Deal CUSIP Number: 12466JAG5
Revolving Credit Facility CUSIP Number: 12466JAH3

AMENDED AND RESTATED
REVOLVING CREDIT
AND
SECURITY AGREEMENT

By and Among

PNC BANK, NATIONAL ASSOCIATION
(AS A LENDER, ADMINISTRATIVE AGENT AND ISSUER)

CJ HOLDING CO.,
C&J SPEC-RENT SERVICES, INC.,
C&J WELL SERVICES, INC.,
ESP COMPLETION TECHNOLOGIES LLC,
KVS TRANSPORTATION, INC.,
TELLUS OILFIELD INC.,
TIGER CASED HOLE SERVICES, INC.
and
TOTAL E&S, INC.
(AS BORROWERS)

C&J ENERGY SERVICES, INC.
(HOLDINGS)

AND VARIOUS LENDERS

May 4, 2017

________________________________________________________________

PNC CAPITAL MARKETS LLC
(SOLE LEAD ARRANGER AND SOLE BOOKRUNNER)

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TABLE OF CONTENTS
Page
I.    DEFINITIONS.    1
1.1. Accounting Terms     1
1.2. General Terms    2
1.3. Uniform Commercial Code Terms    52
1.4. Certain Matters of Construction    52
1.5. Permitted Encumbrances    53
II.    ADVANCES, PAYMENTS.    53
2.1. Revolving Advances    53
2.2.    Procedures for Requesting Revolving Advances; Procedures for Selection
of Applicable Interest Rates for All Advances    54
2.3. [Reserved]    56
2.4. Swing Loans    56
2.5. Disbursement of Advance Proceeds    57
2.6. Making and Settlement of Advances    58
2.7. Maximum Advances    60
2.8. Manner and Repayment of Advances    60
2.9. Repayment of Excess Advances    61
2.10. Statement of Account    61
2.11. Letters of Credit    61
2.12. Issuance of Letters of Credit    62
2.13. Requirements For Issuance of Letters of Credit    63
2.14. Disbursements, Reimbursement    63
2.15. Repayment of Participation Advances    65
2.16. Documentation    65
2.17. Determination to Honor Drawing Request    65
2.18. Nature of Participation and Reimbursement Obligations    65
2.19. Liability for Acts and Omissions    67
2.20. Mandatory Prepayments    68
2.21. Use of Proceeds    70
2.22. Defaulting Lender    70
2.23. Payment of Obligations    73
2.24. Increase in Maximum Revolving Advance Amount    73

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2.25. Reduction of Maximum Revolving Advance Amount    76
III.    INTEREST AND FEES.    76
3.1. Interest    76
3.2. Letter of Credit Fees    76
3.3. Facility Fee; Fee Letter Fees    78
3.4. Computation of Interest and Fees    78
3.5. Maximum Charges    79
3.6. Increased Costs    79
3.7. Basis For Determining Interest Rate Inadequate or Unfair    80
3.8. Capital Adequacy    81
3.9. Taxes    82
3.10. Replacement of Lenders    85
IV.    COLLATERAL: GENERAL TERMS    86
4.1. Security Interest in the Collateral    86
4.2. Perfection of Security Interest    87
4.3. Preservation of Collateral    87
4.4. Ownership and Location of Collateral    88
4.5. Defense of Agent’s and Lenders’ Interests    88
4.6. Inspection of Premises    89
4.7. Appraisals    89
4.8. Receivables; Deposit Accounts and Securities Accounts    89
4.9. Inventory    93
4.10. Maintenance of Equipment    93
4.11. Exculpation of Liability    93
4.12. Financing Statements    94
V.    REPRESENTATIONS AND WARRANTIES.    94
5.1. Authority    94
5.2. Formation and Qualification    94
5.3. Survival of Representations and Warranties    95
5.4. Tax Returns    95
5.5. Financial Statements    95
5.6. Entity Names    96
5.7. O.S.H.A. Environmental Compliance; Flood Insurance    96
5.8. Solvency; No Litigation, Violation, Indebtedness or Default; ERISA
Compliance    97
5.9. Patents, Trademarks, Copyrights and Licenses    99

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5.10. Licenses and Permits    99
5.11. No Default    99
5.12. No Burdensome Restrictions    99
5.13. No Labor Disputes    99
5.14. Margin Regulations    99
5.15. Investment Company Act    100
5.16. Disclosure    100
5.17. Conflicting Agreements    100
5.18. Application of Certain Laws and Regulations    100
5.19. Business and Property of Credit Parties    100
5.20. Ineligible Securities    101
5.21. Equity Interests    101
5.22. Commercial Tort Claims    101
5.23. Letter of Credit Rights    101
5.24. Deposit Accounts    101
5.25. Perfection of Security Interest in Collateral    101
5.26. Swaps    101
5.27. EEA Financial Institution    101
VI.    AFFIRMATIVE COVENANTS.    102
6.1. Compliance with Laws    102
6.2. Conduct of Business and Maintenance of Existence and Assets    102
6.3. Books and Records    102
6.4. Payment of Taxes    102
6.5. Financial Covenant    103
6.6. Insurance    103
6.7. Payment of Indebtedness and Leasehold Obligations    104
6.8. Environmental Matters    105
6.9. [Reserved]    106
6.10. Execution of Supplemental Instruments    106
6.11. Government Receivables    106
6.12. [Reserved].    106
6.13. Keepwell    106
6.14. Negative Pledge Agreements; Permitted Releases.    107
6.15. Post-Closing Covenants    107
VII.    NEGATIVE COVENANTS.    108

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7.1. Merger, Consolidation, Acquisition and Sale of Assets    108
7.2. Creation of Liens    109
7.3. Guarantees    109
7.4. Investments    110
7.5. Loans    110
7.6. Hedges    111
7.7. Dividends    111
7.8. Indebtedness    111
7.9. Nature of Business    111
7.10. Transactions with Affiliates    111
7.11. Subsidiaries    112
7.12. Fiscal Year and Accounting Changes    113
7.13. Pledge of Credit    113
7.14. Amendment of Certain Documents    113
7.15. Compliance with ERISA    113
7.16. Prepayment of Indebtedness    113
7.17. Bank Accounts    114
7.18. Capital Expenditures    114
VIII.    CONDITIONS PRECEDENT.    114
8.1. Conditions to Initial Advances    114
8.2. Conditions to Each Advance    117
IX.    INFORMATION AS TO BORROWERS.    118
9.1. Disclosure of Material Matters    118
9.2. Schedules    118
9.3. Environmental Reports    119
9.4. Litigation    119
9.5. Material Occurrences    120
9.6. Government Receivables    120
9.7. Annual Financial Statements    120
9.8. Quarterly Compliance    120
9.9. Monthly Financial Statements    121
9.10. Other Reports    121
9.11. Additional Information    121
9.12. Projected Operating Budget    121
9.13. Variances From Operating Budget    121

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9.14. Notice of Suits, Adverse Events    121
9.15. ERISA Notices and Requests    122
9.16. Additional Documents    122
9.17. Updates to Certain Schedules    122
9.18. Appraisals and Field Examinations    123
X.    EVENTS OF DEFAULT.    123
10.1. Nonpayment    123
10.2. Breach of Representation    123
10.3. Financial Information    123
10.4. Noncompliance    123
10.5. Judgments    124
10.6. Bankruptcy    124
10.7. Lien Priority    124
10.8. Cross Default    124
10.9. Breach of Guaranty or Pledge Agreement    125
10.10. Change of Control    125
10.11. Invalidity    125
10.12. Seizures    125
10.13. Pension Plans    125
10.14. Anti-Money Laundering/International Trade Law Compliance    125
XI.    LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT.    125
11.1. Rights and Remedies    125
11.2. Agent’s Discretion    127
11.3. Setoff    127
11.4. Rights and Remedies not Exclusive    128
11.5. Allocation of Payments After Event of Default    128
11.6. Right to Cure    130
XII.    WAIVERS AND JUDICIAL PROCEEDINGS.    131
12.1. Waiver of Notice    131
12.2. Delay    131
12.3. Jury Waiver    131
XIII.    EFFECTIVE DATE AND TERMINATION.    131

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13.1. Term    131
13.2. Termination    131
XIV.    REGARDING AGENT.    132
14.1. Appointment    132
14.2. Nature of Duties    132
14.3. Lack of Reliance on Agent    133
14.4. Resignation of Agent; Successor Agent    134
14.5. Certain Rights of Agent    134
14.6. Reliance    135
14.7. Notice of Default    135
14.8. Indemnification    135
14.9. Agent in its Individual Capacity    135
14.10. Delivery of Documents    136
14.11. Borrowers’ Undertaking to Agent    136
14.12. No Reliance on Agent’s Customer Identification Program    136
14.13. Other Agreements    136
XV.    BORROWING AGENCY.    136
15.1. Borrowing Agency Provisions    136
15.2. Waiver of Subrogation    137
15.3. Common Enterprise    137
XVI.    MISCELLANEOUS.    138
16.1.    Governing Law    138
16.2.    Entire Understanding    138
16.3.    Successors and Assigns; Participations; New Lenders    142

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16.4.    Application of Payments    145
16.5.    Indemnity    145
16.6.    Notice    147
16.7.    Survival    149
16.8.    Severability    149
16.9.    Expenses    149
16.10.    Injunctive Relief    149
16.11.    Consequential Damages    150
16.12.    Captions    150
16.13.    Counterparts; Facsimile Signatures    150
16.14.    Construction    150
16.15.    Confidentiality; Sharing Information    150
16.16.    Publicity    151
16.17.    Certifications From Banks and Participants; USA PATRIOT Act    151
16.18.    Anti-Terrorism Laws    151
16.19.    Concerning Joint and Several Liability of Borrowers    152
16.20.    No Advisory or Fiduciary Responsibility    154
16.21.    Acknowledgement and Consent to Bail-In of EEA Financial
Institutions    155
16.22.    Effect of Amendment and Restatement; Reaffirmation    155
16.23.    Release    156

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LIST OF EXHIBITS AND SCHEDULES
Exhibits

Exhibit 1.2
Borrowing Base Certificate

Exhibit 1.2(a)
Compliance Certificate

Exhibit 2.1(a)
Revolving Credit Note

Exhibit 2.4(a)
Swing Loan Note

Exhibit 2.24
Joinder

Exhibit 3.10(e)-1
Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are Not
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit 3.10(e)-2
Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Not
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit 3.10(e)-3
Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit 3.10(e)-4
Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit 8.1(c)
Financial Condition Certificate

Exhibit 16.3
Commitment Transfer Supplement

Schedules

Schedule 1.2
Permitted Encumbrances

Schedule 4.4
Equipment and Inventory Locations; Place of Business, Chief Executive Office,
Real Property

Schedule 4.8(i)
Deposit and Investment Accounts

Schedule 5.1
Consents

Schedule 5.2(a)
States of Qualification and Good Standing

Schedule 5.2(b)
Subsidiaries

Schedule 5.4
Federal Tax Identification Number

Schedule 5.6
Prior Names

Schedule 5.8(d)
Plans

Schedule 5.9
Intellectual Property, Source Code Escrow Agreements

Schedule 5.12
Material Contracts

Schedule 5.13
Labor Disputes

Schedule 5.21(a)
Equity Interests

Schedule 5.21(b)
Restrictions on Equity Interests

Schedule 5.21(c)
Option Rights

Schedule 5.22
Commercial Tort Claims

Schedule 5.23
Letter of Credit Rights

Schedule 5.24
Deposit Accounts

Schedule 7.8
Permitted Indebtedness

AMENDED AND RESTATED
REVOLVING CREDIT AND SECURITY AGREEMENT
Amended and Restated Revolving Credit and Security Agreement, dated as of May 4,
2017, among C&J ENERGY SERVICES, INC., a corporation organized under the laws of
the State of Delaware (“Holdings”), CJ HOLDING CO., a corporation organized
under the laws of the State of Delaware (the “CJ Holding”), C&J SPEC-RENT
SERVICES, INC., a corporation organized under the laws of the State of Indiana
(“Spec-Rent”), C&J WELL SERVICES, INC., a corporation organized under the laws
of the State of Delaware (“Well Services”), ESP COMPLETION TECHNOLOGIES LLC, a
limited liability company organized under the laws of the State of Texas
(“ESP”), KVS TRANSPORTATION, INC., a corporation organized under the laws of the
State of California (“KVS”), TELLUS OILFIELD INC., a corporation organized under
the laws of the State of Delaware (“Tellus”), TIGER CASED HOLE SERVICES, INC., a
corporation organized under the laws of the State of California (“Tiger”), TOTAL
E&S, INC., a corporation organized under the laws of the State of Indiana
(“Total”; and together with Holdings, CJ Holding, Spec-Rent, Well Services, ESP,
KVS, Tellus, Tiger, and each other Person joined hereto as a borrower from time
to time, collectively, the “Borrowers”, and each a “Borrower”), the financial
institutions which are now or which hereafter become a party hereto
(collectively, the “Lenders” and each individually a “Lender”) and PNC BANK,
NATIONAL ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such capacity,
together with its successors and assigns in such capacity, the “Agent”).
IN CONSIDERATION of the mutual covenants and undertakings herein contained, and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, Borrowers, Lenders and Agent hereby agree as follows:
I.DEFINITIONS.
1.1.    Accounting Terms. As used in this Agreement, the Other Documents or any
certificate, report or other document made or delivered pursuant to this
Agreement, accounting terms not defined in Section 1.2 or elsewhere in this
Agreement and accounting terms partly defined in Section 1.2 to the extent not
defined shall have the respective meanings given to them under GAAP; provided
that, whenever such accounting terms are used for the purposes of determining
compliance with financial covenants in this Agreement, such accounting terms
shall be defined in accordance with GAAP as consistently applied in preparation
of the audited financial statements of C&J Energy Services Ltd. for the fiscal
year ended December 31, 2015 and otherwise as reasonably adjusted by, and giving
effect to (i) Fresh Start Accounting in accordance with American Institute of
Certified Public Accountants (AICPA) Statement of Position 90-7: Financial
Reporting by Entities in Reorganization under the Bankruptcy Code (SOP 90-7) and
(ii) such other adjustments and modifications as may be reasonably acceptable to
Agent. If there occurs after the Closing Date any change in GAAP that affects in
any respect the calculation of any covenant contained in this Agreement or the
definition of any term defined under GAAP used in such calculations, at the
request of the Borrowing Agent or the Required Lenders, Agent, Lenders and
Borrowers shall negotiate in good faith to amend the provisions of this
Agreement that relate to the calculation of such covenants with the intent of
having the respective positions of Agent, Lenders and Borrowers after such
change in GAAP conform as nearly as possible to their respective positions as of
the Closing Date; provided that, until any such amendments have been agreed
upon, the covenants in this Agreement shall be calculated as if no such change
in GAAP had occurred and Borrowers shall provide additional financial statements
or supplements thereto, attachments to Compliance Certificates and/or
calculations regarding financial covenants as Agent may reasonably require in
order to provide the appropriate financial information required hereunder with
respect to Borrowers both reflecting any applicable changes in GAAP and as
necessary to demonstrate compliance with the financial covenants before giving
effect to the applicable changes in GAAP.
1.2.    General Terms. For purposes of this Agreement the following terms shall
have the following meanings:
“Accountants” shall have the meaning set forth in Section 9.7.
“Advance Rates” shall have the meaning set forth in Section 2.1(a)(y)(v).
“Advances” shall mean and include the Revolving Advances, Letters of Credit and
Swing Loans.
“Affected Lender” shall have the meaning set forth in Section 3.10.
“Affiliate” of any Person shall mean (a) any Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with
such Person, or (b) any Person who is a director, manager, member, managing
member, general partner or officer (i) of such Person, (ii) of any Subsidiary of
such Person or (iii) of any Person described in clause (a) above. For purposes
of this definition, control of a Person shall mean the power, direct or
indirect, (x) to vote ten percent (10%) or more of the Equity Interests having
ordinary voting power for the election of directors of such Person or other
Persons performing similar functions for any such Person, or (y) to direct or
cause the direction of the management and policies of such Person whether by
ownership of Equity Interests, contract or otherwise.
“Agent” shall have the meaning set forth in the preamble to this Agreement and
shall include its successors and assigns.
“Agreement” shall mean this Amended and Restated Revolving Credit and Security
Agreement, as the same may be amended, amended and restated, replaced and
restated, extended, supplemented and/or otherwise modified from time to time.
“Alternate Base Rate” shall mean, for any day, a rate per annum equal to the
highest of (a) the Base Rate in effect on such day, (b) the sum of the Federal
Funds Open Rate in effect on such day plus one half of one percent (0.5%), and
(c) the sum of the Daily LIBOR Rate in effect on such day plus one percent
(1.0%), so long as a Daily LIBOR Rate is offered, ascertainable and not
unlawful; provided that if the Alternate Base Rate shall be less than zero, such
rate shall be deemed zero for purposes of this Agreement.
“Alternate Source” shall have the meaning set forth in the definition of Federal
Funds Open Rate.
“Anti-Terrorism Laws” shall mean any Laws relating to terrorism, trade sanctions
programs and embargoes, money laundering or bribery, and any regulation, order,
or directive promulgated, issued or enforced pursuant to such Laws, all as
amended, supplemented or replaced from time to time.
“Applicable Law” shall mean all laws, rules and regulations applicable to the
Person, conduct, transaction, covenant, Other Document or contract in question,
including all applicable common law and equitable principles, all provisions of
all applicable state, federal and foreign constitutions, statutes, rules,
regulations, treaties, directives and orders of any Governmental Body, and all
orders, judgments and decrees of all courts and arbitrators.
“Applicable Margin” shall mean, as of the Closing Date and through and including
the date immediately prior to the first Adjustment Date (as defined below), the
applicable percentage specified below:
Applicable Margin For Revolving Advances And Swing Loans That Are Domestic Rate
Loans
Applicable Margin For Revolving Advances That Are LIBOR Rate Loans
1.00%
2.00%

Effective as of the date on which the Borrowing Base Certificate required under
Section 9.2 for the month ending on September 30, 2017 are due to be delivered,
and thereafter on the first day of the month following receipt of the Borrowing
Base Certificate required under Section 9.2 for the most recently completed
month (each day of such delivery, an “Adjustment Date”), the Applicable Margin
for each type of Advance shall be adjusted, if necessary, to the applicable
percent per annum set forth in the pricing table below corresponding to the then
applicable Average Excess Availability (determined as provided in the sentence
immediately following such pricing table):
Average
Excess Availability
Applicable Margins For Revolving Advances And Swing Loans That Are Domestic Rate
Loans
Applicable Margins For Revolving Advances That Are LIBOR Rate Loans
≥ 62.5%
0.75%
1.75%
< 62.5% but
≥ 37.5%
1.00%
2.00%
< 37.5%
1.25%
2.25%

