (i) forgive or reduce the principal amount or
extend the final scheduled date of maturity of any Loan or Reimbursement
Obligations, extend the scheduled date of any amortization payment in respect of
any Incremental Term Loan, reduce the stated rate of any interest or fee payable
hereunder (except (x) 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 Majority Facility Lenders of each adversely affected
Facility) and (y) that any amendment or modification of defined terms used in
the financial covenants in this Agreement shall not constitute a reduction in
the rate of interest or fees for purposes of this clause (i)) or extend the
scheduled date of any payment thereof, or increase the amount or extend the
expiration date of any Lender’s Revolving Commitment, in each case without the
written consent of each Lender directly affected thereby; (ii) eliminate or
reduce the voting rights of any Lender under this Section 10.1 without the
written consent of such Lender; (iii) reduce any percentage specified in the
definition of Required Lenders, consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement and the other
Loan Documents, release all or substantially all of the Subsidiary Guarantors
from their obligations under the Guarantee, in each case without the written
consent of all Lenders; (iv) amend, modify or waive any provision of Section 3.7
without the written consent of the Majority Facility Lenders in respect of each
Facility adversely affected thereby; (v) reduce the percentage specified in the
definition of Majority Facility Lenders with respect to any Facility without the
written consent of all Lenders under such Facility; (vi) amend, modify or waive
any provision of Section 9 or any other provision of any Loan Document that
affects the Administrative Agent without the written consent of the
Administrative Agent; (vii) [reserved]; or (viii) amend, modify or waive any
provision of Section 2 that affects the Issuing Lenders without the written
consent of the Issuing Lenders. Any such waiver and any such amendment,
supplement or modification shall apply equally to each of the Lenders and shall
be binding upon the Loan Parties, the Lenders, the Administrative Agent and all
future holders of the Loans. In the case of any waiver, the Loan Parties, the
Lenders and the Administrative Agent shall be restored to their former position
and rights hereunder and under the other Loan Documents, and any Default or
Event of Default waived shall be deemed to be cured and not continuing; but no
such waiver shall extend to any subsequent or other Default or Event of Default,
or impair any right consequent thereon.

 

(b)          If, in connection with any proposed change, waiver, discharge or
termination of or to any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the proviso to Section 10.1(a), the
consent of Lenders having Revolving Extensions of Credit, Incremental Term Loans
and unused Commitments representing more than 50% of the sum of the Total
Revolving Extensions of Credit, outstanding Incremental Term Loans and unused
Commitments at such time is obtained but the consent of one or more of such
other Lenders whose consent is required is not obtained, then the Borrower shall
have the right, so long as all non-consenting Lenders whose individual consent
is required are treated as described in either clause (i) or (ii) below, to
either (i) replace each such non-consenting Lender or Lenders (or, at the option
of the Borrower if any such Lender’s consent is required with respect to less
than all classes of Loans (or related Commitments), to replace only the
Commitments and/or Loans of any such non-consenting Lender that gave rise to the
need to obtain such Lender’s individual consent) with one or more assignees
pursuant to, and with the effect of an assignment under, Section 3.12 so long as
at the time of such replacement, each such assignee consents to the proposed
change, waiver, discharge or termination or (ii) terminate such non-consenting
Lender’s Commitment (if such Lender’s consent is required as a result of its
Commitment) and/or repay each class of outstanding Loans of such Lender that
gave rise to the need to obtain such Lender’s consent; provided (A) that, unless
the Commitments that are terminated and Loans that are repaid pursuant to the
preceding clause (ii) are immediately replaced in full at such time through the
addition of new Lenders or the increase of the Commitments and/or outstanding
Loans of existing Lenders (who in each case must specifically consent thereto),
then in the case of any action pursuant to the preceding clause (ii), Lenders
having Revolving Extensions of Credit, Incremental Term Loans and unused
Commitments representing more than 50% of the sum of the Total Revolving
Extensions of Credit, outstanding Incremental Term Loans and unused Commitments
at such time (determined after giving effect to the proposed action) shall
specifically consent thereto and (B) any such replacement or termination
transaction described above shall be effective on the date notice is given of
the relevant transaction and shall have a settlement date no earlier than five
Business Days and no later than 90 days after the relevant transaction; provided
further that the Borrower shall not have the right to replace a Lender,
terminate its Commitment or repay its Loans solely as a result of the exercise
of such Lender’s rights (and the withholding of any required consent by such
Lender) pursuant to clauses (vi) through (viii) of the proviso to Section
10.1(a).

 

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(c)           Notwithstanding the foregoing, this Agreement may be amended (or
amended and restated) (i) with the written consent of the Required Lenders, the
Administrative Agent and the Borrower (a) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time to
time outstanding thereunder and the accrued interest and fees in respect thereof
to share ratably in the benefits of this Agreement and the other Loan Documents
with Incremental Term Loans and Revolving Extensions of Credit and the accrued
interest and fees in respect thereof and (b) to include appropriately the
Lenders holding such credit facilities in any determination of the Required
Lenders and Majority Facility Lenders and (ii) without the written consent of
any other Lenders, as may be necessary or appropriate, in the reasonable opinion
of the Administrative Agent and the Borrower, to effect the provisions of
Section 3.15 or the provisions of Section 10.1(d).

 

(d)          In addition, notwithstanding the foregoing, this Agreement may be
amended with the written consent of the Administrative Agent, the Borrower and
the Lenders providing the relevant Replacement Term Loans (as defined below) to
permit the refinancing, replacement or modification of all outstanding
Incremental Term Loans (“Replaced Incremental Term Loans”) with a replacement
term loan tranche hereunder (“Replacement Term Loans”), provided that (a) the
aggregate principal amount of such Replacement Term Loans shall not exceed the
aggregate principal amount of such Replaced Incremental Term Loans, (b) the
Applicable Margin for such Replacement Term Loans shall not be higher than the
Applicable Margin for such Replaced Incremental Term Loans and (c) the weighted
average life to maturity of such Replacement Term Loans shall not be shorter
than the weighted average life to maturity of such Replaced Incremental Term
Loans at the time of such refinancing.

 

(e)          Furthermore, notwithstanding the foregoing, the Administrative
Agent, with the consent of the Borrower, may amend, modify or supplement any
Loan Document without the consent of any Lender or the Required Lenders in order
to correct, amend or cure any ambiguity, inconsistency or defect or correct any
typographical error or other manifest error in any Loan Document.

 

10.2.        Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower and the
Administrative Agent, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:

 

Borrower: MSC Industrial Direct Co., Inc.   75 Maxess Road   Melville, New York
11747   Attention: General Counsel   Telecopy: OMITTED   Telephone: OMITTED

 

64

 

 

Administrative Agent: JPMorgan Chase Bank, N.A.   Long Island Corporate  
Banking Group   395 North Service Road,   Suite 302   Melville, New York 11747  
    Attention: OMITTED   Telecopy: OMITTED   Telephone: OMITTED       and      
JPMorgan Chase Bank, N.A.   10 South Dearborn, Floor L2   Chicago, Illinois
60603       Attention: OMITTED   Telecopy: OMITTED   Telephone: OMITTED   Email:
OMITTED

 

provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.

 

Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Section 2 and Section 3 unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.

 

10.3.        No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

 

10.4.        Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans and other extensions of credit hereunder.

 

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10.5.        Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Administrative Agent and its Affiliates for all its reasonable
out-of-pocket costs and expenses incurred in connection with the development,
preparation and execution of, and any amendment, supplement or modification to,
this Agreement and the other Loan Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including the reasonable fees and
disbursements of counsel to the Administrative Agent and filing and recording
fees and expenses, with statements with respect to the foregoing to be submitted
to the Borrower prior to the Closing Date (in the case of amounts to be paid on
the Closing Date) and from time to time thereafter on a quarterly basis or such
other periodic basis as the Administrative Agent shall deem appropriate, (b) to
pay or reimburse each Lender, each Issuing Lender and the Administrative Agent
for all its reasonable costs and expenses incurred in connection with the
enforcement or preservation of any rights under this Agreement, the other Loan
Documents and any such other documents, including the reasonable fees and
disbursements of counsel to each Lender and each Issuing Lender and of counsel
to the Administrative Agent, (c) to pay, indemnify, and hold each Lender, each
Issuing Lender and the Administrative Agent harmless from, any and all recording
and filing fees that may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this Agreement, the other
Loan Documents and any such other documents, and (d) to pay, indemnify, and hold
each Lender, each Issuing Lender and the Administrative Agent and their
respective officers, directors, employees, affiliates, agents and controlling
persons (each, an “Indemnitee”) harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever, excluding
taxes (as to which the provisions of Sections 3.8 and 3.9 shall control) with
respect to the execution, delivery, enforcement, performance and administration
of this Agreement, the other Loan Documents and any such other documents,
including any of the foregoing relating to the use of proceeds of the Loans or
Letters of Credit (including any refusal by an Issuing Lender 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)
or the violation of, noncompliance with or liability under, any Environmental
Law applicable to the operations of any Group Member or any of the Properties
and the reasonable fees and expenses of legal counsel in connection with claims,
actions or proceedings by any Indemnitee against any Loan Party under any Loan
Document (all the foregoing in this clause (d), collectively, the “Indemnified
Liabilities”), provided, that the Borrower shall have no obligation hereunder to
any Indemnitee with respect to Indemnified Liabilities to the extent such
Indemnified Liabilities are found by a final and nonappealable decision of a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of such Indemnitee. Without limiting the foregoing, and to
the extent permitted by applicable law, the Borrower agrees not to assert and to
cause its Subsidiaries not to assert, and hereby waives and agrees to cause its
Subsidiaries to waive, all rights for contribution or any other rights of
recovery with respect to all claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature, under or
related to Environmental Laws, that any of them might have by statute or
otherwise against any Indemnitee. All amounts due under this Section 10.5 shall
be payable not later than 10 days after written demand therefor. Statements
payable by the Borrower pursuant to this Section 10.5 shall be submitted to
Rustom Jilla, Executive Vice President and Chief Financial Officer (Telecopy
No. 516-812-1703), at the address of the Borrower set forth in Section 10.2, or
to such other Person or address as may be hereafter designated by the Borrower
in a written notice to the Administrative Agent. The agreements in this Section
10.5 shall survive repayment of the Loans and all other amounts payable
hereunder.