Average Excess Availability shall be determined once each calendar month based
on the Borrowing Base Certificate delivered by Borrowers under Section 9.2 by
the date required pursuant to such section. If Borrowers shall fail to deliver
such Borrowing Base Certificate required under Section 9.2 by the date required
pursuant to such section, each Applicable Margin shall be conclusively presumed
to equal the highest Applicable Margin specified in the pricing table set forth
above until the date of delivery of such Borrowing Base Certificate, at which
time the rate will be adjusted based upon the Average Excess Availability
reflected in such statements. Notwithstanding anything to the contrary contained
herein, (x) no downward adjustment in any Applicable Margin shall be made on any
Adjustment Date on which any Event of Default shall have occurred and be
continuing and (y) immediately and automatically upon the occurrence of any
Event of Default, each Applicable Margin shall increase to and equal the highest
Applicable Margin specified in the pricing table set forth above and shall
continue at such highest Applicable Margin until the date (if any) on which such
Event of Default shall be waived in accordance with the provisions of this
Agreement, at which time the rate will be adjusted based upon the Average Excess
Availability reflected on the most recently delivered Borrowing Base Certificate
delivered by Borrowers to Agent pursuant to Section 9.2. Any increase in
interest rates payable by Borrowers under this Agreement and the Other Documents
pursuant to the provisions of the foregoing sentence shall be in addition to and
independent of any increase in such interest rates resulting from the occurrence
of any Event of Default (including, if applicable, any Event of Default arising
from a breach of Section 9.2) and/or the effectiveness of the Default Rate
provisions of Section 3.1.
“Application Date” shall have the meaning set forth in Section 2.8(b).
“Approved Electronic Communication” shall mean each notice, demand,
communication, information, document and other material transmitted, posted or
otherwise made or communicated by e-mail, E-Fax, the StuckyNet System©, or any
other equivalent electronic service agreed to by Agent, whether owned, operated
or hosted by Agent, any Lender, any of their Affiliates or any other Person,
that any party is obligated to, or otherwise chooses to, provide to Agent
pursuant to this Agreement or any Other Document, including any financial
statement, financial and other report, notice, request, certificate and other
information material; provided that Approved Electronic Communications shall not
include any notice, demand, communication, information, document or other
material that Agent specifically instructs a Person in writing to deliver in
physical form.
“Authorized Officer” shall mean the chief executive officer, president, any
executive vice president, chief financial officer, treasurer, assistant
treasurer, controller, secretary or assistant secretary of a Credit Party and,
solely for purposes of notices given pursuant to Article II, any other officer
of the applicable Borrower so designated by any of the foregoing officers in a
notice to the Agent. Any document delivered hereunder that is signed by an
Authorized Officer of a Credit Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the
part of such Credit Party and such Authorized Officer shall be conclusively
presumed to have acted on behalf of such Credit Party. To the extent requested
by the Agent, each Authorized Officer will provide an incumbency certificate and
to the extent requested by the Agent, appropriate authorization documentation,
in form and substance satisfactory to the Agent.
“Average Excess Availability” shall mean, with respect to any calendar month of
the Borrowers, the percentage equivalent to a fraction, (i) the numerator of
which is the average Excess Availability for the days of such calendar month,
and (ii) the denominator of which is the average Maximum Revolving Advance
Amount for the days of such calendar month.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.
“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.
“Base Rate” shall mean the base commercial lending rate of PNC as publicly
announced to be in effect from time to time, such rate to be adjusted
automatically, without notice, on the effective date of any change in such rate.
This rate of interest is determined from time to time by PNC as a means of
pricing some loans to its customers and is neither tied to any external rate of
interest or index nor does it necessarily reflect the lowest rate of interest
actually charged by PNC to any particular class or category of customers of PNC.
“Benefited Lender” shall have the meaning set forth in Section 2.6(e).
“Blocked Account Bank” shall have the meaning set forth in Section 4.8(g).
“Borrower” or “Borrowers” shall have the meaning set forth in the preamble to
this Agreement and shall extend to all permitted successors and assigns of such
Persons.
“Borrowers’ Account” shall have the meaning set forth in Section 2.10.
“Borrowing Agent” shall mean Holdings.
“Borrowing Base Certificate” shall mean a certificate in substantially the form
of Exhibit 1.2 duly executed by an Authorized Officer of the Borrowing Agent and
delivered to the Agent, appropriately completed, by which such officer shall
certify to Agent the Formula Amount and calculation thereof as of the date of
such certificate.
“Business Day” shall mean any day other than Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required by law to be closed
for business in East New Brunswick, New Jersey and, if the applicable Business
Day relates to any LIBOR Rate Loans, such day must also be a day on which
dealings are carried on in the London interbank market.
“Capital Expenditures” means, for any period, the aggregate of all expenditures
by Holdings and its Subsidiaries (whether paid in cash or accrued as a
liability) during such period that, in conformity with GAAP, are or are required
to be included as capital expenditures on the consolidated statement of cash
flows of the Holdings and its Subsidiaries. Capital Expenditures shall include
the total principal portion of Capitalized Lease Obligations.
“Capitalized Lease Obligation” shall mean any Indebtedness of Holdings and its
Subsidiaries represented by obligations under a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP; provided
that, for all purposes hereunder, Indebtedness shall not be deemed to arise from
a transaction that is an operating lease.
“Captive Insurance Companies” shall mean CJES Insurance (Texas) Inc., a
corporation organized under the laws of the State of Texas, and any other
Subsidiary of Holdings incorporated in the United States that acts as a captive
insurance company.
“Cash Equivalents” means any of the following types of investments, to the
extent owned by Holdings or any of its Subsidiaries free and clear of all Liens
(other than Liens permitted hereunder):
(a)    U.S. Dollars, Canadian Dollars, Euros, Pound Sterling and other
currencies issued by member countries of the Organization for Economic
Cooperation and Development and held by Holdings or any of its Subsidiaries in
the ordinary course of business and not for speculation or otherwise as are
reasonably acceptable to the Agent (including such currencies as are held as
overnight bank deposits and demand deposits with (i) U.S. banks or (ii) foreign
banks having a short term deposit rating of no lower than A2 or P2, as such
rating is set forth from time to time by S&P or Moody’s, respectively, or the
equivalent rating from DBRS in Canada);
(b)    readily marketable obligations issued or directly and fully guaranteed or
insured by the United States of America or Canada or, in each case, any agency
or instrumentality thereof having maturities of not more than 12 months from the
date of acquisition thereof; provided that the full faith and credit of the
United States of America or Canada, as applicable, is pledged in support
thereof;
(c)    time deposits (including Eurocurrency time deposits) with, or insured
certificates of deposit or bankers’ acceptances of, any commercial bank that (i)
(A) is a Lender or (B) is organized under the laws of the United States of
America, any state thereof, the District of Columbia or Canada or is the
principal banking subsidiary of a bank holding company organized under the laws
of the United States of America, any state thereof, the District of Columbia or
Canada (including a foreign bank which is a subsidiary of a commercial bank or a
holding company of a commercial bank which is organized under such laws) and
(ii) has combined capital and surplus of at least $500,000,000, in each case
with maturities of not more than 180 days from the date of acquisition thereof;
(d)    repurchase obligations of any Lender or of any commercial bank satisfying
(at the time of acquisition) the requirements of clause (b) of this definition,
having a term of not more than 90 days, with respect to securities issued or
fully guaranteed or insured by the United States government;
(e)    commercial paper issued by (i) any Lender or any Affiliate of any Lender
and (ii) any Person organized under the laws of any state of the United States
of America or Canada and rated at least “Prime-2” (or the then equivalent
grade) by Moody’s or at least “A-2” (or the then equivalent grade) by S&P, or
the equivalent rating by DBRS in Canada, in each case with maturities of not
more than 180 days from the date of acquisition thereof;
(f)    securities with maturities of one year 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 (c) of this definition;
(g)    Indebtedness or preferred stock issued by Persons with a rating, at the
time of acquisition thereof, of “A” or higher from S&P or “A2” or higher from
Moody’s, or the equivalent rating by DBRS in Canada, with maturities of one year
or less from the date of acquisition;
(h)    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 of the United States, or by any foreign
government, the securities of which state, commonwealth, province, 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, or the equivalent rating by
DBRS in Canada;
(i)    investments, classified in accordance with GAAP as current assets of
Holdings or any of its Subsidiaries, in money market investment programs
registered under the investment Company Act of 1940, as amended, which are (i)
administered by financial institutions that have one of the two highest ratings
obtainable from either Moody’s or S&P, and that have at least 95% of their
assets invested continuously in investments of the character, quality and
maturity described in clauses (a) through (h) of this definition or (ii)(A)
comply with the criteria set forth in SEC Rule 2a-7 under the investment Company
Act of 1940, as amended, (B) are rated AAA by S&P and Aaa by Moody’s and (C)
have portfolio assets of at least $5,000,000,000; and
(j)    in the case of any Foreign Subsidiary, investments of a character, credit
quality and maturity similar to those described in clauses (c) through (g) of
this definition that are customarily used by companies in the jurisdiction of
such Foreign Subsidiary for cash management purposes.
“Cash Management Products and Services” shall mean agreements or other
arrangements under which Agent or any Lender or any Affiliate of Agent or a
Lender provides any of the following products or services to Holdings or any of
its Subsidiaries: (a) credit cards; (b) credit card processing services;
(c) debit cards and stored value cards; (d) commercial cards; (e) ACH
transactions; and (f) cash management and treasury management services and
products, including without limitation controlled disbursement accounts or
services, lockboxes, automated clearinghouse transactions, overdrafts,
interstate depository network services. The indebtedness, obligations and
liabilities of any Borrower to the provider of any Cash Management Products and
Services (including all obligations and liabilities owing to such provider in
respect of any returned items deposited with such provider) (the “Cash
Management Liabilities”) shall be “Obligations” hereunder, guaranteed
obligations under the Guaranty and secured obligations under any Guarantor
Security Agreement, as applicable, and otherwise treated as Obligations for
purposes of each of the Other Documents. The Liens securing the Cash Management
Products and Services shall be pari passu with the Liens securing all other
Obligations under this Agreement and the Other Documents, subject to the express
provisions of Section 11.5.
“Cash Management Liabilities” shall have the meaning provided in the definition
of “Cash Management Products and Services.”
“CEA” shall mean the Commodity Exchange Act (7 U.S.C.§1 et seq.), as amended
from time to time, and any successor statute.
“CFC” shall mean a Person that is a controlled foreign corporation under Section
957 of the Code.
“CFC Holdco” shall mean a Subsidiary of Holdings substantially all of the assets
of which consist, directly or indirectly, of Equity Interests or Indebtedness of
one or more CFCs. “CFTC” shall mean the Commodity Futures Trading Commission.
“CERCLA” shall mean the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. §§9601 et seq.
“Change in Law” shall mean the occurrence, after the Closing Date, of any of the
following: (a) the adoption or taking effect of any Applicable Law; (b) any
change in any Applicable Law or in the administration, implementation,
interpretation or application thereof by any Governmental Body; or (c) the
making or issuance of any request, rule, guideline or directive (whether or not
having the force of law) by any Governmental Body; provided that notwithstanding
anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and
Consumer Protection Act and all requests, rules, regulations, guidelines,
interpretations or directives thereunder or issued in connection therewith
(whether or not having the force of Applicable Law) and (y) all requests, rules,
regulations, guidelines, interpretations or directives promulgated by the Bank
for International Settlements, the Basel Committee on Banking Supervision (or
any successor or similar authority) or the United States or foreign regulatory
authorities (whether or not having the force of law), in each case pursuant to
Basel III, shall in each case be deemed to be a Change in Law regardless of the
date enacted, adopted, issued, promulgated or implemented.
“Change of Control” shall mean an event or series of events by which any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such
person or its subsidiaries, and any person or entity acting in its capacity as
trustee, agent or other fiduciary or administrator of any such plan) other than
a Permitted Holder becomes the “beneficial owner” (as defined in Rules 13d-3 and
13d-5 under the Securities Exchange Act of 1934, except that a person or group
shall be deemed to have “beneficial ownership” of all securities that such
person or group has the right to acquire, whether such right is exercisable
immediately or only after the passage of time (such right, an “option right”)),
directly or indirectly, of forty percent (40%) or more of the Equity Interests
of Holdings entitled to vote for members of the board of directors or equivalent
governing body of Holdings on a fully-diluted basis (and taking into account all
such securities that such “person” or “group” has the right to acquire pursuant
to any option right).
“Charges” shall mean all Taxes, charges, fees, imposts, levies or other
assessments, including all net income, gross income, gross receipts, sales, use,
ad valorem, value added, transfer, franchise, profits, inventory, capital stock,
license, withholding, payroll, employment, social security, unemployment,
excise, severance, stamp, occupation and property Taxes, custom duties, fees,
assessments, liens, claims and charges of any kind whatsoever, together with any
interest and any penalties, additions to Tax or additional amounts, imposed by
any taxing or other authority, domestic or foreign (including the PBGC), upon
the Collateral, any Borrower or any of its Affiliates.
“CIP Regulations” shall have the meaning set forth in Section 14.12.
“Closing Date” shall mean May 4, 2017.
“Code” shall mean the Internal Revenue Code of 1986, as the same may be amended
or supplemented from time to time, and any successor statute of similar import,
and the rules and regulations thereunder, as from time to time in effect.
“Collateral” shall mean and include all right, title and interest of each Credit
Party in all of the following types of property and assets of such Credit Party,
in each case whether now existing or hereafter arising or created and whether
now owned or hereafter acquired and wherever located:
(a)    all Receivables and all supporting obligations relating thereto;
(b)    all equipment and machinery;
(c)    all general intangibles and Intellectual Property (including all payment
intangibles and all software) and all supporting obligations related thereto;
(d)    all Inventory;
(e)    all Subsidiary Stock, securities, investment property, and financial
assets;
(f)    all contract rights, rights of payment which have been earned under
contract rights, chattel paper (including electronic chattel paper and tangible
chattel paper), commercial tort claims (whether now existing or hereafter
arising); documents (including all warehouse receipts and bills of lading),
deposit accounts, goods, instruments (including promissory notes), letters of
credit (whether or not the respective letter of credit is evidenced by a
writing) and letter-of-credit rights, cash, certificates of deposit, insurance
proceeds (including hazard, flood and credit insurance), security agreements,
eminent domain proceeds, condemnation proceeds, tort claim proceeds and all
supporting obligations;
(g)    all ledger sheets, ledger cards, files, correspondence, records, books of
account, business papers, computers, computer software (owned by any Credit
Party or in which it has an interest), computer programs, tapes, disks and
documents, including all of such property relating to the property described in
clauses (a) through (f) of this definition; and
(h)    all proceeds and products of the property described in clauses (a)
through (g) of this definition, in whatever form. It is the intention of the
parties that if Agent shall fail to have a perfected Lien in any particular
property or assets of any Credit Party for any reason whatsoever, but the
provisions of this Agreement and/or of the Other Documents, together with all
financing statements and other public filings relating to Liens filed or
recorded by Agent against the Credit Parties, would be sufficient to create a
perfected Lien in any property or assets that such Credit Party may receive upon
the sale, lease, license, exchange, transfer or disposition of such particular
property or assets, then all such “proceeds” of such particular property or
assets shall be included in the Collateral as original collateral that is the
subject of a direct and original grant of a security interest as provided for
herein and in the Other Documents (and not merely as proceeds (as defined in
Article 9 of the Uniform Commercial Code) in which a security interest is
created or arises solely pursuant to Section 9-315 of the Uniform Commercial
Code).
Notwithstanding the foregoing, Collateral shall not include any Excluded
Property or, prior to the occurrence of an Other Property Trigger Event, Other
Property.
“Collection Accounts” shall have the meaning set forth in Section 4.8(g).
“Commitment” shall mean, as to any Lender, the obligation of such Lender (if
applicable), to make Revolving Advances and participate in Swing Loans and
Letters of Credit, in an aggregate principal and/or face amount not to exceed
the Commitment Amount (if any) of such Lender.
“Commitment Amount” shall mean, (i) as to any Lender other than a New Lender,
the Commitment Amount (if any) set forth below such Lender’s name on its
signature page hereto (or, in the case of any Lender that became party to this
Agreement after the Closing Date pursuant to Section 16.3(c) or (d), the
Commitment Amount (if any) of such Lender as set forth in the applicable
Commitment Transfer Supplement), and (ii) as to any Lender that is a New Lender,
the Commitment Amount provided for in the joinder signed by such New Lender
under Section 2.24(a)(ix) in each case as the same may be adjusted upon any
increase by such Lender pursuant to Section 2.24, or any assignment by or to
such Lender pursuant to Section 16.3(c) or (d).
“Commitment Percentage” shall mean, (i) as to any Lender other than a New
Lender, the Commitment Percentage (if any) set forth below such Lender’s name on
its signature page hereof (or, in the case of any Lender that became party to
this Agreement after the Closing Date pursuant to Section 16.3(c) or (d), the
Commitment Percentage (if any) of such Lender as set forth in the applicable
Commitment Transfer Supplement), and (ii) as to any Lender that is a New Lender,
the Commitment Percentage provided for in the joinder signed by such New Lender
under Section 2.24(a)(ix), in each case as the same may be adjusted upon any
increase in the Maximum Revolving Advance Amount pursuant to Section 2.24, or
any assignment by or to such Lender pursuant to Section 16.3(c) or (d).
“Commitment Transfer Supplement” shall mean a document in the form of Exhibit
16.3, properly completed and otherwise in form and substance satisfactory to
Agent by which the Purchasing Lender purchases and assumes a portion of the
obligation of Lenders to make Advances under this Agreement.
“Compliance Authority” shall mean each and all of the (a) U.S. Treasury
Department/Office of Foreign Assets Control, (b) U.S. Treasury
Department/Financial Crimes Enforcement Network, (c) U.S. State
Department/Directorate of Defense Trade Controls, (d) U.S. Commerce
Department/Bureau of Industry and Security, (e) the U.S. Internal Revenue
Service, (f) the U.S. Justice Department, (g) the U.S. Securities and Exchange
Commission, and (h) any other similar applicable authority in any applicable
jurisdiction.
“Compliance Certificate” shall mean a compliance certificate substantially in
the form of Exhibit 1.2(a) to be signed by the Chief Financial Officer or
Controller of Borrowing Agent.
“Consents” shall mean all filings and all licenses, permits, consents,
approvals, authorizations, qualifications and orders of Governmental Bodies and
other third parties, domestic or foreign, necessary to carry on any Borrower’s
business or necessary (including to avoid a conflict or breach under any
agreement, instrument, other document, license, permit or other authorization)
for the execution, delivery or performance of this Agreement, the Other
Documents, including any Consents required under all applicable federal, state
or other Applicable Law.
“Consigned Inventory” shall mean Inventory of any Person in the possession of
any Borrower or Guarantor that is in the possession of another Person on a
consignment, sale or return, or other basis that does not constitute a final
sale and acceptance of such Inventory.
“Controlled Group” shall mean, at any time, each Borrower and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which, together with
any Borrower, are treated as a single employer under Section 414 of the Code.
“Covered Entity” shall mean (a) each Borrower, each of Borrower’s Subsidiaries,
all Guarantors and all pledgors of Collateral and (b) each Person that, directly
or indirectly, is in control of a Person described in clause (a) above. For
purposes of this definition, control of a Person shall mean the direct or
indirect (x) ownership of, or power to vote, 25% or more of the issued and
outstanding Equity Interests having ordinary voting power for the election of
directors of such Person or other Persons performing similar functions for such
Person, or (y) power to direct or cause the direction of the management and
policies of such Person whether by ownership of Equity Interests, contract or
otherwise.
“Credit Parties” shall mean the Borrowers and the Guarantors, and “Credit Party”
shall mean any of them.
“Customer” shall mean and include the account debtor with respect to any
Receivable and/or the prospective purchaser of goods, services or both with
respect to any contract or contract right, and/or any party who enters into or
proposes to enter into any contract or other arrangement with any Borrower,
pursuant to which such Borrower is to deliver any personal property or perform
any services.
“Customs” shall have the meaning set forth in Section 2.13(b).
“Daily LIBOR Rate” shall mean, for any day, the rate per annum determined by the
Agent by dividing (x) the Published Rate by (y) a number equal to 1.00 minus the
Reserve Percentage.
“Debt Incurrence Test” shall have the meaning set forth in Section 6.14(b).
“Debt Payments” shall mean for any period, in each case, all cash actually
expended by Holdings and its Subsidiaries to make: (a) interest payments on any
Advances hereunder, plus (b) payments for all fees, commissions and charges set
forth herein, plus (c) interest payments, payments for fees, commissions and
charges and regularly scheduled principal payments (but excluding mandatory
prepayments of Revolving Advances or payments due at final maturity) on
Capitalized Lease Obligations and other Indebtedness for borrowed money.
“Default” shall mean an event, circumstance or condition which, with the giving
of notice or passage of time or both, would constitute an Event of Default.
“Default Rate” shall have the meaning set forth in Section 3.1.
“Defaulting Lender” shall mean any Lender that: (a) has failed, within two (2)
Business Days of the date required to be funded or paid, to (i) fund any portion
of its Commitment Percentage of Advances, (ii) if applicable, fund any portion
of its Participation Commitment in Letters of Credit or Swing Loans or (iii) pay
over to Agent, Issuer, Swing Loan Lender or any Lender any other amount required
to be paid by it hereunder, unless, in the case of clause (i) above, such Lender
notifies 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 a particular Default or Event of Default, if any) has
not been satisfied; (b) has notified Borrowers or Agent 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 a particular Default or Event of 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 two (2) Business Days
after request by Agent, 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 Advances and, if applicable, participations in then outstanding
Letters of Credit and Swing Loans under this Agreement, provided that such
Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon
Agent’s receipt of such certification in form and substance satisfactory to the
Agent; (d) has, or has a direct or indirect parent company that has, (i) become
the subject of an Insolvency Event, (ii) had appointed for it a receiver,
custodian, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business or assets, including the Federal Deposit Insurance Corporation or any
other state or federal regulatory authority acting in such a capacity or (iii)
become the subject of a Bail-In Action; provided that a Lender shall not be a
Defaulting Lender solely by virtue of the ownership or acquisition of any Equity
Interest in that Lender or any direct or indirect parent company thereof by a
Governmental Body so long as such ownership interest does not result in or
provide such Lender 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 Lender (or such Governmental Body) to reject, repudiate,
disavow or disaffirm any contracts or agreements made with such Lender; or (e)
has failed at any time to comply with the provisions of Section 2.6(e) with
respect to purchasing participations from the other Lenders, whereby such
Lender’s share of any payment received, whether by setoff or otherwise, is in
excess of its pro rata share of such payments due and payable to all of the
Lenders.
“Deposit Account Control Agreements” shall mean the deposit account control
agreements or blocked account agreements to be executed by each institution
maintaining a deposit account or securities account for any of the Credit
Parties, in favor of Agent, for the benefit of Secured Parties, as security for
the Obligations to the extent required by Section 4.8(g) or any other provision
of this Agreement or any Other Document.
“Depository Accounts” shall have the meaning set forth in Section 4.8(g).
“Designated Lender” shall have the meaning set forth in Section 16.2(d).
“Disposition” shall have the meaning set forth in Section 7.1.
“Document” shall have the meaning given to the term “document” in the Uniform
Commercial Code.
“Dollar” and the sign “$” shall mean lawful money of the United States of
America.
“Domestic Rate Loan” shall mean any Advance that bears interest based upon the
Alternate Base Rate.
“Domestic Subsidiaries” shall mean, with respect to any Person, any Subsidiary
of such Person which is incorporated or organized under the laws of any state of
the United States or the District of Columbia other than any such Subsidiary
that is owned directly or indirectly by an entity that is not incorporated or
organized under the laws of any state of the United States or the District of
Columbia.
“Drawing Date” shall have the meaning set forth in Section 2.14(b).
2    “EBITDA” shall mean, at any date of determination, an amount equal to Net
Income of Holdings and its Subsidiaries on a consolidated basis for the most
recently completed Measurement Period plus
(a)    the following to the extent deducted in calculating such Net Income:
(i)    Interest Charges,
(ii)    the provision for Federal, state, provincial, territorial, local and
foreign income or franchise Taxes payable,
(iii)    depreciation and amortization expense,
(iv)    extraordinary, non-recurring or unusual non-cash charges,
(v)    any non-cash expenses or losses for such period that do not constitute
reserves and which are not expected to result in cash payments in a future
period (including non-cash losses on sales of assets outside the ordinary course
of business),
(vi)    expenses incurred in connection with the prepayment, termination,
amendment, modification or refinancing of Indebtedness during such period,
(vii)    any non-capitalized transaction costs incurred during such period in
connection with any actual or proposed (A) incurrence of Indebtedness, including
a refinancing thereof, (B) issuance of Equity Interests, (C) investment, (D)
acquisition, (E) disposition or (F) recapitalization, in each case, to the
extent permitted hereunder,
(viii)    stock based compensation expenses which do not represent a cash item
in such period or any future period (in each case of or by Holdings and its
Subsidiaries for such Measurement Period),
(ix)    the write-off of unamortized deferred financing, legal and accounting
costs in connection with any permitted refinancing of Indebtedness,
(x)    tender premiums, redemption premiums, fees, and other amounts expenses in
connection with any permitted tender for and/or permitted redemption of
Indebtedness,
(xi)    extraordinary, non-recurring or unusual cash charges,
(xii)    cash restructuring charges or reserves and business optimization
expense, in each case, that are extraordinary, non-recurring or unusual,
including the following: any restructuring costs and integration costs incurred
in connection with Permitted Acquisitions, project start-up costs, costs related
to the closure and/or consolidation of facilities, retention charges, contract
termination costs, recruiting, retention, relocation, severance and signing
bonuses and expenses, systems establishment costs, conversion costs and excess
pension charges, pension termination liabilities, consulting fees and any
one-time expense relating to enhanced accounting function and updates to
information technology systems, settlement of disputes, expenses in connection
with incentive arrangements,
(xiii)    non‑cash losses from joint ventures and non‑cash minority interest
reductions,
(xiv)    the amount of net cost savings, operating expense reductions, other
operating improvements and acquisition synergies projected by the Borrowers in
good faith to be realized during such Measurement Period (calculated on a pro
forma basis as though such items had been realized on the first day of such
Measurement Period) as a result of actions taken or to be taken in connection
with any acquisition or disposition by the Borrowers or any of their
Subsidiaries, any operational changes (including, without limitation,
operational changes arising out of the modification of contractual arrangements
(including, without limitation, renegotiation of lease agreements, utilities and
logistics contracts and insurance policies, as well as purchases of leased real
properties)) or headcount reductions, net of the amount of actual benefits
realized during such period that are otherwise included in the calculation of
EBITDA from such actions, provided that (A) such cost savings, operating expense
reductions and synergies are reasonably expected, reasonably identifiable and
factually supportable as determined in good faith by the Borrowers, (B) such
cost savings, operating expense reductions or synergies do not exceed, when
combined with the amount of any pro forma adjustments made pursuant to the
proviso to the last sentence of this definition pertaining to adjustments of the
type described in this clause (a)(xiv), 20% of EBITDA for such Measurement
Period (prior to giving effect to any increase in EBITDA pursuant to this clause
or pursuant to the proviso to the last sentence of this definition), (C) such
actions are to be taken and the results with respect thereto are to be achieved
within 12 months after the consummation of the acquisition, disposition or
operational change, which is expected to result in such cost savings, expense
reductions or synergies, (D) the adjustments pursuant to this clause may be
incremental to (but not duplicative of) the pro forma adjustments made pursuant
to the proviso to the last sentence of this definition, and (E) the adjustments
would otherwise be permitted to be included in pro forma financial statements
prepared in accordance with Regulation S-X under the Securities Act of 1933, as
amended, or otherwise are reasonably acceptable to the Agent, minus
(b)    the following to the extent included in calculating such Net Income:
(i)    Federal, state, provincial, territorial, local and foreign income Tax
credits and
(ii)    all non-cash items increasing Net Income (in each case of or by Holdings
and its Subsidiaries for such Measurement Period).
Notwithstanding any of the foregoing to the contrary, for purposes of
calculating EBITDA, the aggregate amount permitted under clauses (a)(vi),
(a)(vii), (a)(ix), (a)(x), (a)(xi) and (a)(xii) shall not, collectively as to
all items referenced in such clauses exceed the greater of (x) $11,000,000 and
(y) 20% of EBITDA for such Measurement Period (or, if any such Measurement
Period is less than twelve (12) fiscal months, then the twelve fiscal months
ending on the applicable date of determination) (in each case, calculated
without giving effect to any adjustments pursuant to such clauses) or in each
case such higher amount as the Agent may from time to time approve in its
discretion. EBITDA shall be calculated for each Measurement Period, on a pro
forma basis, after giving effect to, without duplication, any acquisition or
disposition made during each period commencing on the first day of such period
through the date of such transaction (the “Reference Period”) as if such
acquisition or disposition and any related incurrence or repayment of
Indebtedness occurred on the first day of the Reference Period; provided that
the above pro forma calculations shall be made in good faith by a financial or
accounting officer of the Borrowing Agent who is a Responsible Officer with any
such pro forma amounts being reasonably identifiable, quantifiable and factually
supportable in the good faith judgment of the Borrowing Agent and, upon Agent’s
reasonable request where applicable, based on a third-party quality of earnings
or similar report satisfactory to the Agent in its reasonable discretion.
“EEA Financial Institution” means (a) any credit institution or investment firm
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 financial institution established in an EEA Member Country which is a
Subsidiary of an institution described in clauses (a) or (b) of this definition
and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any
Person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.
“Effective Date” shall mean the date indicated in a document or agreement to be
the date on which such document or agreement becomes effective, or, if there is
no such indication, the date of execution and delivery of such document or
agreement.
“Eligibility Date” shall mean, with respect to each Credit Party and each Swap,
the date on which this Agreement or any Other Document becomes effective with
respect to such Swap (for the avoidance of doubt, the Eligibility Date shall be
the Effective Date of such Swap if this Agreement or any Other Document is then
in effect with respect to such Credit Party, and otherwise it shall be the
Effective Date of this Agreement and/or such Other Document(s) to which such
Credit Party is a party).
“Eligible Contract Participant” shall mean an “eligible contract participant” as
defined in the CEA and regulations thereunder.
“Eligible In-Transit Inventory” shall mean Inventory that would be Eligible
Inventory but for the fact that it is In-Transit Inventory, but only if, as to
such In-Transit Inventory: (a) a Borrower has retained title or title has passed
to a Borrower, (b) such In-Transit Inventory has been insured to the full value
thereof, (c) either (i) Agent has established a reserve against the Formula
Amount for the processing, transportation or other bailee fees or costs related
to such In-Transit Inventory or (ii) a Lien Waiver Agreement has been received
with from the applicable processor, transporter or other bailee in possession of
such In-Transit Inventory, and (d) if such In-Transit Inventory has been
acquired pursuant to a Permitted Acquisition, Agent has completed its due
diligence with respect to such Inventory, the results of which are satisfactory
to it in its Permitted Discretion.
“Eligible Inventory” shall mean and include Inventory with respect to each
Borrower, valued at the lower of cost (on a weighted average basis for Inventory
consisting of fuel and otherwise on a first-in first-out basis) or current
market value, which is not obsolete, slow moving or unmerchantable and which
Agent, in its Permitted Discretion, shall not deem ineligible Inventory, based
on such considerations as Agent may from time to time deem appropriate including
whether (a) the Inventory is subject to a perfected, first priority security
interest in favor of Agent and no other Lien (other than a Permitted
Encumbrance) and (b) the Agent has completed due diligence satisfactory to it in
its Permitted Discretion with respect to any new Inventory acquired pursuant to
a Permitted Acquisition. In addition, Inventory shall not be Eligible Inventory
if it (i) does not conform in all material respects to all standards imposed by
any Governmental Body which has regulatory authority over such goods or the use,
transport or sale thereof; (ii) except for Eligible In-Transit Inventory (which
shall, in any event and as of any computation date, amount to no more than ten
percent (10%) of the value of Eligible Inventory), is in transit; (iii) is
located outside the continental United States or at a location that is not
otherwise in compliance with this Agreement; (iv) constitutes Consigned
Inventory; (v) is subject to an agreement that limits, conditions or restricts
any Borrower’s or Agent’s right to sell or otherwise dispose of such Inventory;
or (vi) is situated at a location not owned by a Borrower unless (A) the owner
or occupier of such location has executed in favor of Agent a Lien Waiver
Agreement, or (B) Agent has established a rent reserve for such location (it
being understood that no rent reserve established hereunder shall exceed an
amount equal to three (3) months of the base rent for such location).
“Eligible Receivables” shall mean and include with respect to each Borrower,
each Receivable of such Borrower (other than Eligible Unbilled Receivables), as
applicable, arising in the ordinary course of business. A Receivable shall not
be deemed eligible unless such Receivable is subject to Agent’s first priority
perfected security interest and no other Lien (other than Permitted
Encumbrances), and is evidenced by an invoice or other documentary evidence
satisfactory to Agent in its Permitted Discretion. In addition, no Receivable
shall be an Eligible Receivable if:
(a)    it arises out of a sale made by any Borrower, to an Affiliate of any
Borrower, or to a Person controlled by an Affiliate of any Borrower;
(b)    it is due or unpaid more than ninety (90) days after the original invoice
date but not to exceed sixty (60) days after the original due date;
(c)    forty percent (40%) or more of the Receivables from such Customer are not
deemed Eligible Receivables or Eligible Unbilled Receivables by virtue of clause
(b) hereunder;
(d)    any covenant, representation or warranty contained in this Agreement with
respect to such Receivable has been breached in any material respect;
(e)    an Insolvency Event shall have occurred with respect to such Customer;
(f)    the sale is not payable in Dollars or Canadian Dollars or is to a
Customer outside the United States of America or a province of Canada (other
than Quebec or any other province or territory thereof that has not adopted the
PPSA), unless the sale is on letter of credit, guaranty or acceptance terms, in
each case acceptable to Agent in its Permitted Discretion;
(g)    the sale to the Customer is on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment or any other repurchase or return
basis or is evidenced by chattel paper;
(h)    the Customer is the United States of America, any state or any
department, agency or instrumentality of any of them, unless the applicable
Borrower assigns its right to payment, if the Receivable is subject to such an
assignment, of such Receivable to Agent pursuant to the Assignment of Claims Act
of 1940, as amended (31 U.S.C. Sub-Section 3727 et seq. and 41 U.S.C.
Sub-Section 15 et seq.) or has otherwise complied with other similar applicable
statutes or ordinances, but only to the extent the aggregate amount of all such
Receivables not subject to such an assignment exceeds 10% of the Formula Amount
as of any date of determination;
(i)    the goods giving rise to such Receivable have not been delivered to and
accepted by the Customer or the services giving rise to such Receivable have not
been performed by the applicable Borrower and accepted by the Customer or the
Receivable otherwise does not represent a final sale;
(j)    the aggregate amount of outstanding Receivables with respect to any
Customer which exceed twenty-five (25%) of all Eligible Receivables, to the
extent such Receivables exceed such limit;
(k)    the Receivable is subject to any offset, deduction, defense, dispute or
counterclaim or is contingent in any respect (including by virtue of the
Customer also being a creditor or supplier of Borrower) with respect to the
Receivable, but only to the extent of the maximum potential amount of such
offset, deduction, defense, dispute, counterclaim or contingency against the
applicable Receivable;
(l)    the applicable Borrower, has made any agreement with any Customer for any
deduction therefrom, except for discounts, deductions, allowances or sales
rebates made in the ordinary course of business for prompt payment, all of which
discounts or allowances or sales rebates are reflected in the calculation of the
face value of each respective invoice related thereto, but, with respect to a
Receivable subject to discounts, deductions, allowances or sales rebates, only
to the extent of the maximum potential amount of such discount or allowance
against the applicable Receivables are reflected in Borrowers’ calculation of
the Formula Amount;
(m)    any return, rejection or repossession of the merchandise has occurred or
the rendition of services has been disputed;
(n)    such Receivable is not payable to a Borrower; or
(o)    such Receivable is not otherwise satisfactory to Agent as determined in
good faith by Agent in the exercise of its Permitted Discretion.
“Eligible Unbilled Receivables” shall mean and include with respect to any
Borrower, each Receivable of such Borrower (other than Eligible Receivables)
arising in the ordinary course of business (i) representing services previously
performed by such Borrower and accepted by the Customer, (ii) which in
accordance with such Borrower’s written agreement with the Customer, has not yet
been fully invoiced and billed to the Customer and (iii) that would otherwise
constitute an Eligible Receivable but for the fact that the full amount of such
Receivable has not been invoiced and billed to the Customer. A Receivable shall
not be deemed an Eligible Unbilled Receivable unless such Receivable is subject
to Agent’s first priority perfected security interest and no other Lien (other
than Permitted Encumbrances), and is evidenced by documentation satisfactory to
Agent in its Permitted Discretion and has been verified to Agent’s reasonable
satisfaction pursuant to field examination and other verifications from time to
time performed on behalf of Agent pursuant to the terms of this Agreement. In
addition, no Receivable shall be an Eligible Unbilled Receivable if:
(a)    it has not been invoiced and billed to the Customer within thirty (30)
days of the applicable and corresponding work completion date;
(b)    with respect to any Receivable generated after the Closing Date, Agent
shall not have received, upon request, a true, correct and complete copy of the
written agreement between such Borrower and Customer in respect thereof; or
(c)    any representation, circumstance or requirement set forth in the
definition of Eligible Receivables (other than clauses (b), (c) and (i) (with
respect to the provision of services only) thereof) is not true or otherwise
satisfied with respect to the applicable Receivable.
“Environmental Complaint” shall have the meaning set forth in Section 9.3(a).
“Environmental Laws” shall mean all applicable federal, state and local laws,
statutes, ordinances and codes relating to the protection of the environment
and/or human health and safety, including any of the foregoing governing the
use, storage, treatment, generation, transportation, processing, handling,
production or disposal of Hazardous Substances and the rules, regulations,
legally binding policies, guidelines, or interpretations, decisions, orders and
legally binding directives of federal, state and local governmental agencies and
authorities with respect thereto.
“Equity Interests” shall mean, with respect to any Person, any and all shares,
rights to purchase, options, warrants, general, limited or limited liability
partnership interests, member interests, participation or other equivalents of
or interest in (regardless of how designated) equity of such Person, whether
voting or nonvoting, including common stock, preferred stock, convertible
securities or any other “equity security” (as such term is defined in Rule
3a11-1 of the General Rules and Regulations promulgated by the SEC under the
Exchange Act), including in each case all of the following rights relating to
such Equity Interests, whether arising under the Organizational Documents of the
Person issuing such Equity Interests (the “issuer”) or under the Applicable Laws
of such issuer’s jurisdiction of organization relating to the formation,
existence and governance of corporations, limited or unlimited liability
companies or partnerships or business trusts or other legal entities, as the
case may be: (i) all economic rights (including all rights to receive dividends
and distributions) relating to such Equity Interests; (ii) all voting rights and
rights to consent to any particular action(s) by the applicable issuer; (iii)
all management rights with respect to such issuer; (iv) in the case of any
Equity Interests consisting of a general partner interest in a partnership, all
powers and rights as a general partner with respect to the management,
operations and control of the business and affairs of the applicable issuer; (v)
in the case of any Equity Interests consisting of the membership/limited
liability company interests of a managing member in a limited liability company,
all powers and rights as a managing member with respect to the management,
operations and control of the business and affairs of the applicable issuer;
(vi) all rights to designate or appoint or vote for or remove any officers,
directors, manager(s), general partner(s) or managing member(s) of such issuer
and/or any members of any board of members/managers/partners/directors that may
at any time have any rights to manage and direct the business and affairs of the
applicable issuer under its Organizational Documents as in effect from time to
time or under Applicable Law; (vii) all rights to amend the Organizational
Documents of such issuer, (viii) in the case of any Equity Interests in a
partnership or limited liability company, the status of the holder of such
Equity Interests as a “partner”, general or limited, or “member” (as applicable)
under the applicable Organizational Documents and/or Applicable Law; and (ix)
all certificates evidencing such Equity Interests.
“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the
same may be amended or supplemented from time to time and the rules and
regulations promulgated thereunder.
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.
“Event of Default” shall have the meaning set forth in Article X.
“Excess Availability” at a particular date shall mean an amount equal to (a) the
lesser of (i) the Formula Amount or (ii) the Maximum Revolving Advance Amount
minus the Maximum Undrawn Amount of all outstanding Letters of Credit minus (b)
the outstanding amount of Advances (other than Letters of Credit).
“Exchange Act” shall mean the Securities Exchange Act of 1934 or any other
similar applicable legislation in any applicable jurisdiction, as amended.
“Excluded Deposit Accounts” shall mean (a) those deposit accounts identified as
“Excluded Deposit Accounts” on Schedule 5.24 and any other deposit accounts
established after the Closing Date, so long as at any time the balance in any
such “Excluded Deposit Account” or other deposit account established after the
Closing Date does not exceed $1,000,000 and the aggregate balance in all such
“Excluded Deposit Accounts” or other deposit accounts established after the
Closing Date does not exceed $2,500,000; (b) deposit accounts established solely
as payroll, payroll taxes, other employee taxes, employee benefits or health
care reimbursement; (c) zero balance disbursement accounts; and (d) deposit
accounts maintained with banks outside of the United States for Foreign
Subsidiaries.
“Excluded Hedge Liability or Liabilities” shall mean, with respect to each
Credit Party, each of its Swap Obligations if, and to the extent that, all or
any portion of this Agreement or any Other Document that relates to such Swap
Obligation (or the guaranty of such Swap Obligation, or the grant by such Credit
Party of a security interest in the Collateral to secure such Swap Obligation)
is or becomes illegal under the CEA, or any rule, regulation or order of the
CFTC, by virtue of such Credit Party’s failure to qualify as an Eligible
Contract Participant on the Eligibility Date for such Swap. Notwithstanding
anything to the contrary contained in the foregoing or in any other provision of