 

10.6.          Successors and Assigns; Participations and Assignments. (a)  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby
(including any affiliate of any Issuing Lender that issues any Letter of
Credit), except that (i) the Borrower may not assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void) and (ii) no Lender may assign or otherwise
transfer its rights or obligations hereunder except in accordance with this
Section.

 

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(b)          (i)  Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more assignees (other than a natural
person (or a holding company, investment vehicle or trust for, or owned and
operated for the primary benefit of, a natural person) or a Defaulting Lender)
(each, an “Assignee”) all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans at the
time owing to it) with the prior written consent of:

 

(A)the Borrower (such consent not to be unreasonably withheld or delayed),
provided that no consent of the Borrower shall be required for an assignment to
a Lender, an affiliate of a Lender, an Approved Fund (as defined below) or, if
an Event of Default under Section 8(a) or (f) has occurred and is continuing,
any other Person; and provided, further, that the Borrower shall be deemed to
have consented to any such assignment unless the Borrower shall object thereto
by written notice to the Administrative Agent within five Business Days after
having received written notice thereof;

 

(B)the Administrative Agent (such consent not to be unreasonably withheld or
delayed), provided that no consent of the Administrative Agent shall be required
for an assignment of all or any portion of a Loan to a Lender, an affiliate of a
Lender or an Approved Fund;

 

(C)with respect to the Revolving Commitment and Revolving Loans only, the
Issuing Lenders (such consent not to be unreasonably withheld or delayed),
provided that no consent of the Issuing Lenders shall be required for an
assignment of all or any portion of a Loan to a Lender, an affiliate of a Lender
or an Approved Fund; and

 

(D)no assignment of Incremental Term Loans may be made to the Borrower or its
Affiliates except pursuant to, and in accordance with the terms of, Section
3.13, and no assignment of Revolving Loans or Revolving Commitments may be made
to the Borrower or its Affiliates.

 

(ii)         Assignments shall be subject to the following additional
conditions:

 

(A)except in the case of an assignment to a Lender, an affiliate of a Lender or
an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitments or Loans under any Facility, the amount of the
Commitments or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$5,000,000 unless each of the Borrower and the Administrative Agent otherwise
consent, provided that (1) no such consent of the Borrower shall be required if
an Event of Default under Section 8(a) or (f) has occurred and is continuing and
(2) such amounts shall be aggregated in respect of each Lender and its
affiliates or Approved Funds, if any;

 

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(B)the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500; and

 

(C)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 Borrower and its
Affiliates 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 law.

 

For the purposes of this Section 10.6, “Approved Fund” means any Person (other
than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
of its business and that is administered or managed by (a) a Lender, (b) an
affiliate of a Lender or (c) an entity or an affiliate of an entity that
administers or manages a Lender.

 

(iii)        Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) below, from and after the effective date specified in each
Assignment and Assumption the Assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Assumption, have
the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Sections 3.8, 3.9, 3.10 and 10.5). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
Section 10.6 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.

 

(iv)        The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount (and
stated interest) of the Loans and L/C Obligations owing to, each Lender pursuant
to the terms hereof from time to time (the “Register”). The entries in the
Register shall be conclusive, and the Borrower, the Administrative Agent, the
Issuing Lenders and the Lenders shall treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrower and any Lender (as to its
interest only) at any reasonable time and from time to time upon reasonable
prior notice.

 

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(v)         Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Lender and an Assignee, the Assignee’s completed
administrative questionnaire (unless the Assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Assumption and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

 

(c)          (i)          Any Lender may, without the consent of the Borrower or
the Administrative Agent, sell participations to one or more banks or other
entities (other than a natural person (or a holding company, investment vehicle
or trust for, or owned and operated for the primary benefit of, a natural
person) or a Defaulting Lender) (a “Participant”) in all or a portion of such
Lender’s rights and obligations under this Agreement (including all or a portion
of its Commitments and the Loans owing to it); provided that (A) such Lender’s
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent, the Issuing
Lenders and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender’s rights and obligations under this
Agreement. Any agreement pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement may provide that such Lender
will not, without the consent of the Participant, agree to any amendment,
modification or waiver that (1) requires the consent of each Lender directly
affected thereby pursuant to the proviso to the second sentence of Section 10.1
and (2) directly affects such Participant. Subject to paragraph (c)(ii) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits and subject to the limitations of Sections 3.8, 3.9 and 3.10 to the
same extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.7(b) as though
it were a Lender, provided such Participant shall be subject to Section 10.7(a)
as though it were a Lender. Each Lender that sells a participation, acting
solely for this purpose as an agent of the Borrower, shall maintain a register
on which it enters the name and address of each Participant and the principal
amounts (and stated interest) of each Participant’s interest in the Loans or
other obligations under this Agreement (the “Participant Register”); provided
that no Lender shall have any obligation to disclose all or any portion of the
Participant Register to any Person (including the identity of any Participant or
any information relating to a Participant’s interest in any Commitments, Loans,
Letters of Credit or its other obligations under any Loan Document) except to
the extent that such disclosure is necessary to establish that such Commitment,
Loan, Letter of Credit or other obligation is in registered form under Section
5f.103-1(c) of the United States Treasury Regulations. The entries in the
Participant Register shall be conclusive, and such Lender, each Loan Party and
the Administrative Agent shall treat each person whose name is recorded in the
Participant Register pursuant to the terms hereof as the owner of such
participation for all purposes of this Agreement, notwithstanding 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.

 

(ii)         A Participant shall not be entitled to receive any greater payment
under Section 3.8 or 3.9 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent. No Participant shall be entitled to the benefits of Section 3.9
unless such Participant complies with Section 3.9(d) as if it were a Lender.

 

(d)          Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or Assignee for such Lender as a party hereto.

 

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(e)           The Borrower, upon receipt of written notice from the relevant
Lender, agrees to issue Notes to any Lender requiring Notes to facilitate
transactions of the type described in paragraph (d) above.

 

(f)            Notwithstanding the foregoing, any Conduit Lender may assign any
or all of the Loans it may have funded hereunder to its designating Lender
without the consent of the Borrower or the Administrative Agent and without
regard to the limitations set forth in Section 10.6(b). The Borrower, each
Lender and the Administrative Agent hereby confirms that it will not institute
against a Conduit Lender or join any other Person in instituting against a
Conduit Lender any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding under any state bankruptcy or similar law, for one year
and one day after the payment in full of the latest maturing commercial paper
note issued by such Conduit Lender; provided, however, that each Lender
designating any Conduit Lender hereby agrees to indemnify, save and hold
harmless each other party hereto for any loss, cost, damage or expense arising
out of its inability to institute such a proceeding against such Conduit Lender
during such period of forbearance.

 

10.7.        Adjustments; Set-off. (a)  Except to the extent that this Agreement
or a court order expressly provides for payments to be allocated to a particular
Lender or to the Lenders under a particular Facility, if any Lender (a
“Benefitted Lender”) shall, at any time after the Loans and other amounts
payable hereunder shall immediately become due and payable pursuant to Section
8, receive any payment of all or part of the Obligations owing to it (other than
in connection with an assignment made pursuant to Section 10.6), or receive any
collateral in respect thereof (whether voluntarily or involuntarily, by set-off,
pursuant to events or proceedings of the nature referred to in Section 8(f), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of the Obligations owing to
such other Lender, such Benefitted Lender shall purchase for cash from the other
Lenders a participating interest in such portion of the Obligations owing to
each such other Lender, or shall provide such other Lenders with the benefits of
any such collateral, as shall be necessary to cause such Benefitted Lender to
share the excess payment or benefits of such collateral ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such Benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest; provided, further, that to the extent
prohibited by applicable law as described in the definition of “Excluded Swap
Obligation,” no amounts received from, or set off with respect to, any Loan
Party shall be applied to any Excluded Swap Obligations of such Loan Party.

 

(b)          In addition to any rights and remedies of the Lenders provided by
law, each Lender and its affiliates shall have the right, without prior notice
to the Borrower, any such notice being expressly waived by the Borrower to the
extent permitted by applicable law, upon any Obligations becoming due and
payable by the Borrower (whether at the stated maturity, by acceleration or
otherwise), to apply to the payment of such Obligations, by setoff or otherwise,
any and all deposits (general or special, time or demand, provisional or final),
in any currency, and any other credits, indebtedness or claims, in any currency,
in each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender, any affiliate thereof or
any of their respective branches or agencies to or for the credit or the account
of the Borrower; provided that if any Defaulting Lender shall exercise any such
right of set-off, (i) all amounts so set off shall be paid over immediately to
the Administrative Agent for further application in accordance with the
provisions of this Agreement and, pending such payment, shall be segregated by
such Defaulting Lender from its other funds and deemed held in trust for the
benefit of the Administrative Agent, the Issuing Lenders and the Lenders and
(ii) the Defaulting Lender shall provide promptly to the Administrative Agent a
statement describing in reasonable detail the obligations owing to such
Defaulting Lender as to which it exercised such right of set off. Each Lender
agrees promptly to notify the Borrower and the Administrative Agent after any
such application made by such Lender, provided that the failure to give such
notice shall not affect the validity of such application.

 

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10.8.        Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by email or
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.

 

10.9.        Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

10.10.      Integration. This Agreement and the other Loan Documents represent
the entire agreement of the Borrower, the Administrative Agent and the Lenders
with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.

 

10.11.      Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

10.12.      Submission To Jurisdiction; Waivers. The Borrower hereby irrevocably
and unconditionally:

 

(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
exclusive general jurisdiction of the United States District Court for the
Southern District of New York and, to the extent that such federal court lacks
subject matter jurisdiction or diversity jurisdiction, the courts of the State
of New York sitting in the Borough of Manhattan, and, in each case, the
appellate courts from any thereof;

 

(b) consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;

 

(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower, at its
address set forth in Section 10.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;

 

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(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

 

(e) waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

 

10.13.    Acknowledgements. The Borrower hereby acknowledges and agrees that
(a) no fiduciary, advisory or agency relationship between the Loan Parties and
the Credit Parties is intended to be or has been created in respect of any of
the transactions contemplated by this Agreement or the other Loan Documents,
irrespective of whether the Credit Parties have advised or are advising the Loan
Parties on other matters, and the relationship between the Credit Parties, on
the one hand, and the Loan Parties, on the other hand, in connection herewith
and therewith is solely that of creditor and debtor, (b) the Credit Parties, on
the one hand, and the Loan Parties, on the other hand, have an arm’s length
business relationship that does not directly or indirectly give rise to, nor do
the Loan Parties rely on, any fiduciary duty to the Loan Parties or their
affiliates on the part of the Credit Parties, (c) the Loan Parties are capable
of evaluating and understanding, and the Loan Parties understand and accept, the
terms, risks and conditions of the transactions contemplated by this Agreement
and the other Loan Documents, (d) the Loan Parties have been advised that the
Credit Parties are engaged in a broad range of transactions that may involve
interests that differ from the Loan Parties’ interests and that the Credit
Parties have no obligation to disclose such interests and transactions to the
Loan Parties, (e) the Loan Parties have consulted their own legal, accounting,
regulatory and tax advisors to the extent the Loan Parties have deemed
appropriate in the negotiation, execution and delivery of this Agreement and the
other Loan Documents, (f) each Credit Party has been, is, and will be acting
solely as a principal and, except as otherwise expressly agreed in writing by it
and the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary for the Loan Parties, any of their affiliates or any
other Person, (g) none of the Credit Parties has any obligation to the Loan
Parties or their affiliates with respect to the transactions contemplated by
this Agreement or the other Loan Documents except those obligations expressly
set forth herein or therein or in any other express writing executed and
delivered by such Credit Party and the Loan Parties or any such affiliate and
(h) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Credit Parties or among the Loan Parties and the Credit Parties.

 

10.14.    Releases of Guarantees. (a)  Notwithstanding anything to the contrary
contained herein or in any other Loan Document, the Administrative Agent is
hereby irrevocably authorized by each Lender (without requirement of notice to
or consent of any Lender except as expressly required by Section 10.1) to take
any action requested by the Borrower having the effect of releasing any
guarantee obligations (i) to the extent necessary to permit consummation of any
transaction not prohibited by any Loan Document or that has been consented to in
accordance with Section 10.1 or (ii) under the circumstances described in
paragraph (b) below.

 

(b)          At such time as the Loans, the Reimbursement Obligations and the
other Obligations (other than Obligations under or in respect of Specified Swap
Agreements and unmatured contingent reimbursement and indemnification
obligations) have been paid in full, the Commitments have been terminated and no
Letters of Credit are outstanding (other than Letters of Credit cash
collateralized in the manner set forth in Section 2.5(a)), the Guarantee and all
obligations (other than those expressly stated to survive such termination) of
each Loan Party under the Guarantee shall terminate subject to the provisions
thereof, all without delivery of any instrument or performance of any act by any
Person.

 

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10.15.    Confidentiality. Each of the Administrative Agent, each Issuing Lender
and each Lender agrees to keep confidential all Information (as defined below);
provided that nothing herein shall prevent the Administrative Agent, any Issuing
Lender or any Lender from disclosing any such Information (a) to the
Administrative Agent, any other Issuing Lender, any other Lender or any
affiliate thereof, (b) subject to an agreement to comply with the provisions of
this Section, to any actual or prospective Transferee or any direct or indirect
counterparty to any Swap Agreement (or any professional advisor to such
counterparty), (c) to its employees, directors, agents, attorneys, accountants
and other professional advisors or those of any of its affiliates, (d) upon the
request or demand of any Governmental Authority, (e) in response to any order of
any court or other Governmental Authority or as may otherwise be required
pursuant to any Requirement of Law, (f) if requested or required to do so in
connection with any litigation or similar proceeding, (g) that has been publicly
disclosed, (h) to the National Association of Insurance Commissioners or any
similar organization or any nationally recognized rating agency that requires
access to information about a Lender’s investment portfolio in connection with
ratings issued with respect to such Lender, (i) in connection with the exercise
of any remedy hereunder or under any other Loan Document, or (j) if agreed by
the Borrower in its sole discretion, to any other Person. “Information” means
all information received from any Loan Party relating to the Borrower or its
business, other than any such information that is available to the
Administrative Agent, any Issuing Lender or any Lender on a non-confidential
basis prior to disclosure by such Loan Party and other than information
pertaining to this Agreement routinely provided by arrangers to data service
providers, including league table providers, that serve the lending industry.

 

Each Lender acknowledges that information furnished to it pursuant to this
Agreement may include material non-public information concerning the Borrower
and its Affiliates and their related parties or their respective securities, and
confirms that it has developed compliance procedures regarding the use of
material non-public information and that it will handle such material non-public
information in accordance with those procedures and applicable law, including
Federal and state securities laws.

 

All information, including requests for waivers and amendments, furnished by the
Borrower or the Administrative Agent pursuant to, or in the course of
administering, this Agreement will be syndicate-level information, which may
contain material non-public information about the Borrower and its Affiliates
and their related parties or their respective securities. Accordingly, each
Lender represents to the Borrower and the Administrative Agent that it has
identified in its administrative questionnaire a credit contact who may receive
information that may contain material non-public information in accordance with
its compliance procedures and applicable law, including Federal and state
securities laws.

 

10.16.    WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT AND THE
LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND
FOR ANY COUNTERCLAIM THEREIN.

 

10.17.    USA PATRIOT Act. Each Lender hereby notifies the Borrower 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”), it is required to
obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender to identify the Borrower in accordance with the
Patriot Act. The Borrower shall promptly provide such information upon request
by any Lender. In connection therewith, each Lender hereby agrees that the
confidentiality provisions set forth in Section 10.15 shall apply to any
non-public information provided to it by the Borrower and its Subsidiaries
pursuant to this Section 10.17.