this Agreement or any Other Document, the foregoing is subject to the following
provisos: (a) if a Swap Obligation arises under a master agreement governing
more than one Swap, this definition shall only include the portion of such Swap
Obligation that is attributable to Swaps for which such guaranty or security
interest is or becomes illegal as a result of the failure by such Credit Party
for any reason to qualify as an Eligible Contract Participant on the Eligibility
Date for such Swap; (b) if a guarantee of a Swap Obligation would cause such
obligation to be an Excluded Hedge Liability but the grant of a security
interest would not cause such obligation to be an Excluded Hedge Liability, such
Swap Obligation shall constitute an Excluded Hedge Liability for purposes of the
guaranty but not for purposes of the grant of the security interest; and (c) if
there is more than one Credit Party executing this Agreement or the Other
Documents and a Swap Obligation would be an Excluded Hedge Liability with
respect to one or more of such Persons, but not all of them, the definition of
Excluded Hedge Liability or Liabilities with respect to each such Person shall
only be deemed applicable to (i) the particular Swap Obligations that constitute
Excluded Hedge Liabilities with respect to such Person and (ii) the particular
Person with respect to which such Swap Obligations constitute Excluded Hedge
Liabilities.
“Excluded Property” shall mean any:
1.lease, license, contract or agreement (or any Credit Party’s rights or
interests thereunder) to which any Borrower is a party, and any of its rights or
interests thereunder, if and to the extent that a security interest therein is
prohibited by or in violation of, or requires the obtaining of any consent under
(x) any Applicable Law, or (y) a term, provision or condition of any such lease,
license, contract or agreement (unless in each case, such Applicable Law, term,
provision or condition would be rendered ineffective with respect to the
creation of such security interest pursuant to Sections 9-406, 9-407, 9-408 or
9-409 of the Uniform Commercial Code (or any successor provision or provisions)
of any relevant jurisdiction or any other Applicable Law or principles of
equity);
(a)equipment owned by any Credit Party that is subject to a purchase money lien
or a capital lease obligation if (but only to the extent that and only for so
long as such purchase money Indebtedness or capital lease restricts the granting
of a Lien therein to Agent) the grant of a security interest therein would
constitute a violation of a valid and enforceable restriction in favor of a
third party, unless any required consents shall have been obtained;
(b)Collateral for which the benefits of obtaining such Collateral are outweighed
by the costs or burdens of providing the same in Agent’s discretion;
(c)any property (including General Intangibles and Investment Property) which by
its express terms or in which applicable Law prohibits the grant of a security
interest, except to the extent such prohibition is ineffective under the UCC;
(d)Excluded Stock;
(e)Excluded Deposit Accounts;
(f)any “intent-to-use” application for registration of a Trademark filed
pursuant to Section 1(b) of the Lanham Act, 15 U.S.C. § 1051, prior to the
filing of a “Statement of Use” pursuant to Section 1(d) of the Lanham Act or an
“Amendment to Allege Use” pursuant to Section 1(c) of the Lanham Act with
respect thereto, solely to the extent, if any, that, and solely during the
period, if any, in which, the grant of a security interest therein would impair
the validity or enforceability of any registration that issues from such
intent-to-use application under applicable federal law; and
(g)any property for which the grant of a security interest therein would result
in material adverse tax consequences as reasonably determined by the Borrower in
consultation with the Agent;
provided that the foregoing shall cease to be treated as “Excluded Property”
(and shall constitute Collateral) immediately at such time as the contractual or
legal prohibition shall no longer be applicable and to the extent severable,
such security interest shall attach immediately to any portion of such lease,
license, contract or agreement not subject to the prohibitions specified in
clause (x) or (y) of clause (a) to this definition, provided that Excluded
Property shall not include any proceeds of any such lease, license, contract,
property, equipment or agreement or any goodwill of Borrowers’ business
associated therewith or attributable thereto.
“Excluded Stock” shall mean (x) any Equity Interests of any CFC or CFC Holdco,
other than sixty-five percent (65%) of each class of the issued and outstanding
Equity Interests entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) (“Voting Equity”) and one hundred percent (100%) of each class of
the issued and outstanding Equity Interests not entitled to vote (within the
meaning of Treas. Reg. Section 1.956-2(c)(2)) (“Non-Voting Equity”) of each CFC
or CFC Holdco that is directly owned by a Credit Party (but only to the extent
that the pledge of such Non-Voting Equity would not cause the Obligations to be
treated as “United States property” of such Foreign Subsidiary within the
meaning of Treas. Reg. Section 1.956-2), and (y) any Equity Interests of any
Subsidiary of a CFC or CFC Holdco.
“Excluded Subsidiary” shall mean:
(a)    any Subsidiary of Holdings that is not a Wholly Owned Subsidiary;
provided that any such Excluded Subsidiary shall cease to be an Excluded
Subsidiary pursuant to this clause (a) at the time such Subsidiary becomes a
Wholly Owned Subsidiary;
(b)    any Subsidiary of Holdings that is a captive insurance company (including
the Captive Insurance Companies); provided that any such Excluded Subsidiary
shall cease to be an Excluded Subsidiary pursuant to this clause (b) at the time
such Subsidiary is no longer a captive insurance company;
(c)    any Subsidiary of Holdings that is prohibited by applicable law
(including financial assistance, fraudulent conveyance, preference,
capitalization or other similar laws and regulations), regulation or contractual
provision, existing on the Closing Date (or, if later, on the date such Person
became a Subsidiary of Holdings and not entered into in contemplation thereof)
from guaranteeing the Obligations as determined by the Agent in its reasonable
discretion; provided, that any such Excluded Subsidiary shall cease to be an
Excluded Subsidiary pursuant to this clause (c) at the time any such prohibition
ceases to exist or apply;
(d)    any direct or indirect Subsidiary of Holdings that is (i) a CFC, (ii) a
CFC Holdco or (iii) a direct or indirect Subsidiary of a CFC or CFC Holdco; and
(e)    any Subsidiary of Holdings for which the provision of a guarantee under
the Obligations would result in material adverse tax consequences, as reasonably
determined by the Borrower in consultation with the Agent.
“Excluded Taxes” shall mean, with respect to any Recipient, any of the following
Taxes imposed on with respect to any payment to be made to such Recipient by or
on account of any Obligations, (a) Taxes imposed on or measured by its net
income (however denominated), franchise Taxes and branch profits Taxes, in each
case, (i) imposed on it by the jurisdiction (or any political subdivision
thereof) under the laws of which such Recipient is organized or in which its
principal office is or applicable lending office is located or, in the case of
any Lender, Participant, Swing Loan Lender or Issuer, in which its applicable
lending office is located or (ii) that are Other Connection Taxes, (b) any
withholding Tax that is imposed on amounts payable to such Recipient at the time
such Recipient becomes a party hereto or acquires a participation (or designates
a new lending office), except to the extent that such Recipient (or its assignor
or seller of a participation, if any) was entitled, at the time of designation
of a new lending office (or assignment or sale of a participation), to receive
additional amounts from the Borrowers with respect to such withholding Tax
pursuant to Section 3.9(a), (c) Taxes attributable to such Recipient’s failure
to comply with Section 3.9(e), or (d) any Taxes imposed under FATCA.
“Facility Fee” shall have the meaning set forth in Section 3.3(a).
“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of
this Agreement (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), any current or
future regulations thereunder or official interpretations thereof, any
agreements entered into pursuant to Section 1471(b)(1) of the Code and any
fiscal or regulatory legislation, rules or practices adopted pursuant to any
intergovernmental agreement, treaty or convention among Governmental Bodies
entered into in connection with the implementation of the foregoing.
“Federal Funds Effective Rate” for any day shall mean the rate per annum (based
on a year of 360 days and actual days elapsed and rounded upward to the nearest
1/100 of 1%) announced by the Federal Reserve Bank of New York (or any
successor) on such day as being the weighted average of the rates on overnight
federal funds transactions arranged by federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the “Federal Funds
Effective Rate” as of the date of this Agreement; provided, that if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
“Federal Funds Effective Rate” for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.
“Federal Funds Open Rate” for any day shall mean the rate per annum (based on a
year of 360 days and actual days elapsed) which is the daily federal funds open
rate as quoted by ICAP North America, Inc. (or any successor) as set forth on
the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such
other substitute Bloomberg Screen that displays such rate), or as set forth on
such other recognized electronic source used for the purpose of displaying such
rate as selected by PNC (an “Alternate Source”) or if such rate for such day
does not appear on the Bloomberg Screen BTMM (or any substitute screen) or on
any Alternate Source, or if there shall at any time, for any reason, no longer
exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate
Source, a comparable replacement rate determined by PNC at such time (which
determination shall be conclusive absent manifest error); provided however, that
if such day is not a Business Day, the Federal Funds Open Rate for such day
shall be the “open” rate on the immediately preceding Business Day. If and when
the Federal Funds Open Rate changes, the rate of interest with respect to any
advance to which the Federal Funds Open Rate applies will change automatically
without notice to the Borrowers, effective on the date of any such change.
“Fee Letter” shall mean that certain fee letter, dated as of April 17, 2017,
between PNC and C&J Energy Services, Inc., and relating to the transactions
contemplated hereby.
“Fixed Charge Coverage Ratio” shall mean, with respect to any Measurement
Period, the ratio of (a) EBITDA, minus Unfinanced Capital Expenditures made
during such Measurement Period, minus cash taxes paid during such Measurement
Period, to (b) all Debt Payments made during such Measurement Period, plus the
aggregate amount of Permitted Dividends of the type referred to in clause (a) of
such definition made in cash during such Measurement Period.
“Fixed Charge Test Date” shall mean the last day of any fiscal month ending on
or after the Closing Date on which Liquidity is less $40,000,000.
“Flood Laws” shall mean all Applicable Laws relating to policies and procedures
that address requirements placed on federally regulated lenders under the
National Flood Insurance Reform Act of 1994 and other Applicable Laws related
thereto.
“Foreign Currency Hedge” shall mean any foreign exchange transaction, including
spot and forward foreign currency purchases and sales, listed or
over-the-counter options on foreign currencies, non-deliverable forwards and
options, foreign currency swap agreements, currency exchange rate price hedging
arrangements, and any other similar transaction providing for the purchase of
one currency in exchange for the sale of another currency entered into by
Holdings or any of its Subsidiaries.
“Foreign Currency Hedge Liabilities” shall have the meaning assigned in the
definition of Lender-Provided Foreign Currency Hedge.
“Foreign Lender” shall mean any Recipient that is not a “United States person”
as defined in Section 7701(a)(30) of the Code.
“Foreign Subsidiary” of any Person, shall mean any Subsidiary of such Person
that is not a Domestic Subsidiary of such Person.
“Formula Amount” shall have the meaning set forth in Section 2.1(a).
“Free Cash” shall mean the aggregate amount of cash and Cash Equivalents of the
Borrowers and the Captive Insurance Companies (excluding any cash against which
checks or drafts have been issued) held in U.S.-domiciled accounts of the
Borrowers or the Captive Insurance Companies and which are not subject to any
Lien other than Permitted Encumbrances of the type referenced in clauses (a),
(k)(i) and (k)(ii) of such definition; provided that at least seventy-five
percent (75%) of the aggregate amount of cash and Cash Equivalents that
constitute Free Cash shall be held in (a) accounts maintained with the Agent or
(b) other accounts so long as such other accounts are subject to a Deposit
Account Control Agreement for the benefit of Agent.
“Funded Indebtedness” shall mean, as of any date of determination, the aggregate
principal amount of Indebtedness described in clauses (a), (b) or (c) of the
definition of Indebtedness, in each case determined in accordance with GAAP, for
the Borrowers and their Subsidiaries on a consolidated basis.
“GAAP” shall mean generally accepted accounting principles in the United States
of America in effect from time to time.
“Governmental Acts” shall mean any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto Governmental Body.
“Governmental Body” shall mean any nation or government, any state or other
political subdivision thereof or any entity, authority, agency, division or
department exercising the executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to a 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).
“Guarantor” shall mean, (i) Holdings and (ii) any other Person who may hereafter
guarantee payment or performance of the whole or any part of the Obligations and
“Guarantors” means collectively all such Persons.
“Guarantor Security Agreement” shall mean any security agreement executed by any
Guarantor in favor of Agent securing the Obligations or the Guaranty of such
Guarantor, in form and substance satisfactory to Agent.
“Guaranty” shall mean (a) that certain Guaranty Agreement, dated as of the
Original Closing Date, by Holdings in favor of Agent for its benefit and for the
benefit of Lenders and (b) any guaranty of the Obligations executed by a
Guarantor in favor of Agent for its benefit and for the ratable benefit of
Lenders, in form and substance satisfactory to Agent.
“Hazardous Discharge” shall have the meaning set forth in Section 9.3(a).
“Hazardous Substance” shall mean any flammable explosives, radon, radioactive
materials, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum and petroleum products, methane, hazardous materials,
hazardous wastes, hazardous or toxic substances as defined in CERCLA, the
Hazardous Materials Transportation Act, as amended (49 U.S.C. Sections 5101, et
seq.), RCRA or any other applicable Environmental Law and in the regulations
adopted pursuant thereto.
“Hedge” shall mean an interest rate, currency or commodity exchange, collar,
cap, swap, floor, adjustable strike cap, adjustable strike corridor or similar
agreements entered into by any Credit Party in order to provide protection to,
or minimize the impact upon, such Credit Party and/or its respective
Subsidiaries of changes in interest rates, currency exchange rates or commodity
prices.
“Hedge Liabilities” shall mean, collectively, the Foreign Currency Hedge
Liabilities and the Interest Rate Hedge Liabilities.
“Hedge Termination Value” shall mean, in respect of any one or more Hedges,
after taking into account the effect of any legally enforceable netting
agreements related to such Hedges, (a) for any date on or after the date such
Hedges have been closed out and termination values determined in accordance
therewith, such termination values, or (b) for any date prior to the date
referenced in clause (a), the amounts determined as the mark-to-market values
for such Hedges, as determined based upon one or more mid-market or other
readily available quotations provided by any recognized dealer in such Hedges
(which may include a Lender or any Affiliate thereof).
“Holdings on a Consolidated Basis” shall mean the consolidation in accordance
with GAAP of the accounts or other items of Holdings and its Subsidiaries.
“Immaterial Subsidiary” shall mean any Subsidiary of Holdings designated as such
in writing by the Borrowing Agent to the Agent; provided that (a) no Subsidiary
of Holdings may be so designated unless such Subsidiary (i) contributed to
EBITDA for the most recently completed Measurement Period for which financial
statements have been delivered pursuant to Section 9.7 or 9.8 less than 2.50% of
such EBITDA and (ii) had total assets having an aggregate book value, as of the
end of the fiscal quarter most recently ended and for which financial statements
have been delivered pursuant to Section 9.7 or 9.8, not exceeding 2.50% of
consolidated total assets of Holdings as of the end of such fiscal quarter and
(b) any Subsidiary shall automatically cease to be an Immaterial Subsidiary if
such Subsidiary no longer meets the requirements set forth in the foregoing
clause (a) and (c) if the Subsidiaries that constitute Immaterial Subsidiaries
pursuant to clause (a) account for, in the aggregate, more than 5.00% of the
consolidated total assets of Holdings or more than 5.00% of EBITDA, then the
term “Immaterial Subsidiary” shall no longer include each Subsidiary of Holdings
(starting with the Subsidiary that accounts for the most assets and revenues of
Holdings and its Subsidiaries on a consolidated basis pursuant to clause (a) and
then in descending order) necessary to account for no more than 5.00% of the
total assets of Holdings and its Subsidiaries on a consolidated basis and 5.00%
of EBITDA.
“In-Transit Inventory” shall mean Inventory of a Borrower that is in transit in
the United States from a location of such Borrower or a Customer of such
Borrower to another location of such Borrower or a Customer of such Borrower.
“Increasing Lender” shall have the meaning set forth in Section 2.24(a).
“Indebtedness” shall mean, as to any Person at any time, any and all
indebtedness, obligations or liabilities (whether matured or unmatured,
liquidated or unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of: (a) borrowed money; (b) amounts
received under or liabilities in respect of any note purchase or acceptance
credit facility, and all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments; (c) all Capitalized Lease
Obligations; (d) reimbursement obligations (contingent or otherwise) under any
letter of credit agreement, banker’s acceptance agreement or similar
arrangement; (e) obligations under any Interest Rate Hedge, Foreign Currency
Hedge, or other interest rate management device, foreign currency exchange
agreement, currency swap agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement;
(f)  all obligations of such Person to pay the deferred purchase price of
property or services (but not including trade payables and accrued expenses
incurred in the ordinary course of business which are not represented by a
promissory note or other evidence of indebtedness); (g) all Equity Interests of
such Person subject to repurchase or redemption/retraction rights at the time of
determination (excluding repurchases or redemptions at the sole option of such
Person); (h) all indebtedness, obligations or liabilities secured by a Lien on
any asset of such Person, whether or not such indebtedness, obligations or
liabilities are otherwise an obligation of such Person (with the amount of
indebtedness deemed to be outstanding pursuant to this clause (h) to be the
lesser of (x) the net book value of the encumbered property and (y) the amount
of such indebtedness); (i) all obligations of such Person for “earnouts”,
purchase price adjustments, profit sharing arrangements, deferred purchase money
amounts and similar payment obligations or continuing obligations of any nature
of such Person due and payable at the time of determination and arising out of
purchase and sale contracts; and (j) any guaranty of any indebtedness,
obligations or liabilities of a type described in the foregoing clauses
(a) through (i).
“Indemnified Taxes” shall mean (a) Taxes other than Excluded Taxes imposed on or
with respect to any payment made by or on account of any Obligation of a Credit
Party under this Agreement or the Other Documents and (b) to the extent not
otherwise described in clause (a), Other Taxes.
“Ineligible Security(ies)” shall mean any security which may not be underwritten
or dealt in by member banks of the Federal Reserve System under Section 16 of
the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.
“Insolvency Event” shall mean, with respect to any Person, including without
limitation any Lender, such Person or such Person’s direct or indirect parent
company (a) becomes the subject of a bankruptcy or insolvency proceeding
(including any proceeding under Title 11 of the United States Code), or
regulatory restrictions, (b) 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 has called a meeting of its creditors, (c) admits in writing its
inability, or be generally unable, to pay its debts as they become due or cease
operations of its present business, (d) with respect to a Lender, such Lender is
unable to perform hereunder due to the application of Applicable Law, or (e) has
taken any action in furtherance of, or indicating its consent to, approval of,
or acquiescence in, any such proceeding or appointment of a type described in
clause (a) or (b), provided that an Insolvency Event shall not result solely by
virtue of any ownership interest, or the acquisition of any ownership interest,
in such Person or such Person’s direct or indirect parent company by a
Governmental Body or instrumentality thereof if, and only if, 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 Body or instrumentality) to reject, repudiate, disavow or disaffirm
any contracts or agreements made by such Person.
“Intellectual Property” shall mean property constituting a patent, copyright,
trademark (or any application in respect of the foregoing), service mark,
copyright, copyright application, trade name, mask work, trade secrets, design
right, assumed name or license or other right to use any of the foregoing under
Applicable Law.
“Interest Charges” shall mean, for any Measurement Period, to the extent payable
in cash, the sum of (a) all interest, premium payments, debt discount, fees,
charges and related or similar expenses in connection with borrowed money,
letters of credit or bankers’ acceptances or in connection with the deferred
purchase price of assets, in each case to the extent treated as interest in
accordance with GAAP, (b) all interest paid or payable with respect to
discontinued operations, (c) the portion of rent expense under Capitalized Lease
Obligations that is treated as interest in accordance with GAAP and (d) net
payments, if any, made (less net payments, if any, received) pursuant to
interest rate swap contracts with respect to Indebtedness, in each case, of or
by Holdings and its Subsidiaries on a consolidated basis for the most recently
completed Measurement Period (including to the extent accrued during such
Measurement Period).
“Interest Period” shall mean the period provided for any LIBOR Rate Loan
pursuant to Section 2.2(b).
“Interest Rate Hedge” shall mean an interest rate exchange, collar, cap, swap,
floor, adjustable strike cap, adjustable strike corridor, cross-currency swap or
similar agreements entered into by any Borrower, Guarantor and/or their
respective Subsidiaries in order to provide protection to, or minimize the
impact upon, such Borrower, any Guarantor and/or their respective Subsidiaries
of increasing floating rates of interest applicable to Indebtedness.
“Inventory” shall mean and include as to each Borrower all of such Borrower’s
inventory (as defined in Article 9 of the Uniform Commercial Code) and all of
such Borrower’s goods, merchandise and other personal property, wherever
located, to be furnished under any consignment arrangement, contract of service
or held for sale or lease, all raw materials, work in process, finished goods
and materials and supplies of any kind, nature or description which are or might
be used or consumed in such Borrower’s business or used in selling or furnishing
such goods, merchandise and other personal property, and all Documents.
“Inventory Advance Rate” shall have the meaning set forth in Section
2.1(a)(y)(ii).
“Issuer” shall mean (i) Agent in its capacity as the issuer of Letters of Credit
under this Agreement and (ii) subject to such Lender’s consent, any other Lender
which Agent in its discretion shall designate as the issuer of and cause to
issue any particular Letter of Credit under this Agreement in place of Agent as
issuer.
“Law(s)” shall mean any law(s) (including common law and equitable principles),
federal, state and foreign constitutions, statute, treaty, regulation, rule,
ordinance, opinion, issued guidance, release, ruling, order, executive order,
injunction, writ, decree, judgment, authorization or approval, lien or award of
or any settlement arrangement with any Governmental Body or arbitrator,
directives and orders of any Governmental Body, in each case, whether, foreign
or domestic, state, federal or local.
“Lender” and “Lenders” shall have the meaning ascribed to such term in the
preamble to this Agreement and shall include each Person which becomes a
transferee, successor or assign of any Lender. For the purpose of provision of
this Agreement or any Other Document which provides for the granting of a
security interest or other Lien to the Agent for the benefit of Lenders as
security for the Obligations, “Lenders” shall include any Affiliate of a Lender
to which such Obligation (specifically including any Hedge Liabilities and any
Cash Management Liabilities) is owed.
“Lender-Provided Foreign Currency Hedge” shall mean a Foreign Currency Hedge
which is provided by any Lender and for which such Lender confirms to Agent in
writing prior to the execution thereof that it: (a) is documented in a standard
International Swap Dealers Association, Inc. Master Agreement or another
reasonable and customary manner; (b) provides for the method of calculating the
reimbursable amount of the provider’s credit exposure in a reasonable and
customary manner; and (c) is entered into for hedging (rather than speculative)
purposes. The liabilities owing to the provider of any Lender-Provided Foreign
Currency Hedge (the “Foreign Currency Hedge Liabilities”) by any Borrower,
Guarantor, or any of their respective Subsidiaries that is party to such
Lender-Provided Foreign Currency Hedge shall, for purposes of this Agreement and
all Other Documents be “Obligations” of such Person and of each other Borrower
and Guarantor, be guaranteed obligations under any Guaranty and secured
obligations under any Guarantor Security Agreement, as applicable, and otherwise
treated as Obligations for purposes of the Other Documents, except to the extent
constituting Excluded Hedge Liabilities of such Person. The Liens securing the
Foreign Currency Hedge Liabilities shall be pari passu with the Liens
securing all other Obligations under this Agreement and the Other Documents,
subject to the express provisions of Section 11.5.
“Lender-Provided Interest Rate Hedge” shall mean an Interest Rate Hedge which is
provided by any Lender and with respect to which such Lender confirms to Agent
in writing prior to the execution thereof that it: (a) is documented in a
standard International Swap Dealers Association, Inc. Master Agreement or
another reasonable and customary manner; (b) provides for the method of
calculating the reimbursable amount of the provider’s credit exposure in a
reasonable and customary manner; and (c) is entered into for hedging (rather
than speculative) purposes. The liabilities owing to the provider of any
Lender-Provided Interest Rate Hedge (the “Interest Rate Hedge Liabilities”) by
any Borrower, Guarantor, or any of their respective Subsidiaries that is party
to such Lender-Provided Interest Rate Hedge shall, for purposes of this
Agreement and all Other Documents be “Obligations” of such Person and of each
other Borrower and Guarantor, be guaranteed obligations under any Guaranty and
secured obligations under any Guarantor Security Agreement, as applicable, and
otherwise treated as Obligations for purposes of the Other Documents, except to
the extent constituting Excluded Hedge Liabilities of such Person. The Liens
securing the Hedge Liabilities shall be pari passu with the Liens securing all
other Obligations under this Agreement and the Other Documents, subject to the
express provisions of Section 11.5.
“Letter of Credit Application” shall have the meaning set forth in Section
2.12(a).
“Letter of Credit Borrowing” shall have the meaning set forth in Section
2.14(d).
“Letter of Credit Fees” shall have the meaning set forth in Section 3.2.
“Letter of Credit Sublimit” shall mean an amount equal to the lesser of (a)
$70,000,000 and (b) the then effective Maximum Revolving Advance Amount.
“Letters of Credit” shall have the meaning set forth in Section 2.11.
“Leverage Ratio” shall mean, as of any date of determination, the ratio of
(a)(i) Funded Indebtedness as of such date minus (ii) up to $50,000,000 of cash
and Cash Equivalents of the Borrowers that constitute Free Cash as of such date
to (b) EBITDA for the most recently completed Measurement Period.
“LIBOR Alternate Source” shall have the meaning set forth in the definition of
LIBOR Rate.
“LIBOR Rate” shall mean for any LIBOR Rate Loan for the then current Interest
Period relating thereto, the interest rate per annum determined by Agent by
dividing (the resulting quotient rounded upwards, if necessary, to the nearest
1/100th of 1% per annum) (a) the rate which appears on the Bloomberg Page BBAM1
(or on such other substitute Bloomberg page that displays rates at which U.S.
dollar deposits are offered by leading banks in the London interbank deposit
market), or the rate which is quoted by another source selected by Agent as an
authorized information vendor for the purpose of displaying rates at which U.S.
dollar deposits are offered by leading banks in the London interbank deposit
market (a “LIBOR Alternate Source”), at approximately 11:00 a.m., London time,
two (2) Business Days prior to the commencement of such Interest Period as the
London interbank offered rate for U.S. Dollars for an amount comparable to such
LIBOR Rate Loan and having a borrowing date and a maturity comparable to such
Interest Period (or if there shall at any time, for any reason, no longer exist
a Bloomberg Page BBAM1 (or any substitute page) or any LIBOR Alternate Source, a
comparable replacement rate determined by Agent at such time (which
determination shall be conclusive absent manifest error)), by (b) a number equal
to 1.00 minus the Reserve Percentage; provided that if the LIBOR Rate determined
as provided above would be less than zero, such rate shall be deemed to be zero
percent (0%) for purposes of this Agreement.
The LIBOR Rate shall be adjusted with respect to any LIBOR Rate Loan that is
outstanding on the effective date of any change in the Reserve Percentage as of
such effective date. Agent shall give reasonably prompt notice to the Borrowing
Agent of the LIBOR Rate as determined or adjusted in accordance herewith, which
determination shall be conclusive absent manifest error.
“LIBOR Rate Loan” shall mean an Advance at any time that bears interest based on
the LIBOR Rate.
“Lien” shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, security interest, lien (whether statutory or otherwise), Charge,
claim or encumbrance, or preference, priority or other security agreement or
preferential arrangement held or asserted in respect of any asset of any kind or
nature whatsoever including any adverse right or claim, conditional sale or
other title retention agreement, any lease having substantially the same
economic effect as any of the foregoing, and the filing of, or agreement to
give, any financing statement under the Uniform Commercial Code or comparable
law of any jurisdiction.
“Lien Waiver Agreement” shall mean an agreement, in form and substance
satisfactory to Agent in its Permitted Discretion, which is executed in favor of
Agent by a Person who (a) owns or subleases premises at which Collateral is
located from time to time and by which such Person shall waive (or subordinate
as to the Lien in favor of Agent contemplated hereby) any Lien that such Person
may ever have with respect to such Collateral and shall authorize Agent from
time to time to enter upon the premises to inspect or remove such Collateral
from such premises or to use such premises to store or dispose of such
Collateral for a limited time or (b) transports, holds or stores Collateral of a
Borrower and by which such Person shall waive (or subordinate as to the Lien in
favor of Agent contemplated hereby) any Lien, right of reclamation or other
right that such Person may ever have with respect to such Inventory and shall
agree to turn over to Agent such Inventory upon request from Agent.
“Liquidity” shall mean, on any date, the sum of (a) Free Cash and (b) Excess
Availability, in each case, on and as of such date.
“Material Adverse Effect” shall mean a material adverse effect on (a) the
financial condition, operations, assets, business or liabilities of Holdings and
its Subsidiaries taken as a whole, (b) the ability of the Credit Parties taken
as a whole to pay or perform the Obligations in accordance with the terms of
this Agreement or the Other Documents (as applicable), (c) the value of a
material portion of the Collateral, or Agent’s Liens on a material portion of
the Collateral or the priority of any such Lien or (d) Agent’s and each Lender’s
rights and remedies under this Agreement and the Other Documents.
“Material Contract” shall mean any agreement, document, instrument, contract or
other arrangement to which a Credit Party or any of its Subsidiaries is a party
(other than this Agreement and the Other Documents) for which the
nonperformance, cancellation or failure to renew could reasonably be expected to
have a Material Adverse Effect, as amended, restated, supplemented, renewed, or
modified from time to time not in violation of this Agreement.
“Maximum Available Credit” shall mean the lesser of (i) the Maximum Revolving
Advance Amount less the Maximum Undrawn Amount of all outstanding Letters of
Credit or (ii) the Formula Amount.
“Maximum Revolving Advance Amount” shall mean $200,000,000 plus any increases in
accordance with Section 2.24 less any decreases in accordance with Section 2.25.
“Maximum Swing Loan Advance Amount” shall mean an amount equal to the lesser of
(a) $15,000,000 and (b) the then effective Maximum Revolving Advance Amount.
“Maximum Undrawn Amount” shall mean, with respect to any outstanding Letter of
Credit as of any date, the amount of such Letter of Credit that is or may become
available to be drawn, including all automatic increases provided for in such
Letter of Credit, whether or not any such automatic increase has become
effective.
“Measurement Period” shall mean:
(a)    in the case of any calculation or other determination made pursuant to
Section 6.5, (i) for the first Fixed Charge Test Date occurring after the
Closing Date, the most recently completed fiscal month of Holdings, and (ii) for
any subsequent Fixed Charge Test Date, a number of months that is equal to one
(1) month plus the number of months elapsed since the first Fixed Charge Test
Date occurring after the Closing Date; provided that in no case shall any such
Measurement Period exceed twelve (12) months; and
(b)    (i) in the case of any other calculation or other determination made
hereunder on or prior to December 31, 2017, the most recently completed three
(3) fiscal months of Holdings, and (ii) in the case of any other calculation or
other determination made hereunder on or after January 1, 2018, the most
recently completed twelve (12) fiscal months of Holdings.
“Modified Commitment Transfer Supplement” shall have the meaning set forth in
Section 16.3(d).
“Multiemployer Plan” shall mean a “multiemployer plan” as defined in Sections
3(37) or 4001(a)(3) of ERISA to which contributions are required or, within the
preceding five plan years, were required by any Borrower or any member of the
Controlled Group.
“Multiple Employer Plan” shall mean a Plan which has two or more contributing
sponsors (including any Credit Party or any member of the Controlled Group) at
least two of whom are not under common control, as such a plan is described in
Section 4063 or 4064 of ERISA.
“Negative Pledge Agreements” shall mean those certain Negative Pledge
Agreements, in each case, dated as of the Original Closing Date, between
Borrowers and Agent, in form and substance satisfactory to Agent.
“Net Cash Proceeds” shall mean, as to any Person, the aggregate cash or Cash
Equivalents proceeds received by such Person in respect of any incurrence or
issuance of debt, any Specified Equity Contribution or any disposition, damage,
destruction, taking or condemnation of assets, net of (a) direct costs incurred
in connection therewith (including, without limitation, legal, accounting and
investment banking fees and sales commissions), (b) Taxes paid or payable as a
result thereof and (c) in the case of any disposition, damage, destruction,
taking or condemnation of assets, amounts required to be distributed to the
minority interest holders, the amount necessary to retire any Indebtedness
(other than Indebtedness owing between or among Holdings and its Subsidiaries)
secured by a Lien permitted under this Agreement (ranking senior to any Lien in
favor of the Agent) on the related property, the amounts of any purchase price
or similar adjustments owed to the purchaser of assets in such disposition or
other event and the amount of any reasonable reserve established in accordance
with GAAP against any liabilities (other than Taxes deducted pursuant to clause
(b) above) related to any of the applicable assets and retained by Holdings or
any of its Subsidiaries (however, the amount of any subsequent reduction of such
reserve, other than in connection with a payment in respect of any such
liability, shall be deemed to be Net Cash Proceeds of such disposition or other
event); it being understood that “Net Cash Proceeds” shall include, without
limitation, any cash or Cash Equivalents received upon the sale or other
disposition of any non-cash consideration received by any Credit Party or any
Subsidiary in any debt issuance or incurrence, any Specified Equity Contribution
or any disposition, damage, destruction, taking or condemnation of assets.
“Net Income” shall mean, at any date of determination, the net income (or loss)
of Holdings and its Subsidiaries on a consolidated basis for the most recently
completed Measurement Period; provided that Net Income shall exclude
(a)    extraordinary gains and extraordinary losses for such Measurement Period,
(b)    the net income of any Subsidiary of Holdings during such Measurement
Period to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary of such income is not permitted by operation of
the terms of its Organizational Documents or any agreement, instrument or Law
applicable to such Subsidiary during such Measurement Period, except that
Holdings’ equity in any net loss of any Subsidiary of Holdings for such
Measurement Period shall be included in determining Net Income,
(c)    any income (or loss) for such Measurement Period of any Person if such
Person is not a Subsidiary of Holdings, except that Holdings’ equity in the net
income of any such Person for such Measurement Period shall be included in Net
Income up to the aggregate amount of cash actually distributed by such Person
during such Measurement Period to Holdings or a Subsidiary thereof as a dividend
or other distribution (and in the case of a dividend or other distribution to a
Subsidiary of Holdings, such Subsidiary is not precluded from further
distributing such amount to Holdings as described in clause (b) of this
proviso), and
(d)    any non-cash effects due to adjustments in the property and equipment,
software and other intangible assets, deferred revenue and debt line items in
such Person’s consolidated financial statements pursuant to GAAP resulting from
the application of purchase accounting in relation to any consummated
acquisition and any increase in amortization or depreciation or other non-cash
charges resulting therefrom and any write-off of any amounts thereof, in any
case net of taxes.
“New Lender” shall have the meaning set forth in Section 2.24(a).
“NOLV Advance Rate” shall have the meaning set forth in Section 2.1(a)(y)(iii).
“NOLV Appraisal” shall have the meaning set forth in Section 2.1(a)(y)(iii).
“Non-Defaulting Lender” shall mean, at any time, any Lender that is not a
Defaulting Lender at such time.
“Non-Qualifying Party” shall mean any Credit Party that fails for any reason to
qualify as an Eligible Contract Participant.
“Note” shall mean collectively, the Swing Loan Note and the Revolving Credit
Note.
“Obligations” shall mean and include any and all Advances, Swing Loans,
advances, debts, liabilities, obligations (including without limitation all
reimbursement obligations and cash collateralization obligations with respect to
Letters of Credit issued hereunder), covenants and duties owing by any Credit
Party or any Subsidiary of any Credit Party to Issuer, Swing Loan Lender,
Lenders or Agent (or to any other direct or indirect subsidiary or affiliate of
Issuer, Swing Loan Lender, any Lender or Agent) of any kind or nature, present
or future (including any interest or other amounts accruing thereon, any fees
accruing under or in connection therewith, any costs and expenses of any Person
payable by any Borrower and any indemnification obligations payable by any
Credit Party arising or payable after maturity, or after the filing of any
petition in bankruptcy, or the commencement of any insolvency, arrangement,
reorganization or like proceeding relating to any Credit Party, whether or not a
claim for post-filing or post-petition interest, fees or other amounts is
allowable or allowed in such proceeding), whether or not evidenced by any note,
guaranty or other instrument, arising under this Agreement, the Other Documents,
Lender-Provided Interest Rate Hedges, Lender-Provided Foreign Currency Hedges
and any Cash Management Products and Services, whether or not for the payment of
money, whether arising by reason of an extension of credit, opening or issuance
of a letter of credit, loan, establishment of any commercial card or similar
facility or guarantee, under any interest or currency swap, future, option or
other similar agreement, or in any other manner, whether arising out of
overdrafts or deposit or other accounts or electronic funds transfers (whether
through automated clearing houses or otherwise) or out of Agent’s or any
Lender’s non-receipt of or inability to collect funds or otherwise not being
made whole in connection with depository transfer check or other similar
arrangements, whether direct or indirect (including those acquired by assignment
or participation), absolute or contingent, joint or several, due or to become
due, now existing or hereafter arising, contractual or tortious, liquidated or
unliquidated, regardless of how such indebtedness or liabilities arise or by
what agreement or instrument they may be evidenced or whether evidenced by any
agreement or instrument, including, but not limited to, (i) any and all of any
Credit Party’s Indebtedness and/or liabilities (and any and all indebtedness,
obligations and/or liabilities of any Subsidiary of any Credit Party) under this
Agreement or the Other Documents and any amendments, extensions, renewals or
increases and all costs and expenses of Issuer, Agent and any Lender incurred in
the documentation, negotiation, modification, enforcement, collection or
otherwise in connection with any of the foregoing, including but not limited to
reasonable attorneys’ fees and expenses and all obligations of any Borrower to
Issuer, Agent or Lenders to perform acts or refrain from taking any action, (ii)
all Hedge Liabilities and (iii) all Cash Management Liabilities. Notwithstanding
anything to the contrary contained in the foregoing, the Obligations shall not
include any Excluded Hedge Liabilities.
“Original Closing Date” shall mean January 6, 2017.
“Original Credit Agreement” shall mean that certain revolving credit and
security agreement, dated as of the Original Closing Date, by and among the
Credit Parties, PNC as the sole Lender, and the Agent (as amended and as in
effect immediately prior to the Closing Date).
“Organizational Documents” shall mean (i) with respect to any corporation, its
certificate or articles of incorporation or organization, as amended, and its
by-laws, as amended, (ii) with respect to any limited partnership, its
certificate of limited partnership, as amended, and its partnership agreement,
as amended, (iii) with respect to any general partnership, its partnership
agreement, as amended, and (iv) with respect to any limited liability company,
its articles of organization, as amended, and its operating agreement, as
amended. In the event any term or condition of this Agreement or any Other
Document requires any Organizational Document to be certified by a secretary of
state or similar governmental official, the reference to any such
“Organizational Document” shall only be to a document of a type customarily
certified by such governmental official.
“Other Connection Taxes” shall mean, with respect to any Recipient, Taxes
imposed as a result of a present or former connection between it and the
jurisdiction imposing such Tax (other than connections arising solely from (and
would not have existed but for) it having executed, delivered, become a party
to, performed its obligations under, received payments under, received or
perfected a security interest under, engaged in any other transaction pursuant
to or enforced this Agreement or the Other Documents, or sold or assigned an
interest in its Commitment or any Advances, this Agreement or the Other
Documents).
“Other Documents” shall mean the Notes, the Perfection Certificates, the
Guaranty, any security agreement(s), the Pledge Agreements, any Lender-Provided
Interest Rate Hedge, any Lender-Provided Foreign Currency Hedge, the Negative
Pledge Agreement, any Lien Waiver Agreements, any Deposit Account Control
Agreements and any and all other agreements, instruments, certificates,
statements and documents, including any acknowledgment and waivers, any access
agreements, intercreditor agreements (including any Term Intercreditor
Agreement), guaranties, pledges, powers of attorney, consents, certificates,
estoppels, standstill, non-disturbance, interest or currency swap agreements or
other similar agreements and all other writings heretofore, now or hereafter
executed or provided by any Credit Party and/or delivered to Agent or any Lender
in respect of the transactions contemplated by this Agreement (and shall include
any amendment, restatement, renewal, supplement, ratification, confirmation,
reaffirmation or other modification of any of the foregoing).
“Other Property” shall mean and include all right, title and interest of each
Credit Party in all of the property and assets of such Credit Party not
constituting Collateral or Excluded Property, in each case whether now existing
or hereafter arising or created and whether now owned or hereafter acquired and
wherever located, and all as more fully detailed in the applicable Negative
Pledge Agreement, including, without limitation, (a) all Real Property
(including plants), (b) all furniture, (c) all Intellectual Property and (d)
vehicles, vessels and other property represented by certificates of title (or a
similar instrument) and identified by the Borrowers in their reasonable
discretion.
“Other Property Trigger Event” shall have the meaning set forth in Section 6.14.
“Other Taxes” shall mean all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes arising from any payment made
hereunder or under any Other Document or from the execution, delivery or
enforcement of, or otherwise with respect to, this Agreement or any Other
Document, but excluding any and all such Taxes imposed with respect to any
assignment (other than an assignment made pursuant to Section 3.10) by any
Recipient of an interest in its Commitment or any Advances, this Agreement or
the Other Documents.
“Out-of-Formula Loans” shall have the meaning set forth in Section 16.2(e).
“Parent” of any Person shall mean a corporation or other entity owning, directly
or indirectly more than fifty percent (50%) of the shares of stock or other
ownership interests having ordinary voting power to elect a majority of the
directors of the Person, or other Persons performing similar functions for any
such Person.
“Participant” shall mean each Person who pursuant to Section 16.3(b) shall be
granted the right by any Lender to participate in any of the Advances and who
shall have entered into a participation agreement in form and substance
satisfactory to such Lender.
“Participant Register” shall have the meaning set forth in Section 16.3(b).
“Participation Advance” shall have the meaning set forth in Section 2.14(d).
“Participation Commitment” shall mean each Lender’s obligation to buy a
participation of the Letters of Credit issued hereunder.
“Payment Office” shall mean initially Two Tower Center Boulevard, East
Brunswick, New Jersey 08816; thereafter, such other office of Agent, if any,
which it may designate by notice to Borrowing Agent and to each Lender to be the
Payment Office.
“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA or any successor.
“Pension Benefit Plan” shall mean at any time any employee pension benefit plan
(including a Multiple Employer Plan, but not a Multiemployer Plan) which is
covered by Title IV of ERISA or is subject to the minimum funding standards
under Section 412 of the Code and either (i) is maintained or to which
contributions are required by any member of the Controlled Group; or (ii) has at
any time within the preceding five years been maintained or to which
contributions have been required by any entity which was at such time a member
of the Controlled Group.
“Perfection Certificates” shall mean collectively, the Perfection Certificate(s)
and the responses thereto provided by each Credit Party and delivered to Agent.
“Permitted Acquisitions” shall mean (I) acquisitions of the assets or Equity
Interests of another Person the consideration for which consists of Equity
Interests of Holdings or any direct or indirect parent thereof and (II) other
acquisitions of the assets or Equity Interests of another Person (the “target”)
so long as: (a) the total costs and liabilities (including without limitation,
all assumed liabilities, all earn-out payments, deferred payments and the value
of any other stock or assets transferred, assigned or encumbered with respect to
such acquisitions) of any individual acquisition (collectively, the “Acquisition
Consideration”) does not exceed $50,000,000 and of all such acquisitions do not
exceed $200,000,000 in the aggregate throughout the Term; (b) with respect to