 

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10.18.    Acknowledgement and Consent to Bail-In of EEA Financial Institutions.
Notwithstanding anything to the contrary in any Loan Document or in any other
agreement, arrangement or understanding among any such parties, each party
hereto acknowledges that any liability of any EEA Financial Institution arising
under any Loan Document may be subject to the Write-Down and Conversion Powers
of an EEA Resolution Authority and agrees and consents to, and acknowledges and
agrees to be bound by:

 

(a)          the application of any Write-Down and Conversion Powers by an EEA
Resolution Authority to any such liabilities arising hereunder which may be
payable to it by any party hereto that is an EEA Financial Institution; and

 

(b)          the effects of any Bail-In Action on any such liability, including,
if applicable:

 

(i)          a reduction in full or in part or cancellation of any such
liability;

 

(ii)         a conversion of all, or a portion of, such liability into shares or
other instruments of ownership in such EEA Financial Institution, its parent
entity, or a bridge institution that may be issued to it or otherwise conferred
on it, and that such shares or other instruments of ownership will be accepted
by it in lieu of any rights with respect to any such liability under this
Agreement or any other Loan Document; or

 

(iii)        the variation of the terms of such liability in connection with the
exercise of the Write-Down and Conversion Powers of any EEA Resolution
Authority.

 

74

 

 

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

 

  MSC INDUSTRIAL DIRECT CO., INC.           By: /s/ Rustom Jilla     Name:
Rustom Jilla     Title: Executive Vice President and       Chief Financial
Officer

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  JPMORGAN CHASE BANK, N.A.,   as Administrative Agent and as a Lender          
By /s/ Stephen Zajac     Name: Stephen Zajac     Title: Executive Director

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  BANK OF AMERICA, N.A.,   as a Lender and an Issuing Lender           By /s/
Carolina T. Shaefer     Name: Carolina T. Shaefer     Title: Vice President

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  Wells Fargo BANK, National   Association, as a Lender and an Issuing Lender  
        By /s/ Michael Zick     Name: Michael Zick     Title: Vice President

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  u.s. bank national association           By /s/ Paul F. Johnson     Name: Paul
F. Johnson     Title: Vice President

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  Citizens bank, n.a.           By /s/ Angela Reilly     Name: Angela Reilly    
Title: Senior Vice President

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  KeyBank National Association           By /s/ Matthew J. Bradley     Name:
Matthew J. Bradley     Title: Vice President

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

  hsbc bank usa, national association           By /s/ William Conlan     Name:
William Conlan     Title: Senior Vice President

 

MSC Industrial Direct Co., Inc.

Credit Agreement

 

 

 

 

Schedule 1.1A

Commitments

 

Institution  Commitment  JPMorgan Chase Bank, N.A.  $125,000,000.00  Bank of
America, N.A.  $125,000,000.00  Wells Fargo Bank, National Association 
$125,000,000.00  U.S. Bank National Association  $75,000,000.00  Citizens Bank,
N.A.  $65,000,000.00  KeyBank National Association  $65,000,000.00  HSBC Bank
USA, National Association  $20,000,000.00         Total:  $600,000,000.00 

 

 

 

 

Schedule 2.5

Existing Letters of Credit

 

L/C Issuer  Loan Party  L/C No.  Beneficiary  Expiry date  Face amount  JPMorgan
Chase Bank, N.A.  MSC Industrial Direct Co., Inc.  CTCS-844822  ACE American
Insurance Co.  20 Oct. 2017  $2,917,142.00  JPMorgan Chase Bank, N.A.  MSC
Industrial Direct Co., Inc.  T-612684  Federal Insurance Company and ACE  30
Sept. 2017  $169,941.00 

 

 

 

 

Schedule 4.1

 

Guarantee Obligations

 

1.Lease dated April 11, 2007, and commencing July 1, 2007, between Giovanni and
Maria Gullo Family Limited Partnership and MSC Industrial Direct Co., Inc. for
the premises at 1020 Wood Dale Road, Wood Dale, IL.

 

2.Lease Agreement executed June 13, 2005, and commencing July 1, 2005, by and
between Southfield Technecenter RE2 LLC and J&L America, Inc. for the premises
at 20901 Lahser Road, Southfield, MI 48075.

 

3.Lease Agreement executed June 5, 2014, and commencing August 7, 2014, by and
between Duke Realty Ohio and Sid Tool Co., Inc. for the premises at 6000 Freedom
Square Drive, Independence, OH 44131.

 

4.Lease Agreement executed August 27, 2014, and commencing January 1, 2015, by
and between Liberty Property Limited Partnership and Sid Tool Co., Inc. for the
premises at 1575 Hunter Road, Hanover Park, IL.

 

5.Sid Tool Co., Inc. has entered into various fleet services leases with Donlen
Corporation.

 

6.MSC Contract Management, Inc. has entered into various equipment leases with
International Business Machines Corporation.

 

 

 

 

Schedule 4.4

 

Consents, Authorizations, Filings and Notices

 

1.Any filings required by the Securities Act of 1933 or the Securities Exchange
Act of 1934, and the rules promulgated thereunder, including without limitation
(i) a Form 8-K disclosing the execution and delivery of the Credit Agreement and
(ii) the filing of a copy of the Credit Agreement and all schedules and exhibits
thereto as an exhibit to the Form 8-K, to the Borrower’s next Quarterly Report
on Form 10-Q and next Annual Report on Form 10-K and as otherwise may be
required by Item 601 of Regulation S-K.

 

 

 

 

Schedule 4.6

 

Litigation

 

1.None.

 

 

 

 

Schedule 4.15

 

Subsidiaries

 

Name   Jurisdiction   Percentage of each class
of Capital Stock owned
by any Loan Party   Restricted /
Unrestricted
Subsidiary MSC Acquisition Corp III   New York   100% owned by Borrower  
Restricted MSC Acquisition Corp VI   New York   100% owned by Borrower  
Restricted MSC Acquisition Corp VII   New York   100% owned by Borrower  
Restricted MSC Foreign Properties Corporation   Delaware   100% owned by
Borrower   Restricted MSC Services Corp.   New York   100% owned by Borrower  
Restricted Primeline International, Inc.   New York   100% owned by Borrower  
Restricted Sid Tool Co., Inc.   New York   100% owned by Borrower   Restricted
Mission Real Estate Acquisition Company   Delaware   100% owned by Sid Tool Co.,
Inc.   Restricted Swiss Precision Instruments Inc.   California   100% owned by
Borrower   Restricted J&L America, Inc.   Michigan   100% owned by MSC
Acquisition Corp VI   Restricted American Specialty Grinding Co., Inc.  
Massachusetts   100% owned by Sid Tool Co., Inc.   Restricted MSC Contract
Management, Inc.   New York   100% owned by Sid Tool Co., Inc.   Restricted MSC
Industrial Supply ULC   British Columbia, Canada   100% owned by Sid Tool Co.,
Inc.   Restricted MSC Industrial Supply Co.   UK   100% owned by J&L America,
Inc.   Restricted Deco Tool, an MSC Company, LLC   Delaware   100% owned by Sid
Tool Co., Inc.   Restricted

 

 

 

 

Schedule 7.3(f)

 

Existing Liens

 

1.Any liens described in UCC financing statements filed against Sid Tool Co.,
Inc. as debtor and in effect as of as of February 24, 2017, as evidenced by the
UCC debtor search conducted on March 3, 2017 and delivered to the Administrative
Agent.

 

2.Any liens described in UCC financing statements filed against MSC Contract
Management, Inc. as debtor and in effect as of February 24, 2017, as evidenced
by the UCC debtor search conducted on March 3, 2017 and delivered to the
Administrative Agent.

 

3.Any liens described in UCC financing statements filed against MSC Industrial
Direct Co., Inc. as debtor and in effect as of February 24, 2017 as evidence by
the UCC debtor search conducted on March 3, 2017 and delivered to the
Administrative Agent.

 

 

 

 

Schedule 7.6(e)

 

Existing Investments

 

1.Taxable Special Obligation Development Lease Revenue Bonds (Sid Tool Co., Inc.
Project) dated December 4, 2012 in the aggregate principal amount of up to
$35,000,000 pursuant to that certain Bond Advance Agreement and Assignment of
Lease and Rental Payments, dated as of December 4, 2012.

 

2.Guarantee by Sid Tool Co., Inc., MSC Contract Management, Inc. and J & L
America of the Note Purchase Agreement dated July 28, 2016, between MSC
Industrial Direct Co., Inc. and New York Life Insurance Company, for 2.65%
Senior Notes, Series A, due July 28, 2023, in the aggregate principal amount of
$75,000,000 and 2.90% Senior Notes, Series B, due July 28, 2026, in the
aggregate principal amount of $100,000,000.

 

 

 

 

Schedule 7.7

 

Affiliate Transactions

 

1.None.

 

 

 

 

EXHIBIT A

 

FORM OF

GUARANTEE

 

 

 

GUARANTEE

 

GUARANTEE, dated as of April 14, 2017 (this “Guarantee”), made by MSC Industrial
Direct Co., Inc. (the “Borrower”) and each of the Subsidiaries of the Borrower
that are signatories hereto (the “Subsidiary Guarantors” and, together with the
Borrower, the “Guarantors”), in favor of JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, together with its successors in such
capacity, the “Administrative Agent”) for the lenders (the “Lenders”) from time
to time parties to the Credit Agreement, dated as of April 14, 2017 (as amended,
supplemented or otherwise modified, from time to time, the “Credit Agreement”),
among the Borrower, the Lenders and the Administrative Agent.

 

W I T N E S S E T H:

 

WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to
make extensions of credit to the Borrower upon the terms and subject to the
conditions set forth therein;

 

WHEREAS, the Borrower is a member of an affiliated group of companies that
includes each Subsidiary Guarantor;

 

WHEREAS, the proceeds of the extensions of credit under the Credit Agreement
will be used in part to enable the Borrower to make valuable transfers to each
Subsidiary Guarantor in connection with the operation of its business;

 

WHEREAS, the Borrower and the Subsidiary Guarantors are engaged in related
businesses, and each Guarantor will derive substantial direct and indirect
benefit from the making of the extensions of credit under the Credit Agreement;
and

 

WHEREAS, it is a condition precedent to the obligation of the Lenders to make
their respective extensions of credit to the Borrower under the Credit Agreement
that the Guarantors shall have executed and delivered this Guarantee to the
Administrative Agent for the ratable benefit of the Guaranteed Parties.

 

NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the Borrower
under the Credit Agreement, each Guarantor hereby agrees with the Administrative
Agent, for the ratable benefit of the Guaranteed Parties, as follows:

 

1.         Defined Terms. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.

 

(b)       The following terms shall have the following meanings:

 

“Guaranteed Parties”: the collective reference to the Administrative Agent, the
Lenders and any affiliate of any Lender to which Primary Obligations or
Guarantor Obligations, as applicable, are owed.

 

“Guarantor Obligations”: with respect to any Guarantor, all obligations and
liabilities of such Guarantor which may arise under or in connection with this
Guarantee, whether on account of guarantee obligations, reimbursement
obligations, fees, indemnities, costs, expenses (including, without limitation,
all fees, charges and disbursements of counsel to the Administrative Agent or
any Lender that are required to be paid by such Guarantor pursuant to the terms
of this Guarantee) or otherwise.

 

2 

 

“Payment in Full Time”: the time that the Loans, the Reimbursement Obligations
and the other Primary Obligations of the Loan Parties (other than Primary
Obligations under or in respect of Specified Swap Agreements and unmatured
contingent reimbursement and indemnification obligations) have been paid in
full, the Commitments have been terminated and no Letters of Credit are
outstanding (other than Letters of Credit that have been cash collateralized in
the manner set forth in Section 2.5(a) of the Credit Agreement).

 

“Primary Obligations”: with respect to any Loan Party, the collective reference
to the unpaid principal of and interest on (including, without limitation,
interest accruing at the then applicable rate provided in the Credit Agreement
after the maturity of the Loans and Reimbursement Obligations and interest
accruing at the then applicable rate provided in the Credit Agreement after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to such Loan Party, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
the Loans and Reimbursement Obligations and all other obligations and
liabilities of such Loan Party to the Administrative Agent or any Lender (or, in
the case of any Specified Swap Agreement, any affiliate of any Lender), whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, the Credit Agreement, any other Loan Document (other than this Guarantee),
any Letter of Credit, any Specified Swap Agreement or any other document made,
delivered or given in connection with any of the foregoing, in each case whether
on account of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses (including, without limitation, all fees, charges and
disbursements of counsel to the Administrative Agent or any Lender that are
required to be paid by such Loan Party pursuant to the terms of any of the
foregoing agreements) or otherwise; provided that for purposes of determining
any Guarantor Obligations of any Guarantor under this Guarantee, the definition
of “Primary Obligations” shall not create any guarantee by any Guarantor of any
Excluded Swap Obligations of such Guarantor.

 

“Qualified Keepwell Provider”: in respect of any Swap Obligation, each Loan
Party that, at the time the relevant guarantee (or grant of the relevant
security interest, as applicable) becomes effective with respect to such Swap
Obligation, has total assets exceeding $10,000,000 or otherwise 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” with respect to such Swap Obligation at such
time by entering into a keepwell or guarantee pursuant to Section
1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

(c)       The words “hereof,” “herein” and “hereunder” and words of similar
import when used in this Guarantee shall refer to this Guarantee as a whole and
not to any particular provision of this Guarantee, and section and paragraph
references are to this Guarantee unless otherwise specified.

 

(d)       The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.

 

2.         Guarantee. (a) Each of the Guarantors hereby, jointly and severally,
unconditionally and irrevocably, guarantees to the Administrative Agent, for the
ratable benefit of the Guaranteed Parties and their respective successors,
indorsees, transferees and assigns, the prompt and complete payment and
performance by the Loan Parties when due (whether at the stated maturity, by
acceleration or otherwise) of the Primary Obligations of the Loan Parties (other
than, with respect to each Guarantor, (i) its own Primary Obligations and (ii)
any Excluded Swap Obligations of such Guarantor). This Guarantee is a guarantee
of payment and not of collection.

 

(b)       Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor (other than in respect
of its own Primary Obligations) hereunder and under the other Loan Documents
shall in no event exceed the amount which can be guaranteed by such Guarantor
under applicable federal and state laws relating to the insolvency of debtors
(after giving effect to the right of contribution established in Section 3).

 

3 

 

(c)       Each Guarantor agrees that the Primary Obligations of the other Loan
Parties may at any time and from time to time exceed the amount of the liability
of such Guarantor hereunder without impairing this Guarantee or affecting the
rights and remedies of any Guaranteed Party hereunder.

 

(d)       This Guarantee shall remain in full force and effect until the Payment
in Full Time, notwithstanding that from time to time during the term of the
Credit Agreement the Loan Parties may be free from any Primary Obligations.

 

(e)       No payment made by the Borrower, any other Loan Party with Primary
Obligations, any of the Guarantors, any other guarantor or any other Person or
received or collected by any Guaranteed Party from the Borrower, any other Loan
Party with Primary Obligations, any of the Guarantors, any other guarantor or
any other Person by virtue of any action or proceeding or any set-off or
appropriation or application at any time or from time to time in reduction of or
in payment of the Primary Obligations of the Loan Parties shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment (other than any payment
made by such Guarantor in respect of the Primary Obligations of the other Loan
Parties or any payment received or collected from such Guarantor in respect of
the Primary Obligations of the other Loan Parties), remain liable for the
Primary Obligations of the other Loan Parties up to the maximum liability of
such Guarantor hereunder until the Payment in Full Time.

 

3.         Right of Contribution. Each Subsidiary Guarantor hereby agrees that
to the extent that a Subsidiary Guarantor shall have paid more than its
proportionate share of any payment made hereunder, such Subsidiary Guarantor
shall be entitled to seek and receive contribution from and against any other
Subsidiary Guarantor hereunder which has not paid its proportionate share of
such payment. Each Subsidiary Guarantor’s right of contribution shall be subject
to the terms and conditions of Section 4. The provisions of this Section 3 shall
in no respect limit the obligations and liabilities of any Subsidiary Guarantor
to the Guaranteed Parties, and each Subsidiary Guarantor shall remain liable to
the Guaranteed Parties for the full amount guaranteed by such Subsidiary
Guarantor hereunder.

 

4.         No Subrogation. Notwithstanding any payment made by any Guarantor
hereunder or any set-off or application of funds of any Guarantor by any
Guaranteed Party, no Guarantor shall be entitled to be subrogated to any of the
rights of any Guaranteed Party against the Borrower, any other Loan Party with
Primary Obligations or any other Guarantor or any collateral security or
guarantee or right of offset held by any Guaranteed Party for the payment of the
Primary Obligations of the Loan Parties, nor shall any Guarantor seek or be
entitled to seek any contribution or reimbursement from the Borrower, any other
Loan Party with Primary Obligations or any other Guarantor in respect of
payments made by such Guarantor hereunder, until the Payment in Full Time. If
any amount shall be paid to any Guarantor on account of such subrogation rights
at any time prior to the Payment in Full Time, such amount shall be held by such
Guarantor in trust for the Guaranteed Parties, segregated from other funds of
such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned
over to the Administrative Agent in the exact form received by such Guarantor
(duly indorsed by such Guarantor to the Administrative Agent, if required), to
be applied against the Primary Obligations of the Loan Parties, whether matured
or unmatured, in such order as the Administrative Agent may determine.

 

5.         Amendments, etc. with respect to the Obligations. Each Guarantor
shall remain obligated hereunder notwithstanding that, without any reservation
of rights against any Guarantor and without notice to or further assent by any
Guarantor, any demand for payment of any of the Primary Obligations of the Loan
Parties made by any Guaranteed Party may be rescinded by such Guaranteed Party
and any of the Primary Obligations of the Loan Parties continued, and the
Primary Obligations of the Loan Parties, or the liability of any other Person
upon or for any part thereof, or any collateral security or guarantee therefor
or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by any Guaranteed Party, and the Credit Agreement and
the other Loan Documents and any other documents executed and delivered in
connection therewith may be amended, modified, supplemented or terminated, in
whole or in part, as the Administrative Agent (or the Required Lenders or all
Lenders, as the case may be) may deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by any
Guaranteed Party for the payment of the Primary Obligations of the Loan Parties
may be sold, exchanged, waived, surrendered or released. No Guaranteed Party
shall have any obligation to protect, secure, perfect or insure any Lien at any
time held by it as security for the Primary Obligations of the Loan Parties or
for this Guarantee or any property subject thereto.