the acquisition of Equity Interests of an entity which becomes a Subsidiary
(other than an Excluded Subsidiary or an Immaterial Subsidiary), such target
shall (i) be added as a Borrower to this Agreement and be jointly and severally
liable for all Obligations, and (ii) grant to Agent a first priority lien in all
assets of such target, in each case to the extent required pursuant to Section
7.11; (c) Agent shall have received a first-priority security interest in all
acquired assets or Equity Interests required to be pledged pursuant to Section
7.11, subject to documentation reasonably satisfactory to Agent; (d) the board
of directors (or other comparable governing body) of the target shall have duly
approved the transaction; (e) in the case of an acquisition for which the
Acquisition Consideration exceeds $10,000,000, Borrowers shall have delivered to
Agent (i) a pro forma balance sheet and pro forma financial statements and a
Compliance Certificate demonstrating that, upon giving effect to such
acquisition on a pro forma basis, Borrowers would be in compliance with the
financial covenant set forth in Section 6.5 as of the most recent month-end and
(ii) financial statements of the acquired entity for the most recent fiscal year
then ended, in form and substance reasonably acceptable to Agent; (f) no assets
acquired in any such transaction(s) shall be included in the Formula Amount
until Agent has received a field examination and/or appraisal of such assets, in
form and substance acceptable to Agent; and (g) no Default or Event of Default
shall have occurred or will occur after giving pro forma effect to such
acquisition; provided that the Acquisition Consideration for the Permitted
Acquisition of Persons that do not become Borrowers or Guarantors shall not
exceed $25,000,000 in the aggregate during the Term. For the purposes of
calculating Excess Availability under this definition, any assets being acquired
in the proposed acquisition shall be included in the Formula Amount on the date
of closing so long as Agent has received an audit or appraisal of such assets as
set forth in clause (g) above and so long as such assets satisfy the applicable
eligibility criteria.
“Permitted Discretion” shall mean Agent’s reasonable credit judgment in
accordance with customary business practices for comparable asset-based lending
transactions, and as it relates to the establishment of reserves or the
imposition of exclusionary criteria shall require that (a) such establishment,
adjustment or imposition after the Closing Date be based on the analysis of
facts or events first occurring or first discovered by Agent after the Closing
Date or are materially different from the facts or events occurring or known to
Agent on the Closing Date, unless the Borrowers and Agent otherwise agree in
writing, (b) the contributing factors to the imposition of any reserves or the
reduction of any Advance Rate shall not duplicate (i) the exclusionary criteria
set forth in the definitions of Eligible Receivables, Eligible Inventory,
Eligible In-Transit Inventory, and Eligible Unbilled Receivables, as applicable
(and vice versa) or (ii) any reserves deducted in computing book value and (c)
the amount of any such reserve so established, any decrease in an Advance Rate
or the effect of any adjustment or imposition of exclusionary criteria be a
reasonable quantification of the incremental dilution of the Formula Amount
attributable to such contributing factors.
“Permitted Dividends” shall mean: (a) so long as no Event of Default or Default
shall have occurred or would occur after giving pro forma effect to such
dividends, dividends made by Holdings to any Parent, to pay professional fees,
taxes and other ordinary course of business operating expenses (excluding
salaries and other employee compensation) incurred by such Parent solely in its
capacity as parent corporation of Credit Parties; (b) dividends and
distributions made by any Subsidiary of Holdings to any Credit Party and any
other Person that owns a direct Equity Interest in such Subsidiary, ratably
according to their respective holdings of the type of Equity Interest in respect
of which such dividend or distribution is being made; (c) dividend payments or
other distributions payable solely in the common stock or other common Equity
Interests of the payor thereof; (d) any purchase redemption or other acquisition
of common Equity Interests with the proceeds received from the substantially
concurrent issue of new common Equity Interests; (e) the redemption, repurchase
or other acquisition or retirement for value of Equity Interests of any Parent
of Holdings held by officers, directors or employees or former officers,
directors or employees (or their transferees, estates or beneficiaries under
their estates), either (i) upon any such individual’s death, disability,
retirement, severance or termination of employment or service or (ii) pursuant
to any equity subscription agreement, stock option agreement, restricted stock
agreement, restricted stock unit agreement, stockholders’ agreement or similar
agreement; provided, in any case, that the aggregate cash consideration paid for
all such redemptions, repurchases or other acquisitions or retirements shall not
exceed $5,000,000 during any calendar year; (f) the consummation of (i)
repurchases, redemptions or other acquisitions or retirements for value of
Equity Interests deemed to occur upon the exercise of stock options, warrants,
rights to acquire Equity Interests or other convertible securities to the extent
such Equity Interests represent a portion of the exercise or exchange price
thereof and (ii) any repurchases, redemptions or other acquisitions or
retirements for value of Equity Interests made or deemed to be made in lieu of
withholding Taxes in connection with any exercise, vesting, settlement or
exchange, as applicable, of stock options, warrants, restricted stock,
restricted stock units or other similar right (g) payments of cash in lieu of
issuing fractional Equity Interests; (h) payments or distributions to dissenting
stockholders pursuant to applicable Law in connection with a merger,
consolidation or transfer of assets that complies with the provisions of Section
7.1; and (i) dividends or distributions made in connection with the Tax
Restructuring Plan and the transactions contemplated thereby.
“Permitted Encumbrances” shall mean: (a) Liens in favor of Agent for the benefit
of Agent and Lenders, including without limitation, Liens securing Hedge
Liabilities and Cash Management Products and Services; (b) Liens for Taxes,
assessments or other governmental charges not delinquent or being Properly
Contested; (c) deposits or pledges to secure obligations under worker’s
compensation, social security or similar laws, or under unemployment insurance;
(d) deposits or pledges to secure bids, tenders, contracts (other than contracts
for the payment of money), leases, statutory obligations, surety and appeal
bonds and other obligations of like nature arising in the ordinary course of
business; (e) Liens arising by virtue of the rendition, entry or issuance
against Holdings or any of its Subsidiaries, or any property of Holdings or any
of its Subsidiaries, of any judgment, writ, order, or decree to the extent the
rendition, entry, issuance or continued existence of such judgment, writ, order
or decree (or any event or circumstance relating thereto) has not resulted in
the occurrence of an Event of Default under Section 10.5; (f) carriers’,
repairmens’, mechanics’, workers’, materialmens’ or other like Liens arising in
the ordinary course of business with respect to obligations which are not due or
which are being Properly Contested; (g) Liens securing Permitted Purchase Money
Indebtedness; (h) other Liens incidental to the conduct of Holdings’ or any of
its Subsidiaries’ business or the ownership of its property and assets which
were not incurred in connection with the borrowing of money or the obtaining of
advances or credit, and which do not in the aggregate materially detract from
Agent’s or Lenders’ rights in and to the Collateral or the value of any
Borrower’s property or assets or which do not materially impair the use thereof
in the operation of any Borrower’s business; (i) restrictions, covenants,
easements, rights-of-way, survey exceptions, zoning restrictions, minor defects
or irregularities in title and other charges or encumbrances, in each case,
which do not interfere in any material respect with the ordinary course of
business of Borrowers and their Subsidiaries; (j) Liens disclosed on Schedule
1.2; provided that such Liens shall secure only those obligations which they
secure on the Closing Date (and extensions, renewals and refinancing of such
obligations permitted by Section 7.8) and shall not subsequently apply to any
other property or assets of any Borrower other than the property and assets to
which they apply as of the Closing Date; (k) Liens that are contractual rights
of set-off (i) relating to the establishment of depository relations with banks
not given in connection with the issuance of Indebtedness, (ii) relating to
pooled deposit or sweep accounts of Holdings or any of its Subsidiaries to
permit satisfaction of overdraft or similar obligations or (iii) relating to
purchase orders and other agreements entered into with customers of a Credit
Party or any Subsidiary in the ordinary course of business; (l) Liens arising
from filing Uniform Commercial Code financing statements relating solely to
leases not prohibited by this Agreement; (m) 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; (n) Liens on property at the
time such Person or any of its Subsidiaries acquires the property, including any
acquisition by means of a merger or consolidation with or into such Person or a
Subsidiary of such Person (other than a Lien incurred in connection with, or to
provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of transactions pursuant to which such
Person or any of its Subsidiaries acquired such property); provided that the
Liens may not extend to any other property owned by such Person (other than
assets and property affixed or appurtenant thereto and improvements, additions
and accessions thereto and proceeds and distributions thereof); (o) Liens
arising from the deposit of funds or securities in trust for the purpose of
decreasing or defeasing Indebtedness so long as such deposit of funds or
securities and such decreasing or defeasing of Indebtedness are permitted by
this Agreement; (p) Liens on assets pursuant to merger agreements, stock or
asset purchase agreements and similar agreements limiting the disposition of
such assets pending the closing of the transactions contemplated thereby; (q)
Liens on any cash earnest money deposits made by Holdings or any of its
Subsidiaries in connection with any letter of intent or purchase agreement; (r)
leases, licenses, subleases and sublicenses of assets (including real property
and intellectual property rights) that do not materially interfere with the
ordinary conduct of the business of any Credit Party; (s) Liens (A) on advances
of cash in favor of the seller of any asset to be acquired by Holdings or any of
its Subsidiaries to be applied against the purchase price for such asset, (B)
consisting of an agreement to dispose of any property in a disposition permitted
under this Agreement and (C) on cash earnest money deposits made by Holdings or
any of its Subsidiaries in connection with any letter of intent or purchase
agreement permitted under this Agreement; (t) [reserved]; (u) Liens arising out
of conditional sale, title retention, consignment or similar arrangements for
the sale of goods entered into by Holdings or any Subsidiary in the ordinary
course of business in accordance with the past practices of such Person; (v)
Liens on property of a Person existing at the time such Person becomes a
Subsidiary of Holdings after the Closing Date as result of a Permitted
Acquisition; provided that such Liens were not created in contemplation of such
Person becoming a Subsidiary of Holdings and do not extend to any assets other
than those of the Person becoming a Subsidiary of Holdings, and the applicable
Indebtedness secured by such Lien is permitted hereunder; (w) any interest or
title of a lessor under any lease entered into by Holdings or any of its
Subsidiaries in the ordinary course of its business and covering only the assets
so leased, including Liens arising from precautionary UCC financing statements
or similar or related filings in any jurisdiction made in respect of such
leases; (x) Liens (i) of a collection bank arising under Section 4-210 of the
Uniform Commercial Code on items in the course of collection and (ii) consistent
with those arising by operation of law consisting of customary and ordinary
course rights of setoff upon deposits of cash in favor of banks or other
depository institutions in the ordinary course of business; (y) Liens on
unearned premiums in respect of insurance policies securing insurance premium
financing as described in the definition of Permitted Indebtedness; (z) Liens
solely on cash earnest money deposits made in connection with any letter of
intent or purchase agreement in connection with an investment (including
Permitted Acquisitions) permitted hereunder; (aa) any encumbrance or restriction
(including put and call arrangements) with respect to capital stock of any joint
venture or similar arrangement pursuant to any joint venture or similar
agreement; provided that such encumbrance or restriction does not prohibit the
granting of a Lien by a Credit Party on its interests in such capital stock
pursuant to the Other Documents; (bb) Liens arising in connection with the Tax
Restructuring Plan and the transactions contemplated thereby; (cc) Liens on
Permitted Released Property and/or Collateral securing any Term Indebtedness;
provided that, with respect to any Liens securing any such Term Indebtedness,
the rights and obligations of the holders of such Term Indebtedness (such
holders, the “Term Lenders”) and of the Secured Parties in respect of such Liens
shall be subject to the terms and conditions of an intercreditor agreement by
and among the applicable Borrowers, the Agent and the Term Lenders (or the agent
of the Term Lenders, on their collective behalf) which shall be on terms and
conditions reasonably satisfactory to the Agent and otherwise provide that,
among other things, (i) the Secured Parties shall have a first priority interest
in all Collateral and a second priority interest in all applicable Permitted
Released Property and (ii) the Term Lenders shall have a first priority interest
in all applicable Permitted Released Property and a second priority interest in
the Collateral (any such intercreditor agreement, a “Term Intercreditor
Agreement”); and (dd) Liens securing other obligations (including Indebtedness)
not exceeding $10,000,000.
“Permitted General Amount” shall mean $10,000,000 less (i) the aggregate amount
of guaranteed obligations outstanding pursuant to clause (g) of the definition
of Permitted Guaranties, (ii) the aggregate amount of investments outstanding
pursuant to clause (q) of the definition of Permitted Investments and (iii) the
aggregate amount of loans outstanding pursuant to clause (j) of the definition
of Permitted Loans.
“Permitted General Intercompany Amount” shall mean $30,000,000 less (i) the
aggregate amount of guaranteed obligations outstanding pursuant to clause
(f)(ii) of the definition of Permitted Guaranties, (ii) the aggregate amount of
investments outstanding pursuant to clause (o)(iii) of the definition of
Permitted Investments and (iii) the aggregate amount of loans outstanding
pursuant to clause (e) of the definition of Permitted Loans.
“Permitted Guaranties” shall mean: (a) guarantees of Indebtedness or other
obligations of Holdings or one or more of its Subsidiaries which Indebtedness or
other obligation is permitted by this Agreement; (b) the endorsement of checks
or documents in the ordinary course of business; (c) guarantees of Indebtedness
permitted by Section 7.8; (d) guarantees of operating leases of Holdings or one
or more of its Subsidiaries or other obligations of Holdings and one or more of
its Subsidiaries, in each case, that do not constitute Indebtedness and are
entered into in the ordinary course of business; (e) guarantees arising in
connection with the Tax Restructuring Plan and the transactions contemplated
thereby; (f)(i) guarantees by Subsidiaries of Holdings that are not Credit
Parties of the obligations of any other Subsidiaries of Holdings that are not
Credit Parties and (ii) guarantees by the Credit Parties of the obligations of
Subsidiaries of Holdings that are not Credit Parties in an aggregate amount not
to exceed the Permitted General Intercompany Amount; and (g) guaranties of other
obligations in an aggregate principal amount not to exceed the Permitted General
Amount.
“Permitted Holders” shall mean, at any time, Blue Mountain Capital Management,
LLC, GSO Capital Partners LP, Solus Alternative Asset Management LP, or any of
their Affiliates or Related Funds, or their respective successors, assigns,
designees, heirs, beneficiaries, trusts or estates.
“Permitted Indebtedness” shall mean: (a) the Obligations; (b) any guarantees of
Indebtedness permitted under Section 7.3; (c) any Indebtedness outstanding as of
the date hereof and listed on Schedule 7.8; (d) Indebtedness incurred in
connection with Permitted Acquisitions to the extent it is subordinated to the
Obligations on terms and conditions satisfactory to Agent in its sole
discretion; (e) intercompany Indebtedness incurred in accordance with clauses
(c), (d) or (e) of the definition of Permitted Loans; (f) obligations
(contingent or otherwise) existing or arising under any Swap Contract, provided
that such obligations are (or were) entered into for the purpose of directly
mitigating risks associated with fluctuations in interest rates, foreign
exchange rates or commodity prices; (g) Indebtedness issued to insurance
companies, or their affiliates, to finance insurance premiums payable to such
insurance companies, or their affiliates, to finance insurance premiums payable
to such insurance companies in connection with policies purchased by a Credit
Party in the ordinary course of business; (h) Indebtedness in respect of
workers’ compensation claims, self-insurance obligations, performance bonds,
surety appeal or similar bonds and completion guarantees provided by Holdings or
a Subsidiary in the ordinary course of its business; (i) Indebtedness in respect
of (i) self-insurance obligations, completion, bid, performance, appeal or
surety bonds issued for the account of Holdings or any of its Subsidiaries,
performance and completion guarantees, import and export custom and duty
guaranties and similar obligations, in each case in the ordinary course of
business, including guarantees or obligations of Holdings or any of its
Subsidiaries with respect to letters of credit or similar instruments supporting
such obligations (in each case other than for an obligation for money borrowed)
or (ii) obligations represented by letters of credit for the account of Holdings
or any of its Subsidiaries, as the case may be, in order to provide security for
workers’ compensation claims; (j) indemnification, adjustment of purchase price,
earnout or similar obligations, in each case, entered into in connection with
any Permitted Acquisition or permitted Disposition of any business or assets of
Holdings or any of its Subsidiaries or Equity Interests of such a Subsidiary,
other than guarantees of Indebtedness incurred by any Person acquiring all or
any portion of such business, assets or Equity Interests for the purpose of
financing or in contemplation of any such Permitted Acquisition; provided that
(x) any amount of such obligations included on the face of the balance sheet of
Holdings or any of its Subsidiaries shall not be permitted under this clause (j)
and (y) in the case of any permitted Disposition, the maximum aggregate
liability in respect of all such obligations outstanding under this clause (j)
shall at no time exceed the gross proceeds actually received by Holdings and its
Subsidiaries in connection with such permitted Disposition; (k) Indebtedness
arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument drawn against insufficient funds in the ordinary
course of business; provided that such Indebtedness is extinguished within five
Business Days of its incurrence; (l) customer deposits and advance payments
received in the ordinary course of business; (m) Permitted Purchase Money
Indebtedness; (n) Indebtedness incurred in connection with the Tax Restructuring
Plan and the transactions contemplated thereby; (o) secured term Indebtedness
(such indebtedness, “Term Indebtedness”) in an aggregate principal amount (as to
all such Term Indebtedness) at any time outstanding not to exceed $175,000,000
(or such larger amount as to which the Required Lenders shall agree), and, in
any event, only so long as (i) both before and after giving pro forma effect to
the incurrence thereof, the Debt Incurrence Test shall be satisfied, (ii) such
Term Indebtedness shall be secured in accordance with clause (cc) of the
definition of Permitted Encumbrance and (iii) such Term Indebtedness is
otherwise incurred on terms and conditions, and pursuant to documentation
(including any applicable Term Intercreditor Agreement), reasonably satisfactory
to the Agent; and (p) other unsecured Indebtedness in an aggregate principal
amount not to exceed (i) if the Fixed Charge Coverage Ratio for the applicable
Measurement Period shall be at least 1.00 to 1.00 after giving pro forma effect
to the incurrence of such Indebtedness (as demonstrated in a Compliance
Certificate delivered to Agent for distribution to the Lenders), $100,000,000,
and (ii) on any other date, $50,000,000.
“Permitted Investments” shall mean investments in or constituting: (a) Permitted
Loans; (b) cash and Cash Equivalents; (c) [reserved]; (d) receivables owing to
any Credit Party if created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms; provided that
such trade terms may include such concessionary trade terms as any Credit Party
deems reasonable under the circumstances; (e) Equity Interests, obligations or
securities received in settlement of debts created in the ordinary course of
business and owing to any Credit Party or in satisfaction of judgments; (f) any
Person where such investment was acquired by Holdings or any of its Subsidiaries
(x) in exchange for any other investment or accounts receivable held by any
Credit Party in connection with or as a result of a bankruptcy, workout,
reorganization or recapitalization of the issuer of such other investment or
accounts receivable or (y) as a result of a foreclosure by any Credit Party with
respect to any secured investment or other transfer of title with respect to any
secured investment in default; (g) any Person to the extent such investments
consist of prepaid expenses, negotiable instruments held for collection and
lease, utility and workers’ compensation, performance and other similar pledges
and deposits made in the ordinary course of business by any Credit Party; (h)
any Person to the extent such investments consist of Swap Obligations otherwise
permitted under this Agreement; (i) existing investments and any extension,
modification or renewal of such existing investments or any investments made
with the proceeds of any additional advances, contributions or other investments
of cash or other assets or other increases thereof (other than as a result of
the appreciation, accrual or accretion of interest or original issue discount or
the issuance of pay-in-kind securities, in each case, pursuant to the terms of
such existing investment as in effect on the Closing Date); (j) obligations of
one or more officers, directors, or employees of any Credit Party in connection
with such individual’s acquisition of Equity Interests of any Credit Party (and
refinancings of the principal thereof and accrued interest thereon) so long as
no net cash is paid by such Credit Party to such individuals in connection with
the acquisition of any such obligations; (k) investments acquired after the
Closing Date as a result of the acquisition by any Credit Party of another
Person, including by way of a merger, amalgamation, or consolidation with or
into such Credit Party, in a transaction that is not prohibited by this
Agreement to the extent that such investments were not made in contemplation of
such acquisition, merger, amalgamation or consolidation and were in existence on
the date of such acquisition, merger, amalgamation or consolidation; (l)
investments by the Credit Parties in Swap Contracts; (m) investments received in
consideration for an asset sale permitted by Section 7.1; (n) investments
(including Indebtedness and other obligations) received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers in
the ordinary course of business; (o)(i) investments by the Credit Parties and
their respective Subsidiaries in Credit Parties, (ii) additional investments by
Subsidiaries of Holdings that are not Credit Parties in other Subsidiaries of
Holdings that are not Credit Parties and (iii) additional investments by the
Credit Parties in Subsidiaries of Holdings that are not Credit Parties in an
aggregate amount not to exceed the Permitted General Intercompany Amount; (p)
investments arising in connection with the Tax Restructuring Plan and the
transactions contemplated thereby; (q) investments permitted pursuant to Section
7.11(b)(i); and (r) other investments in an aggregate amount at any time not
exceeding the Permitted General Amount.
“Permitted Loans” shall mean: (a) the extension of trade credit by Holdings or
any of its Subsidiaries to its Customer(s), in the ordinary course of business
in connection with a sale of Inventory or rendition of services, in each case on
open account terms; (b) loans to employees in the ordinary course of business
not to exceed as to all such loans the aggregate amount of $2,000,000 at any
time outstanding; (c) intercompany loans between and among Borrowers, so long
as, at the request of Agent, each such intercompany loan is evidenced by a
promissory note (including, if applicable, any master intercompany note executed
by Borrowers) on terms subordinating payment of the indebtedness evidenced by
such note to the prior payment in full of all Obligations reasonably acceptable
to Agent that, if it has a principal value in excess of $1,000,000, has been
delivered to Agent either endorsed in blank or together with an undated
instrument of transfer executed in blank by the applicable Borrower(s) that are
the payee(s) on such note; (d) loans between and among Subsidiaries of Holdings
that are not Credit Parties; (e) loans made by the Credit Parties in
Subsidiaries of Holdings that are not Credit Parties in an aggregate amount
outstanding at any time not to exceed the Permitted General Intercompany Amount;
(f) existing loans and any extension, modification or renewal of such existing
loans (other than as a result of the appreciation, accrual or accretion of
interest or original issue discount or the issuance of pay-in-kind securities,
in each case, pursuant to the terms of such existing loans as in effect on the
Closing Date); (g) payroll, travel and similar extensions of credit to cover
matters that are expected at the time of such extensions of credit ultimately to
be treated as expenses for accounting purposes and that are made in the ordinary
course of business; (h) extensions of credit to employees, officers, directors,
customers and suppliers made in the ordinary course of business of any Credit
Party; (i) intercompany loans arising in connection with the Tax Restructuring
Plan and the transactions contemplated thereby; and (j) loans in an aggregate
amount outstanding at any time not to exceed the Permitted General Amount.
“Permitted Purchase Money Indebtedness” shall mean Purchase Money Indebtedness
of Holdings and its Subsidiaries which is incurred after the date of this
Agreement and which is secured by no Lien or only by a Lien permitted by clause
(g) of the definition of Permitted Encumbrance as defined herein; provided that
(a) the aggregate principal amount of such Purchase Money Indebtedness of
Holdings and its Subsidiaries outstanding at any time shall not exceed
$45,000,000, (b) such Indebtedness when incurred shall not exceed the purchase,
construction or improvement price of the asset(s) financed, and (c) no such
Indebtedness shall be refinanced for a principal amount in excess of the
principal balance outstanding thereon at the time of such refinancing, plus
accrued interest thereon.
“Permitted Released Property” shall mean any and all Released Property that the
Borrowers and Agent reasonably agree may be used as collateral to support any
Term Indebtedness.
“Person” shall mean any individual, sole proprietorship, partnership,
corporation, business trust, joint stock company, trust, unincorporated
organization, association, limited liability company, unlimited liability
company, limited liability partnership, institution, public benefit corporation,
joint venture, entity or Governmental Body (whether federal, state, county,
city, municipal or otherwise, including any instrumentality, division, agency,
body or department thereof).
“Plan” shall mean any employee benefit plan within the meaning of Section 3(3)
of ERISA which is a (i) Pension Benefit Plan, a Multiemployer Plan or a Welfare
Plan (as defined in Section 3(2) of ERISA) which provides self-insured benefits
and (ii) which is maintained by any Credit Party or to which any Credit Party or
is required to contribute.
“Pledge Agreement” shall mean, collectively, (a) that certain Pledge and
Security Agreement, dated the Original Closing Date, executed by certain of the
Borrowers in favor of Agent, for its own benefit and the benefit of the Secured
Parties and (b) any other pledge agreements executed subsequent to the Original
Closing Date by any other Person to secure the Obligations.
“PNC” shall have the meaning set forth in the preamble to this Agreement and
shall extend to all of its successors and assigns.
“Pro Forma Balance Sheet” shall have the meaning set forth in Section 5.5(a).
“Pro Forma Financial Statements” shall have the meaning set forth in Section
5.5(b).
“Projections” shall have the meaning set forth in Section 5.5(b).
“Properly Contested” shall mean, in the case of any Indebtedness, obligation or
Lien, as applicable, of any Person (including any Taxes) that is not paid as and
when due and payable by reason of such Person’s bona fide dispute concerning its
liability to pay same or concerning the amount thereof: (i) such Indebtedness or
Lien, as applicable, is being properly contested in good faith by appropriate
proceedings promptly instituted and diligently conducted; (ii) such Person has
established appropriate reserves as shall be required in conformity with GAAP;
(iii) the non-payment of such Indebtedness is not reasonably expected to have a
Material Adverse Effect; (iv) no Lien is imposed upon any of such Person’s
assets with respect to such Indebtedness unless such Lien is at all times junior
and subordinate in priority to the Liens in favor of Agent (except only with
respect to Liens that have priority as a matter of applicable state law) and
enforcement of such Lien is stayed during the period prior to the final
resolution or disposition of such dispute; (v) if such Indebtedness or Lien, as
applicable, results from, or is determined by the entry, rendition or issuance
against a Person or any of its assets of a judgment, writ, order or decree,
enforcement of such judgment, writ, order or decree is stayed pending a timely
appeal or other judicial review; and (vi) if such contest is abandoned, settled
or determined adversely (in whole or in part) to such Person, such Person
forthwith pays such Indebtedness and all penalties, interest and other amounts
due in connection therewith.
“Protective Advances” shall have the meaning set forth in Section 16.2(f).
“Published Rate” shall mean the rate of interest published each Business Day in
the Wall Street Journal “Money Rates” listing under the caption “London
Interbank Offered Rates” for a one month period (or, if no such rate is
published therein for any reason, then the Published Rate shall be the LIBOR
Rate for a one month period as published in another publication reasonably
selected by the Agent).
“Purchase Money Indebtedness” shall mean and include (i) Indebtedness (other
than the Obligations) of the Credit Parties or any of their respective
Subsidiaries for the payment of all or any part of the purchase price of any
Equipment, Real Property or other fixed assets, (ii) any Indebtedness (other
than the Obligations) of the Credit Parties or any of their respective
Subsidiaries incurred at the time of or within 30 days prior to or 180 days
after the acquisition of any Equipment, Real Property or other fixed assets for
the purpose of financing all or any part of the purchase price thereof (whether
by means of a loan agreement, capitalized lease or otherwise), and (iii) any
renewals, extensions or refinancings (but not any increases in the principal
amounts) thereof outstanding at the time (it being understood that the
definition of Purchase Money Indebtedness shall include Capitalized Lease
Obligations and mortgage financings).
“Purchasing CLO” shall have the meaning set forth in Section 16.3(d).
“Purchasing Lender” shall have the meaning set forth in Section 16.3(c).
“Qualified ECP Credit Party” shall mean, with respect to any Swap Obligation,
(a) each Credit Party that has total assets exceeding $10,000,000 on the
Eligibility Date at the time the guaranty of such Credit Party or the grant of
such security interest becomes effective with respect to such Swap Obligation,
or (b) such other Person as constitutes an Eligible Contract Participant and can
cause another Person to qualify as an Eligible Contract Participant at such time
by entering into a keepwell under Section 1a(18)(A)(v)(II) of the CEA.
“RCRA” shall mean the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901
et seq., as same may be amended from time to time.
“Real Property” shall mean all real property (including fixtures and
improvements thereon) owned or leased by any Credit Party.
“Receivables” shall mean and include, as to each Borrower, as applicable, all of
such Borrower’s, applicable accounts, contract rights, instruments (including
those evidencing indebtedness owed to such Borrower, as applicable by its
Affiliates), documents, chattel paper, (including electronic paper), general
intangibles relating to accounts, drafts and acceptances, credit card
receivables and all other forms of obligations owing to such Borrower, as
applicable arising out of or in connection with the sale or lease of Inventory
or the rendition of services, all supporting obligations, guarantees and other
security therefor, whether secured or unsecured, now existing or hereafter
created, and whether or not specifically sold or assigned to Agent hereunder.
“Receivables Advance Rate” shall have the meaning set forth in Section
2.1(a)(y)(i).
“Recipient” shall mean the Agent, any Lender, Swing Loan Lender, a Participant
or Issuer.
“Register” shall have the meaning set forth in Section 16.3(e).
“Reimbursement Obligation” shall have the meaning set forth in Section 2.14(b).
“Related Fund” means, with respect to a Person, any fund, account or investment
vehicle that is controlled, managed, advised or sub-advised by (a) such Person,
(b) an Affiliate of such Person or (c) the same investment manager, advisor or
subadvisor as such Person or an Affiliate of such investment manager, advisor or
subadvisor.
“Release” shall have the meaning set forth in Section 5.7(c)(i).
“Released Property” shall have the meaning set forth in Section 6.14(b).
“Relevant Twelve Month Period” shall have the meaning set forth in Section 11.6.
“Reportable Compliance Event” shall mean that any Covered Entity becomes a
Sanctioned Person, or is indicted, arraigned or custodially detained in
connection any Anti-Terrorism Law or any predicate crime to any Anti-Terrorism
Law, or self-discovers facts or circumstances implicating any aspect of its
operations with the actual violation of any Anti-Terrorism Law.
“Reportable Event” shall mean a reportable event described in Section 4043(c) of
ERISA or the regulations promulgated thereunder (other than an event for which
the 30-day notice period has been waived by regulation).
“Required Lenders” shall mean Lenders (not including the Swing Loan Lender (in
its capacity as such) or any Defaulting Lender) holding fifty-one percent (51%)
or more of either (a) the aggregate of the Commitment Amounts of all Lenders
(excluding any Defaulting Lender), or (b) after the termination of all
Commitments of the Lenders hereunder, the sum of (i) the outstanding Revolving
Advances and (ii) the aggregate of the Maximum Undrawn Amount of all outstanding
Letters of Credit and outstanding Swing Loans (in each case, excluding any such
Obligations held by a Defaulting Lender); provided, however, if there are fewer
than three (3) Lenders, Required Lenders shall mean all Lenders (excluding any
Defaulting Lender).
“Reserve Percentage” shall mean as of any day of determination the maximum
effective percentage in effect on such day as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
reserve requirements (including supplemental, marginal and emergency reserve
requirements) with respect to eurocurrency funding (currently referred to as
“Eurocurrency Liabilities”).
“Revolving Advances” shall mean Advances other than Letters of Credit and the
Swing Loans.
“Revolving Credit Note” shall mean the promissory notes referred to in Section
2.1(a).
“Revolving Interest Rate” shall mean (a) with respect to Revolving Advances that
are Domestic Rate Loans and Swing Loans, an interest rate per annum equal to the
sum of the Applicable Margin plus the Alternate Base Rate and (b) with respect
to LIBOR Rate Loans, an interest rate per annum equal to the sum of the
Applicable Margin plus the LIBOR Rate.
“Sanctioned Country” shall mean a country that is, or whose government is, the
subject or target of a comprehensive sanctions program maintained by any
Compliance Authority.
“Sanctioned Person” shall mean any individual person, group, regime, entity or
thing listed or otherwise recognized as a specially designated, prohibited,
sanctioned or debarred person or entity, or subject to any limitations or
prohibitions (including but not limited to the blocking of property or rejection
of transactions), under any order or directive of any Compliance Authority
relating to Anti-Terrorism Laws or otherwise subject to, or specially designated
under, any sanctions program maintained by any Compliance Authority relating to
Anti-Terrorism Laws.
“SEC” shall mean the Securities and Exchange Commission or any other similar
applicable authority in any applicable jurisdiction or any successor thereto.
“Secured Parties” shall mean, collectively, Agent, Issuer, Swing Loan Lender and
Lenders, together with any Affiliates of Agent or any Lender to whom any Hedge
Liabilities or Cash Management Liabilities are owed and with each other holder
of any of the Obligations, and the respective successors and assigns of each of
them.
“Securities Act” shall mean the Securities Act of 1933, or any similar
applicable statute in any applicable jurisdiction, as amended.
“Settlement” shall have the meaning set forth in Section 2.6(d).
“Settlement Date” shall have the meaning set forth in Section 2.6(d).
“Specified Dispositions” shall mean each of the following:
(a)    the Disposition of the frac pump manufacturing business of Holdings and
its Subsidiaries and any and all assets related thereto (including, without
limitation, related equipment) to Gardner Denver, Inc. or an affiliate thereof;
(b)    the Disposition of manufacturing businesses (other than the frac pump
manufacturing business) of Holdings and its Subsidiaries and any and all assets
related thereto (including, without limitation, certain real property located in
Granbury, Texas and/or Greenville, Texas, and related inventory);
(c)    the Disposition of the directional drilling resistivity tool business of
Holdings and its Subsidiaries and any and all assets related thereto;
(d)    the Disposition of all or a portion of an ownership interest in Ray
Energy Solutions Private Limited; and
(e)    the Disposition of any salt water disposal well or an ownership interest
in any Person all or substantially all of the assets of which consist of any
salt water disposal well.
which, in each case, (i) shall be sold or otherwise Disposed of for fair market
value and (ii) the proceeds of such Disposition are paid not less than 75% in
cash.
“Specified Equity Contribution” shall have the meaning set forth in Section
11.6.
“Stockholders Agreement” means that agreement, entered into on or about January
6, 2016, by and among Holdings and certain of its stockholders (the “SHA
Stockholders”), as the same may be amended, supplemented, restated or otherwise
modified from time to time.
“Subsidiary” of any Person shall mean a corporation or other entity of whose
Equity Interests having ordinary voting power (other than Equity Interests
having such power only by reason of the happening of a contingency) to elect a
majority of the directors of such corporation, or other Persons performing
similar functions for such entity, are owned, directly or indirectly, by such
Person.
“Subsidiary Stock” shall mean:
(a)    Equity Interests of any Subsidiary of Holdings, other than Excluded
Stock, together with the certificates (or other agreements or instruments), if
any, representing such Equity Interests, and all options and other rights,
contractual or otherwise, with respect thereto (collectively, the “Pledged
Capital Stock”), including, but not limited to, the following:
(x)    all shares, securities, membership interests or other equity interests
representing a dividend on any of the Pledged Capital Stock, or representing a
distribution or return of capital upon or in respect of the Pledged Capital
Stock, or resulting from a stock split, revision, reclassification or other
exchange therefor, and any subscriptions, warrants, rights or options issued to
the holder of, or otherwise in respect of, the Pledged Capital Stock; and
(y)     without affecting the obligations of the Credit Parties under any
provision prohibiting such action hereunder, in the event of any consolidation
or merger involving the issuer of any Pledged Capital Stock and in which such
issuer is not the surviving entity, all shares of each class of the Equity
Interests of the successor entity formed by or resulting from such consolidation
or merger;
(b)    Any and all other Equity Interests owned by any Credit Party in any
Domestic Subsidiary or any Foreign Subsidiary, other than Excluded Stock; and
(c)    All proceeds and products of the foregoing, however and whenever acquired
and in whatever form.
“Swap” shall mean any “swap” as defined in Section 1a(47) of the CEA and
regulations thereunder other than (a) a swap entered into on, or subject to the
rules of, a board of trade designated as a contract market under Section 5 of
the CEA, or (b) a commodity option entered into pursuant to CFTC Regulation
32.3(a).
“Swap Contract” shall mean (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.
“Swap Obligation” shall mean any obligation to pay or perform under any
agreement, contract or transaction that constitutes a Swap which is also a
Lender-Provided Interest Rate Hedge or a Lender-Provided Foreign Currency Hedge.
“Swing Loan Lender” shall mean PNC, in its capacity as lender of the Swing
Loans.
“Swing Loan Note” shall mean the promissory note described in Section 2.4(a).
“Swing Loans” shall mean the Advances made pursuant to Section 2.4.
“Tax Restructuring Plan” shall mean the restructuring transactions described in
Exhibit M to the Plan Supplement for the Borrowers’ plan of reorganization, and
any transactions reasonably incidental thereto.
“Taxes” shall mean all present or future taxes, levies, imposts, duties,
deductions, withholdings, assessments, fees or other charges imposed by any
Governmental Body, including any interest, additions to tax or penalties
applicable thereto.
“Term” shall have the meaning set forth in Section 13.1.
“Term Indebtedness” shall have the meaning set forth in clause (o) of the
definition of Permitted Indebtedness.
“Term Intercreditor Agreement” shall have the meaning set forth in clause (cc)
of the definition of Permitted Encumbrance.
“Term Lender” shall have the meaning set forth in the definition of Permitted
Encumbrance.
“Termination Date” shall mean the date on which (a) all of the Obligations
(including any required repayment or cash collateralization thereof, but
excluding contingent indemnification obligations with respect to which no claims
have been made) have been paid in full in cash, (b) all Commitments have been
terminated and (c) all agreements under which Cash Management Products and
Services, Lender-Provided Interest Rate Hedges or Lender-Provided Foreign
Currency Hedges are provided have been terminated unless, at the option of the
Secured Party providing such Obligations, either cash collateralized pursuant to
clause (a) above or other arrangements satisfactory to such Secured Party have
been made; provided, however, if at any time, any payment, or any part thereof,
made in respect of any of the Obligations, is rescinded or must otherwise be
restored or returned by any Lender upon the insolvency, bankruptcy or
reorganization of any of Borrowers, or otherwise, the Termination Date shall be
deemed to have not occurred.
“Termination Event” shall mean: (i) a Reportable Event with respect to any
Pension Benefit Plan; (ii) the withdrawal of any Credit Party or any member of
the Controlled Group from a Pension Benefit Plan during a plan year in which
such Person was a “substantial employer” as defined in Section 4001(a)(2) of
ERISA or a cessation of operations that is treated as such a withdrawal under
Section 4062(e) of ERISA; (iii) the providing of notice of intent to terminate a
Pension Benefit Plan in a distress termination described in Section 4041(c) of
ERISA or any termination under Section 4042 of ERISA, or of the appointment of a
trustee to administer a Pension Benefit Plan, and with respect to which any
Credit Party has material liability (including liability in its capacity as a
member of the Controlled Group of another entity); (iv) the termination of a
Multiemployer Plan pursuant to Section 4041A or 4042 of ERISA, which termination
could reasonably result in material liability to any Credit Party (including
liability in its capacity as a member of the Controlled Group of another
entity); (v) the partial or complete withdrawal within the meaning of Section
4203 or 4205 of ERISA, of any Credit Party or any member of the Controlled Group
from a Multiemployer Plan, which withdrawal could reasonably result in material
liability of any Credit Party (including liability in its capacity as a member
of the Controlled Group of another entity); (vi) notice that a Multiemployer
Plan is subject to Section 4245 of ERISA; or (vii) the imposition of any
material liability under Title IV of ERISA, other than for PBGC premiums due but
not delinquent, upon any Borrower or any member of the Controlled Group.
“Transactions” shall have the meaning set forth in Section 5.5(a).
“Transferee” shall have the meaning set forth in Section 16.3(d).
“Trigger Event” shall mean, as of any date of determination, (a) an Event of
Default has occurred and is continuing or (b) Excess Availability on any
Business Day was less than 15% of the Maximum Available Credit and, in either
case, (x) Agent has elected to, in its sole discretion, or (y) Agent shall, upon
request of the Required Lenders, commence a Trigger Period.
“Trigger Period” shall mean each period commencing upon the occurrence of a
Trigger Event and ending on the first date thereafter on which either (a) if
such Trigger Event was the occurrence of an Event of Default, such Event of
Default has been waived in writing in accordance with the terms of this
Agreement or (b) in all other cases, Borrowers’ average Excess Availability for
forty-five (45) consecutive days following the occurrence (or re-occurrence) of
any event described in clause (b) of the definition of Trigger Event, is greater
than 15% of the Maximum Available Credit.
“Unbilled Receivables Advance Rate” shall have the meaning set forth in Section
2.1(a)(y)(ii).
“Unfinanced Capital Expenditures” shall mean all Capital Expenditures of
Borrowing Agent and its consolidated Subsidiaries other than those made (i)
utilizing Permitted Purchase Money Indebtedness, (ii) utilizing net cash
proceeds of the issuance of Equity Interests of Borrowing Agent, (iii) utilizing
the proceeds of insurance or asset sales, as permitted under this Agreement, in
order to replace the assets giving rise to such proceeds, (iv) by way of a
trade-in of existing assets, (v) as part of a Permitted Acquisition, or (vi)
utilizing other Indebtedness (except Revolving Advances) permitted to be
incurred hereunder. For the avoidance of doubt, Capital Expenditures made by any
applicable Person with proceeds of Revolving Advances shall be deemed Unfinanced
Capital Expenditures.
“Uniform Commercial Code” shall have the meaning set forth in Section 1.3.
“USA PATRIOT Act” shall mean the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107‑56, as the same has been, or shall hereafter be, renewed,
extended, amended or replaced.
“Wholly Owned Subsidiary” shall mean, as to any Person, a Subsidiary of such
Person of which securities (except for directors’ qualifying shares) or other
ownership interests representing 100% of the Equity Interests are, at the time
any determination is being made, owned, controlled or held by such Person or one
or more wholly owned subsidiaries of such Person or by such Person and one or
more wholly owned subsidiaries of such Person.
“Withholding Agent” means any Credit Party and the Agent.
“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.
1.3.    Uniform Commercial Code Terms. All terms used herein and defined in the
Uniform Commercial Code as adopted in the State of New York from time to time
(the “Uniform Commercial Code”) shall have the meaning given therein unless
otherwise defined herein. Without limiting the foregoing, the terms “accounts”,
“chattel paper” (and “electronic chattel paper” and “tangible chattel paper”),
“commercial tort claims”, “deposit accounts”, “documents”, “equipment”,
“financial asset”, “fixtures”, “general intangibles”, “goods”, “instruments”,
“inventory”, “investment property”, “letter-of-credit rights”, “payment
intangibles”, “proceeds”, “promissory note” “securities”, “software” and
“supporting obligations” as and when used in the description of Collateral shall
have the meanings given to such terms in Articles 8 or 9 of the Uniform
Commercial Code. To the extent the definition of any category or type of
collateral is expanded by any amendment, modification or revision to the Uniform
Commercial Code, such expanded definition will apply automatically as of the
date of such amendment, modification or revision.
1.4.    Certain Matters of Construction. The terms “herein”, “hereof” and
“hereunder” and other words of similar import refer to this Agreement as a whole
and not to any particular section, paragraph or subdivision. All references
herein to Articles, Sections, Exhibits and Schedules shall be construed to refer
to Articles and Sections of, and Exhibits and Schedules to, this Agreement. Any
pronoun used shall be deemed to cover all genders. Wherever appropriate in the
context, terms used herein in the singular also include the plural and vice
versa. All references to Laws shall include any amendments of same and any
successor Laws. Unless otherwise provided, all references to any instruments or
agreements, including references to this Agreement or any of the Other
Documents, shall include any and all modifications, or amendments thereto and
any and all extensions or renewals thereof. All references herein to the time of
day shall mean the time in New York, New York. Unless otherwise provided, all
financial calculations shall be performed with Inventory valued on a first-in,
first-out basis. Whenever the words “including” or “include” shall be used, such
words shall be understood to mean “including, without limitation” or “include,
without limitation”. A Default or an Event of Default shall be deemed to exist
at all times during the period commencing on the date that such Default or Event
of Default occurs to the date on which such Default or Event of Default is
waived in writing pursuant to this Agreement or, in the case of a Default, is
cured within any period of cure expressly provided for in this Agreement; and an
Event of Default shall “continue” or be “continuing” until such Event of Default
has been waived in writing by Required Lenders. Any Lien referred to in this
Agreement or any of the Other Documents as having been created in favor of
Agent, any agreement entered into by Agent pursuant to this Agreement or any of
the Other Documents, any payment made by or to or funds received by Agent
pursuant to or as contemplated by this Agreement or any of the Other Documents,
or any act taken or omitted to be taken by Agent, shall, unless otherwise
expressly provided, be created, entered into, made or received, or taken or
omitted, for the benefit or account of Agent and Lenders. Wherever the phrase
“to the best of Borrowers’ knowledge” or words of similar import relating to the
knowledge or the awareness of any Borrower are used in this Agreement or Other
Documents, such phrase shall mean and refer to (i) the actual knowledge of an
Authorized Officer of any Borrower or (ii) the knowledge that an Authorized
Officer would have obtained if he/she had engaged in good faith and diligent
performance of his/her duties, including the making of such reasonably specific
inquiries as may be necessary of the employees or agents of such Borrower and a
good faith attempt to ascertain the existence or accuracy of the matter to which
such phrase relates. All covenants hereunder shall be given independent effect
so that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or otherwise
within the limitations of, another covenant shall not avoid the occurrence of a
default if such action is taken or condition exists. In addition, all
representations and warranties hereunder shall be given independent effect so
that if a particular representation or warranty proves to be incorrect or is
breached, the fact that another representation or warranty concerning the same
or similar subject matter is correct or is not breached will not affect the
incorrectness of a breach of a representation or warranty hereunder.
1.5.    Permitted Encumbrances.    The inclusion of Permitted Encumbrances in
this Agreement is not intended to subordinate and shall not subordinate any Lien
created by any of the security contemplated by this Agreement and the Other
Documents to any Permitted Encumbrances.
II.    ADVANCES, PAYMENTS.
2.1.    Revolving Advances.
(a)    Amount of Revolving Advances. Subject to the terms and conditions set
forth in this Agreement, each Lender, severally and not jointly, will make
Revolving Advances to Borrowers in aggregate amounts outstanding at any time
equal to such Lender’s Commitment Percentage of the lesser of (x) the Maximum
Revolving Advance Amount, less the outstanding amount of Swing Loans, less the
aggregate Maximum Undrawn Amount of all outstanding Letters of Credit or (y) an
amount equal to the sum of:
(i)    eighty-five percent (85%) (the “Receivables Advance Rate”) of Eligible
Receivables; plus
(ii)    the lesser of (A) up to eighty percent (80%) of Eligible Unbilled
Receivables and (B) twenty percent (20%) of the Formula Amount (“Unbilled
Receivables Advance Rate”); plus
(iii)    the least of (A) up to sixty percent (60%) (the “Inventory Advance
Rate”; and together with the Receivables Advance Rate and the Unbilled
Receivables Advance Rate, the “Advance Rates”) of the net book value of Eligible
Inventory, (B) up to eighty-five percent (85%) (the “NOLV Advance Rate”) of the
net orderly liquidation value percentage (as evidenced by the most recent
appraisal accepted by Agent in its Permitted Discretion, each, an “NOLV
Appraisal”) of Eligible Inventory, and (C) twenty percent (20%) of the Formula
Amount; minus
(iv)    the aggregate Maximum Undrawn Amount of all outstanding Letters of
Credit and the outstanding amount of Swing Loans; minus
(v)    such reserves as Agent may reasonably deem proper and necessary from time
to time in the exercise of its Permitted Discretion.
The amount derived from the sum of (x) Sections 2.1(a)(y)(i), (ii) and (iii)
minus (y) Sections 2.1(a)(y)(iv) and (v) at any time and from time to time shall
be referred to as the “Formula Amount”. The Revolving Advances shall be
evidenced by one or more secured promissory notes (collectively, the “Revolving
Credit Note”) substantially in the form attached hereto as Exhibit 2.1(a).
Notwithstanding anything to the contrary contained in the foregoing or otherwise
in this Agreement, the outstanding aggregate principal amount of Swing Loans and
the Revolving Advances at any one time outstanding shall not exceed an amount
equal to the lesser of (i) the Maximum Revolving Advance Amount less the Maximum
Undrawn Amount of all outstanding Letters of Credit or (ii) the Formula Amount.
(b)    Discretionary Rights. The Advance Rates may be (i) increased by Agent at
any time and from time to time in the exercise of its Permitted Discretion and
(ii) at any time and from time to time following the occurrence and during the
continuance of an Event of Default, decreased by Agent in the exercise of its
Permitted Discretion. Each Borrower consents to any such increases or decreases
and acknowledges that decreasing the Advance Rates or increasing or imposing
reserves may limit or restrict Advances requested by Borrowing Agent. The rights
of Agent under this subsection are subject to the provisions of Section 16.2(b).
2.2.    Procedures for Requesting Revolving Advances; Procedures for Selection
of Applicable Interest Rates for All Advances.
(a)    Borrowing Agent on behalf of any Borrower may notify Agent prior to 1:00
p.m. on a Business Day of a Borrower’s request to incur, on that day, a
Revolving Advance hereunder. Should any amount required to be paid as interest
hereunder, or as fees or other charges under this Agreement or any other
agreement with Agent or Lenders, or with respect to any other Obligation under
this Agreement, become due, same shall be deemed a request for a Revolving
Advance maintained as a Domestic Rate Loan as of the date such payment is due,
in the amount required to pay in full such interest, fee, charge or Obligation,
and such request shall be irrevocable.
(b)    Notwithstanding the provisions of subsection (a) above, in the event any
Borrower desires to obtain a LIBOR Rate Loan for any Advance (other than a Swing
Loan), Borrowing Agent shall give Agent written notice by no later than 1:00
p.m. on the day which is three (3) Business Days prior to the date such LIBOR
Rate Loan is to be borrowed, specifying (i) the date of the proposed borrowing
(which shall be a Business Day), (ii) the type of borrowing and the amount of
such Advance to be borrowed, which amount shall be in a minimum amount of
$500,000 and in integral multiples of $100,000 thereafter, and (iii) the
duration of the first Interest Period therefor. Interest Periods for LIBOR Rate
Loans shall be for one (1), two (2), three (3) or six (6) months; provided that,
if an Interest Period would end on a day that is not a Business Day, it shall
end on the next succeeding Business Day unless such day falls in the next
succeeding calendar month in which case the Interest Period shall end on the
next preceding Business Day. No LIBOR Rate Loan shall be made available to any
Borrower during the continuance of a Default or an Event of Default. After
giving effect to each requested LIBOR Rate Loan, including those which are
converted from a Domestic Rate Loan under Section 2.2(e), there shall not be
outstanding more than six (6) LIBOR Rate Loans, in the aggregate.
(c)    Each Interest Period of a LIBOR Rate Loan shall commence on the date such
LIBOR Rate Loan is made and shall end on such date as Borrowing Agent may elect
as set forth in subsection (b)(iii) above, provided that the exact length of
each Interest Period shall be determined in accordance with the practice of the
interbank market for offshore Dollar deposits and no Interest Period shall end
after the last day of the Term.
(d)    Borrowing Agent shall elect the initial Interest Period applicable to a
LIBOR Rate Loan by its notice of borrowing given to Agent pursuant to Section
2.2(b) or by its notice of conversion given to Agent pursuant to Section 2.2(e),
as the case may be. Borrowing Agent shall elect the duration of each succeeding
Interest Period by giving irrevocable written notice to Agent of such duration
not later than 1:00 p.m. on the day which is three (3) Business Days prior to
the last day of the then current Interest Period applicable to such LIBOR Rate
Loan. If Agent does not receive timely notice of the Interest Period elected by
Borrowing Agent, Borrowing Agent shall be deemed to have elected to convert such
LIBOR Rate Loan to a Domestic Rate Loan subject to Section 2.2(e) below.
(e)    Provided that no Default or Event of Default shall have occurred and be
continuing, Borrowing Agent may, on the last Business Day of the then current
Interest Period applicable to any outstanding LIBOR Rate Loan, or on any
Business Day with respect to Domestic Rate Loans, convert any such loan into a
loan of another type in the same aggregate principal amount provided that any
conversion of a LIBOR Rate Loan shall be made only on the last Business Day of
the then current Interest Period applicable to such LIBOR Rate Loan. If
Borrowing Agent desires to convert a loan, Borrowing Agent shall give Agent
written notice by no later than 1:00 p.m. (i) on the day which is three (3)
Business Days prior to the date on which such conversion is to occur with
respect to a conversion from a Domestic Rate Loan to a LIBOR Rate Loan, or (ii)
on the day which is one (1) Business Day prior to the date on which such
conversion is to occur (which date shall be the last Business Day of the
Interest Period for the applicable LIBOR Rate Loan) with respect to a conversion
from a LIBOR Rate Loan to a Domestic Rate Loan, specifying, in each case, the
date of such conversion, the loans to be converted and if the conversion is to a
LIBOR Rate Loan, the duration of the first Interest Period therefor.
(f)    At its option and upon written notice given prior to 1:00 p.m. at least
three (3) Business Days prior to the date of such prepayment, any Borrower may,
subject to Section 2.2(g), prepay the LIBOR Rate Loans in whole at any time or
in part from time to time with accrued interest on the principal being prepaid
to the date of such repayment. Such Borrower shall specify the date of
prepayment of Advances which are LIBOR Rate Loans and the amount of such
prepayment. In the event that any prepayment of a LIBOR Rate Loan is required or
permitted on a date other than the last Business Day of the then current
Interest Period with respect thereto, such Borrower shall indemnify Agent and
Lenders therefor in accordance with Section 2.2(g).
(g)    Each Borrower shall indemnify Agent and Lenders and hold Agent and
Lenders harmless from and against any and all losses or expenses that Agent and
Lenders may sustain or incur as a consequence of any prepayment, conversion of
or any default by any Borrower in the payment of the principal of or interest on
any LIBOR Rate Loan or failure by any such Borrower to complete a borrowing of,
a prepayment of or conversion of or to a LIBOR Rate Loan after notice thereof
has been given, including, but not limited to, any interest payable by Agent or
Lenders to lenders of funds obtained by it in order to make or maintain its
LIBOR Rate Loans hereunder. A certificate as to any additional amounts payable
pursuant to the foregoing sentence submitted by Agent or any Lender to Borrowing
Agent shall be conclusive absent manifest error.
(h)    Notwithstanding any other provision hereof, if any Applicable Law,
treaty, regulation or directive, or any change therein or in the interpretation
or application thereof, including without limitation any Change in Law, shall
make it unlawful for Lenders or any Lender (for purposes of this subsection (h),
the term “Lender” shall include any Lender and the office or branch where any
Lender or any Person controlling such Lender makes or maintains any LIBOR Rate
Loans) to make or maintain its LIBOR Rate Loans, the obligation of Lenders (or
such affected Lender) to make LIBOR Rate Loans hereunder shall forthwith be
cancelled and Borrowers shall, if any affected LIBOR Rate Loans are then
outstanding, promptly upon request from Agent, either pay all such affected
LIBOR Rate Loans or convert such affected LIBOR Rate Loans into loans of another
type. If any such payment or conversion of any LIBOR Rate Loan is made on a day
that is not the last day of the Interest Period applicable to such LIBOR Rate
Loan, Borrowers shall pay Agent, upon Agent’s request, such amount or amounts
set forth in clause (g) above. A certificate as to any additional amounts
payable pursuant to the foregoing sentence submitted by Lenders to Borrowing
Agent shall be conclusive absent manifest error.
2.3.    [Reserved]
2.4.    Swing Loans.
(a)    Subject to the terms and conditions set forth in this Agreement, and in
order to minimize the transfer of funds between Lenders and Agent for
administrative convenience, Agent, Lenders holding Commitments and Swing Loan
Lender agree that in order to facilitate the administration of this Agreement,
Swing Loan Lender may, at its election and option made in its sole discretion
cancelable at any time for any reason whatsoever, make swing loan advances
(“Swing Loans”) available to Borrowers as provided for in this Section at any
time or from time to time after the date hereof to, but not including, the
expiration of the Term, in an aggregate principal amount up to but not in excess
of the Maximum Swing Loan Advance Amount, provided that the outstanding
aggregate principal amount of Swing Loans and the Revolving Advances at any one
time outstanding shall not exceed an amount equal to the lesser of (i) the
Maximum Revolving Advance Amount less the Maximum Undrawn Amount of all
outstanding Letters of Credit or (ii) the Formula Amount and shall be subject to
the sublimits in Section 2.1(a). All Swing Loans shall be Domestic Rate Loans
only. Borrowers may borrow (at the option and election of Swing Loan Lender),
repay and reborrow (at the option and election of Swing Loan Lender) Swing Loans
and Swing Loan Lender may make Swing Loans as provided in this Section during
the period between Settlement Dates.  All Swing Loans shall be evidenced by a
secured promissory note (the “Swing Loan Note”) substantially in the form
attached hereto as Exhibit 2.4(a). Swing Loan Lender’s agreement to make Swing
Loans under this Agreement is cancelable at any time for any reason whatsoever
and the making of Swing Loans by Swing Loan Lender from time to time shall not
create any duty or obligation, or establish any course of conduct, pursuant to
which Swing Loan Lender shall thereafter be obligated to make Swing Loans in the
future.
(b)    Upon (i) any request by Borrowing Agent for a Revolving Advance made
pursuant to Section 2.2(a), (ii) the occurrence of any deemed request by
Borrowers for a Revolving Advance pursuant to the provisions of the last
sentence of Section 2.2(a) or (iii) receipt by the Swing Loan Lender of a
written Swing Loan request from the Borrowing Agent at or prior to 2:30 p.m. on
the requested date of borrowing (so long as such date is a Business Day), Swing
Loan Lender may elect, in its sole discretion, to have such request or deemed
request treated as a request for a Swing Loan, and may advance same day funds to
Borrowers as a Swing Loan; provided that, notwithstanding anything to the
contrary provided for herein, Swing Loan Lender may not make Swing Loan Advances
if Swing Loan Lender has been notified by Agent or by Required Lenders that one
or more of the applicable conditions set forth in Section 8.2 have not been
satisfied or the Commitments have been terminated for any reason.
(c)    Upon the making of a Swing Loan (whether before or after the occurrence
of a Default or an Event of Default and regardless of whether a Settlement has
been requested with respect to such Swing Loan), each Lender holding a
Commitment shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from Swing Loan Lender, without
recourse or warranty, an undivided interest and participation in such Swing Loan
in proportion to its Commitment Percentage. Swing Loan Lender or Agent may, at
any time, require the Lenders holding Commitments to fund such participations by
means of a Settlement as provided for in Section 2.6(d) below. From and after
the date, if any, on which any Lender holding a Commitment is required to fund,
and funds, its participation in any Swing Loans purchased hereunder, Agent shall
promptly distribute to such Lender its Commitment Percentage of all payments of
principal and interest and all proceeds of Collateral received by Agent in
respect of such Swing Loan; provided that no Lender holding a Commitment shall
be obligated in any event to make Revolving Advances in an amount in excess of
its Commitment Amount minus its Participation Commitment (taking into account
any reallocations under Section 2.22) of the Maximum Undrawn Amount of all
outstanding Letters of Credit.
2.5.    Disbursement of Advance Proceeds. All Advances shall be disbursed from
whichever office or other place Agent may designate from time to time and,
together with any and all other Obligations of Borrowers to Agent or Lenders,
shall be charged to Borrowers’ Account on Agent’s books. The proceeds of each
Revolving Advance or Swing Loan requested by Borrowing Agent on behalf of any
Borrower or deemed to have been requested by any Borrower under Section 2.2(a),
2.6(b) or 2.14 shall, (i) with respect to requested Revolving Advances, to the
extent Lenders make such Revolving Advances in accordance with Section 2.2(a),
2.6(b) or 2.14, and with respect to Swing Loans made upon any request by
Borrowing Agent for a Revolving Advance to the extent Swing Loan Lender makes
such Swing Loan in accordance with Section 2.4(b), be made available to the
applicable Borrower on the day so requested by way of credit to such Borrower’s
operating account at PNC, or such other bank as Borrowing Agent may designate
following notification to Agent, in immediately available federal funds or other
immediately available funds or, (ii) with respect to Revolving Advances deemed
to have been requested by any Borrower or Swing Loans made upon any deemed
request for a Revolving Advance by any Borrower, be disbursed to Agent to be
applied to the outstanding Obligations giving rise to such deemed request.
During the Term, Borrowers may use the Revolving Advances and Swing Loans by
borrowing, prepaying and reborrowing, all in accordance with the terms and
conditions hereof.
2.6.    Making and Settlement of Advances.
(a)    Each borrowing of Revolving Advances shall be advanced according to the
applicable Commitment Percentages of Lenders holding the Commitments (subject to
any contrary terms of Section 2.22). Each borrowing of Swing Loans shall be
advanced by Swing Loan Lender alone.
(b)    Promptly after receipt by Agent of a request or a deemed request for a
Revolving Advance pursuant to Section 2.2(a) and, with respect to Revolving
Advances, to the extent Agent elects not to provide a Swing Loan or the making
of a Swing Loan would result in the aggregate amount of all outstanding Swing
Loans exceeding the maximum amount permitted in Section 2.4(a), Agent shall
notify Lenders holding the Commitments of its receipt of such request specifying
the information provided by Borrowing Agent and the apportionment among Lenders
of the requested Revolving Advance as determined by Agent in accordance with the
terms hereof. Each Lender shall remit the principal amount of each Revolving
Advance to Agent such that Agent is able to, and Agent shall, to the extent the
applicable Lenders have made funds available to it for such purpose and subject
to Section 8.2, fund such Revolving Advance to Borrowers in U.S. Dollars and
immediately available funds at the Payment Office prior to the close of
business, on the applicable borrowing date; provided that if any applicable
Lender fails to remit such funds to Agent in a timely manner, Agent may elect in
its sole discretion to fund with its own funds the Revolving Advance of such
Lender on such borrowing date, and such Lender shall be subject to the repayment
obligation in clause (c) of this Section.
(c)    Unless Agent shall have been notified by telephone, confirmed in writing,
by any Lender holding a Commitment that such Lender will not make the amount
which would constitute its applicable Commitment Percentage of the requested
Revolving Advance available to Agent, Agent may (but shall not be obligated to)
assume that such Lender has made such amount available to Agent on such date in
accordance with clause (b) of this Section and may, in reliance upon such
assumption, make available to Borrowers a corresponding amount. Agent will
promptly notify Borrowing Agent of its receipt of any such notice from a Lender.
In such event, if a Lender has not in fact made its applicable Commitment
Percentage of the requested Revolving Advance available to Agent, then the
applicable Lender and Borrowers severally agree to pay to Agent on demand such
corresponding amount with interest thereon, for each day from and including the
date such amount is made available to Borrowers through but excluding the date
of payment to Agent, at (i) in the case of a payment to be made by such Lender,
the greater of (A) (x) the daily average Federal Funds Effective Rate (computed
on the basis of a year of 360 days) during such period as quoted by Agent, times
(y) such amount or (B) a rate determined by Agent in accordance with banking
industry rules on interbank compensation, and (ii) in the case of a payment to
be made by Borrowers, the Revolving Interest Rate for Revolving Advances that
are Domestic Rate Loans. If such Lender pays its share of the applicable
Revolving Advance to Agent, then the amount so paid shall constitute such
Lender’s Revolving Advance. Any payment by Borrowers shall be without prejudice
to any claim Borrowers may have against a Lender holding a Commitment that shall
have failed to make such payment to Agent. A certificate of Agent submitted to
any Lender or Borrowers with respect to any amounts owing under this paragraph
(c) shall be conclusive, in the absence of manifest error.
(d)    Agent, on behalf of Swing Loan Lender, shall demand settlement (a
“Settlement”) of all or any Swing Loans with Lenders holding the Commitments on
at least a weekly basis, or on any more frequent date that Agent elects or that
Swing Loan Lender at its option exercisable for any reason whatsoever may
request, by notifying Lenders holding the Commitments of such requested
Settlement by facsimile, telephonic or electronic transmission no later than
3:00 p.m. on the date of such requested Settlement (the “Settlement Date”).
Subject to any contrary provisions of Section 2.22, each Lender holding a
Commitment shall transfer the amount of such Lender’s Commitment Percentage of
the outstanding principal amount (plus interest accrued thereon to the extent
requested by Agent) of the applicable Swing Loan with respect to which
Settlement is requested by Agent, to such account of Agent as Agent may
designate not later than 5:00 p.m. on such Settlement Date if requested by Agent
by 3:00 p.m., otherwise not later than 5:00 p.m. on the next Business Day.
Settlements may occur at any time notwithstanding that the conditions precedent
to making Revolving Advances set forth in Section 8.2 have not been satisfied or
the Commitments shall have otherwise been terminated at such time. All amounts
so transferred to Agent shall be applied against the amount of outstanding Swing
Loans and, when so applied shall constitute Revolving Advances of such Lenders
accruing interest as Domestic Rate Loans. If any such amount is not transferred
to Agent by any Lender holding a Commitment on such Settlement Date, Agent shall
be entitled to recover such amount on demand from such Lender together with
interest thereon as specified in Section 2.6(c).
(e)    If any Lender or Participant (a “Benefited Lender”) shall at any time
receive any payment of all or part of its Advances, or interest thereon, or
receive any Collateral in respect thereof (whether voluntarily or involuntarily
or by set-off) in a greater proportion than any such payment to and Collateral
received by any other Lender, if any, in respect of such other Lender’s
Advances, or interest thereon, and such greater proportionate payment or receipt
of Collateral is not expressly permitted hereunder, such Benefited Lender shall
purchase for cash from the other Lenders a participation in such portion of each
such other Lender’s Advances, or shall provide such other Lender with the
benefits of any such Collateral, or the proceeds thereof, as shall be necessary
to cause such Benefited Lender to share the excess payment or benefits of such
Collateral or proceeds ratably with each of the other Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest. Each Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under Applicable Law, that each
Lender so purchasing a portion of another Lender’s Advances may exercise all
rights of payment (including rights of set-off) with respect to such portion as
fully as if such Lender were the direct holder of such portion, and the
obligations owing to each such purchasing Lender in respect of such
participation and such purchased portion of any other Lender’s Advances shall be
part of the Obligations secured by the Collateral, and the obligations owing to
each such purchasing Lender in respect of such participation and such purchased
portion of any other Lender’s Advances shall be part of the Obligations secured
by the Collateral.
2.7.    Maximum Advances. The aggregate balance of Revolving Advances plus Swing
Loans outstanding at any time shall not exceed the lesser of (a) the Maximum
Revolving Advance Amount less the aggregate Maximum Undrawn Amount of all issued
and outstanding Letters of Credit or (b) the Formula Amount.
2.8.    Manner and Repayment of Advances.
(a)    The Revolving Advances and Swing Loans shall be due and payable in full
on the last day of the Term subject to earlier prepayment as herein provided.
Notwithstanding the foregoing, all Advances shall be subject to earlier
repayment upon (x) acceleration upon the occurrence and continuance of an Event
of Default under this Agreement or (y) termination of this Agreement by the
Borrowing Agent. Each payment (including each prepayment) by any Borrower on
account of the principal of and interest on the Advances shall be applied, first
to the outstanding Swing Loans and next, pro rata according to the applicable
Commitment Percentages of Lenders, to the outstanding Advances (subject to any
contrary provisions of Section 2.22).
(b)    Each Borrower recognizes that the amounts evidenced by checks, notes,
drafts or any other items of payment relating to and/or proceeds of Collateral
may not be collectible by Agent on the date received by Agent. Agent shall
conditionally credit Borrowers’ Account for each item of payment on the next
Business Day after the Business Day on which such item of payment is received by
Agent (and the Business Day on which each such item of payment is so credited
shall be referred to, with respect to such item, as the “Application Date”).
Agent is not, however, required to credit the applicable Borrowers’ Account for
the amount of any item of payment which is unsatisfactory to Agent and Agent may
charge Borrowers’ Account for the amount of any item of payment which is
returned, for any reason whatsoever, to Agent unpaid. Subject to the foregoing,
Borrowers agree that for purposes of computing the interest charges under this
Agreement, each item of payment received by Agent shall be deemed applied by
Agent on account of the Obligations on its respective Application Date. All
proceeds received by Agent during a Trigger Period shall be applied to the
Obligations in accordance with Section 4.8(g).
(c)    All payments of principal, interest and other amounts payable hereunder,
or under any of the Other Documents shall be made to Agent at the Payment Office
not later than 1:00 p.m. on the due date therefor in Dollars in federal funds or
other funds immediately available to Agent. Agent shall have the right to
effectuate payment of any and all Obligations due and owing hereunder by
charging the applicable Borrowers’ Account or by making Advances as provided in
Section 2.2.
(d)    Except as expressly provided herein, all payments (including prepayments)
to be made by any Borrower on account of principal, interest, fees and other
amounts payable hereunder shall be made without deduction, setoff or
counterclaim and shall be made to Agent on behalf of Lenders to the Payment
Office, in each case on or prior to 1:00 p.m., in Dollars and in immediately
available funds.
2.9.    Repayment of Excess Advances. If at any time the aggregate balance of
outstanding Revolving Advances, Swing Loans, and/or Advances taken as a whole
exceeds the maximum amount of such type of Advances and/or Advances taken as a
whole (as applicable) permitted hereunder, such excess Advances shall be
immediately due and payable without the necessity of any demand, at the Payment
Office, whether or not a Default or an Event of Default has occurred.
2.10.    Statement of Account. Agent shall maintain, in accordance with its
customary procedures, loan accounts (“Borrowers’ Accounts”), in the names of
Borrowers, in which shall be recorded the date and amount of each Advance made
by Agent or Lenders and the date and amount of each payment in respect thereof;
provided, however, the failure by Agent to record the date and amount of any
Advance shall not adversely affect Agent or any Lender. Each month, Agent shall
send to Borrowing Agent a statement showing the accounting for the Advances
made, payments made or credited in respect thereof, and other transactions
between Agent, Lenders and Borrowers during such month. The monthly statements
shall be deemed correct and binding upon Borrowers in the absence of manifest
error and shall constitute an account stated between Lenders and Borrowers
unless Agent receives a written statement of Borrowers’ specific exceptions
thereto within thirty (30) days after such statement is received by Borrowing
Agent. The records of Agent with respect to the Borrowers’ Accounts shall be
conclusive evidence absent manifest error of the amounts of Advances and other
charges thereto and of payments applicable thereto.
2.11.    Letters of Credit.
(a)    Subject to the terms and conditions hereof, Issuer shall issue or cause
the issuance of standby and/or trade letters of credit denominated in Dollars
(“Letters of Credit”) for the account of any Borrower except to the extent that
the issuance thereof would then cause the sum of (i) the outstanding Revolving
Advances plus (ii) the outstanding Swing Loans, plus (iii) the Maximum Undrawn
Amount of all outstanding Letters of Credit, plus (iv) the Maximum Undrawn
Amount of the Letter of Credit to be issued to exceed the lesser of (x) the
Maximum Revolving Advance Amount or (y) the Formula Amount (calculated without
giving effect to the deductions provided for in Section 2.1(a)(y)(vi)). The
Maximum Undrawn Amount of all outstanding Letters of Credit shall not exceed in
the aggregate at any time the Letter of Credit Sublimit. All disbursements or
payments related to Letters of Credit shall be deemed to be Domestic Rate Loans
consisting of Revolving Advances and shall bear interest at the Revolving
Interest Rate for Domestic Rate Loans. Letters of Credit that have not been
drawn upon shall not bear interest (but fees shall accrue in respect of
outstanding Letters of Credit as provided in Section 3.2).
(b)    Notwithstanding any provision of this Agreement, Issuer shall not be
under any obligation to issue any Letter of Credit if (i) any order, judgment or
decree of any Governmental Body or arbitrator shall by its terms purport to
enjoin or restrain  Issuer from issuing any Letter of Credit, or any Law
applicable to Issuer or any request or directive (whether or not having the
force of law) from any Governmental Body with jurisdiction over Issuer shall
prohibit, or request that Issuer refrain from, the issuance of letters of credit
generally or the Letter of Credit in particular or shall impose upon Issuer with
respect to the Letter of Credit any restriction, reserve or capital requirement
(for which Issuer is not otherwise compensated hereunder) not in effect on the
date of this Agreement, or shall impose upon Issuer any unreimbursed loss, cost
or expense which was not applicable on the date of this Agreement, and which
Issuer in good faith deems material to it, or (ii) the issuance of the Letter of
Credit would violate one or more policies of Issuer applicable to letters of
credit generally.
2.12.    Issuance of Letters of Credit.
(a)    Borrowing Agent, on behalf of any Borrower, may request Issuer to issue
or cause the issuance of a Letter of Credit by delivering to Issuer, with a copy
to Agent at the Payment Office, prior to 1:00 p.m., at least five (5) Business
Days prior to the proposed date of issuance, such Issuer’s form of Letter of
Credit Application (the “Letter of Credit Application”) completed to the
satisfaction of Agent and Issuer; and, such other certificates, documents and
other papers and information as Agent or Issuer may reasonably request. Issuer
shall not issue any requested Letter of Credit if such Issuer has received
notice from Agent or any Lender that one or more of the applicable conditions
set forth in Section 8.2 have not been satisfied or the commitments of Lenders
to make Revolving Advances hereunder have been terminated for any reason.
(b)    Each Letter of Credit shall, among other things, (i) provide for the
payment of sight drafts, other written demands for payment, or acceptances of
usance drafts when presented for honor thereunder in accordance with the terms
thereof and when accompanied by the documents described therein and (ii) have an
expiry date not later than twelve (12) months after such Letter of Credit’s date
of issuance and any automatic renewals thereof and in no event later than the
last day of the Term. Each standby Letter of Credit shall be subject either to
the Uniform Customs and Practice for Documentary Credits as most recently
published by the International Chamber of Commerce at the time a Letter of
Credit is issued (the “UCP”) or the International Standby Practices
(ISP98-International Chamber of Commerce Publication Number 590) (the “ISP98
Rules”), or any subsequent revision thereof at the time a standby Letter of
Credit is issued, as determined by Issuer, and each trade Letter of Credit shall
be subject to the UCP. In addition, no trade Letter of Credit may permit the
presentation of an ocean bill of lading that includes a condition that the
original bill of lading is not required to claim the goods shipped thereunder.
(c)    Agent shall use its reasonable efforts to notify Lenders of the request
by Borrowing Agent for a Letter of Credit hereunder.
2.13.    Requirements For Issuance of Letters of Credit.
(a)    Borrowing Agent shall authorize and direct any Issuer to name the
applicable Borrower as the “Applicant” or “Account Party” of each Letter of
Credit. If Agent is not the Issuer of any Letter of Credit, Borrowing Agent
shall authorize and direct the Issuer to deliver to Agent all instruments,
documents, and other writings and property received by the Issuer pursuant to
the Letter of Credit and to accept and rely upon Agent’s instructions and
agreements with respect to all matters arising in connection with the Letter of
Credit or the application therefor.
(b)    In connection with all trade Letters of Credit issued or caused to be
issued by Issuer under this Agreement, each Borrower hereby appoints Issuer, or
its designee, as its attorney, with full power and authority if an Event of
Default shall have occurred and continues: (i) to sign and/or endorse such
Borrower’s name upon any warehouse or other receipts, and acceptances; (ii) to
sign such Borrower’s name on bills of lading; (iii) to clear Inventory through
the United States of America Customs Department (“Customs”) in the name of such
Borrower or Issuer or Issuer’s designee, and to sign and deliver to Customs
officials powers of attorney in the name of such Borrower for such purpose; and
(iv) to complete in such Borrower’s name or Issuer’s, or in the name of Issuer’s
designee, any order, sale or transaction, obtain the necessary documents in
connection therewith, and collect the proceeds thereof. Neither Agent, Issuer
nor their attorneys will be liable for any acts or omissions nor for any error
of judgment or mistakes of fact or law, except for Agent’s, Issuer’s or their
respective attorney’s gross negligence or willful misconduct. This power, being
coupled with an interest, is irrevocable as long as any Letters of Credit remain
outstanding.
2.14.    Disbursements, Reimbursement.
(a)    Immediately upon the issuance of each Letter of Credit, each Lender
holding a Commitment shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from Issuer a participation in each Letter
of Credit and each drawing thereunder in an amount equal to such Lender’s
Commitment Percentage of the Maximum Undrawn Amount of such Letter of Credit (as
in effect from time to time) and the amount of such drawing, respectively.
(b)    In the event of any request for a drawing under a Letter of Credit by the
beneficiary or transferee thereof, Issuer will promptly notify Agent and
Borrowing Agent. Regardless of whether Borrowing Agent shall have received such
notice, Borrowers shall reimburse (such obligation to reimburse Issuer shall
sometimes be referred to as a “Reimbursement Obligation”) Issuer prior to 12:00
noon, on each date that an amount is paid by Issuer under any Letter of Credit
(each such date, a “Drawing Date”) in an amount equal to the amount so paid by
Issuer. In the event Borrowers fail to reimburse Issuer for the full amount of
any drawing under any Letter of Credit by 12:00 noon, on the Drawing Date,
Issuer will promptly notify Agent and each Lender holding a Commitment thereof,
and Borrowers shall be automatically deemed to have requested that a Revolving
Advance maintained as a Domestic Rate Loan be made by Lenders to be disbursed on
the Drawing Date under such Letter of Credit, and Lenders holding the
Commitments shall be unconditionally obligated to fund such Revolving Advance
(all whether or not the conditions specified in Section 8.2 are then satisfied
or the commitments of Lenders to make Revolving Advances hereunder have been
terminated for any reason) as provided for in clause (c) of this Section
immediately below. Any notice given by Issuer pursuant to this clause (b) may be
oral if promptly confirmed in writing; provided that the lack of such a
confirmation shall not affect the conclusiveness or binding effect of such
notice.
(c)    Each Lender holding a Commitment shall upon any notice pursuant to clause
(b) of this Section make available to Issuer through Agent at the Payment Office
an amount in immediately available funds equal to its Commitment Percentage
(subject to any contrary provisions of Section 2.22) of the amount of the
drawing, whereupon the participating Lenders shall (subject to Section 2.14(d))
each be deemed to have made a Revolving Advance maintained as a Domestic Rate
Loan to Borrowers in that amount. If any Lender holding a Commitment so notified
fails to make available to Agent, for the benefit of Issuer, the amount of such
Lender’s Commitment Percentage of such amount by 2:00 p.m. on the Drawing Date,
then interest shall accrue on such Lender’s obligation to make such payment,
from the Drawing Date to the date on which such Lender makes such payment (i) at
a rate per annum equal to the Federal Funds Effective Rate during the first
three (3) days following the Drawing Date and (ii) at a rate per annum equal to
the rate applicable to Revolving Advances maintained as a Domestic Rate Loan on
and after the fourth day following the Drawing Date. Agent and Issuer will
promptly give notice of the occurrence of the Drawing Date, but failure of Agent
or Issuer to give any such notice on the Drawing Date or in sufficient time to
enable any Lender holding a Commitment to effect such payment on such date shall
not relieve such Lender from its obligations under this clause (c), provided
that such Lender shall not be obligated to pay interest as provided in
subclauses (i) and (ii) of this clause (c) until and commencing from the date of
receipt of notice from Agent or Issuer of a drawing.
(d)    With respect to any unreimbursed drawing that is not converted into a
Revolving Advance maintained as a Domestic Rate Loan to Borrowers in whole or in
part as contemplated by Section 2.14(b), because of Borrowers’ failure to
satisfy the conditions set forth in Section 8.2 (other than any notice
requirements) or for any other reason, Borrowers shall be deemed to have
incurred from Agent, subject to Section 16.19, a borrowing (each a “Letter of
Credit Borrowing”) in the amount of such drawing. Such Letter of Credit
Borrowing shall be due and payable on demand (together with interest) and shall
bear interest at the rate per annum applicable to a Revolving Advance maintained
as a Domestic Rate Loan. Each applicable Lender’s payment to Agent pursuant to
clause (c) of this Section shall be deemed to be a payment in respect of its
participation in such Letter of Credit Borrowing and shall constitute a
“Participation Advance” from such Lender in satisfaction of its Participation
Commitment in respect of the applicable Letter of Credit under this Section.
(e)    Each applicable Lender’s Participation Commitment in respect of the
Letters of Credit shall continue until the last to occur of any of the following
events: (x) Issuer ceases to be obligated to issue or cause to be issued Letters
of Credit hereunder; (y) no Letter of Credit issued or created hereunder remains
outstanding and uncancelled; and (z) all Persons (other than Borrowers) have
been fully reimbursed for all payments made under or relating to Letters of
Credit.
2.15.    Repayment of Participation Advances.
(a)    Upon (and only upon) receipt by Agent for the account of Issuer of
immediately available funds from Borrowers (i) in reimbursement of any payment
made by Issuer or Agent under the Letter of Credit with respect to which any
Lender has made a Participation Advance to Agent, or (ii) in payment of interest
on such a payment made by Issuer or Agent under such a Letter of Credit, Agent
will pay to each Lender holding a Commitment, in the same funds as those
received by Agent, the amount of such Lender’s Commitment Percentage of such
funds, except Agent shall retain the amount of the Commitment Percentage of such
funds of any Lender holding a Commitment that did not make a Participation
Advance in respect of such payment by Agent (and, to the extent that any of the
other Lender(s) holding the Commitment have funded any portion such Defaulting
Lender’s Participation Advance in accordance with the provisions of Section
2.22, Agent will pay over to such Non-Defaulting Lenders a pro rata portion of
the funds so withheld from such Defaulting Lender).
(b)    If Issuer or Agent is required at any time to return to any Borrower, or
to a trustee, receiver, liquidator, monitor, custodian, or any official in any
insolvency proceeding, any portion of the payments made by Borrowers to Issuer
or Agent pursuant to Section 2.15(a) in reimbursement of a payment made under
the Letter of Credit or interest or fee thereon, each applicable Lender shall,
on demand of Agent, forthwith return to Issuer or Agent the amount of its
Commitment Percentage of any amounts so returned by Issuer or Agent plus
interest at the Federal Funds Effective Rate.
2.16.    Documentation. Each Borrower agrees to be bound by the terms of the
Letter of Credit Application and by Issuer’s interpretations of any Letter of
Credit issued on behalf of such Borrower and by Issuer’s written regulations and
customary practices relating to letters of credit, though Issuer’s
interpretations may be different from such Borrower’s own. In the event of a
conflict between the Letter of Credit Application and this Agreement, this
Agreement shall govern. It is understood and agreed that, except in the case of
gross negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final non-appealable judgment), Issuer shall not be liable for
any error, negligence and/or mistakes, whether of omission or commission, in
following Borrowing Agent’s or any Borrower’s instructions or those contained in
the Letters of Credit or any modifications, amendments or supplements thereto.
2.17.    Determination to Honor Drawing Request. In determining whether to honor
any request for drawing under any Letter of Credit by the beneficiary thereof,
Issuer shall be responsible only to determine that the documents and
certificates required to be delivered under such Letter of Credit have been
delivered and that they comply on their face with the requirements of such
Letter of Credit and that any other drawing condition appearing on the face of
such Letter of Credit has been satisfied in the manner so set forth.
2.18.    Nature of Participation and Reimbursement Obligations. The obligation
of each Lender holding a Commitment in accordance with this Agreement to make
the Revolving Advances or Participation Advances as a result of a drawing under
a Letter of Credit, and the obligations of Borrowers to reimburse Issuer upon a
draw under a Letter of Credit, shall be absolute, unconditional and irrevocable,
and shall be performed strictly in accordance with the terms of this Section
under all circumstances, including the following circumstances:
(i)    any set-off, counterclaim, recoupment, defense or other right which such
Lender or any Borrower, as the case may be, may have against Issuer, Agent, any
Borrower or Lender, as the case may be, or any other Person for any reason
whatsoever;
(ii)    the failure of any Borrower or any other Person to comply, in connection
with a Letter of Credit Borrowing, with the conditions set forth in this
Agreement for the making of a Revolving Advance, it being acknowledged that such
conditions are not required for the making of a Letter of Credit Borrowing and
the obligation of Lenders to make Participation Advances under Section 2.14;
(iii)    any lack of validity or enforceability of any Letter of Credit;
(iv)    any claim of breach of warranty that might be made by any Borrower,
Agent, Issuer or any Lender against the beneficiary of a Letter of Credit, or
the existence of any claim, set-off, recoupment, counterclaim, cross-claim,
defense or other right which any Borrower, Agent, Issuer or any Lender may have
at any time against a beneficiary, any successor beneficiary or any transferee
of any Letter of Credit or assignee of the proceeds thereof (or any Persons for
whom any such transferee or assignee may be acting), Issuer, Agent or any Lender
or any other Person, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any underlying
transaction between any Borrower or any Subsidiaries of such Borrower and the
beneficiary for which any Letter of Credit was procured);
(v)    the lack of power or authority of any signer of (or any defect in or
forgery of any signature or endorsement on) or the form of or lack of validity,
accuracy, enforceability or genuineness of any draft, demand, instrument,
certificate or other document presented under or in connection with any Letter
of Credit, or any fraud or alleged fraud in connection with any Letter of
Credit, or the transport of any property or provision of services relating to a
Letter of Credit, in each case even if Issuer or any of Issuer’s Affiliates has
been notified thereof;
(vi)    payment by Issuer under any Letter of Credit against presentation of a
demand, draft or certificate or other document which is forged or does not fully
comply with the terms of such Letter of Credit (provided that the foregoing
shall not excuse Issuer from any obligation under the terms of any applicable
Letter of Credit to require the presentation of documents that on their face
appear to satisfy any applicable requirements for drawing under such Letter of
Credit prior to honoring or paying any such draw);
(vii)    the solvency of, or any acts or omissions by, any beneficiary of any
Letter of Credit, or any other Person having a role in any transaction or
obligation relating to a Letter of Credit, or the existence, nature, quality,
quantity, condition, value or other characteristic of any property or services
relating to a Letter of Credit;
(viii)    any failure by Issuer or any of Issuer’s Affiliates to issue any
Letter of Credit in the form requested by Borrowing Agent, unless Agent and
Issuer have each received written notice from Borrowing Agent of such failure
within three (3) Business Days after Issuer shall have furnished Agent and
Borrowing Agent a copy of such Letter of Credit and such error is material and
no drawing has been made thereon prior to receipt of such notice;
(ix)    the occurrence of any Material Adverse Effect;
(x)    any breach of this Agreement or any Other Document by any party thereto;
(xi)    the occurrence or continuance of an insolvency proceeding with respect
to any Borrower or any Guarantor;
(xii)    the fact that a Default or an Event of Default shall have occurred and
be continuing; and
(xiii)    the fact that the Term shall have expired or this Agreement or the
obligations of Lenders to make Advances have been terminated.
2.19.    Liability for Acts and Omissions.
(a)    As between Borrowers and Issuer, Swing Loan Lender, Agent and Lenders,
each Borrower assumes all risks of the acts and omissions of, or misuse of the
Letters of Credit by, the respective beneficiaries of such Letters of Credit,
other than the gross negligence or willful misconduct of the Agent as determined
by a final and non-appealable judgment of a court of competent jurisdiction. In
furtherance and not in limitation of the foregoing, Issuer shall not be
responsible for: (i) the form, validity, accuracy, genuineness or legal effect
of any document submitted by any party in connection with the application for an
issuance of any such Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged
(even if Issuer or any of its Affiliates shall have been notified thereof); (ii)
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) the failure of the beneficiary
of any such Letter of Credit, or any other party to which such Letter of Credit
may be transferred, to comply fully with any conditions required in order to
draw upon such Letter of Credit or any other claim of any Borrower against any
beneficiary of such Letter of Credit, or any such transferee, or any dispute