 

4 

 

6.         Guarantee Absolute and Unconditional. Each Guarantor waives any and
all notice of the creation, renewal, extension or accrual of any of the Primary
Obligations of the Loan Parties and notice of or proof of reliance by any
Guaranteed Party upon this Guarantee or acceptance of this Guarantee; the
Primary Obligations of the Loan Parties, and any of them, shall conclusively be
deemed to have been created, contracted or incurred, or renewed, extended,
amended or waived, in reliance upon this Guarantee; and all dealings between the
Borrower and any of the other Guarantors, on the one hand, and Guaranteed
Parties, on the other hand, likewise shall be conclusively presumed to have been
had or consummated in reliance upon this Guarantee. Each Guarantor waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon the Borrower, any other Loan Party with Primary
Obligations or any of the other Guarantors with respect to the Primary
Obligations of the Loan Parties. Each Guarantor understands and agrees that this
Guarantee shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity or enforceability of the
Credit Agreement or any other Loan Document, any of the Primary Obligations of
the Loan Parties or any other collateral security therefor or guarantee or right
of offset with respect thereto at any time or from time to time held by any
Guaranteed Party, (b) any defense, set-off or counterclaim (other than a defense
of payment or performance) which may at any time be available to or be asserted
by the Borrower or any other Person against any Guaranteed Party, or (c) any
other circumstance whatsoever (with or without notice to or knowledge of the
Borrower or such other Guarantor) which constitutes, or might be construed to
constitute, an equitable or legal discharge of the Loan Parties for their
Primary Obligations, or of such Guarantor under this Guarantee, in bankruptcy or
in any other instance. When making any demand hereunder or otherwise pursuing
its rights and remedies hereunder against any Guarantor, any Guaranteed Party
may, but shall be under no obligation to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Borrower, any other
Loan Party with Primary Obligations, any other Guarantor or any other Person or
against any collateral security or guarantee for the Primary Obligations of the
Loan Parties or any right of offset with respect thereto, and any failure by any
Guaranteed Party to make any such demand, to pursue such other rights or
remedies or to collect any payments from the Borrower, any other Loan Party with
Primary Obligations, any other Guarantor or any other Person or to realize upon
any such collateral security or guarantee or to exercise any such right of
offset, or any release of the Borrower, any other Loan Party with Primary
Obligations, any other Guarantor or any other Person or any such collateral
security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and
remedies, whether express, implied or available as a matter of law, of any
Guaranteed Party against any Guarantor. For the purposes hereof “demand” shall
include the commencement and continuance of any legal proceedings.

 

7.         Reinstatement. This Guarantee shall continue to be effective, or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Primary Obligations of the Loan Parties is rescinded or must
otherwise be restored or returned by any Guaranteed Party upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower, any
other Loan Party with Primary Obligations or any other Guarantor, or upon or as
a result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower, any other Loan Party with Primary
Obligations or any other Guarantor or any substantial part of its property, or
otherwise, all as though such payments had not been made.

 

5 

 

8.         Payments. Each Guarantor hereby guarantees that payments hereunder
will be paid to the Administrative Agent without set-off or counterclaim in
Dollars at the Funding Office.

 

9.         Keepwell. Each Qualified Keepwell Provider hereby jointly and
severally absolutely, unconditionally, and irrevocably undertakes to provide
such funds or other support as may be needed from time to time by each other
Loan Party to honor all of its obligations under this Guarantee in respect of
any Swap Obligation (provided, however, that each Qualified Keepwell Provider
shall only be liable under this Section 9 for the maximum amount of such
liability that can be hereby incurred without rendering its obligations under
this Section 9, or otherwise under this Guarantee, voidable under applicable law
relating to fraudulent conveyance or fraudulent transfer, and not for any
greater amount). The obligations of each Qualified Keepwell Provider under this
Section 9 shall remain in full force and effect until the Payment in Full Time.
Each Qualified Keepwell Provider intends that this Section 9 constitute, and
this Section 9 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.

 

10.       Representations and Warranties. Each Guarantor hereby represents and
warrants that:

 

(a)       it is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its formation and has the power and authority and
the legal right to own and operate its property, to lease the property it
operates and to conduct the business in which it is currently engaged;

 

(b)       it has the power and authority and the legal right to execute and
deliver, and to perform its obligations under, this Guarantee, and has taken all
necessary action to authorize its execution, delivery and performance of this
Guarantee;

 

(c)       this Guarantee constitutes a legal, valid and binding obligation of
such Guarantor enforceable against such Guarantor in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law);

 

(d)       the execution, delivery and performance of this Guarantee will not
violate any Requirement of Law or material Contractual Obligation of such
Guarantor and will not result in or require the creation or imposition of any
Lien on any of the properties or revenues of such Guarantor pursuant to any
Requirement of Law or such Contractual Obligation of the Guarantor;

 

(e)       no consent or authorization of, filing with, notice to or other act by
or in respect of, any Governmental Authority or any other Person (including,
without limitation, any stockholder or creditor of such Guarantor) is required
in connection with the execution, delivery, performance, validity or
enforceability of this Guarantee, except consents, authorizations, filings and
notices described in Schedule 4.4 to the Credit Agreement, which consents,
authorizations, filings and notices have been obtained or made and are in full
force and effect; and

 

6 

 

(f)        except as set forth on Schedule 4.6 to the Credit Agreement, no
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of such Guarantor,
threatened by or against such Guarantor or against any of its properties or
revenues (1) with respect to this Guarantee or any of the transactions
contemplated hereby, or (2) that is reasonably likely to be determined adversely
and, if so adversely determined, could reasonably be expected to have a Material
Adverse Effect.

 

Each Guarantor agrees that the foregoing representations and warranties shall be
deemed to have been made by such Guarantor on the date of each borrowing by the
Borrower under the Credit Agreement on and as of such date of borrowing as
though made hereunder on and as of such date.

 

11.       Authority of Administrative Agent. Each Guarantor acknowledges that
the rights and responsibilities of the Administrative Agent under this Guarantee
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, right, request, judgment
or other right or remedy provided for herein or resulting or arising out of this
Guarantee shall, as between the Administrative Agent and the Lenders, be
governed by the Credit Agreement and by such other agreements with respect
thereto as may exist from time to time among them, but, as between the
Administrative Agent and such Guarantor, the Administrative Agent shall be
conclusively presumed to be acting as agent for the Lenders with full and valid
authority so to act or refrain from acting, and no Guarantor shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.

 

12.       Notices. All notices, requests and demands to or upon the
Administrative Agent, any Lender or any Guarantor hereunder shall be effected in
the manner provided for in Section 10.2 of the Credit Agreement; provided that
any such notice, request or demand to or upon any Guarantor shall be addressed
to such Guarantor at its notice address set forth under its signature below.

 

13.       Counterparts. This Guarantee may be executed by one or more of the
Guarantors on any number of separate counterparts (including by telecopy), and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.

 

14.       Severability. Any provision of this Guarantee which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

15.       Integration. This Guarantee represents the agreement of each Guarantor
with respect to the subject matter hereof and there are no promises or
representations by the Administrative Agent or any Lender relative to the
subject matter hereof not reflected herein.

 

16.       Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of the
terms or provisions of this Guarantee may be waived, amended, supplemented or
otherwise modified except in accordance with Section 10.1 of the Credit
Agreement.

 

(b)       Neither the Administrative Agent nor any Lender shall by any act
(except by a written instrument pursuant to paragraph 16(a) hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any Default or Event of Default or in any
breach of any of the terms and conditions hereof. No failure to exercise, nor
any delay in exercising, on the part of the Administrative Agent or any Lender,
any right, power or privilege hereunder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by the Administrative Agent or any Lender of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Administrative Agent or such Lender would
otherwise have on any future occasion.

 

7 

 

(c)       The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.

 

17.       Section Headings. The section headings used in this Guarantee are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.

 

18.       Successors and Assigns. This Guarantee shall be binding upon the
successors and assigns of each Guarantor and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and assigns.