between or among any Borrower and any beneficiary of any Letter of Credit or any
such transferee; (iv) errors, omissions, interruptions or delays in transmission
or delivery of any messages, by mail, cable, facsimile, telex or otherwise,
whether or not they be in cipher; (v) errors in interpretation of technical
terms; (vi) any loss or delay in the transmission or otherwise of any document
required in order to make a drawing under any such Letter of Credit or of the
proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter
of Credit of the proceeds of any drawing under such Letter of Credit; or (viii)
any consequences arising from causes beyond the control of Issuer, including any
Governmental Acts, and none of the above shall affect or impair, or prevent the
vesting of, any of Issuer’s rights or powers hereunder. Nothing in the preceding
sentence shall relieve Issuer from liability for Issuer’s gross negligence or
willful misconduct (as determined by a court of competent jurisdiction in a
final non-appealable judgment) in connection with actions or omissions described
in such clauses (i) through (viii) of such sentence. In no event shall Issuer or
Issuer’s Affiliates be liable to any Borrower for any indirect, consequential,
incidental, punitive, exemplary or special damages or expenses (including
without limitation attorneys’ fees), or for any damages resulting from any
change in the value of any property relating to a Letter of Credit.
(b)    Without limiting the generality of the foregoing, Issuer and each of its
Affiliates: (i) may rely on any oral or other communication believed in good
faith by Issuer or such Affiliate to have been authorized or given by or on
behalf of the applicant for a Letter of Credit; (ii) may honor any presentation
if the documents presented appear on their face substantially to comply with the
terms and conditions of the relevant Letter of Credit; (iii) may honor a
previously dishonored presentation under a Letter of Credit, whether such
dishonor was pursuant to a court order, to settle or compromise any claim of
wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the
same extent as if such presentation had initially been honored, together with
any interest paid by Issuer or its Affiliates; (iv) may honor any drawing that
is payable upon presentation of a statement advising negotiation or payment,
upon receipt of such statement (even if such statement indicates that a draft or
other document is being delivered separately), and shall not be liable for any
failure of any such draft or other document to arrive, or to conform in any way
with the relevant Letter of Credit; (v) may pay any paying or negotiating bank
claiming that it rightfully honored under the laws or practices of the place
where such bank is located; and (vi) may settle or adjust any claim or demand
made on Issuer or its Affiliate in any way related to any order issued at the
applicant’s request to an air carrier, a letter of guarantee or of indemnity
issued to a steamship agent or carrier or any document or instrument of like
import (each an “Order”) and honor any drawing in connection with any Letter of
Credit that is the subject of such Order, notwithstanding that any drafts or
other documents presented in connection with such Letter of Credit fail to
conform in any way with such Letter of Credit.
(c)    In furtherance and extension and not in limitation of the specific
provisions set forth above, any action taken or omitted by Issuer under or in
connection with the Letters of Credit issued by it or any documents and
certificates delivered thereunder, if taken or omitted in good faith and without
gross negligence (as determined by a court of competent jurisdiction in a final
non-appealable judgment), shall not put Issuer under any resulting liability to
any Borrower, Agent or any Lender.
2.20.    Mandatory Prepayments.
(a)    Subject to Section 7.1, when any Borrower sells or otherwise disposes of
any Collateral other than as permitted pursuant to clause (i), clauses (vii)
through (xv) and clauses (xvii) through (xx) of Section 7.1(b), the Borrowers
shall repay the Advances an amount equal to the Net Cash Proceeds of such sale,
such repayments to be made promptly but in no event more than five (5) Business
Days following receipt of such net proceeds, and until the date of payment, such
proceeds shall be and shall be deemed to be held in trust exclusively for Agent;
provided that the Borrowers shall not be required to repay Advances with such
Net Cash Proceeds if, at the election of the Borrowers (as notified by Borrowing
Agent to Agent on or prior to the date of the required prepayment), such
Borrower reinvests all or a portion of such Net Cash Proceeds in operating
assets (other than current assets) within 365 days after the receipt of such Net
Cash Proceeds (or, if such Credit Party or Subsidiary shall have entered into a
legally binding commitment within such 365-day period to so apply such Net Cash
Proceeds, within such 180 days following such 365-day period), it being
understood that if such Net Cash Proceeds have not been so reinvested within the
applicable period, the Borrower shall promptly prepay advances in an aggregate
amount equal to such Net Cash Proceeds. The foregoing shall not be deemed to be
implied consent to any such sale otherwise prohibited by the terms and
conditions hereof. Such repayments shall be applied to the remaining Advances
(including cash collateralization of all Obligations relating to any outstanding
Letters of Credit in accordance with the provisions of Section 3.2(b); provided
that if no Default or Event of Default has occurred and is continuing, such
repayments shall be applied to cash collateralize any Obligations related to
outstanding Letters of Credit last) in such order as Agent may determine,
subject to Borrowers’ ability to reborrow Revolving Advances in accordance with
the terms hereof or (ii) if the Collateral disposed of is equipment other than
as set forth in (i) above or other Collateral, to the remaining Advances
(including cash collateralization of all Obligations relating to any outstanding
Letters of Credit in accordance with the provisions of Section 3.2(b), provided
however that if no Default or Event of Default has occurred and is continuing,
such repayments shall be applied to cash collateralize any Obligations related
to outstanding Letters of Credit last) in such order as Agent may determine,
subject to Borrowers’ ability to reborrow Revolving Advances in accordance with
the terms hereof.
(b)     In the event of any issuance or other incurrence of Indebtedness (other
than Indebtedness described in the definition of Permitted Indebtedness) by
Borrowers, the Borrowers shall, no later than one (1) Business Day after the
receipt by Borrowers of the Net Cash Proceeds from any such issuance or
incurrence of Indebtedness, repay the Advances made for its benefit and/or made
directly or indirectly to it in an amount equal to one hundred percent (100%) of
such Net Cash Proceeds of such incurrence or issuance of Indebtedness. Such
repayments will be applied in the same manner as set forth in clause (a) of this
Section.
(c)    All Net Cash Proceeds received by Borrowers or Agent, if such Net Cash
Proceeds are in excess of $2,000,000, (i) under any insurance policy on account
of damage or destruction of any assets or property of any Borrowers, or (ii) as
a result of any taking or condemnation of any assets or property shall be
applied in accordance with Section 6.6; provided that the Borrowers shall not be
required to so apply such Net Cash Proceeds if, at the election of the Borrowers
(as notified by Borrowing Agent to Agent on or prior to the date of the required
prepayment), such Borrower reinvests all or a portion of such Net Cash Proceeds
in operating assets (other than current assets) within 365 days after the
receipt of such Net Cash Proceeds (or, if such Credit Party or Subsidiary shall
have entered into a legally binding commitment within such 365-day period to so
apply such Net Cash Proceeds, within such 180 days following such 365-day
period), it being understood that if such Net Cash Proceeds have not been so
reinvested within the applicable period, the Borrower shall promptly prepay
advances in an aggregate amount equal to such Net Cash Proceeds.
(d)    In the event of any Specified Equity Contribution, Borrowers shall, no
later than five (5) Business Days after the receipt by Borrowers of the Net Cash
Proceeds of such Specified Equity Contribution repay the Advances in an amount
equal to one hundred percent (100%) of such Net Cash Proceeds. Such repayments
will be applied in the same manner as set forth in clause (a) of this Section.
It is understood and agreed that no reduction of the Commitments or the Maximum
Revolving Advance Amount shall be required to be made in connection with any
prepayment pursuant to this Section.
2.21.    Use of Proceeds.
(a)    Borrowers shall apply the proceeds of Advances to (i) pay fees and
expenses relating to the Transactions, and (ii) provide for Holdings’ and its
Subsidiaries’ general business purposes, including working capital requirements,
making Capital Expenditures, making Permitted Acquisitions, making debt payments
(but not prepayments on debt other than Advances) when due and making
distributions and dividends, in each case, to the extent not prohibited under
this Agreement.
(b)    Without limiting the generality of clause (a) of this Section, neither
the Borrowers, the Guarantors nor any other Person which may in the future
become party to this Agreement or the Other Documents as a Borrower or
Guarantor, intends to use nor shall they use any portion of the proceeds of the
Advances, directly or indirectly, for any purpose in violation of Applicable
Law.
2.22.    Defaulting Lender.
(a)    Notwithstanding anything to the contrary contained herein, in the event
any Lender is a Defaulting Lender, all rights and obligations hereunder of such
Defaulting Lender and of the other parties hereto shall be modified to the
extent of the express provisions of this Section so long as such Lender is a
Defaulting Lender.
(b)    %3. except as otherwise expressly provided for in this Section, Revolving
Advances shall be made pro rata from Lenders holding Commitments which are not
Defaulting Lenders based on their respective Commitment Percentages, and no
Commitment Percentage of any Lender or any pro rata share of any Revolving
Advances required to be advanced by any Lender shall be increased as a result of
any Lender being a Defaulting Lender. Amounts received in respect of principal
of any type of Revolving Advances shall be applied to reduce such type of
Revolving Advances of each Lender (other than any Defaulting Lender) holding a
Commitment in accordance with their Commitment Percentages; provided that, Agent
shall not be obligated to transfer to a Defaulting Lender any payments received
by Agent for Defaulting Lender’s benefit, nor shall a Defaulting Lender be
entitled to the sharing of any payments hereunder (including any principal,
interest or fees). Amounts payable to a Defaulting Lender shall instead be paid
to or retained by Agent. Agent may hold and, in its discretion, re-lend to a
Borrower the amount of such payments received or retained by it for the account
of such Defaulting Lender.
(i)    fees pursuant to Section 3.3 shall cease to accrue in favor of such
Defaulting Lender.
(ii)    if any Swing Loans are outstanding or any Letters of Credit (or drawings
under any Letter of Credit for which Issuer has not been reimbursed) are
outstanding or exist at the time any such Lender holding a Commitment becomes a
Defaulting Lender, then:
(A)     Defaulting Lender’s Participation Commitment in the outstanding Swing
Loans and of the Maximum Undrawn Amount of all outstanding Letters of Credit
shall be reallocated among Non-Defaulting Lenders holding Commitments in
proportion to the respective Commitment Percentages of such Non-Defaulting
Lenders to the extent (but only to the extent) that (x) such reallocation does
not cause the aggregate sum of outstanding Revolving Advances made by any such
Non-Defaulting Lender holding a Commitment plus such Lender’s reallocated
Participation Commitment in the outstanding Swing Loans plus such Lender’s
reallocated Participation Commitment in the aggregate Maximum Undrawn Amount of
all outstanding Letters of Credit to exceed the Commitment Amount of any such
Non-Defaulting Lender, and (y) no Default or Event of Default has occurred and
is continuing at such time;
(B)    if the reallocation described in clause (A) above cannot, or can only
partially, be effected, Borrowers shall within one Business Day following notice
by Agent (x) first, prepay any outstanding Swing Loans that cannot be
reallocated, and (y) second, cash collateralize for the benefit of Issuer,
Borrowers’ obligations corresponding to such Defaulting Lender’s Participation
Commitment in the Maximum Undrawn Amount of all Letters of Credit (after giving
effect to any partial reallocation pursuant to clause (A) above) in accordance
with Section 3.2(b) for so long as such Obligations are outstanding;
(C)    if Borrowers cash collateralize any portion of such Defaulting Lender’s
Participation Commitment in the Maximum Undrawn Amount of all Letters of Credit
pursuant to clause (B) above, Borrowers shall not be required to pay any fees to
such Defaulting Lender pursuant to Section 3.2(a) with respect to such
Defaulting Lender’s Commitment Percentage of Maximum Undrawn Amount of all
Letters of Credit during the period such Defaulting Lender’s Participation
Commitment in the Maximum Undrawn Amount of all Letters of Credit are cash
collateralized;
(D)    if Defaulting Lender’s Participation Commitment in the Maximum Undrawn
Amount of all Letters of Credit is reallocated pursuant to clause (A) above,
then the fees payable to Lenders holding Commitments pursuant to Section 3.2(a)
shall be adjusted and reallocated to Non-Defaulting Lenders holding Commitments
in accordance with such reallocation; and
(E)    if all or any portion of such Defaulting Lender’s Participation
Commitment in the Maximum Undrawn Amount of all Letters of Credit is neither
reallocated nor cash collateralized pursuant to clauses (A) or (B) above, then,
without prejudice to any rights or remedies of Issuer or any other Lender
hereunder, all Letter of Credit Fees payable under Section 3.2(a) with respect
to such Defaulting Lender’s Commitment Percentage of the Maximum Undrawn Amount
of all Letters of Credit shall be payable to the Issuer (and not to such
Defaulting Lender) until (and then only to the extent that) such Participation
Commitment in the Maximum Undrawn Amount of all Letters of Credit is reallocated
and/or cash collateralized; and
(iii)    so long as any Lender holding a Commitment is a Defaulting Lender,
Swing Loan Lender shall not be required to fund any Swing Loans and Issuer shall
not be required to issue, amend or increase any Letter of Credit, unless such
Issuer is satisfied that the related exposure and Defaulting Lender’s
Participation Commitment in the Maximum Undrawn Amount of all Letters of Credit
and all Swing Loans (after giving effect to any such issuance, amendment,
increase or funding) will be fully allocated to Non-Defaulting Lenders holding
Commitments and/or cash collateral for such Letters of Credit will be provided
by Borrowers in accordance with clause (A) and (B) above, and participating
interests in any newly made Swing Loan or any newly issued or increased Letter
of Credit shall be allocated among Non-Defaulting Lenders in a manner consistent
with Section 2.22(b)(iii)(A) above (and such Defaulting Lender shall not
participate therein).
(c)    A Defaulting Lender shall not be entitled to give instructions to Agent
or to approve, disapprove, consent to or vote on any matters relating to this
Agreement and the Other Documents, and all amendments, waivers and other
modifications of this Agreement and the Other Documents may be made without
regard to a Defaulting Lender and, for purposes of the definition of “Required
Lenders”, a Defaulting Lender shall not be deemed to be a Lender, to have any
outstanding Advances or a Commitment Percentage provided, that this clause
(c) shall not apply to the vote of a Defaulting Lender in the case of an
amendment, waiver or other modification described in subclauses (i) or (ii) of
Section 16.2(b).
(d)    Other than as expressly set forth in this Section, the rights and
obligations of a Defaulting Lender (including the obligation to indemnify Agent)
and the other parties hereto shall remain unchanged. Nothing in this Section
shall be deemed to release any Defaulting Lender from its obligations under this
Agreement and the Other Documents, shall alter such obligations, shall operate
as a waiver of any default by such Defaulting Lender hereunder, or shall
prejudice any rights which any Borrower, Agent or any Lender may have against
any Defaulting Lender as a result of any default by such Defaulting Lender
hereunder.
(e)    In the event that Agent, Borrowers, Swing Loan Lender and Issuer agree in
writing that a Defaulting Lender has adequately remedied all matters that caused
such Lender to be a Defaulting Lender, then Agent will so notify the parties
hereto, and, if such cured Defaulting Lender is a Lender holding a Commitment,
then Participation Commitments of Lenders holding Commitments (including such
cured Defaulting Lender) of the Swing Loans and Maximum Undrawn Amount of all
outstanding Letters of Credit shall be reallocated to reflect the inclusion of
such Lender’s Commitment, and on such date such Lender shall purchase at par
such of the Revolving Advances of the other Lenders as Agent shall determine may
be necessary in order for such Lender to hold such Revolving Advances in
accordance with its Commitment Percentage.
(f)    If Swing Loan Lender or Issuer has a good faith belief that any Lender
holding a Commitment has defaulted in fulfilling its obligations under one or
more other agreements in which such Lender commits to extend credit, Swing Loan
Lender shall not be required to fund any Swing Loans and Issuer shall not be
required to issue, amend or increase any Letter of Credit, unless Swing Loan
Lender or Issuer, as the case may be, shall have entered into arrangements with
Borrowers or such Lender, satisfactory to Swing Loan Lender or Issuer, as the
case may be, to defease any risk to it in respect of such Lender hereunder.
2.23.    Payment of Obligations. Agent may charge to Borrowers’ Account a
Revolving Advance or, at the discretion of Swing Loan Lender, as a Swing Loan
(i) all payments with respect to any of the Obligations required hereunder
(including without limitation principal payments, payments of interest, payments
of Letter of Credit Fees and all other fees provided for hereunder and payments
under Sections 16.5 and 16.9) as and when each such payment shall become due and
payable (whether as regularly scheduled, upon or after acceleration, upon
maturity or otherwise), (ii) without limiting the generality of the foregoing
clause (i), (a) all amounts expended by Agent or any Lender pursuant to Section
4.2 or 4.3 and (b) all respective expenses which Agent incurs in connection with
the forwarding of Advance proceeds and the establishment and maintenance of any
Collection Accounts or Depository Accounts as provided for in Section 4.8(g),
and (iii) any sums expended by Agent or any Lender due to any Borrower’s failure
to perform or comply with its obligations under this Agreement or any Other
Document including any Borrower’s obligations under Sections 3.3, 3.4, 4.3, 4.6,
6.4, 6.6, 6.7 and 6.8, and all amounts so charged shall be added to the
Obligations and shall be secured by the Collateral. To the extent Revolving
Advances are not actually funded by the other Lenders in respect of any such
amounts so charged, all such amounts so charged shall be deemed to be Revolving
Advances made by and owing to Agent and Agent shall be entitled to all rights
(including accrual of interest) and remedies of a Lender under this Agreement
and the Other Documents with respect to such Revolving Advances.  
2.24.    Increase in Maximum Revolving Advance Amount.
(a)    Borrowers may request that the Maximum Revolving Advance Amount be
increased by (1) one or more of the current Lenders increasing their Commitment
Amount (any current Lender which elects to increase its Commitment Amount shall
be referred to as an “Increasing Lender”) or (2) one or more new lenders (each a
“New Lender”) joining this Agreement and providing a Commitment Amount
hereunder, subject to the following terms and conditions:
(i)    No current Lender shall be obligated to increase its Commitment Amount
and any increase in the Commitment Amount by any current Lender shall be in the
sole discretion of such current Lender;
(ii)    There shall exist no Event of Default or Default on the effective date
of such increase after giving effect to such increase;
(iii)    After giving effect to such increase, the Maximum Revolving Advance
Amount shall not exceed $300,000,000;
(iv)    Borrowers may not request an increase in the Maximum Revolving Advance
Amount under this Section more than three (3) times during the Term, and no
single such increase in the Maximum Revolving Advance Amount shall be for an
amount less than $20,000,000, and all such increases in the Maximum Revolving
Advance Amount shall not exceed $100,000,000 in the aggregate;
(v)    Borrowers shall deliver to Agent on or before the effective date of such
increase the following documents in form and substance satisfactory to Agent:
(1) certifications of their corporate secretaries with attached resolutions
certifying that the increase in the Commitment Amounts has been approved by such
Borrowers, (2) certificate dated as of the effective date of such increase
certifying that no Default or Event of Default shall have occurred and be
continuing and certifying that the representations and warranties made by each
Borrower herein and in the Other Documents are true and correct in all material
respects (or, if such representation and warranty is, by its terms, limited by
materiality (including a Material Adverse Effect), then such representation and
warranty shall be true in all respects) on and as of such date as if made on and
as of such date (except to the extent any such representation or warranty
specifically relates to a certain prior date), (3) such other agreements,
instruments and information including supplements or modifications to this
Agreement and/or the Other Documents executed by Borrowers as Agent reasonably
deems necessary in order to document the increase to the Maximum Revolving
Advance Amount and to protect, preserve and continue the perfection and priority
of the liens, security interests, rights and remedies of Agent and Lenders
hereunder and under the Other Documents in light of such increase, and (4) an
opinion of counsel in form and substance satisfactory to Agent which shall cover
such matters related to such increase as Agent may reasonably require and each
Borrower hereby authorizes and directs such counsel to deliver such opinions to
Agent and Lenders;
(vi)    Borrowers shall execute and deliver (1) to each Increasing Lender a
replacement Note or Notes reflecting the new amount of such Increasing Lender’s
Commitment Amount after giving effect to the increase (and the prior Note or
Notes issued to such Increasing Lender shall be deemed to be cancelled) and (2)
to each New Lender a Note or Notes reflecting the amount of such New Lender’s
Commitment Amount;
(vii)    Borrowers may not request the addition of a New Lender unless (and then
only to the extent that) there is insufficient participation on behalf of the
existing Lenders in the increased aggregate Commitment Amount being requested by
Borrowers, and, in any event, any New Lender shall be subject to the reasonable
satisfaction of the Agent;
(viii)    Each Increasing Lender shall confirm its agreement to increase its
Commitment Amount pursuant to an acknowledgement in a form reasonably acceptable
to Agent, signed by it and each Borrower and delivered to Agent at least five
(5) days before the effective date of such increase; and
(ix)    Each New Lender shall execute a lender joinder in substantially the form
of Exhibit 2.24 pursuant to which such New Lender shall join and become a party
to this Agreement and the Other Documents with a Commitment Amount as set forth
in such lender joinder.
(b)    On the effective date of such increase, (i) Borrowers shall repay all
Revolving Advances then outstanding, subject to Borrowers’ obligations under
Sections 3.7, 3.9, or 3.10; provided that subject to the other conditions of
this Agreement, the Borrowing Agent may request new Revolving Advances on such
date and (ii) the Commitment Percentages of Lenders holding a Commitment
(including each Increasing Lender and/or New Lender) shall be recalculated such
that each such Lender’s Commitment Percentage is equal to (x) the Commitment
Amount of such Lender divided by (y) the aggregate of the Commitment Amounts of
all Lenders. Each Lender shall participate in any new Revolving Advances made on
or after such date in accordance with its Commitment Percentage after giving
effect to the increase in the Maximum Revolving Advance Amount and recalculation
of the Commitment Percentages contemplated by this Section.
(c)    On the effective date of such increase, each Increasing Lender shall be
deemed to have purchased an additional/increased participation in, and each New
Lender will be deemed to have purchased a new participation in, each then
outstanding Letter of Credit and each drawing thereunder and each then
outstanding Swing Loan in an amount equal to such Lender’s Commitment Percentage
(as calculated pursuant to clause (b) of this Section) of the Maximum Undrawn
Amount of each such Letter of Credit (as in effect from time to time) and the
amount of each drawing and of each such Swing Loan, respectively. As necessary
to effectuate the foregoing, each existing Lender holding a Commitment
Percentage that is not an Increasing Lender shall be deemed to have sold to each
applicable Increasing Lender and/or New Lender, as necessary, a portion of such
existing Lender’s participations in such outstanding Letters of Credit and
drawings and such outstanding Swing Loans such that, after giving effect to all
such purchases and sales, each Lender holding a Commitment (including each
Increasing Lender and/or New Lender) shall hold a participation in all Letters
of Credit (and drawings thereunder) and all Swing Loans in accordance with their
respective Commitment Percentages (as calculated pursuant to clause (b) of this
Section).
(d)    On the effective date of such increase, Borrowers shall pay all
reasonable out-of-pocket costs and expenses incurred by Agent and by each
Increasing Lender and New Lender in connection with the negotiations regarding,
and the preparation, negotiation, execution and delivery of all agreements and
instruments executed and delivered by any of Agent, Borrowers and/or Increasing
Lenders and New Lenders in connection with, such increase (including all fees
for any supplemental or additional public filings of any Other Documents
necessary to protect, preserve and continue the perfection and priority of the
liens, security interests, rights and remedies of Agent and Lenders hereunder
and under the Other Documents in light of such increase).
(e)    Each of the parties hereto hereby agrees that, upon the effectiveness of
any increase to the Commitments provided for under this Section, this Agreement
shall be amended to the extent (but only to the extent) necessary to reflect the
existence of such increase and the Advances provided for in connection
therewith, and any such amendment may, without the consent of the other Lenders,
effect such amendments to this Agreement and the Other Documents as may be
necessary or appropriate, in the reasonable opinion of the Agent and Borrowers,
to effectuate the provisions of this Section and, for the avoidance of doubt,
this clause (e) shall supersede any contrary provisions in Section 16.2.
2.25.    Reduction of Maximum Revolving Advance Amount. Borrowing Agent may, on
no more than three (3) occasions during each period of twelve months, on at
least three (3) Business Days’ prior written notice received by Agent (which
shall promptly advise each Lender thereof) permanently reduce the Maximum
Revolving Advance Amount, minimum increments of $10,000,000 to an amount not
less than the amount of the then outstanding Advances. All reductions of the
Maximum Revolving Advance Amount shall be applied ratably among the Lenders
according to their respective Commitment Amounts. For the avoidance of doubt,
voluntary prepayments on the unutilized portion of the Maximum Revolving Advance
Amount coupled with any permanent reduction of the Maximum Revolving Advance
Amount effected pursuant to the immediately preceding sentence will be subject
to (x) payment of breakage costs in the case of a prepayment of LIBOR Rate Loans
other than on the last day of the relevant Interest Period, and (y) any other
provisions contained in this Agreement.
III.    INTEREST AND FEES.
3.1.    Interest. Interest on Advances shall be payable in arrears on the first
day of each month with respect to Domestic Rate Loans and, with respect to LIBOR
Rate Loans, at (a) the end of each Interest Period or (b) for LIBOR Rate Loans
with an interest period in excess of three months, at the end of each three
month period during such Interest Period, provided further that all accrued and
unpaid interest shall be due and payable at the end of the Term. Interest
charges shall be computed on the actual principal amount of Advances outstanding
during the month at a rate per annum equal to (i) with respect to Revolving
Advances, the Revolving Interest Rate and (ii) with respect to Swing Loans, the
Revolving Interest Rate for Domestic Rate Loans. Except as expressly provided
otherwise in this Agreement, any Obligations other than the Advances that are
not paid when due shall accrue interest at the Revolving Interest Rate for
Domestic Rate Loans, subject to the provision of the final sentence of this
Section regarding the Default Rate. Whenever, subsequent to the date of this
Agreement, the Alternate Base Rate is increased or decreased, the Revolving
Interest Rate for Domestic Rate Loans shall be similarly changed without notice
or demand of any kind by an amount equal to the amount of such change in the
Alternate Base Rate during the time such change or changes remain in effect. The
LIBOR Rate shall be adjusted with respect to LIBOR Rate Loans without notice or
demand of any kind on the effective date of any change in the Reserve Percentage
as of such effective date. Upon and after the occurrence of an Event of Default,
and during the continuation thereof, at the option of Agent or at the direction
of Required Lenders (or, in the case of any Event of Default under Section 10.6,
immediately and automatically upon the occurrence of any such Event of Default
without the requirement of any affirmative action by any party), the Obligations
shall bear interest at the applicable Revolving Interest Rate plus two percent
(2%) per annum (the “Default Rate”)
3.2.    Letter of Credit Fees.
(a)    The Borrowers shall pay (x) to Agent, for the ratable benefit of Lenders
holding Commitments, fees for each Letter of Credit for the period from and
excluding the date of issuance of same to and including the date of expiration
or termination, equal to the average daily face amount of each outstanding
Letter of Credit multiplied by the Applicable Margin for Revolving Advances
consisting of LIBOR Rate Loans, such fees to be calculated on the basis of a
360-day year for the actual number of days elapsed and to be payable quarterly
in arrears on the first day of each calendar quarter and on the last day of the
Term, and (y) to Issuer, a fronting fee of one-eighth of one percent (0.125%)
per annum times the average daily face amount of each outstanding Letter of
Credit for the period from and excluding the date of issuance of same to and
including the date of expiration or termination, to be payable quarterly in
arrears on the first day of each calendar quarter and on the last day of the
Term (all of the foregoing fees, the “Letter of Credit Fees”). In addition,
Borrowers shall pay to Agent, for the benefit of Issuer, any and all applicable
administrative, issuance, amendment, payment and negotiation charges with
respect to Letters of Credit and all fees and expenses as agreed upon by Issuer
and the Borrowing Agent in connection with any Letter of Credit, including in
connection with the opening, amendment or renewal of any such Letter of Credit
and any acceptances created thereunder, all such charges, fees and expenses, if
any, to be payable on demand. All such charges shall be deemed earned in full on
the date when the same are due and payable hereunder and shall not be subject to
rebate or pro-ration upon the termination of this Agreement for any reason. Any
such charge in effect at the time of a particular transaction shall be the
charge for that transaction, notwithstanding any subsequent change in Issuer’s
prevailing charges for that type of transaction. Upon and after the occurrence
of an Event of Default, and during the continuation thereof, at the option of
Agent or at the direction of Required Lenders (or, in the case of any Event of
Default under Section 10.6, immediately and automatically upon the occurrence of
any such Event of Default without the requirement of any affirmative action by
any party), the Letter of Credit Fees described in clause (x) of this clause (a)
shall be increased by an additional two percent (2.0%) per annum.
(b)    At any time following the occurrence and during the continuance of an
Event of Default, at the option of Agent or at the direction of Required Lenders
(or, in the case of any Event of Default under Section 10.6, immediately and
automatically upon the occurrence of such Event of Default, without the
requirement of any affirmative action by any party), or upon the expiration of
the Term or any other termination of this Agreement (and also, if applicable, in
connection with any mandatory prepayment under Section 2.20), Borrowers will
cause cash to be deposited and maintained in an account with Agent, as cash
collateral, in an amount equal to one hundred and five percent (105%) of the
Maximum Undrawn Amount of their respective outstanding Letters of Credit, and
each Borrower hereby irrevocably authorizes Agent, in its discretion, on such
Borrower’s behalf and in such Borrower’s name, to open such an account and to
make and maintain deposits therein, or in an account opened by such Borrower, in
the amounts required to be made by such Borrower, out of the proceeds of
Receivables or other Collateral or out of any other funds of such Borrower
coming into any Lender’s possession at any time. Agent may, in its discretion,
invest such cash collateral (less applicable reserves) in such short-term
money-market items as to which Agent and such Borrower mutually agree (or, in
the absence of such agreement, as Agent may reasonably select) and the net
return on such investments shall be credited to such account and constitute
additional cash collateral, or Agent may (notwithstanding the foregoing)
establish the account provided for under this clause (b) as a non-interest
bearing account and in such case Agent shall have no obligation (and Borrowers
hereby waive any claim) under Article 9 of the Uniform Commercial Code or under
any other Applicable Law to pay interest on such cash collateral being held by
Agent. No Borrower may withdraw amounts credited to any such account except upon
the occurrence of all of the following: (x) payment and performance in full of
all Obligations; (y) expiration of all Letters of Credit; and (z) termination of
this Agreement. Borrowers hereby assign, pledge and grant to Agent, for its
benefit and the ratable benefit of Issuer, Lenders and each other Secured Party,
a continuing security interest in and to and Lien on any such cash collateral
and any right, title and interest of Borrowers in any deposit account,
securities account or investment account into which such cash collateral may be
deposited from time to time to secure the Obligations, specifically including
all Obligations with respect to any Letters of Credit. Borrowers agree that upon
the coming due of any Reimbursement Obligations (or any other Obligations,
including Obligations for Letter of Credit Fees) with respect to the Letters of
Credit, Agent may, subject to Section 16.19, use such cash collateral to pay and
satisfy such Obligations.
3.1.    Facility Fee; Fee Letter Fees.
(a)    If, for any calendar quarter during the Term, the average daily unpaid
balance of the sum of Revolving Advances plus Swing Loans plus the Maximum
Undrawn Amount of all outstanding Letters of Credit for each day of such
calendar quarter (such sum, the “Utilization Amount”) does not equal the Maximum
Revolving Advance Amount, then Borrowers shall pay to Agent, for the ratable
benefit of Lenders holding the Commitments based on their Commitment
Percentages, a fee at a rate equal to:
(i)    at any time the Utilization Amount is less than twenty-five percent (25%)
of the Maximum Revolving Advance Amount, three-quarters of one percent (0.75%)
per annum,
(ii)    at any time the Utilization Amount equals or exceeds twenty-five percent
(25%) but is less than or equal to fifty percent (50%) of the Maximum Revolving
Advance Amount, one-half of one percent (0.50%) per annum,
(iii)    at any time the Utilization Amount exceeds fifty percent (50%) of the
Maximum Revolving Advance Amount, three-eighths of one percent (0.375%) per
annum,
in each case, on the amount by which the Maximum Revolving Advance Amount
exceeds the Utilization Amount (the “Facility Fee”). The Facility Fee shall be
payable to Agent in arrears on the first day of each calendar quarter with
respect to the previous calendar quarter.
(b)    All of the fees payable under the Fee Letter, as well as fees and
reasonable out-of-pocket costs and expenses of any appraisals conducted pursuant
to Section 4.7 shall, in each case, be paid for when due, in full and without
deduction, off-set or counterclaim by Borrowers.
3.2.    Computation of Interest and Fees. Interest and fees hereunder shall be
computed on the basis of a year of 365 days or 366 days, as applicable (360 days
with respect to LIBOR Rate Loans), with respect to Base Rate Advances and for
the actual number of days elapsed. If any payment to be made hereunder becomes
due and payable on a day other than a Business Day, the due date thereof shall
be extended to the next succeeding Business Day and interest thereon shall be
payable at the Revolving Interest Rate for Domestic Rate Loans during such
extension.
3.3.    Maximum Charges. In no event whatsoever shall interest and other charges
charged hereunder exceed the highest rate permissible under Applicable Law. In
the event interest and other charges as computed hereunder would otherwise
exceed the highest rate permitted under Applicable Law: (i) the interest rates
hereunder will be reduced to the maximum rate permitted under Applicable Law;
(ii) such excess amount shall be first applied to any unpaid principal balance
owed by Borrowers; and (iii) if the then remaining excess amount is greater than
the previously unpaid principal balance, Lenders shall promptly refund such
excess amount to Borrowers and the provisions hereof shall be deemed amended to
provide for such permissible rate. Notwithstanding anything to the contrary
contained in this Agreement or in any Other Document, all agreements which
either now are or which shall become agreements among Credit Parties, Agent and
Lenders are hereby limited so that in no contingency or event whatsoever shall
the total liability for payments in the nature of interest, additional interest
and other charges exceed the applicable limits imposed by any applicable usury
laws. If any payments in the nature of interest, additional interest and other
charges made under this Agreement or any Other Document are held to be in excess
of the limits imposed by any applicable usury laws, it is agreed that any such
amount held to be in excess shall be considered payment of principal hereunder,
and the indebtedness evidenced hereby shall be reduced by such amount so that
the total liability for payments in the nature of interest, additional interest
and other charges shall not exceed the applicable limits imposed by any
applicable usury laws, in compliance with the desires of Credit Parties and
Agent. In addition, unless preempted by federal law, the Revolving Interest Rate
or Default Rate, as applicable, from time to time in effect hereunder may not
exceed the “weekly ceiling” from time to time in effect under Chapter 303 of the
Texas Finance Code, as amended from time to time. The foregoing provisions shall
never be superseded or waived and shall control every other provision of this
Agreement or any Other Document and all agreements among Borrowers and Agent and
Lenders, or their respective successors and assigns. If the applicable state or
federal law is amended in the future to allow a greater rate of interest to be
charged under this Agreement than is presently allowed by applicable state or
federal law, then the limitation of interest hereunder shall be increased to the
maximum rate of interest allowed by applicable state or federal law as amended,
which increase shall be effective hereunder on the effective date of such
amendment, and all interest charges owing to Lender by reason thereof shall be
payable in accordance with Section 3.1. If by operation of this provision,
Borrowers would be entitled to a refund of interest paid pursuant to this
Agreement, each Lender agrees that it shall pay to Borrowers upon Agent’s
request such Lender’s Commitment Percentage, of such interest to be refunded, as
determined by Agent.
3.4.    Increased Costs. In the event that any Change in Law or compliance by
any Lender (for purposes of this Section, the term “Lender” shall include Agent,
Swing Loan Lender, any Issuer or Lender and any corporation or bank controlling
Agent, Swing Loan Lender, any Lender or Issuer and the office or branch where
Agent, Swing Loan Lender, any Lender or Issuer (as so defined) makes or
maintains any LIBOR Rate Loans) with any request or directive (whether or not
having the force of law) from any central bank or other financial, monetary or
other authority, shall:
(a)    subject Agent, Swing Loan Lender, any Lender or Issuer to any tax of any
kind whatsoever with respect to this Agreement, any Letter of Credit, any
participation in a Letter of Credit or any LIBOR Rate Loan, or change the basis
of taxation of payments to Agent, Swing Loan Lender, such Lender or Issuer in
respect thereof (except for Indemnified Taxes or Other Taxes covered by Section
3.9 and the imposition of, or any change in the rate of, any Excluded Tax
payable by Agent, Swing Loan Lender, such Lender or the Issuer);
(b)    impose, modify or deem applicable any reserve, special deposit,
assessment, special deposit, compulsory loan, insurance charge or similar
requirement against assets held by, or deposits in or for the account of,
advances or loans by, or other credit extended by, any office of Agent, Swing
Loan Lender, Issuer or any Lender, including pursuant to Regulation D of the
Board of Governors of the Federal Reserve System; or
(c)    impose on Agent, Swing Loan Lender, any Lender or Issuer or the London
interbank LIBOR market any other condition, loss or expense (other than Taxes)
affecting this Agreement or any Other Document or any Advance made by any
Lender, or any Letter of Credit or participation therein;
and the result of any of the foregoing is to increase the cost to Agent, Swing
Loan Lender, any Lender or Issuer of making, converting to, continuing, renewing
or maintaining its Advances hereunder or to reduce the amount of any payment
(whether of principal, interest or otherwise) in respect of any of the Advances,
then, in any case Borrowers shall promptly pay Agent, Swing Loan Lender, such
Lender or Issuer, upon its demand, such additional amount as will compensate
Agent, Swing Loan Lender or such Lender or Issuer for such additional cost or
such reduction, as the case may be, provided that the foregoing shall not apply
to increased costs which are reflected in the LIBOR Rate, as the case may be.
Agent, Swing Loan Lender, such Lender or Issuer shall certify the amount of such
additional cost or reduced amount to Borrowing Agent, and such certification
shall be conclusive absent manifest error. Borrower shall not be required to
compensate Agent, Swing Loan Lender, Issuer or a Lender pursuant to this Section
for any amounts incurred more than one-hundred eighty (180) days prior to the
date that such Person notifies Borrowing Agent of such losses or expenses and of
such Person’s intention to claim compensation therefor.
3.5.    Basis For Determining Interest Rate Inadequate or Unfair. In the event
that Agent or any Lender shall have determined that:
(a)    reasonable means do not exist for ascertaining the LIBOR Rate applicable
pursuant to Section 2.2 for any Interest Period;
(b)    Dollar deposits in the relevant amount and for the relevant maturity are
not available in the London interbank LIBOR market, with respect to an
outstanding LIBOR Rate Loan, a proposed LIBOR Rate Loan, or a proposed
conversion of a Domestic Rate Loan into a LIBOR Rate Loan;
(c)    the making, maintenance or funding of any LIBOR Rate Loan has been made
impracticable or unlawful by compliance by Agent of such Lender in good faith
with any Applicable Law or any interpretation or application thereof by any
Governmental Body or with any request or directive of any such Governmental Body
(whether or not having the force of law); or
(d)    the LIBOR Rate will not adequately and fairly reflect the cost to such
Lender of the establishment or maintenance of any LIBOR Rate Loan,
then Agent shall give Borrowing Agent prompt written or telephonic notice of
such determination. If such notice is given, (i) any such requested LIBOR Rate
Loan shall be made as a Domestic Rate Loan, unless Borrowing Agent shall notify
Agent no later than 1:00 p.m. two (2) Business Days prior to the date of such
proposed borrowing, that its request for such borrowing shall be cancelled or
made as an unaffected type of LIBOR Rate Loan, (ii) any Domestic Rate Loan or
LIBOR Rate Loan which was to have been converted to an affected type of LIBOR
Rate Loan shall be continued as or converted into a Domestic Rate Loan, or, if
Borrowing Agent shall notify Agent, no later than 1:00 p.m. two (2) Business
Days prior to the proposed conversion, shall be maintained as an unaffected type
of LIBOR Rate Loan, and (iii) any outstanding affected LIBOR Rate Loans shall be
converted into a Domestic Rate Loan, or, if Borrowing Agent shall notify Agent,
no later than 1:00 p.m. two (2) Business Days prior to the last Business Day of
the then current Interest Period applicable to such affected LIBOR Rate Loan,
shall be converted into an unaffected type of LIBOR Rate Loan, on the last
Business Day of the then current Interest Period for such affected LIBOR Rate
Loans (or sooner, if any Lender cannot continue to lawfully maintain such
affected LIBOR Rate Loan). Until such notice has been withdrawn, Lenders shall
have no obligation to make an affected type of LIBOR Rate Loan or maintain
outstanding affected LIBOR Rate Loans and no Borrower shall have the right to
convert a Domestic Rate Loan or an unaffected type of LIBOR Rate Loan into an
affected type of LIBOR Rate Loan.
3.6.    Capital Adequacy.
(a)    In the event that Agent, Swing Loan Lender or any Lender shall have
determined that any Applicable Law or guideline regarding capital adequacy or
liquidity requirements, or any Change in Law or any change in the interpretation
or administration thereof by any Governmental Body, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by Agent, Swing Loan Lender, Issuer or any Lender (for purposes of this Section,
the term “Lender” shall include Agent, Swing Loan Lender, Issuer or any Lender
and any corporation or bank controlling Agent, Swing Loan Lender or any Lender
and the office or branch where Agent, Swing Loan Lender or any Lender (as so
defined) makes or maintains any LIBOR Rate Loans) with any request or directive
regarding capital adequacy or liquidity requirements (whether or not having the
force of law) of any such authority, central bank or comparable agency, has or
would have the effect of reducing the rate of return on Agent, Swing Loan Lender
or any Lender’s capital as a consequence of its obligations hereunder (including
the making of any Swing Loans) to a level below that which Agent, Swing Loan
Lender or such Lender could have achieved but for such adoption, change or
compliance (taking into consideration Agent’s, Swing Loan Lender’s and each
Lender’s policies with respect to capital adequacy) by an amount deemed by
Agent, Swing Loan Lender or any Lender to be material, then, from time to time,
Borrowers shall pay upon demand to Agent, Swing Loan Lender or such Lender such
additional amount or amounts as will compensate Agent, Swing Loan Lender or such
Lender for such reduction. In determining such amount or amounts, Agent, Swing
Loan Lender or such Lender may use any reasonable averaging or attribution
methods. The protection of this Section shall be available to Agent, Swing Loan
Lender and each Lender regardless of any possible contention of invalidity or
inapplicability with respect to the Applicable Law, rule, regulation, guideline
or condition.
(b)    A certificate of Agent, Swing Loan Lender or such Lender setting forth
such amount or amounts as shall be necessary to compensate Agent, Swing Loan
Lender or such Lender with respect to clause (a) of this Section when delivered
to Borrowing Agent shall be conclusive absent manifest error.
(c)    If Agent or any Lender requests compensation under this Section or
Section 3.6 or Section 3.9 or if Borrowers are required to pay any additional
amount to Agent or any Lender pursuant to this Section, Section 3.6 or
Section 3.9, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Advances hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or affiliates, if, in the reasonable judgment of Agent or such Lender, such
designation or assignment (i) would eliminate or reduce materially amounts
payable pursuant to this Section, Section 3.6 or Section 3.9, as the case may
be, in the future, (ii) would not subject Agent or such Lender to any
unreimbursed cost or expense, (iii) would not require Agent or such Lender to
take any action inconsistent with its internal policies or legal or regulatory
restrictions, and (iv) would not otherwise be disadvantageous to Agent or such
Lender.
3.7.    Taxes.
(a)    Any and all payments by or on account of any Obligations hereunder or
under any Other Document shall be made free and clear of and without deduction
or withholding for any Taxes, except as required by Applicable Law. If any
Applicable Law (as determined in the good faith discretion of an applicable
Withholding Agent) requires the deduction or withholding of any Tax from any
such payment by a Withholding Agent, then the applicable Withholding Agent shall
be entitled to make such deduction or withholding and shall timely pay the full
amount deducted or withheld to the relevant Government Body in accordance with
Applicable Law and if such Tax is an Indemnified Tax, then  the sum payable by
the applicable Credit Party shall be increased as necessary so that after such
deduction or withholding has been made (including such deductions and
withholdings applicable to additional sums payable under this Section) the
Recipient receives an amount equal to the sum it would have received had no such
deductions or withholding been made.
(b)    Without limiting the provisions of clause (a) of this Section, Borrowers
shall timely pay any Other Taxes to the relevant Governmental Body in accordance
with Applicable Law.
(c)    Each Borrower shall indemnify each Recipient, within twenty (20) days
after demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by such Recipient and
any penalties, interest and reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Body;
provided that if any Recipient requests indemnification more than 180 days after
the earlier of (1) the date on which such Recipient received written demand for
payment of the applicable Indemnified Taxes from the relevant Governmental Body
or (2) the date on which Recipient paid the applicable Indemnified Taxes, such
Recipient shall not be indemnified to extent that such failure or delay results
in prejudice to the Borrower. A certificate as to the amount of such payment or
liability delivered to Borrowers by any Recipient (with a copy to Agent), or by
Agent on its own behalf or on behalf of any Recipient, shall be conclusive
absent manifest error.
(d)    As soon as practicable after any payment of Indemnified Taxes or Other
Taxes by any Borrower to a Governmental Body, the Borrowers shall deliver to
Agent the original or a certified copy of a receipt issued by such Governmental
Body evidencing such payment, a copy of the return reporting such payment or
other evidence of such payment reasonably satisfactory to Agent.
(e)    (i)    Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments hereunder or under any Other Document
shall deliver to Borrowers (with a copy to Agent), at the time or times
prescribed by Applicable Law or reasonably requested by Borrowers or Agent, such
properly completed and executed documentation prescribed by Applicable Law or
reasonably requested by the Borrower or Agent as will permit such payments to be
made without withholding or at a reduced rate of withholding. In addition, any
Lender, if reasonably requested by Borrowers or Agent, shall deliver such other
documentation prescribed by Applicable Law or reasonably requested by the
Borrowers or Agent as will enable Borrowers or Agent to determine whether or not
such Lender is subject to backup withholding or information reporting
requirements, and as will enable the Borrower or the Agent to comply with their
own withholding or information reporting requirements (including pursuant to
FATCA or any analogous provisions of non-U.S. law). 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
subclauses (ii)(A), (ii)(C) and (ii)(D) of this clause (e)) shall not be
required if in the Lender’s reasonable judgment such completion, execution or
submission would subject such Lender to any material unreimbursed cost or
expense or would materially prejudice the legal or commercial position of such
Lender.
(ii)    Without limiting the generality of the foregoing,
(A)    in the case of a Foreign Lender, such Lender shall, to the extent it is
legally entitled to do so, deliver to the Borrower and the Agent, on or prior to
the date on which such Lender becomes a Lender under this Agreement (and from
time to time thereafter upon the request of Borrowers or Agent), whichever of
the following is applicable:
(1)    two (2) duly completed valid originals of IRS Form W-8BEN or IRS Form
W-8BEN-E claiming eligibility for benefits of an income tax treaty to which the
United States of America is a party, or any subsequent versions thereof or
successors thereto;
(2)    two (2) duly completed valid originals of IRS Form W-8ECI, or any
subsequent versions thereof or successors thereto;
(3)     in the case of a Foreign Lender claiming the benefits of the exemption
for portfolio interest under section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit 3.10(e)-1 to the effect that such Foreign
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 Borrowers within the meaning of
section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation”
related to the Borrower as described in section 881(c)(3)(C) of the Code (a
“U.S. Tax Compliance Certificate”) and (y) two duly completed valid originals of
IRS Form W-8BEN or IRS Form W-8BEN-E, or any subsequent versions thereof or
successors thereto; or
(4)    to the extent a Foreign Lender is not the beneficial owner, two duly
completed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form
W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in
the form of Exhibit 3.10(e)-2 or Exhibit 3.10(e)-3, IRS Form W-9, and/or other
certification documents from each beneficial owner, as applicable; provided that
if the Foreign Lender is a partnership and one or more direct or indirect
partners of such Foreign Lender are claiming the portfolio interest exemption,
such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially
in the form of Exhibit 3.10(e)-4 on behalf of each such direct and indirect
partner;
(B)    any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Agent (in such number of copies as shall be
requested by the recipient) on or prior to the date on which such Lender becomes
a Lender under this Agreement (and from time to time thereafter upon the request
of Borrowers or Agent), any other form prescribed by Applicable Law as a basis
for claiming exemption from or a reduction in United States Federal withholding
tax duly completed together with such supplementary documentation as may be
prescribed by Applicable Law to permit the Borrowers to determine the
withholding or deduction required to be made;
(C)    in the case of any Lender that is not a Foreign Lender, such Lender shall
submit to Borrower and Agent, on or prior to the date on which such Lender
becomes a Lender under this Agreement (and from time to time thereafter upon the
request of Borrower or Agent), two (2) originals of an IRS Form W-9 or any other
form prescribed by Applicable Law demonstrating that such Lender is not a
Foreign Lender; and
(D)    if a payment made to a Recipient under this Agreement or any Other
Document would be subject to U.S. Federal withholding Tax imposed by FATCA if
such Person fails 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 Recipient shall deliver to the Agent (in the case of Swing
Loan Lender, a Lender, Participant or Issuer) and Borrowers (A) a certification
signed by the chief financial officer, principal accounting officer, treasurer
or controller of such Person, and (B) other documentation reasonably requested
by Agent or any Borrower, including such documentation prescribed by applicable
law (including prescribed by Section 1471(b)(3)(C)(i) of the Code), and such
additional documentation reasonably requested by Agent or any Borrower as may be
sufficient for Agent and Borrowers to comply with their obligations under FATCA
and to determine that Recipient has complied with such Recipient’s obligations
under FATCA or to determine to deduct and withhold from such payment. For the
purposes of this clause (f), “FATCA” shall include any amendments made to FATCA
after the date of this Agreement.
(f)    Each Recipient agrees that if any form or certification it previously
delivered pursuant to this Section expires or becomes obsolete or inaccurate in
any respect, it shall update such form or certification or promptly notify such
Borrowers and the Agent in writing of its legal inability to do so.
(g)    If any Recipient determines, in its sole discretion, exercised in good
faith, that it has received a refund of any Indemnified Taxes or Other Taxes as
to which it has been indemnified by Borrowers or with respect to which Borrowers
have paid additional amounts pursuant to this Section, it shall pay to Borrowers
an amount equal to such refund (but only to the extent of indemnity payments
made, or additional amounts paid, by Borrowers under this Section with respect
to the Indemnified Taxes or Other Taxes giving rise to such refund); net of all
out-of-pocket expenses of the Agent, Swing Loan Lender, such Lender,
Participant, or the Issuer, as the case may be, and without interest (other than
any interest paid by the relevant Governmental Body with respect to such
refund), provided that Borrowers, upon the request of Agent, Swing Loan Lender,
such Lender, Participant, or Issuer, agrees to repay the amount paid over to
Borrowers (plus any penalties, interest or other charges imposed by the relevant
Governmental Body) to Agent, Swing Loan Lender, such Lender, Participant or the
Issuer in the event Agent, Swing Loan Lender, such Lender, Participant or the
Issuer is required to repay such refund to such Governmental Body. This Section
shall not be construed to require Agent, Swing Loan Lender, any Lender,
Participant, or Issuer to make available its tax returns (or any other
information relating to its taxes that it deems confidential) to Borrowers or
any other Person.
(h)    Each Lender shall severally indemnify the Agent, within 20 days after
demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but
only to the extent that any Credit Party has not already indemnified the Agent
for such Indemnified Taxes and without limiting the obligation of the Credit
Parties to do so), (ii) any Taxes attributable to such Lender’s failure to
comply with the provisions of Section 16.3 relating to the maintenance of a
Participant Register and (iii) any Excluded Taxes attributable to such Lender,
in each case, that are payable or paid by the Agent in connection with any
Obligation hereunder or under any Other Document, and any reasonable expenses
arising therefrom or with respect thereto, whether or not such Taxes were
correctly or legally imposed or asserted by the relevant Governmental Body. A
certificate as to the amount of such payment or liability delivered to any
Lender by the Agent shall be conclusive absent manifest error. Each Lender
hereby authorizes the Agent to set off and apply any and all amounts at any time
owing to such Lender under any Obligation hereunder or under any Other Document
or otherwise payable by the Agent to the Lender from any other source against
any amount due to the Agent under this clause (h).
3.8.    Replacement of Lenders. If any Lender (an “Affected Lender”) (a) makes
demand upon Borrowers for (or if Borrowers are otherwise required to pay)
amounts pursuant to Section 3.6, 3.8 or 3.9, (b) is unable to make or maintain
LIBOR Rate Loans as a result of a condition described in Section 2.2(h), (c) is
a Defaulting Lender, or (d) denies any consent or fails to approve any amendment
or other modification requested by the Borrowing Agent pursuant to Section
16.2(b), Borrowers may, within one-hundred twenty (120) days of receipt of such
demand, notice (or the occurrence of such other event causing Borrowers to be
required to pay such compensation or causing Section 2.2(h) to be applicable),
or such Lender becoming a Defaulting Lender or denial of a request by the Agent
pursuant to Section 16.2(b), as the case may be, by notice (a “Replacement
Notice”) in writing to the Agent and such Affected Lender (i) request the
Affected Lender to cooperate with Borrowers in obtaining a replacement Lender
satisfactory to the Agent and Borrowers (the “Replacement Lender”); (ii) request
the non-Affected Lenders to acquire and assume all of the Affected Lender’s
Advances and its Commitment Percentage, as provided herein, but none of such
Lenders shall be under any obligation to do so; or (iii) propose a Replacement
Lender subject to approval by the Agent in its good faith business judgment;
provided, (x) in the case of any such replacement resulting from a claim for
compensation under Section 3.6, 3.8 or 3.9, such replacement will result in a
reduction of such compensation from the Replacement Lender at the time of such
replacement; and (y) such replacement does not conflict with Applicable Law. If
any satisfactory Replacement Lender shall be obtained, and/or if any one or more
of the non-Affected Lenders shall agree to acquire and assume all of the
Affected Lender’s Advances and its Commitment Percentage, then such Affected
Lender shall assign, in accordance with Section 16.3, all of its Advances and
its Commitment Percentage, and other rights and obligations under this Agreement
and the Other Documents to such Replacement Lender or non-Affected Lenders, as
the case may be, in exchange for payment of the principal amount so assigned and
all interest and fees accrued on the amount so assigned, plus all other
Obligations then due and payable to the Affected Lender. If any Affected Lender
does not execute an assignment in accordance with Section 16.3 within five
(5) Business Days after receipt of notice to do so by Agent or Borrowing Agent,
then such assignment shall become effective for purposes of Section 16.3 and
this Agreement upon execution by Agent and Borrowing Agent.
IV.    COLLATERAL: GENERAL TERMS
4.1.    Security Interest in the Collateral. To secure the prompt payment and
performance to Agent, Issuer and each Lender (and each other holder of any
Obligations) of the Obligations, each Borrower hereby assigns, pledges and
grants to Agent for its benefit and for the ratable benefit of each Lender,
Issuer and each other Secured Party, a continuing security interest in and to
and Lien on all of its Collateral, whether now owned or existing or hereafter
created, acquired or arising and wheresoever located. Each Borrower shall mark
its books and records as may be necessary or appropriate to evidence, protect
and perfect Agent’s security interest and shall cause its financial statements
to reflect such security interest. Each Borrower shall provide Agent with
written notice of all commercial tort claims exceeding $1,000,000 promptly upon
the occurrence of any events giving rise to any such claim(s) (regardless of
whether legal proceedings have yet been commenced), such notice to contain a
brief description of the claim(s), the events out of which such claim(s) arose
and the parties against which such claims may be asserted and, if applicable in
any case where legal proceedings regarding such claim(s) have been commenced,
the case title together with the applicable court and docket number. Upon
delivery of each such notice, such Borrower shall be deemed to thereby grant to
Agent a security interest and lien in and to such commercial tort claims
described therein and all proceeds thereof. Each Borrower shall provide Agent
with written notice promptly upon becoming the beneficiary under any letter of
credit or otherwise obtaining any right, title or interest in any letter of
credit rights, and at Agent’s request shall take such actions as Agent may
reasonably request for the perfection of Agent’s security interest therein.
4.2.    Perfection of Security Interest. Except for any Collateral disposed of
in accordance with Section 7.1, each Borrower shall take all action that may be
necessary that Agent may request, so as at all times to maintain the validity,
perfection, enforceability and priority of Agent’s security interest in and Lien
on the Collateral or to enable Agent to protect, exercise or enforce its rights
hereunder and in the Collateral, including, but not limited to, (i) promptly
discharging all Liens other than Permitted Encumbrances, (ii) using commercially
reasonable efforts to obtain Lien Waiver Agreements required under this
Agreement, (iii) delivering to Agent, endorsed or accompanied by such
instruments of assignment as Agent may specify, and stamping or marking, in such
manner as Agent may specify, any and all chattel paper, instruments, letters of
credits and advices thereof and documents evidencing or forming a part of the
Collateral, (iv) entering into warehousing, lockbox, customs and freight
agreements and other custodial arrangements satisfactory to Agent, and (v)
executing and delivering financing statements, control agreements, instruments
of pledge, mortgages, notices and assignments, in each case in form and
substance satisfactory to Agent, relating to the creation, validity, perfection,
maintenance or continuation of Agent’s security interest and Lien under the
Uniform Commercial Code or other Applicable Law. By its signature hereto, each
Borrower hereby authorizes Agent to file against such Borrower, one or more
financing, continuation or amendment statements pursuant to the Uniform
Commercial Code in form and substance satisfactory to Agent (which statements
may have a description of collateral which is broader than that set forth
herein, including without limitation a description of Collateral as “all assets”
and/or “all personal property” of any Borrower). All reasonable out-of-pocket
charges, expenses and fees Agent may incur in doing any of the foregoing, and
any local taxes relating thereto, shall be charged to Borrowers’ Account as a
Revolving Advance of a Domestic Rate Loan and added to the Obligations, or, at
Agent’s option, shall be paid by the applicable Borrowers to Agent for its
benefit and for the ratable benefit of Lenders immediately upon demand.
4.3.    Preservation of Collateral. Each Borrower will safeguard and protect all
Collateral for Agent’s general account. In addition to the rights and remedies
set forth in Section 11.1, Agent: (a) may at any time take such steps as Agent
deems necessary in the exercise of its Permitted Discretion to protect Agent’s
interest in and to preserve the Collateral, including after the occurrence and
during the continuance of an Event of Default, the hiring of such security
guards or the placing of other security protection measures as Agent may deem
appropriate; (b) after the occurrence and during the continuance of an Event of
Default, may employ and maintain at any of each Borrower’s premises a custodian
who shall have full authority to do all acts necessary to protect Agent’s
interests in the Collateral; (c) after the occurrence and during the continuance
of a Default or Event of Default, may lease warehouse facilities to which Agent
may move all or part of the Collateral; (d) after the occurrence and during the
continuance of an Event of Default, may use any Borrower’s owned or leased
lifts, hoists, trucks and other facilities or equipment for handling or removing
the Collateral; and (e) subject to Section 4.10, shall have, and is hereby
granted, a right of ingress and egress to the places where the Collateral is
located, and may proceed over and through any of Borrowers’ owned or leased
property, subject to the rights of the landlords of any leased Real Property
and, if applicable, the terms of any applicable Lien Waiver Agreement. Subject
to the other provisions of this Agreement regarding Borrowers’ maintenance of
Collateral, each Borrower shall cooperate with all of Agent’s efforts to
preserve the Collateral and will take such actions to preserve the Collateral as
Agent may direct in its Permitted Discretion. Subject to Section 16.9, all of
Agent’s reasonable out-of-pocket expenses of preserving the Collateral,
including any such expenses relating to the bonding of a custodian, shall be
charged to Borrowers’ Account as a Revolving Advance maintained as a Domestic
Rate Loan and added to the Obligations.
4.4.    Ownership and Location of Collateral.
(a)    With respect to the Collateral, at the time the Collateral becomes
subject to Agent’s security interest: (i) each Borrower is, and shall remain the
sole owner of and fully authorized and able to sell, transfer, pledge and/or
grant a first priority security interest (subject only to Permitted Encumbrances
that have priority as a matter of Applicable Law) in each and every item of its
respective Collateral; (ii) except for Permitted Encumbrances the Collateral
shall be free and clear of all Liens; and (iii) each Borrower’s Inventory shall
be located as set forth on Schedule 4.4 (as updated from time to time pursuant
to each Compliance Certificate delivered pursuant to Section 9.3) and shall not
be removed from such location(s) without the prior written consent of Agent,
except (1) as may be moved from one location on such schedule to another
location on such schedule, (2) Inventory in-transit, (3) Equipment out in the
ordinary course of business, (4) the sale, transfer or disposition of assets
permitted under this Agreement, (5) as may be located at a Customer site and (6)
as may be located at locations not set forth on Schedule 4.4 to the extent the
aggregate value of Inventory at such locations does not exceed $2,500,000 for
any one location or $5,000,000 in the aggregate for all such locations.
(b)    (i) Schedule 4.4(b)(ii) hereto contains a correct and complete list, as
of the Closing Date, of the legal names and addresses of each warehouse at which
Inventory having a value in excess of $2,500,000 of any Borrower is stored; none
of the receipts received by any Borrower from any warehouse states that the
goods covered thereby are to be delivered to bearer or to the order of a named
Person or to a named Person and such named Person’s assigns; (ii) Schedule
4.4(b)(iii) hereto sets forth a correct and complete list as of the Closing Date
of (A) the principal place of business of each Borrower and (B) the chief
executive office of each Borrower; and (iii) Schedule 4.4(b)(iv) hereto sets
forth a correct and complete list as of the Closing Date of the location, by
state and street address, of all Real Property owned or leased by each Borrower,
identifying which properties are owned and which are leased, together with the
names and addresses of any landlords.
4.5.    Defense of Agent’s and Lenders’ Interests. Until (a) payment and
performance in full of all of the Obligations and (b) termination of this
Agreement, Agent’s interests in the Collateral shall continue in full force and
effect. During such period no Borrower shall, without Agent’s prior written
consent, pledge, sell (except for Dispositions otherwise permitted in Section
7.1(b)), assign, transfer, create or suffer to exist a Lien upon or encumber or
allow or suffer to be encumbered in any way except for Permitted Encumbrances,
any part of the Collateral. Each Borrower shall defend Agent’s interests in the
Collateral against any and all Persons whatsoever. At any time following demand
by Agent for payment of all Obligations upon the occurrence and during the
continuance of an Event of Default, Agent shall have the right to take
possession of the indicia of the Collateral and the Collateral in whatever
physical form contained, including: labels, stationery, documents, instruments
and advertising materials. If Agent exercises this right to take possession of
the Collateral, upon the occurrence and during the continuance of an Event of
Default, Borrowers shall, upon demand, assemble it in the best manner possible
and make it available to Agent at a place reasonably convenient to Agent. In
addition, with respect to all Collateral, Agent and Lenders shall be entitled to
all of the rights and remedies set forth herein and further provided by the
Uniform Commercial Code or other Applicable Law. Each Borrower shall, and Agent
may, upon the occurrence and during the continuance of an Event of Default, at
its option, instruct all suppliers, carriers, forwarders, warehousers or others
receiving or holding cash, checks, Inventory, documents or instruments in which
Agent holds a security interest to deliver same to Agent and/or subject to
Agent’s order and if they shall come into any Borrower’s possession, they, and
each of them, shall be held by such Borrower in trust as Agent’s trustee, and
such Borrower will promptly deliver them to Agent in their original form
together with any necessary endorsement.
4.6.    Inspection of Premises. Subject to the limitations set forth in Section
9.18, at all reasonable times and from time to time as often as Agent shall
elect in its sole discretion, Agent and each Lender shall have full access to
and the right to audit, check, inspect and make abstracts and copies from each
Borrower’s books, records, audits, correspondence and all other papers relating
to the Collateral and the operation of each Borrower’s business. Agent, any
Lender and their agents may enter upon any premises of any Borrower at any time
during business hours and at any other reasonable time, and from time to time as
often as Agent shall elect in its sole discretion, for the purpose of inspecting
the Collateral and any and all records pertaining thereto and the operation of
such Borrower’s business.
4.7.    Appraisals. Subject to the limitations set forth in Section 9.18, Agent
may, in its sole discretion, exercised in a commercially reasonable manner, at
any time after the Closing Date and from time to time, engage the services of an
independent appraisal firm or firms of reputable standing, satisfactory to
Agent, for the purpose of appraising the then current values of Borrowers’
assets. Absent the occurrence and continuance of an Event of Default at such
time, Agent shall consult with Borrowers as to the identity of any such firm. In
the event the value of Borrowers’ Inventory, as so determined pursuant to such
appraisal, is less than anticipated by Agent or Lenders, such that the Revolving
Advances are in excess of such Advances permitted hereunder, then, promptly upon
Agent’s demand for same, Borrowers shall make mandatory prepayments of the then
outstanding Revolving Advances so as to eliminate the excess Advances.
4.8.    Receivables; Deposit Accounts and Securities Accounts.
(a)    Each of the Receivables shall, except as noted therein, be a bona fide
and valid account representing a bona fide indebtedness incurred by the Customer
therein named, for a fixed sum (subject to customary discounts or reductions
permitted in the ordinary course of business and in accordance with past
practices) as set forth in the invoice relating thereto (provided immaterial or
unintentional invoice errors shall not be deemed to be a breach hereof) with
respect to an absolute sale or lease and delivery of goods upon stated terms of
a Borrower, or work, labor or services theretofore rendered by a Borrower as of
the date each Receivable is created. Same shall be due and owing in accordance
with the applicable Borrower’s standard terms of sale without dispute, setoff or
counterclaim except as may be stated on the accounts receivable schedules
delivered by Borrowers to Agent.
(b)    Each Borrower’s chief executive office is located as set forth on
Schedule 4.4(b)(iii). Until written notice is given to Agent by Borrowing Agent
of any other office at which any Borrower keeps its records pertaining to
Receivables, all such records shall be kept at such executive office.
(c)    Borrowers shall instruct their Customers to deliver all remittances upon
Receivables (whether paid by check or by wire transfer of funds) to such
Collection Account(s) and/or Depository Accounts (and any associated lockboxes)
as the Borrowing Agent shall designate from time to time as contemplated by
Section 4.8(g) or as otherwise agreed to from time to time by Agent.
Notwithstanding the foregoing, to the extent any Borrower directly receives any
remittances upon Receivables, such Borrower shall, at such Borrower’s sole cost
and expense, but on Agent’s behalf and for Agent’s account, collect as Agent’s
property and in trust for Agent all amounts received on Receivables, and shall
not commingle such collections with any Borrower’s funds or use the same except
to pay Obligations, and shall as soon as possible and in any event no later than
one (1) Business Day after the receipt thereof (i) in the case of remittances
paid by check, deposit all such remittances in their original form (after
supplying any necessary endorsements) and (ii) in the case of remittances paid
by wire transfer of funds, transfer all such remittances, in each case, into
such Collection Accounts(s) and/or Depository Account(s). Each Borrower shall
deposit in the applicable Collection Account and/or Depository Account or, upon
request by Agent during a Trigger Period, deliver to Agent, in original form and
on the date of receipt thereof, all checks, drafts, notes, money orders,
acceptances, cash and other evidences of Indebtedness.
(d)    At any time following the occurrence, and during the continuance of, an
Event of Default, Agent shall have the right to send notice of the assignment
of, and Agent’s security interest in and Lien on, the Receivables to any and all
Customers or any third party holding or otherwise concerned with any of the
Collateral. At any time after the occurrence and during the continuance of an
Event of Default, Agent shall have the sole right to collect the Receivables,
take possession of the Collateral, or both. Agent’s actual collection expenses,
including, but not limited to, stationery and postage, telephone, facsimile,
telegraph, secretarial and clerical expenses and the salaries of any collection
personnel used for collection, may be charged to Borrowers’ Account and added to
the Obligations.
(e)    Power of Agent to Act on Borrowers’ Behalf. Upon and during the
continuance of an Event of Default (except to the extent otherwise agreed in any
treasury management agreement between any Borrower and Agent), Agent shall have
the right to receive, endorse, assign and/or deliver in the name of Agent or any
Borrower any and all checks, drafts and other instruments for the payment of
money relating to the Receivables, and each Borrower hereby waives notice of
presentment, protest and non-payment of any instrument so endorsed. Each
Borrower hereby constitutes Agent or Agent’s designee as such Borrower’s
attorney with power (i) to endorse such Borrower’s name upon any notes,
acceptances, checks, drafts, money orders or other evidences of payment or
Collateral upon and during the continuance of an Event of Default (except to the
extent otherwise agreed in treasury management agreement between any Borrower
and Agent); (ii) to sign such Borrower’s name on any invoice or bill of lading
relating to any of the Receivables, drafts against Customers, and assignments of
Receivables, upon and during the continuance of an Event of Default; (iii) to
send verifications of Receivables to any Customer (provided that, so long as no
Event of Default has occurred and is continuing, Agent shall only conduct
verifications of Receivables over the phone with participation from Borrowers or
with Borrowers being present); (iv) to sign such Borrower’s name on any
documents or instruments deemed necessary or appropriate by Agent to preserve,
protect, or perfect Agent’s interest in the Collateral and to file same upon and
during the continuance of an Event of Default; (v) to demand payment of the
Receivables upon and during the continuance of an Event of Default; (vi) to
enforce payment of the Receivables by legal proceedings or otherwise upon and
during the continuance of an Event of Default; (vii) to exercise all of such
Borrower’s rights and remedies with respect to the collection of the Receivables
and any other Collateral upon and during the continuance of an Event of Default;
(viii) to settle, adjust, compromise, extend or renew the Receivables upon and
during the continuance of an Event of Default; (ix) to settle, adjust or
compromise any legal proceedings brought to collect Receivables upon and during
the continuance of an Event of Default; (x) to prepare, file and sign such
Borrower’s name on a proof of claim in bankruptcy or similar document against
any Customer upon and during the continuance of an Event of Default; (xi) to
prepare, file and sign such Borrower’s name on any notice of Lien, assignment or
satisfaction of Lien or similar document in connection with the Receivables upon
and during the continuance of an Event of Default; (xii) to receive, open and
dispose of all mail addressed to any Borrower to the extent such actions are
taken in connection with operation and administration of Borrowers’ lockboxes or
otherwise in connection with treasury management services; and (xiii) upon and
during the continuance of an Event of Default, to do all other acts and things
necessary to carry out this Agreement. All acts of said attorney or designee are
hereby ratified and approved, and said attorney or designee shall not be liable
for any acts of omission or commission nor for any error of judgment or mistake
of fact or of law, unless constituting willful misconduct or gross negligence
(as determined by a court of competent jurisdiction in a final non-appealable
judgment); this power being coupled with an interest is irrevocable while any of
the Obligations remain unpaid. Agent shall have the right at any time following
the occurrence and during the continuation of an Event of Default, to change the
address for delivery of mail addressed to any Borrower to such address as Agent
may designate and to receive, open and dispose of all mail addressed to any
Borrower.
(f)    No Liability. Neither Agent nor any Lender shall, under any circumstances
or in any event whatsoever, have any liability for any error or omission or
delay of any kind occurring in the settlement, collection or payment of any of
the Receivables or any instrument received in payment thereof, or for any damage
resulting therefrom, except for the gross negligence or willful misconduct of
the Agent as determined by a final and non-appealable judgment of a court of
competent jurisdiction. Following the occurrence and during the continuance of
an Event of Default, Agent may, without notice or consent from any Borrower, sue
upon or otherwise collect, extend the time of payment of, compromise or settle
for cash, credit or upon any terms any of the Receivables or any other
securities, instruments or insurance applicable thereto and/or release any
obligor thereof. Agent is authorized and empowered to accept, following the
occurrence and during the continuance of an Event of Default, the return of the
goods represented by any of the Receivables, without notice to or consent by any
Borrower, all without discharging or in any way affecting any Borrower’s
liability hereunder
(g)    Cash Management.
(i)    All Collateral consisting of cash or Cash Equivalents or proceeds of
Collateral of the Borrowers shall be deposited by such Borrowers into either (A)
a lockbox account, dominion account or other such “blocked account” established
at a bank, or a securities account, in each case reasonably satisfactory to
Agent (each such bank, a “Blocked Account Bank”) pursuant to an arrangement with
such Blocked Account Bank as may be selected by Borrowers and be acceptable to
Agent or (B) a collection account established at PNC for the deposit of such
proceeds (all such accounts in clauses (A) and (B), the “Collection Accounts”).
Each Borrower shall deliver to Agent a Deposit Account Control Agreement, in
form and substance satisfactory to Agent in its Permitted Discretion, with
respect to each Collection Account other than any Excluded Deposit Account which
shall be in “springing” form permitting Borrowers to access and use such
Collection Accounts unless and until a “notice of sole control” (such notice, or
any similar notice described in any applicable control agreement an “Activation
Notice”) is issued by Agent to the bank at which such Collection Account is
maintained; provided that Agent shall not issue such an Activation Notice except
after the occurrence and during the continuance of a Trigger Event and shall
revoke such Activation Notice if, subsequent thereto, the Trigger Period
commenced by such Trigger Event shall have ended. Upon issuance of an Activation
Notice, such Deposit Account Control Agreements shall provide that all available
funds in each Collection Account will be transferred, on each Business Day, to
Agent, either to any account maintained by Agent at such bank or by wire
transfer to appropriate account(s) of Agent, and otherwise be in form and
substance (including as to the extent of offset and statutory lien rights)
reasonably satisfactory to Agent. All funds deposited in such Collection
Accounts during the effectiveness of a Trigger Period shall immediately become
the property of Agent and be applied to the satisfaction of the Obligations
(including the cash collateralization of the Letters of Credit) in such order as
Agent shall determine in its sole discretion, provided that, in the absence of
any Event of Default, Agent shall apply all such funds representing collection
of Receivables first to the prepayment of the principal amount of the Swing
Loans, if any, and then to the Revolving Advances. Neither Agent nor any Lender
assumes any responsibility for such collection account arrangement, including
any claim of accord and satisfaction or release with respect to deposits
accepted by any bank maintaining a Collection Account.
(ii)    Notwithstanding anything to the contrary herein or in any Other
Document, Borrowers shall ensure that Agent does not receive, whether by deposit
to the Collection Accounts or otherwise, any funds from any Customer located in
a Sanctioned Country.
(iii)    The parties hereto hereby acknowledge, confirm and agree that the
implementation of the cash management arrangements contemplated herein is a
contractual right provided to the Agent and the Lenders hereunder in order for
the Agent and the Lenders to manage and monitor their collateral position and
not a proceeding for enforcement or recovery of a claim, or pursuant to, or an
enforcement of, any security or remedies whatsoever, the cash management
arrangements contemplated herein are critical to the structure of the lending
arrangements contemplated herein, the Agent and Lenders are relying on the
Credit Parties’ acknowledgement, confirmation and agreement with respect to such
cash management arrangements in making accommodations of credit available to
them and in particular that any accommodations of credit are being provided by
the Agent and Lenders strictly on the basis of a borrowing base calculation to
fully support and collateralize any such accommodations of credit hereunder.
(iv)    Adjustments. No Borrower will, without Agent’s consent, compromise or
adjust any material amount of the Receivables (or extend the time for payment
thereof) or accept any material returns of merchandise or grant any additional
discounts, allowances or credits thereon except for those compromises,
adjustments, returns, discounts, credits and allowances as have been granted in
the ordinary course of business of such Borrower.
(a)    All deposit accounts (including all Collection Accounts and Depository
Accounts), securities accounts and investment accounts of each Borrower and its
Subsidiaries as of the Closing Date are set forth on Schedule 4.8(i). No
Borrower shall open any new deposit account, securities account or investment
account unless (i) Borrowers shall have given prior written notice to Agent and
(ii) if such account is to be maintained with a bank, depository institution or
securities intermediary that is not the Agent, such bank, depository institution
or securities intermediary, each applicable Borrower and Agent shall first have
entered into an account control agreement in form and substance satisfactory to
Agent sufficient to give Agent “control” (for purposes of Articles 8 and 9 of
the Uniform Commercial Code) over such account other than with respect to any
Excluded Deposit Account.
4.9.    Inventory. To the extent Inventory held for sale or lease has been
produced by any Borrower, it has been and will be produced, in all material
respects, by such Borrower in accordance with the Federal Fair Labor Standards
Act of 1938, as amended, and all rules, regulations and orders thereunder.
4.10.    Maintenance of Equipment. The Equipment necessary to Borrowers’
business shall be maintained in good operating condition and repair (reasonable
wear and tear and casualty excepted) and all necessary replacements of and
repairs thereto shall be made so that the value and operating efficiency of the
Equipment shall be maintained and preserved consistent with industry standards;
provided that the same shall not be required if not necessary for the continued
operation of the Borrowers’ business. No Borrower shall use or operate the
Equipment in violation of any law, statute, ordinance, code, rule or regulation
to the extent such use or operation could reasonably be expected to materially
and adversely affect the operation of its business as currently conducted.
4.11.    Exculpation of Liability. Nothing herein contained shall be construed
to constitute Agent or any Lender as any Borrower’s agent for any purpose
whatsoever, nor shall Agent or any Lender be responsible or liable for any
shortage, discrepancy, damage, loss or destruction of any part of the Collateral
wherever the same may be located and regardless of the cause thereof, except for
the gross negligence or willful misconduct of the Agent as determined by a final
and non-appealable judgment of a court of competent jurisdiction. Neither Agent
nor any Lender, whether by anything herein or in any assignment or otherwise,
assume any of any Borrower’s obligations under any contract or agreement
assigned to Agent or such Lender, and neither Agent nor any Lender shall be
responsible in any way for the performance by any Borrower of any of the terms
and conditions thereof.
4.12.    Financing Statements. Except as respects the financing statements filed
by Agent, financing statements described on Schedule 1.2, and financing
statements filed in connection with Permitted Encumbrances, no financing
statement covering any of the Collateral or any proceeds thereof is on file in
any public office.
V.    REPRESENTATIONS AND WARRANTIES.
Each Borrower represents and warrants as follows:
5.1.    Authority. Each Credit Party has full power, authority and legal right
to enter into this Agreement and the Other Documents to which it is a party and
to perform all its respective Obligations hereunder and thereunder. This
Agreement and the Other Documents to which any Credit Party is a party have been
duly executed and delivered by the Credit Parties party thereto, and this
Agreement and the Other Documents constitute the legal, valid and binding
obligation of the Credit Parties party thereto enforceable in accordance with
their terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights
generally. The execution, delivery and performance of this Agreement and of the
Other Documents to which any Credit Party is party (a) are within each Credit
Party’s corporate, limited liability company, limited partnership, partnership
or other applicable powers, have been duly authorized by all necessary
corporate, limited liability company, limited partnership, partnership or other
applicable action, are not in contravention of the terms of each Credit Party’s
Organizational Documents or other applicable documents relating to such Credit
Party’s formation or to the conduct of such Credit Party’s business, (b) will
not conflict with or violate (i) any Applicable Law, except to the extent such
conflict or violation could not reasonably be expected to have a Material
Adverse Effect or (ii) any Material Contract, (c) will not require the Consent
of any Governmental Body or any other Person as of the Closing Date, all of
which will have been duly obtained, made or compiled prior to the Closing Date
to the extent such Consents are required to be in force on the Closing Date and
which are in full force and effect and (d) will not conflict with, nor result in
any breach in any of the provisions of or constitute a default under or result
in the creation of any Lien except Permitted Encumbrances upon any asset of such
Credit Party under the provisions of any Applicable Law, Organizational Document
or Material Contract to which such Credit Party is a party or by which it or its
property is a party or by which it may be bound.
5.2.    Formation and Qualification.
(a)    On the Closing Date, each Credit Party is duly incorporated or formed, as
applicable and in good standing under the laws of the jurisdiction listed on
Schedule 5.2(a) and is qualified to do business and is in good standing in the
jurisdictions listed on Schedule 5.2(a). Each Credit Party is in good standing
and is qualified to do business in the states in which qualification and good
standing are necessary for such Credit Party to conduct its business and own its
property and where the failure to so qualify could reasonably be expected to
have a Material Adverse Effect on such Credit Party. Each Credit Party has
delivered to Agent true and complete copies of its Organizational Documents and
will promptly notify Agent of any material amendment or changes thereto.
(b)    All of the Subsidiaries of Holdings are listed on Schedule 5.2(b). The
Persons identified on Schedule 5.2(b) are the record and beneficial owners of
all of the Equity Interests of each of the Subsidiaries listed on Schedule
5.2(b) as being owned thereby, there are no proxies, irrevocable or otherwise,
with respect to such shares, and no equity securities of any of such Persons are
or may become required to be issued by reason of any options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into or exchangeable for,
Equity Interests of any such Person, and there are no contracts, commitments,
understandings or arrangements by which any such Person is or may become bound
to issue additional Equity Interests or securities convertible into or
exchangeable for such Equity Interests. All of the shares owned by the Credit
Parties are owned free and clear of any Liens other than Permitted Encumbrances.
(c)    All accrued but unpaid dividends owing on account of the Equity Interests
of each Borrower as of the Closing Date are set forth on Schedule 5.2(c).
5.3.    Survival of Representations and Warranties. All representations and
warranties of the Credit Parties contained in this Agreement and the Other
Documents shall, at the time of such Credit Party’s execution of this Agreement
and the Other Documents, be true and correct in all material respects (or, if
such representation and warranty is, by its terms, limited by materiality
(including a Material Adverse Effect), then such representation and warranty
shall be true in all respects) and shall survive the execution, delivery and
acceptance thereof by the parties thereto and the closing of the transactions
described therein or related thereto.
5.4.    Tax Returns. The Credit Parties have filed all federal, state and local
Tax returns and other reports they are required by law to file, except for those
returns which are subject to valid extensions, and have paid all Taxes that are
due and payable, except those which are being Properly Contested, or except to
the extent failure to do so would not reasonably be expected to result in an
Event of Default, result in material liability to any Credit Party or have a
Material Adverse Effect. The provision for Taxes on the books of the Credit
Parties have been made in accordance with GAAP and the Credit Parties have no
knowledge of any material deficiency or additional assessment in connection
therewith not provided for on its books.
5.5.    Financial Statements.
(a)    The pro forma balance sheet of Holdings on a Consolidated Basis (the “Pro
Forma Balance Sheet”) furnished to the Lenders on or prior to the Closing Date
reflects the consummation of the transactions contemplated by this Agreement
(collectively, the “Transactions”) and was prepared by or under the supervision
of the Chief Financial Officer of Holdings, based upon good faith estimates and
stated assumptions believed to be reasonable and fair as of the date made in
light of conditions and facts then known and, as of such date, reflect good
faith, reasonable and fair estimates of the information projected for the
periods set forth therein; it being understood that (i) actual results may vary
from the Projections and that such variances may be material and (ii) no
representation is made with respect to information of an industry specific or
general economic nature.
(b)    The cash flow projections of Holdings and its Subsidiaries for the five
year period following the Closing Date (on a monthly basis for the first twelve
months), copies of which are annexed to the Financial Condition Certificate (the
“Projections”) were prepared by or under the supervision of the Chief Financial
Officer of Holdings, based upon good faith estimates and stated assumptions
believed to be reasonable and fair as of the date made in light of conditions
and facts then known and, as of such date, reflect good faith, reasonable and
fair estimates of the information projected for the periods set forth therein;
it being understood that (i) actual results may vary from the Projections and
that such variances may be material and (ii) no representation is made with
respect to information of an industry specific or general economic nature. The
Projections together with the Pro Forma Balance Sheet are referred to as the
“Pro Forma Financial Statements”.
(c)    The unaudited consolidated balance sheet of C&J Energy Services Ltd., and
such other Persons described therein, as of February 28, 2017, and the related
unaudited statements of income, changes in stockholder’s equity, and changes in
cash flow for the period ended on such date, all accompanied by reports thereon
containing opinions without qualification by independent certified public
accountants, copies of which have been delivered to Agent, have been prepared in
accordance with GAAP, consistently applied (except for changes in application to
which such accountants concur) and present fairly the financial position of C&J
Energy Services Ltd. at such date and the results of their operations for such
period. Since January 6, 2017, there has been no change in the condition,
financial or otherwise, of Borrowers as shown on the consolidated balance sheet
as of such date and no change in the aggregate value of machinery, equipment and
Real Property owned by Borrowers, except changes in the ordinary course of
business, none of which individually or in the aggregate has resulted in a
Material Adverse Effect.
5.6.    Entity Names. As of the Closing Date, except as set forth on Schedule
5.6, no Credit Party (i) has been known by any other corporate name in the past
five years, (ii) sells Inventory under any other name nor (iii) has been the
surviving corporation or company of a merger or consolidation or acquired all or
substantially all of the assets of any Person during the preceding five (5)
years.
5.7.    O.S.H.A. Environmental Compliance; Flood Insurance.
(a)    Except as would not be reasonably be expected to cause a Material Adverse
Effect, (i) the Credit Parties have duly complied in all material respects with,
and their facilities, business, assets, property, leaseholds, Real Property and
Equipment are in compliance in all material respects with, the applicable
provisions of the Federal Occupational Safety and Health Act, RCRA and all other
Environmental Laws (in effect at the time of the representation); and (ii) there
are no outstanding citations, notices of liability, or orders of non-compliance
issued to any Credit Party or relating to its business, assets, property,
leaseholds or Equipment under any such laws, rules or regulations.
(b)    The Credit Parties have been issued or obtained all required federal,
state and local licenses, certificates or permits required pursuant to all
applicable Environmental Laws and all such licenses, certificates and permits
are current and in full force and effect, except to the extent failure to obtain
and maintain such licenses, certificates or permits would not reasonably be
expected to cause a Material Adverse Effect.
(c)    Except as would not reasonably be expected to cause a Material Adverse
Effect: (i) there have been no releases, spills, discharges, leaks or disposal
(collectively referred to as “Releases”) of Hazardous Substances at, upon, under
or migrating from or onto any Real Property owned, leased or occupied by any
Credit Party, except for those Releases which are in compliance with
Environmental Laws; (ii) there are no underground storage tanks or