 

19.       Governing Law. THIS GUARANTEE AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

20.       Submission to Jurisdiction; Waivers. Each Guarantor hereby irrevocably
and unconditionally:

 

(i)       submits for itself and its property in any legal action or proceeding
relating to this Guarantee or for recognition and enforcement of any judgment in
respect thereof, to the exclusive general jurisdiction of the United States
District Court for the Southern District of New York and, to the extent that
such federal court lacks subject matter jurisdiction or diversity jurisdiction,
the courts of the State of New York sitting in the Borough of Manhattan, and, in
each case, the appellate courts from any thereof;

 

(ii)      consents that any such action or proceeding may be brought in such
courts and waives trial by jury and any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;

 

(iii)     agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Guarantor at its
address set forth under its signature below or at such other address of which
the Administrative Agent shall have been notified;

 

(iv)     agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

 

(v)      waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

 

21.       Acknowledgements. Each Guarantor hereby acknowledges that:

 

(i)       it has been advised by counsel in the negotiation, execution and
delivery of this Guarantee and the other Loan Documents to which it is a party;

 

8 

 

(ii)      no Guaranteed Party has any fiduciary relationship with or duty to any
Guarantor arising out of or in connection with this Guarantee or any of the
other Loan Documents, and the relationship between the Guarantors, on the one
hand, and the Guaranteed Parties, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and

 

(iii)      no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Guaranteed Parties or among the Guarantors and the Guaranteed Parties.

 

22.       Additional Guarantors. Each Subsidiary of the Borrower that is
required to become a party to this Guarantee pursuant to Section 6.9 of the
Credit Agreement shall become a Guarantor for all purposes of this Agreement
upon execution and delivery by such Subsidiary of a Guarantor Supplement in the
form of Annex A hereto.

 

23.       WAIVER OF JURY TRIAL. EACH GUARANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS GUARANTEE OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

 

 

IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee to be duly
executed and delivered by its duly authorized officer as of the day and year
first above written.

 

[signatures follow]

 

 

 

 

 

 

 

 

MSC INDUSTRIAL DIRECT CO., INC.     By:       Name:   Title:       Address for
Notices: 75 Maxess Road Melville, New York 11747 Attention: General Counsel  
Telephone:   OMITTED Telecopy: OMITTED  

 

 

 

 

 

 

 

MSC Industrial Direct Co., Inc.

Guarantee

 

 

 

 

 

SID TOOL CO., INC.   By:       Name:   Title:       Address for Notices: 75
Maxess Road Melville, New York 11747 Attention: General Counsel     Telephone:  
OMITTED Telecopy: OMITTED    

 

 

 

MSC Industrial Direct Co., Inc.

Guarantee

 

 

 

MSC CONTRACT MANAGEMENT, INC.   By:       Name:   Title:       Address for
Notices: 75 Maxess Road Melville, New York 11747 Attention: General Counsel  
Telephone:   OMITTED Telecopy: OMITTED  

 

 

MSC Industrial Direct Co., Inc.

Guarantee

 

 

 

J&L AMERICA, INC.     By:       Name:   Title:         Address for Notices: 75
Maxess Road Melville, New York 11747 Attention: General Counsel   Telephone:  
OMITTED Telecopy: OMITTED  

 

 

 

 

 

MSC Industrial Direct Co., Inc.

Guarantee

 

 

 

ANNEX A

 

FORM OF
GUARANTOR SUPPLEMENT

 

 

 

_____________, 201_

 

 

 

JPMorgan Chase Bank, N.A., as Administrative Agent
395 North Service Road, Suite 302

Melville, New York 11747

 

Attention: Alicia Schreibstein

 

Re:Guarantee, dated as of April 14, 2017 (as amended, supplemented or otherwise
modified from time to time, the “Guarantee”), made by MSC Industrial Direct Co.,
Inc. (the “Borrower”) and certain subsidiaries of the Borrower in favor of
JPMorgan Chase Bank, N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to the Guarantee. Terms defined in the Guarantee shall be used
herein as therein defined.

 

The undersigned, ___________________________, a ________________
[corporation/limited liability company/partnership] and a Subsidiary of the
Borrower, in consideration of the extensions of credit by the Lenders to the
Borrower pursuant to the Credit Agreement, which extensions benefit the
undersigned by making funds available to the undersigned and by enhancing the
financial strength of the consolidated group of which the undersigned is a
member, hereby agrees to become an additional Subsidiary Guarantor for the
purposes of the Guarantee and to perform all the obligations of a Subsidiary
Guarantor and a Guarantor under, and to be bound in all respects by the terms
of, the Guarantee as if the undersigned were a signatory party thereto,
effective from the date hereof.

 

The undersigned hereby certifies that (a) this Guarantor Supplement has been
duly authorized, executed and delivered by the undersigned and constitute its
legal, valid and binding obligation enforceable against the undersigned in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting the enforcement of creditors’ rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing and (b) the
representations and warranties contained in Section 10 of the Guarantee insofar
as they relate to the undersigned are true and correct on and as of the date
hereof, with the same effect as if made on and as of such date (except to the
extent such representations and warranties expressly relate to an earlier date,
in which case they are true and correct as of such earlier date).

 

 

The undersigned hereby certifies that attached hereto as Annex I is a copy of
the resolutions of the Board of Directors of the undersigned, authorizing the
undersigned to become a Guarantor under the Guarantee and to perform its
obligations thereunder and to execute, deliver and perform this Guarantor
Supplement.

 

The undersigned confirms that it has received a copy of the Guarantee including
all amendments thereto, if any.

 

The address to which all notices to the undersigned under the Guarantee should
be directed is:

 

[____________________]

 

This Guarantor Supplement shall be effective on and as of the date first written
above. THIS GUARANTOR SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

 

  Very truly yours,       [NAME OF SUBSIDIARY OF BORROWER]           By:    
Title:  

 

 

 

ANNEX I

 

RESOLUTIONS

 

 

  

 

 

 

 

EXHIBIT B

 

FORM OF
COMPLIANCE CERTIFICATE

 

This Compliance Certificate is delivered pursuant to Section 6.2(a) of the
Credit Agreement, dated as of April 14, 2017 (as amended, supplemented or
otherwise modified from time to time, the “Credit Agreement”), among MSC
Industrial Direct Co., Inc. (the “Borrower”), the lenders from time to time
parties thereto (the “Lenders”), and JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, the “Administrative Agent”). Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.

 

1.     I am the duly elected, qualified and acting [President and Chief
Executive Officer]/[Executive Vice President and Chief Financial Officer]/[Vice
President of Finance and Corporate Controller] of the Borrower.

 

2.     I have reviewed and am familiar with the contents of this Certificate.

 

3.     I have reviewed the terms of the Credit Agreement and the other Loan
Documents and have made or caused to be made under my supervision, a review in
reasonable detail of the transactions and condition of the Borrower during the
accounting period covered by the financial statements attached hereto as
Attachment 1 (the “Financial Statements”).

 

(a) Such review did not disclose the existence during or at the end of the
accounting period covered by the Financial Statements, and I have no knowledge
of the existence, as of the date of this Certificate, of any condition or event
which constitutes a Default or Event of Default[, except as set forth below].

 

(b) To the best of my knowledge after such review, each Loan Party during the
accounting period covered by the Financial Statements observed or performed all
of its covenants or other agreements and satisfied every condition contained in
the Credit Agreement and the other Loan Documents to which it is a party that
were to be observed, performed or satisfied by it[, except as set forth below].

 

4.     Attached hereto as Attachment 2 are the computations showing compliance
with the covenants set forth in Section 7.1, 7.2(b)(iii), 7.5(e) and (l), and
7.6(g) of the Credit Agreement.

 

IN WITNESS WHEREOF, I have executed this Certificate this _____ day of _____,
201_.

 

      Name:   Title

 

 

 

 

Attachment 1
to Compliance Certificate

 

[Attach Financial Statements]

 

Attachment 2
to Compliance Certificate

 

The information described herein is as of ______, ____, and pertains to the
period from _________, ____ to ________________ __, ____.

 

[Set forth Covenant Calculations]

 

 

 

 

EXHIBIT C

 

FORM OF
CLOSING CERTIFICATES

 

[INSERT NAME OF LOAN PARTY]

SECRETARY’S CERTIFICATE

 

April 14, 2017

 

Pursuant to Section 5.1(f) of the Credit Agreement, dated as of April 14, 2017
(the “Credit Agreement”; capitalized terms used but not otherwise defined herein
have the meaning given to such terms in the Credit Agreement), by and among MSC
Industrial Direct Co., Inc. [(the “Company”)]1, the lenders from time to time
parties thereto and JPMorgan Chase Bank, N.A., as administrative agent, the
undersigned Secretary of [INSERT NAME OF LOAN PARTY] [(the “Company”)]2 hereby
certifies as follows:

 

1.          Attached hereto as Annex 1 is a true and complete copy of the
[Certificate] [Articles] of Incorporation of the Company, and all amendments
thereto through and including the date hereof, which [Certificate][Articles] of
Incorporation [has][have] not been revoked and [is][are] in effect on the date
hereof.

 

2.          Attached hereto as Annex 2 is a true and complete copy of the
By-Laws of the Company, and all amendments thereto through and including the
date hereof, which By-Laws have not been revoked and are in effect on the date
hereof.

 

3.          Attached hereto as Annex 3 is a true and complete copy of [an
extract of the resolutions duly adopted by the Board of Directors of the Company
on [__], 2017]3 [resolutions duly adopted by the Board of Directors of the
Company on [__], 2017 and a true and complete copy of resolutions duly adopted
by the sole shareholder of the Company on [__], 2017]4[resolutions duly adopted
by the Board of Directors of the Company on [__], 2017]5; such resolutions have
not in any way been amended, modified, revoked or rescinded, have been in full
force and effect since their adoption to and including the date hereof and are
now in full force and effect and are the only corporate proceedings of the
Company now in force relating to or affecting the matters referred to in the
Credit Agreement.

 

4.          Attached hereto as Annex 4 is an incumbency certificate listing
persons who are now duly elected and qualified officers of the Company holding
the offices indicated next to their respective names, and the signatures
appearing opposite their respective names are the true and genuine signatures of
such officers, and each of such officers is duly authorized to execute and
deliver on behalf of the Company each of the Loan Documents to which it is a
party and any certificate or other document to be delivered by the Company
pursuant to the Loan Documents to which it is a party.

 

5.          Attached hereto as Annex 5 is a true and complete copy of the
certificate of good standing of the Company issued by the Secretary of State of
its jurisdiction of organization.

 

6.          There are no liquidation or dissolution proceedings pending or to my
knowledge threatened against the Company.

 

 

1 Borrower only.

2 Subsidiary Guarantors only.

3 Borrower only.

4 Subsidiary Guarantors incorporated in New York only.

5 J & L America, Inc. only.

 

 

 

 

IN WITNESS WHEREOF, the undersigned has executed this Certificate on behalf and
in the undersigned’s capacity as Secretary of the Company (and not in any
individual capacity) as of the date set forth above.

 

  [INSERT NAME OF LOAN PARTY]         By:         Name:   Title:

 

The undersigned, on behalf and in the undersigned’s capacity as an officer of
the Company (and not in any individual capacity), hereby certifies that the
person named above is a duly elected and qualified officer of the Company and
that the signature above is such person’s true and genuine signature.

 

  By:         Name:   Title:

 

 

 

 

ANNEX 1

 

[Certificate][articles] of incorporation

 

 

 

 

ANNEX 2

 

BY-LAWS

 

 

 

 

ANNEX 3

 

[extract of resolutions][Resolutions]

 

 

 

 

ANNEX 4

 

incumbency certificate

 

Name   Office   Signature  

 

 

 

 

ANNEX 5

 

Certificate of good standing

 

 

 

 

EXHIBIT C

 

[INSERT NAME OF LOAN PARTY]

OFFICER’S CERTIFICATE

 

April 14, 2017

 

Pursuant to Section 5.1(f) of the Credit Agreement, dated as of April 14, 2017
(the “Credit Agreement”; capitalized terms used but not otherwise defined herein
have the meaning given to such terms in the Credit Agreement), by and among MSC
Industrial Direct Co., Inc. [(the “Company”)]1, the lenders from time to time
parties thereto, and JPMorgan Chase Bank, N.A., as administrative agent, the
undersigned officer of [INSERT NAME OF LOAN PARTY] [(the “Company”)]2 hereby
certifies as follows:

 

1.          The conditions precedent set forth in Section 5.1 and Section 5.2 of
the Credit Agreement were satisfied as of the Closing Date.3

 

2.          The representations and warranties of the Company set forth in each
of the Loan Documents to which it is a party are true and correct in all
material respects on and as of the date hereof as if made on and as of the date
hereof (except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they were true and correct
in all material respects as of such earlier date).

 

3.          Upon the effectiveness of the Credit Agreement, no Default or Event
of Default [arising from any action, inaction, circumstance or condition of or
directly relating to the Company]4 has occurred and is continuing as of the date
hereof or after giving effect to the extensions of credit requested to be made
on the date hereof and the use of proceeds thereof.

 

 

1 Borrower only.

2 Subsidiary Guarantors only.

3 Borrower only.

4 Subsidiary Guarantors only.

 

 

 

 

IN WITNESS WHEREOF, the undersigned has executed this Certificate on behalf and
in the undersigned’s capacity as an officer of the Company (and not in any
individual capacity) as of the date set forth above.

 

  [INSERT NAME OF LOAN PARTY]       By:           Name:     Title:  

 

 

 

 

EXHIBIT D

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 between the Assignor
named below (the “Assignor”) and the Assignee named below (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 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 any other right 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]]       3. Borrower:
MSC Industrial Direct Co., Inc.       4. Administrative Agent: JPMorgan Chase
Bank, N.A., as the administrative agent under the Credit Agreement       5.
Credit Agreement: The $600,000,000 Credit Agreement dated as of April 14, 2017
among MSC Industrial Direct Co., Inc., the Lenders from time to time parties
thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, and the other
agents parties thereto       6. Assigned Interest:  

 

 

 

 

Facility Assigned1  Aggregate Amount of
Commitment/Loans for
all Lenders   Amount of
Commitment/Loans
Assigned   Percentage Assigned of
Commitment/Loans2    $   $    %    $   $    %

 

Effective Date: _____________ ___, 201__ [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 Borrower, the Loan Parties and their Affiliates
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.

 

 

1 Fill in appropriate terminology for the types of facilities under the Credit
Agreement that are being assigned under this Assignment (e.g., “Revolving
Commitment”, “Incremental Term Loan Commitment”).

 

2 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders.

 

 

 

 

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:  

 

[Consented to and] 3 Accepted:         JPMORGAN CHASE BANK, N.A., as  
Administrative Agent         By       Title:           [Consented to:]4        
MSC INDUSTRIAL DIRECT CO., INC.         By       Title:           [NAME OF
RELEVANT PARTY]         By       Title:    

 

 

3 To be added only if the consent of the Administrative Agent is required by the
terms of the Credit Agreement.

 

4 To be added only if the consent of the Borrower and/or other parties (e.g.
Issuing Lenders) is required by the terms of the Credit Agreement.

 

 

 

 

ANNEX 1

 

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 the
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 the
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 6.1 thereof 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 Non-U.S. 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. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
email or telecopy 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 E-1

 

FORM OF

U.S. TAX CERTIFICATE

 

(For Non-U.S. Lenders That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Credit Agreement, dated as of April 14, 2017 (as
amended, supplemented or otherwise modified, from time to time, the “Credit
Agreement”), among MSC Industrial Direct Co., Inc. (the “Borrower”), the Lenders
from time to time parties thereto, and JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 3.9 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 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 the Borrower within the meaning of Section 871(h)(3)(B) of the Code, and
(iv) it is not a controlled foreign corporation related to the Borrower as
described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower 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 and
the Administrative Agent and (2) the undersigned shall have at all times
furnished the Borrower 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[  ]  

 

 

 

 

Exhibit E-2

 

FORM OF

U.S. TAX CERTIFICATE

 

(For Non-U.S. Lenders That Are Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Credit Agreement, dated as of April 14, 2017 (as
amended, supplemented or otherwise modified, from time to time, the “Credit
Agreement”), among MSC Industrial Direct Co., Inc. (the “Borrower”), the Lenders
from time to time parties thereto, and JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 3.9 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner of the Loan(s)
(as well as any Note(s) evidencing such Loan(s)) in respect of which it is
providing this certificate, (ii) its partners/members are the sole beneficial
owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)),
(iii) with respect to the extension of credit pursuant to this Credit Agreement,
neither the undersigned nor any of its 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 partners/members is a ten percent shareholder of the Borrower
within the meaning of Section 871(h)(3)(B) of the Code, and (v) none of its
partners/members is a controlled foreign corporation related to the Borrower as
described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with
IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of its
partners/members 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 and
the Administrative Agent and (2) the undersigned shall have at all times
furnished the Borrower 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[  ]  

 

 

 

 

exhibit E-3

 

FORM OF

U.S. TAX CERTIFICATE

 

(For Non-U.S. Participants That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Credit Agreement, dated as of April 14, 2017 (as
amended, supplemented or otherwise modified, from time to time, the “Credit
Agreement”), among MSC Industrial Direct Co., Inc. (the “Borrower”), the Lenders
from time to time parties thereto, and JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 3.9 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 the Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign
corporation related to the 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 E-4

 

FORM OF

U.S. TAX CERTIFICATE

 

(For Non-U.S. Participants That Are Partnerships For U.S. Federal Income Tax
Purposes)

 

Reference is hereby made to the Credit Agreement, dated as of April 14, 2017 (as
amended, supplemented or otherwise modified, from time to time, the “Credit
Agreement”), among MSC Industrial Direct Co., Inc. (the “Borrower”), the Lenders
from time to time parties thereto, and JPMorgan Chase Bank, N.A., as
administrative agent (in such capacity, the “Administrative Agent”).

 

Pursuant to the provisions of Section 3.9 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
partners/members are the sole beneficial owners of such participation,
(iii) with respect such participation, neither the undersigned nor any of its
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 partners/members is a ten
percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B)
of the Code, and (v) none of its partners/members is a controlled foreign
corporation related to the 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 an IRS Form W-8BEN from each of its partners/members 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[  ]