polychlorinated biphenyls on any Real Property owned, leased or occupied by any
Credit Party, except for such underground storage tanks or polychlorinated
biphenyls that are present in compliance with Environmental Laws; (iii) the Real
Property including any premises owned, leased or occupied by any Credit Party
has never been used by any Credit Party to dispose of Hazardous Substances,
except as authorized by Environmental Laws; and (iv) no Hazardous Substances are
managed by any Credit Party on any Real Property including any premises owned,
leased or occupied by any Credit Party, excepting such quantities of Hazardous
Substances as are managed in compliance with Environmental Laws and as are
reasonably necessary for the operation of the commercial or industrial business
of any Credit Party or any of its tenants.
(d)     All Real Property owned by Credit Parties is insured pursuant to
policies and other bonds which are valid and in full force and effect and which
provide adequate and commercially standard coverage from reputable and
financially sound insurers in amounts sufficient to insure the assets and risks
of each such Credit Party in accordance with commercially prudent business
practice in the industry of such Credit Party. Each Credit Party has taken all
actions required under the Flood Laws and/or reasonably requested by Agent to
assist in ensuring that each Lender is in compliance with the Flood Laws
applicable to the Collateral (if any), including, but not limited to, to the
extent required, obtaining flood insurance for such property, structures and
contents prior to such property, structures and contents becoming Collateral.
5.8.    Solvency; No Litigation, Violation, Indebtedness or Default; ERISA
Compliance.
(a)    Holdings and its Subsidiaries, taken as a whole, is, and after giving
effect to the Transactions, will be solvent, able to pay its debts as they
mature, has, and after giving effect to the Transactions, will have capital
sufficient to carry on its business and all businesses in which it is about to
engage and the fair present saleable value of its assets, calculated on a going
concern basis, is in excess of the amount of its liabilities and will continue
to be in excess of the amount of its liabilities.
(b)    No Credit Party has (i) any pending against, or to the knowledge of the
Credit Parties, threatened litigation, investigation, arbitration, actions or
proceedings which could reasonably be expected to have a Material Adverse
Effect, and (ii) any liabilities or indebtedness for borrowed money other than
the Obligations and Indebtedness permitted by Section 7.8.
(c)    No Credit Party is in violation of any applicable statute, law, rule,
regulation or ordinance in any respect which could reasonably be expected to
have a Material Adverse Effect, nor is any Credit Party in violation of any
order of any court, Governmental Body or arbitration board or tribunal which
could reasonably be expected to have a Material Adverse Effect.
(d)    No Credit Party or any member of the Controlled Group maintains or is
required to contribute to any Plan other than those listed on Schedule 5.8(d)
hereto. Each Plan has been established and administered in compliance in all
material respects with the applicable provisions of ERISA, the Code and other
Applicable Law. Except as could not reasonably result in Material Adverse Effect
or an Event of Default or result in material liability to any Credit Party: (i)
each Borrower and each member of the Controlled Group has met all applicable
minimum funding requirements under Section 302 of ERISA and Section 412 of the
Code in respect of each Plan and each Pension Benefit Plan is in compliance with
Sections 412, 430 and 436 of the Code and Sections 206(g), 302 and 303 of ERISA,
without regard to waivers and variances; (ii) each Plan which is intended to be
a qualified plan under Section 401(a) of the Code as currently in effect has
been determined by the Internal Revenue Service to be qualified under Section
401(a) of the Code and the trust related thereto determined to be exempt from
federal income Tax under Section 501(a) of the Code or an application for such a
determination is currently being processed by the IRS; (iii) neither any Credit
Party nor any member of the Controlled Group has incurred any liability to the
PBGC other than for the payment of premiums, and there are no premium payments
which have become due which are unpaid; (iv) no Pension Benefit Plan or
Multiemployer Plan has been terminated by the plan administrator thereof nor by
the PBGC, and, to the best of Borrowers’ knowledge, there is no occurrence which
would reasonably be expected to cause the PBGC to institute proceedings under
Title IV of ERISA to terminate any Plan; (v) the current value of the assets of
each Pension Benefit Plan exceeds the present value of the accrued benefits and
other liabilities of such Plan and neither any Credit Party nor any member of
the Controlled Group knows of any facts or circumstances (other than day-to-day
fluctuations in market value) which would change the value of such assets and
accrued benefits and other liabilities; (vi) neither any Credit Party nor any
member of the Controlled Group has breached any of the responsibilities,
obligations or duties imposed on it by ERISA with respect to any Pension Benefit
Plan or Multiemployer Plan; (vii) neither any Credit Party nor any member of the
Controlled Group has incurred any liability for any excise Tax arising under
Section 4971, 4972 or 4980B of the Code, and, to the best of Borrowers’
knowledge, no fact exists which could give rise to any such liability; (viii)
neither any Credit Party nor any member of the Controlled Group nor, to the best
of Borrowers’ knowledge, any fiduciary of or any trustee to, any Plan, has
engaged in a “prohibited transaction” described in Section 406 of ERISA or
Section 4975 of the Code nor taken any action which would constitute or result
in a Termination Event with respect to any such Plan which is subject to ERISA;
(ix) no Termination Event has occurred or is reasonably expected to occur; (x)
neither any Credit Party nor any member of the Controlled Group has engaged in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA; (xi)
neither any Credit Party nor any member of the Controlled Group maintains or is
required to contribute to any Plan which provides health, accident or life
insurance benefits to former employees, their spouses or dependents, other than
in accordance with Part 6 of Subtitle B of Title I of ERISA or Section 4980B of
the Code; (xii) neither any Credit Party nor any member of the Controlled Group
has withdrawn, completely or partially, within the meaning of Section 4203 or
4205 of ERISA, from any Multiemployer Plan so as to incur liability under the
Multiemployer Pension Plan Amendments Act of 1980 and, to the best of Borrowers’
knowledge, there exists no fact which would reasonably be expected to result in
any such liability; and (xiii) no Plan fiduciary (as defined in Section 3(21) of
ERISA) has incurred any liability for breach of fiduciary duty or for any
failure in connection with the administration or investment of the assets of a
Plan.
5.9.    Patents, Trademarks, Copyrights and Licenses. Except as would not
reasonably be expected to have a Material Adverse Effect, all Intellectual
Property owned or utilized by any Borrower: (i) is set forth on Schedule 5.9;
(ii) is valid and has been duly registered or filed with all appropriate
Governmental Bodies; and (iii) constitutes all of the intellectual property
rights which are necessary for the operation of its business. There is no
objection to, pending challenge to the validity of, or proceeding by any
Governmental Body to suspend, revoke, terminate or adversely modify, any
Intellectual Property necessary for the Borrowers’ business and no Borrower is
aware of any grounds for any challenge or proceedings, except as would not
reasonably be expected to have a Material Adverse Effect.
5.10.    Licenses and Permits. Each Credit Party (a) is in compliance with and
(b) has procured and is now in possession of, all material licenses or permits
required by any applicable federal, state or local law, rule or regulation for
the operation of its business in each jurisdiction wherein it is now conducting
or propose to conduct business, except, in the cases of both (a) and (b) where
the failure to procure such licenses or permits would reasonably be expected to
have a Material Adverse Effect.
5.11.    No Default. No Borrower is in default in the payment or performance of
any contractual obligations where such default could reasonably be expected to
result in a Material Adverse Effect and no Default or Event of Default has
occurred.
5.12.    No Burdensome Restrictions. No Credit Party is a party to any contract
or agreement the performance of which could reasonably be expected to have a
Material Adverse Effect or materially and adversely affect such Credit Party’s
ability to comply with the terms of this Agreement. All Material Contracts are
set forth on Schedule 5.12 as of the Closing Date, and the Credit Parties have
heretofore delivered to Agent true and complete copies of all such Material
Contracts to which any of them are a party or to which any of them or any of
their properties is subject. No Credit Party has agreed or consented to cause or
permit in the future (upon the happening of a contingency or otherwise) any of
its property, whether now owned or hereafter acquired, to be subject to a Lien
which is not a Permitted Encumbrance.
5.13.    No Labor Disputes. No Credit Party is involved in any labor dispute;
there are no strikes or walkouts or union organization of any Credit Party’s
employees threatened or in existence and no labor contract is scheduled to
expire during the Term other than as set forth on Schedule 5.13 hereto, which,
in each case, could reasonably be expected to result in a Material Adverse
Effect.
5.14.    Margin Regulations. No Borrower is engaged, nor will it engage,
principally or as one of its important activities, in the business of extending
credit for the purpose of “purchasing” or “carrying” any “margin stock” within
the respective meanings of each of the quoted terms under Regulation U of the
Board of Governors of the Federal Reserve System as now and from time to time
hereafter in effect. No part of the proceeds of any Advance will be used for
“purchasing” or “carrying” “margin stock” as defined in Regulation U of such
Board of Governors.
5.15.    Investment Company Act. No Borrower is an “investment company”
registered or required to be registered under the Investment Company Act of
1940, as amended, nor is it controlled by such a company.
5.16.    Disclosure. No representation or warranty made by any Credit Party in
this Agreement or in any financial statement, report, certificate or any other
document furnished in connection herewith or therewith, taken as a whole,
contains any untrue statement of a material fact or omits to state any material
fact necessary to make the statements herein or therein not materially
misleading in light of the circumstances under which the statements were made;
provided that (a) with respect to projected financial information, the Credit
Parties represent only that such information was prepared in good faith based
upon assumptions believed to be reasonable at the time in light of conditions
and facts then known; it being understood that (i) such projections are subject
to significant uncertainties and contingencies, many of which are beyond
Holdings’ control, and (ii) actual results may vary from such projections and
that such variances may be material and (b) no representation is made with
respect to information of an industry specific or general economic nature. There
is no fact known to any Credit Party or which reasonably should be known to such
Credit Party which such Credit Party has not disclosed to Agent in writing with
respect to the Transactions which could reasonably be expected to have a
Material Adverse Effect.
5.17.    Conflicting Agreements. No provision of any Material Contract,
judgment, decree or order binding on any Credit Party or affecting the
Collateral requires any Consent which has not already been obtained to, or would
in any way prevent the execution, delivery or performance of, the terms of this
Agreement or the Other Documents, except as could not reasonably be expected to
have a Material Adverse Effect.
5.18.    Application of Certain Laws and Regulations. Neither any Credit Party
nor any Subsidiary of any Credit Party is subject to any Law which regulates the
incurrence of any Indebtedness, including Laws relative to common or interstate
carriers or to the sale of electricity, gas, steam, water, telephone, telegraph
or other public utility services.
5.19.    Business and Property of Credit Parties. Upon and after the Closing
Date, the Credit Parties do not propose to engage in any business other than the
businesses engaged in as of the Closing Date and other lines of business
reasonably incidental thereto and activities necessary to conduct the foregoing.
On the Closing Date, each Credit Party will own all the property and possess all
of the rights and privileges necessary for the conduct of the business of such
Credit Party except to the extent a failure to own such property or possess such
rights and privileges could not reasonably be expected to result in a Material
Adverse Effect.
5.20.    Ineligible Securities. The Credit Parties do not intend to use and
shall not use any portion of the proceeds of the Advances, directly or
indirectly, to purchase during the underwriting period, or for 30 days
thereafter, Ineligible Securities being underwritten by a securities Affiliate
of Agent or any Lender.
5.21.    Equity Interests. The authorized and outstanding Equity Interests of
each Borrower, and the legal and beneficial holder thereof, are as set forth on
Schedule 5.21(a) hereto. All of the Equity Interests of each Borrower have been
duly and validly authorized and issued and are fully paid and non-assessable and
have been sold and delivered to the holders hereof in compliance with, or under
valid exemption from, all federal and state laws and the rules and regulations
of each Governmental Body governing the sale and delivery of securities. Except
for the rights and obligations set forth on Schedule 5.21(b), there are no
subscriptions, warrants, options, calls, commitments, rights or agreement by
which any Borrower or any of the shareholders of any Borrower is bound relating
to the issuance, transfer, voting or redemption of shares of its Equity
Interests or any pre-emptive rights held by any Person with respect to the
Equity Interests of Borrowers. Except as set forth on Schedule 5.21(c),
Borrowers have not issued any securities convertible into or exchangeable for
shares of its Equity Interests or any options, warrants or other rights to
acquire such shares or securities convertible into or exchangeable for such
shares.
5.22.    Commercial Tort Claims. As of the Closing Date, no Credit Party has any
commercial tort claims in excess of $1,500,000, except as set forth on Schedule
5.22 hereto.
5.23.    Letter of Credit Rights. As of the Closing Date, no Credit Party has
any letter of credit rights, except as set forth on Schedule 5.23 hereto.
5.24.    Deposit Accounts. All deposit accounts and securities accounts of the
Credit Parties are set forth on Schedule 5.24 (as such schedule may be updated
from time to time).
5.25.    Perfection of Security Interest in Collateral. The provisions of this
Agreement and of each other applicable Other Document are effective to create in
favor of the Agent, for the benefit of itself and the Secured Parties, a legal,
valid and enforceable first priority security interest in all right, title and
interest of the Credit Parties in each item of Collateral, except (i) in the
case of any Permitted Encumbrances, to the extent that any such Permitted
Encumbrance would have priority over the security interest in favor of Agent
pursuant to any Applicable Law or (ii) Liens perfected only by possession or
control to the extent Agent has not obtained or does not maintain possession or
control of such Collateral.
5.26.    Swaps. No Credit Party is a party to, nor will it be a party to, any
swap agreement whereby such Credit Party has agreed or will agree to swap
interest rates or currencies unless same provides that damages upon termination
following an event of default thereunder are payable by the party that is
out-of-the-money on a mark-to-market basis without regard to whether or not such
party is the defaulting party.
5.27.    EEA Financial Institution. No Credit Party is an EEA Financial
Institution.
VI.    AFFIRMATIVE COVENANTS.
The Credit Parties (or Borrowers if otherwise indicated) shall, and shall cause
their Subsidiaries to, until the Termination Date:
6.1.    Compliance with Laws. Comply in all material respects with all
Applicable Laws with respect to the Collateral or any part thereof or to the
operation of such Borrower’s business the non-compliance with which could
reasonably be expected to have a Material Adverse Effect (except to the extent
any separate provision of this Agreement shall expressly require compliance with
any particular Applicable Law(s) pursuant to another standard). Each Borrower
may, however, contest or dispute any Applicable Laws in any reasonable manner,
provided that any related Lien is inchoate or stayed and sufficient reserves are
established in accordance with GAAP.
6.2.    Conduct of Business and Maintenance of Existence and Assets. (a) Conduct
continuously and operate actively its business according to good business
practices and maintain all of its properties useful or necessary in its business
in good working order and condition (reasonable wear and tear excepted and
except as may be disposed of in accordance with the terms of this Agreement),
including all Intellectual Property necessary for the Borrowers’ business and
take all actions necessary to enforce and protect the validity of any
intellectual property right or other right included in the Collateral; (b) keep
in full force and effect its existence and comply in all material respects with
the laws and regulations governing the conduct of its business where the failure
to do so could reasonably be expected to have a Material Adverse Effect; and (c)
make all such reports and pay all such franchise and other taxes and license
fees and do all such other acts and things as may be lawfully required to
maintain its rights, licenses, leases, powers and franchises under the laws of
the United States or any political subdivision thereof where the failure to do
so could reasonably be expected to have a Material Adverse Effect.
6.3.    Books and Records. Keep proper books of record and account in which
full, true and correct entries will be made of all dealings or transactions of
or in relation to its business and affairs (including without limitation
accruals for taxes, assessments, Charges, levies and claims, allowances against
doubtful Receivables and accruals for depreciation, obsolescence or amortization
of assets), all in accordance with, or as required by, GAAP consistently applied
in the opinion of such independent public accountant as shall then be regularly
engaged by Borrowers.
6.4.    Payment of Taxes. Pay, when due, all taxes, assessments and other
Charges lawfully levied or assessed upon such Borrower or any of the Collateral,
including real and personal property taxes, municipal and business taxes,
assessments and charges and all franchise, income, employment, social security
benefits, withholding, and sales taxes except to the extent any such tax is
being contested in good faith or where failure to pay would not reasonably be
expected to have a Material Adverse Effect.
6.5.    Financial Covenant. Cause to be maintained as of any Fixed Charge Test
Date, a Fixed Charge Coverage Ratio of not less than 1.00 to 1.00, measured as
of such Fixed Charge Test Date.
6.6.    Insurance.
(a)    (i) Keep all its insurable properties and properties in which such
Borrower has an interest insured (including through self-insurance) against the
hazards of fire, flood, sprinkler leakage, those hazards covered by extended
coverage insurance and such other hazards, and for such amounts, as is customary
in the case of the Borrower’s properties or companies engaged in businesses
similar to such Borrower’s including business interruption insurance; (ii) (ii)
maintain insurance in such amounts as is customary in the case of companies
engaged in businesses similar to such Borrower insuring against larceny,
embezzlement or other criminal misappropriation of insured’s officers and
employees who may either singly or jointly with others at any time have access
to the assets or funds of such Borrower either directly or through authority to
draw upon such funds or to direct generally the disposition of such assets;
(iii) maintain public and product liability insurance (including through
self-insurance) against claims for personal injury, death or property damage
suffered by others as is customary in the case of the Borrower’s properties or
companies engaged in businesses similar to such Borrower’s; (iv) maintain all
such worker’s compensation or similar insurance as may be required under the
laws of any state or jurisdiction in which such Borrower is engaged in business;
and (v) furnish Agent with (A) copies of all policies and evidence of the
maintenance of such policies by the renewal thereof at least thirty (30) days
before any expiration date, and (B) appropriate loss payable endorsements in
form and substance satisfactory to Agent, naming Agent as an additional insured
and mortgagee and/or lender loss payee (as applicable) as its interests may
appear with respect to all property and general liability insurance policies
referred to in clauses (i) and (iii) above, and providing (I) that, during any
Trigger Period, all proceeds thereunder shall be payable to Agent, (II) no such
insurance shall be affected by any act or neglect of the insured or owner of the
property described in such policy, and (III) that such policy and loss payable
clauses may not be cancelled, amended or terminated unless at least thirty (30)
days prior written notice is given to Agent (or in the case of non-payment, at
least ten (10) days prior written notice). In the event of any loss thereunder,
during any Trigger Period, the carriers named therein hereby are directed by
Agent and the applicable Borrower to make payment for such loss to Agent and not
to such Borrower and Agent jointly. If any insurance losses are paid by check,
draft or other instrument payable to any Borrower and Agent jointly, Agent may
endorse such Borrower’s name thereon and do such other things as Agent may deem
advisable to reduce the same to cash.
(b)    Each Borrower shall take all actions required under the Flood Laws and/or
reasonably requested by Agent to assist in ensuring that each Lender is in
compliance with the Flood Laws applicable to the Collateral, including, but not
limited to, providing Agent with the address or GPS coordinates of each
structure on any real property that will be subject to a mortgage in favor of
Agent, for the benefit of Lenders, and, to the extent required by the Flood
Laws, obtaining flood insurance for such property, structures and contents prior
to such property, structures and contents becoming Collateral, and thereafter
maintaining such flood insurance in full force and effect for so long as
required by the Flood Laws.
(c)    Agent is hereby authorized to adjust and compromise claims under
insurance coverage referred to in Sections 6.6(a)(i) and (ii) and 6.6(b) above.
During any Trigger Period, all loss recoveries shall be payable to Agent and all
loss recoveries received by Agent under any such insurance may be applied to the
Obligations, in such order as Agent in its sole discretion shall determine. Any
surplus shall be paid by Agent to Borrowers or applied as may be otherwise
required by law. During any Trigger Period, any deficiency thereon shall be paid
by Borrowers to Agent, on demand. During any Trigger Period, subject to the
fulfillment of the conditions set forth below, Agent shall remit to Borrowing
Agent insurance proceeds received by Agent during any calendar year under
insurance policies procured and maintained by Borrowers which insure Borrowers’
insurable properties to the extent such insurance proceeds do not exceed
$10,000,000 in the aggregate during such calendar year or $1,000,000 per
occurrence. During any Trigger Period, in the event the amount of insurance
proceeds received by Agent for any occurrence exceeds $1,000,000, then Agent
shall not be obligated to remit the insurance proceeds to Borrowing Agent unless
Borrowing Agent shall provide Agent with evidence reasonably satisfactory to
Agent that the insurance proceeds will be used by Borrowers to repair, replace
or restore the insured property which was the subject of the insurable loss.
During any Trigger Period, in the event Borrowing Agent has previously received
(or, after giving effect to any proposed remittance by Agent to Borrowing Agent
would receive) insurance proceeds which equal or exceed $10,000,000 in the
aggregate during any calendar year, then Agent may, in its Permitted Discretion,
either remit the insurance proceeds to Borrowing Agent upon Borrowing Agent
providing Agent with evidence reasonably satisfactory to Agent that the
insurance proceeds will be used by Borrowers to repair, replace or restore the
insured property which was the subject of the insurable loss, or apply the
proceeds to the Obligations, as aforesaid. The agreement of Agent to remit
insurance proceeds in the manner above provided shall be subject in each
instance to satisfaction of each of the following conditions: (x) No Event of
Default or Default shall then have occurred and be continuing, (y) Borrowers
shall use such insurance proceeds to repair, replace or restore the insurable
property which was the subject of the insurable loss and for no other purpose,
and (z) such remittances shall be made under such procedures as Agent may
establish. If any Borrower fails to obtain insurance as hereinabove provided, or
to keep the same in force, Agent, if Agent so elects, may obtain such insurance
and pay the premium therefor on behalf of such Borrower, which payments shall be
charged to Borrowers’ Account, and constitute part of the Obligations.
6.7.    Payment of Indebtedness and Leasehold Obligations. Pay, discharge or
otherwise satisfy (i) at or before maturity (subject, where applicable, to
specified grace periods and, in the case of trade payables, to normal payment
practices) all its Indebtedness, except when the failure to do so could not
reasonably be expected to have a Material Adverse Effect or when the amount or
validity thereof is currently being Properly Contested, subject at all times to
any applicable subordination arrangement in favor of Lenders and (ii) when due
its rental obligations under all leases under which it is a tenant, and shall
otherwise comply, in all material respects, with all other terms of such leases
and keep them in full force and effect, except to the extent non-payment,
failure to comply or termination could not reasonably be expected to have a
Material Adverse Effect.
6.8.    Environmental Matters.
(a)    Use commercially reasonable efforts to ensure that the Real Property and
all operations and businesses conducted thereon are in material compliance and
remain in material compliance with all Environmental Laws and it shall manage
any and all Hazardous Substances on any Real Property in material compliance
with Environmental Laws; in each case, except as would not reasonably be
expected to result in a Material Adverse Effect.
(b)    Establish and maintain, in a manner consistent with commercially
reasonable business practice in the industry of such Credit Party, an
environmental management system to assure and monitor continued material
compliance with all applicable Environmental Laws.
(c)    Respond reasonably promptly to any Hazardous Discharge or Environmental
Complaint known to a Borrower that could reasonably be expected to have a
Material Adverse Effect and, with respect to any such Hazardous Discharge or
Environmental Complaint, take all necessary action in order to comply with
applicable Environmental Law; provided that Borrower shall not be required to
undertake any such response or action to the extent that its obligation to do so
is being contested in good faith and by proper proceedings and appropriate
reserves are being maintained with respect to such circumstances in accordance
with GAAP. Following Agent’s perfection of its Lien against any applicable Real
Property, if any Borrower shall fail to respond reasonably promptly to any such
Hazardous Discharge or Environmental Complaint or any Borrower shall fail to
comply with any of the requirements of any Environmental Laws, and such failure
results in an Event of Default, Agent on behalf of Lenders may, but without the
obligation to do so, for the sole purpose of protecting Agent’s interest in the
Collateral: (i) give such notices or (ii) enter onto the Real Property (or
authorize third parties to enter onto the Real Property) at reasonable times and
upon reasonable advance written notice and take such actions as Agent (or such
third parties as directed by Agent) deem reasonably necessary, to remediate,
remove, mitigate or otherwise manage any such Hazardous Discharge or
Environmental Complaint, in each case, to the extent required (as determined in
the reasonable discretion of the Agent) to achieve compliance with Environmental
Laws; provided, however, that such actions shall not unreasonably interfere with
Borrower’s (or any of Borrower’s tenants) use and possession of the Real
Property. All reasonable out-of-pocket costs and expenses incurred by Agent and
Lenders (or such third parties) in the exercise of any such rights, including
any sums paid in connection with any judicial or administrative investigation or
proceedings, fines and penalties, together with interest thereon from the date
expended at the Default Rate for Domestic Rate Loans constituting Revolving
Advances shall be paid upon demand by Borrowers and until paid shall be added to
and become a part of the Obligations secured by the Liens created by the terms
of this Agreement or any other agreement between Agent, any Lender and any
Borrower.
(d)    Following Agent’s perfection of its Lien against any applicable Real
Property, promptly upon the written reasonable request of Agent from time to
time, Borrowers shall provide Agent, at Borrowers’ expense, but not more than
once every three (3) years (or at any time following the occurrence of and
during the continuance of an Event of Default or otherwise relating to Section
6.8(b) above with respect to any known Hazardous Discharge or Environmental
Complaint), with an environmental site assessment or environmental compliance
audit report prepared by an environmental engineering firm acceptable in the
reasonable opinion of Agent, to assess the existence of a Hazardous Discharge
and the potential costs (if reasonably estimable) in connection with abatement,
remediation and removal of any such Hazardous Discharge on, under, at or within
the Real Property. Any report or investigation of such Hazardous Discharge
proposed and acceptable to the responsible Governmental Body shall be acceptable
to Agent. If such estimates, individually or in the aggregate, exceed
$2,000,000, Agent shall have the right to require Borrowers to post a bond,
letter of credit or other security reasonably satisfactory to Agent to secure
payment of these costs and expenses if such bond, letter of credit or other
security will not pose a commercially unreasonable financial burden on
Borrowers.
6.9.    [Reserved].
6.10.    Execution of Supplemental Instruments. Execute and deliver to Agent
from time to time, upon demand, such supplemental agreements, statements,
assignments and transfers, or instructions or documents relating to the
Collateral, and such other instruments as Agent may request, in order that the
full intent of this Agreement may be carried into effect.
6.11.    Government Receivables. Take all steps necessary to protect Agent’s
interest in the Collateral under the Federal Assignment of Claims Act, the
Uniform Commercial Code, and all other applicable state, local statutes or
ordinances and deliver to Agent appropriately endorsed, any instrument or
chattel paper connected with any Receivable arising out of any contract between
any Borrower and the United States, any state or any department, agency or
instrumentality of any of them.
6.12.    [Reserved].
6.13.    Keepwell. If it is a Qualified ECP Credit Party, then jointly and
severally, together with each other Qualified ECP Credit Party, hereby
absolutely unconditionally and irrevocably (a) guarantees the prompt payment and
performance of all Swap Obligations owing by each Non-Qualifying Party (it being
understood and agreed that this guarantee is a guaranty of payment and not of
collection), and (b) undertakes to provide such funds or other support as may be
needed from time to time by any Non-Qualifying Party to honor all of such
Non‑Qualifying Party’s obligations under this Agreement or any Other Document in
respect of Swap Obligations (provided, however, that each Qualified ECP Credit
Party shall only be liable under this Section for the maximum amount of such
liability that can be hereby incurred without rendering its obligations under
this Section, or otherwise under this Agreement or any Other Document, voidable
under Applicable Law, including Applicable Law relating to fraudulent conveyance
or fraudulent transfer, and not for any greater amount). The obligations of each
Qualified ECP Credit Party under this Section shall remain in full force and
effect until payment in full of the Obligations and termination of this
Agreement and the Other Documents. Each Qualified ECP Credit Party intends that
this Section constitute, and this Section shall be deemed to constitute a
“keepwell, support, or other agreement” for the benefit of each other Credit
Party for all purposes of Section 1a(18)(A)(v)(II) of the CEA.
6.14.    Negative Pledge Agreements; Permitted Releases.
(a)    Borrowers shall deliver a Negative Pledge Agreement with respect to the
Other Property and, either (a) upon the occurrence of an Event of Default, (b)
at any time Advances equal or exceed $120,000,000 or (c) following the
occurrence of a Trigger Event (the occurrence of any event described in the
foregoing clauses (a), (b) or (c), an “Other Property Trigger Event”), Borrowers
shall execute, at Agent’s prior written request in its Permitted Discretion such
security agreements, pledge agreements or other applicable collateral agreements
as are necessary under Applicable Law or otherwise requested by Agent to create,
in favor of Agent, a valid and perfected security interest in or lien upon the
applicable Other Property; provided that (x) any Other Property which has
previously been pledged to support any Term Indebtedness shall be required to be
subject to a security interest or Lien pursuant to this Section 6.14(a) on a
junior lien basis pursuant to intercreditor arrangements as set forth in clause
(cc) of the definition of Permitted Encumbrance and (y) in no event (other than
during the continuance of an Event of Default) shall the Borrowers be required
to take any such action with respect to (i) any parcel of Real Property
(including plants) the book value of which does not exceed $2,000,000 or (ii)
any individual vehicle, vessel or other item of property represented by a
certificate of title (or similar instrument) the book value of which does not
exceed $500,000.
(b)    Notwithstanding anything herein or in any Other Document to the contrary,
Agent shall, upon request of the Borrowers, release of any machinery, equipment,
fixed assets or Other Property (any such released machinery, equipment, fixed
assets and/or Other Property, “Released Property”) from any pledge (including
any negative pledge) or other Lien of the Agent (on behalf of the Lenders);
provided the Agent shall be required to effectuate such release only if (i) no
Default or Event of Default is then continuing or would result therefrom and
(ii) before and after giving pro forma effect to such release (including the
incurrence of any Term Indebtedness that may be secured by such Released
Property), (A) the Fixed Charge Coverage Ratio is no less than 1.25 to 1.00 and
(B) the Leverage Ratio is no greater than 3.50 to 1.00 (the foregoing clauses
(i) and (ii), the “Debt Incurrence Test”); provided that, notwithstanding the
foregoing and in any event, after giving effect to any such release, the value
of the remaining fixed assets and Other Property not so released (and which
therefore remain subject to a pledge (including any negative pledge) or other
Lien of the Agent (on behalf of the Lenders)) shall, in the aggregate, be no
less than the greater of (x) 25% of the Maximum Revolving Advance Amount and (B)
$50,000,000, with the valuation of the fixed assets determined at the time of
any such proposed release and based on the net orderly liquidation value of such
assets.
6.15.    Post-Closing Covenants. The Borrowers covenant and agree to provide the
Agent and Lenders with such information and documentation as is reasonably
necessary or appropriate for the Agent and Lenders, together with the Borrowers,
to amend and otherwise modify this Agreement (and any other applicable Other
Documents) to provide for a Canadian borrowing base sublimit including, as
applicable and without limitation, necessary or appropriate amendments to
Eligible Receivables, Eligible Inventory and Eligible Unbilled Receivables, all
of the foregoing to be completed on or prior to the date that is sixty (60) days
following the Closing Date (or such later time as the Agent shall reasonably
agree).
VII.    NEGATIVE COVENANTS.
No Credit Party (nor any Borrower if otherwise indicated) shall, nor shall it
permit any of its Subsidiaries to, until the Termination Date:
7.1.    Merger, Consolidation, Acquisition and Sale of Assets.
(a)    Enter into any merger, consolidation or other reorganization with or into
any other Person or acquire all or a substantial portion of the assets or Equity
Interests of any Person or permit any other Person to consolidate with or merge
with it, except (i) any Credit Party may merge, consolidate or reorganize with
another Credit Party or acquire the assets or Equity Interest of another Credit
Party so long as such Credit Party provides Agent with ten (10) days prior
written notice of such merger, consolidation or reorganization and delivers all
of the relevant documents evidencing such merger, consolidation or
reorganization, (ii) any Subsidiary of Holdings that is not a Credit Party may
merge, consolidated or reorganize with any other such Subsidiary (so long as,
the case of a merger, consolidation or reorganization with a Credit Party, such
Credit Party shall be the surviving Person), (iii) Permitted Acquisitions and
(iv) in connection with the Tax Restructuring Plan and the transactions
contemplated thereby. Notwithstanding any of the foregoing to the contrary in
this Section, in Section 7.4 or the definition of “Permitted Acquisitions”, so
long as no Event of Default exists or would occur after giving pro forma effect
thereto, the Credit Parties and their Subsidiaries may acquire assets of equity
interests of any other Person in an unlimited amount to the extent either
(x) Excess Availability for the immediately preceding thirty-day period exceeds
the greater of (I) $40,000,000 and (II) 20% of the Maximum Available Credit, or
(y) (I) Excess Availability for the immediately preceding thirty-day period
exceeds the greater of (A) $30,000,000 and (B) 15% of the Maximum Available
Credit and (II) the Fixed Charge Coverage Ratio for such period shall be at
least 1.00 to 1.00,
in all cases, calculated after giving pro forma effect to each such acquisition,
as demonstrated in a Compliance Certificate delivered to Agent for distribution
to the Lenders.
(b)    Sell, lease, transfer or otherwise dispose (collectively, a
“Disposition”) of any of its properties or assets, except (i) (A) the
Disposition of Inventory in the ordinary course of business and (B) the
Disposition of obsolete and worn-out property in the ordinary course of
business; (ii) any other Dispositions expressly permitted by this Agreement;
(iii) a Disposition of oil and gas properties in connection with tax credit
transactions complying with Section 45K or any successor or analogous provisions
of the Code; (iv) investments to the extent permitted under Section 7.4; (v) a
Disposition of all or substantially all the assets of any Borrower in accordance
with and solely to the extent permitted under this Agreement; (vi) any
Disposition in any single transaction or series of related transactions of
assets with a book value of less than $50,000,000 in the aggregate during any
calendar year and not exceeding $125,000,000 in book value during the Term of
this Agreement; (vii) a Disposition of cash or Cash Equivalents; (viii) the
creation of a Lien (but not the sale or other disposition of the property
subject to such Lien); (ix) the Disposition by any Credit Party of any mineral
property or any related assets or other assets commonly used in the oil and gas
business owned or held by any Credit Party, or any Equity Interests of a Person
all or substantially all of whose assets consist of one or more of such types of
assets, for (A) assets of such types owned or held by another Person or (B) the
Equity Interests of another Person all or substantially all of whose assets
consist of assets of the types described in clause (A) and any cash or cash
equivalents necessary in order to achieve an exchange of equivalent value;
provided that the fair market value of the property or Equity Interests received
by any Credit Party in such trade or exchange (including any cash or cash
equivalents) is substantially equal to the fair market value of the property
(including any cash or cash equivalents) so traded or exchanged; (x) surrender
or waiver of contract rights or the settlement, release or surrender of
contract, tort or other claims of any kind; (xi) any Disposition of defaulted or
otherwise past-due receivables that arose in the ordinary course of business for
collection, so long as excluded from the calculation of the Formula Amount;
(xii) Dispositions of equipment to the extent that (A) such equipment is
exchanged for credit against the purchase price of similar replacement equipment
or (B) (1) the proceeds of such Disposition are paid not less than 75% in cash,
(2) within 180 days of such Disposition, the applicable Credit Party or
Subsidiary thereof has obtained a written replacement order to replace such
equipment with replacement equipment and (3) if the equipment subject to such
Disposition was Collateral, such replacement equipment is or becomes Collateral
subject to a perfected Lien in favor of the Agent for the benefit of the Secured
Parties substantially contemporaneously with the consummation of such
replacement; (xiii) Dispositions to a Credit Party or by any Subsidiary of
Holdings that is not a Credit Party to any other such Subsidiary that is not a
Credit Party; (xiv) sales or non-exclusive grants of licenses or sublicenses to
use the patents, trade secrets, know-how and other intellectual property, and
licenses, leases or subleases of other assets, of the Credit Parties or any of
their respective Subsidiaries to the extent not materially interfering with the
business of such Credit Party or Subsidiary; (xv) the grant of any option or
other right to purchase any asset in any transaction that would be permitted
under clause (iv) above; (xvi) Dispositions of non-core assets acquired in a
Permitted Acquisition by the Credit Parties or any of their respective
Subsidiaries within 18 months of such Permitted Acquisition; (xvii) Dispositions
of light vehicles (i.e., cars and pick-up trucks, but not heavy trucks or rigs)
in the ordinary course of business; (xviii) any settlement of or payment in
respect of, or series of settlements or payments in respect of, any property or
casualty insurance claim or any condemnation proceeding relating to any asset of
the Credit Parties or any of their respective Subsidiaries; (xix) Dispositions
of assets having a value not exceeding $2,000,000 for any transaction or series
of related transactions; (xx) sales, leases, transfers or other dispositions
arising in connection with the Tax Restructuring Plan and the transactions
contemplated thereby; and (xxi) any Specified Disposition.
7.2.    Creation of Liens. Create or suffer to exist any Lien or transfer upon
or against any of its property or assets now owned or hereafter created or
acquired, except Permitted Encumbrances.
7.3.    Guarantees. Except as otherwise agreed to in writing in advance by
Agent, become liable upon the obligations or liabilities of any Person by
assumption, endorsement or guarantee thereof or otherwise (other than to
Lenders) except for Permitted Guaranties. Notwithstanding any of the foregoing
to the contrary in this Section, so long as no Event of Default exists or would
occur after giving pro forma effect thereto, the Credit Parties and their
Subsidiaries may become liable upon the obligations or liabilities of any Person
by assumption, endorsement or guarantee thereof or otherwise, in an unlimited
amount to the extent either
(x) Excess Availability for the immediately preceding thirty-day period exceeds
the greater of (I) $40,000,000 and (II) 20% of the Maximum Available Credit, or
(y) (I) Excess Availability for the immediately preceding thirty-day period
exceeds the greater of (A) $30,000,000 and (B) 15% of the Maximum Available
Credit and (II) the Fixed Charge Coverage Ratio for such period shall be at
least 1.00 to 1.00,
in all cases, calculated after giving pro forma effect to each such assumption,
endorsement or guarantee, as demonstrated in a Compliance Certificate delivered
to Agent for distribution to the Lenders.
7.4.    Investments. Purchase or acquire obligations or Equity Interests of, or
any other interest in, any Person, other than Permitted Investments or (to the
extent constituting loans) Permitted Indebtedness. Notwithstanding any of the
foregoing to the contrary in this Section, so long as no Event of Default exists
or would occur after giving pro forma effect thereto, the Credit Parties and
their Subsidiaries may purchase or acquire obligations or Equity Interests of,
or any other interest in, any Person in an unlimited amount to the extent either
(x) Excess Availability for the immediately preceding thirty-day period exceeds
the greater of (I) $40,000,000 and (II) 20% of the Maximum Available Credit, or
(y) (I) Excess Availability for the immediately preceding thirty-day period
exceeds the greater of (A) $30,000,000 and (B) 15% of the Maximum Available
Credit and (II) the Fixed Charge Coverage Ratio for such period shall be at
least 1.00 to 1.00,
in all cases, calculated after giving pro forma effect to each such purchase or
acquisition, as demonstrated in a Compliance Certificate delivered to Agent for
distribution to the Lenders.
7.5.    Loans. Make advances, loans or extensions of credit to any Person,
including Holdings and any of its Subsidiaries or Affiliates, other than
Permitted Loans. Notwithstanding any of the foregoing to the contrary in this
Section, so long as no Event of Default exists or would occur after giving pro
forma effect thereto, the Credit Parties and their Subsidiaries may make
advances, loans or extensions of credit to any Person in an unlimited amount to
the extent either
(x) Excess Availability for the immediately preceding thirty-day period exceeds
the greater of (I) $40,000,000 and (II) 20% of the Maximum Available Credit, or
(y) (I) Excess Availability for the immediately preceding thirty-day period
exceeds the greater of (A) $30,000,000 and (B) 15% of the Maximum Available
Credit and (II) the Fixed Charge Coverage Ratio for such period shall be at
least 1.00 to 1.00,
in all cases, calculated after giving pro forma effect to each such advance,
loan or extension of credit, as demonstrated in a Compliance Certificate
delivered to Agent for distribution to the Lenders.
7.6.    Hedges. Incur or suffer to exist, or permit any other Credit Party to
incur or suffer to exist, any speculative Hedge. Except to the extent provided
pursuant to this Agreement or any Other Document, in no event shall any Hedge
contain any requirement, agreement or convent for a Credit Party to post
collateral or margin to secure such Credit Party’s obligations under such Hedge
or to cover market exposures.
7.1.    Dividends. Declare, pay or make any dividend or distribution on any
Equity Interests of Holdings or any of its Subsidiaries (other than dividends or
distributions payable in its stock, or split-ups or reclassifications of its
stock) or apply any of its funds, property or assets to the purchase, redemption
or other retirement of any Equity Interest, or of any options to purchase or
acquire any Equity Interest of any Borrower, other than Permitted Dividends.
Notwithstanding any of the foregoing to the contrary in this Section, so long as
no Event of Default exists or would occur after giving pro forma effect thereto,
the Credit Parties and their Subsidiaries may declare, pay and make dividends
and distributions in an unlimited amount to the extent either
(x) Excess Availability for the immediately preceding thirty-day period exceeds
the greater of (I) $40,000,000 and (II) 20% of the Maximum Available Credit, or
(y) (I) Excess Availability for the immediately preceding thirty-day period
exceeds the greater of (A) $30,000,000 and (B) 15% of the Maximum Available
Credit and (II) the Fixed Charge Coverage Ratio for such period shall be at
least 1.00 to 1.00,
in all cases, calculated after giving pro forma effect to each such dividend or
distribution, as demonstrated in a Compliance Certificate delivered to Agent for
distribution to the Lenders.
7.2.    Indebtedness. Create, incur, assume or suffer to exist any Indebtedness
other than Permitted Indebtedness.
7.3.    Nature of Business. Substantially change the nature of the business in
which it is presently engaged, except for similar or related businesses and
reasonable extensions thereof and such other lines of business as may be
reasonably acceptable to the Agent.
7.4.    Transactions with Affiliates. Directly or indirectly, purchase, acquire
or lease any property from, or sell, transfer or lease any property to, make any
payment (including payments of management or consulting fees) to, or enter into
any transaction or arrangement with, or otherwise deal with, any Affiliate,
except, in each case to the extent not otherwise prohibited under this Agreement
or any Other Document: (a) transactions which are on an arm’s-length basis on
terms and conditions no less favorable than terms and conditions which would
have been obtainable from a Person other than an Affiliate; (b) transactions
among Credit Parties not involving any other Affiliates; (c) dividends or
distributions permitted by Section 7.7, investments permitted by Section 7.4 and
loans permitted by Section 7.5; (d) arrangements with respect to the procurement
of services of directors, officers, independent contractors, consultants or
employees in the ordinary course of business and the payment of customary and
market compensation (including bonuses) and other benefits (including
retirement, health, stock option and other benefit plans) and reasonable
reimbursement arrangements in connection therewith; (e) the payment of fees and
expenses relating to the Transactions; (f) transactions with any Affiliate in
its capacity as a holder of Indebtedness or Equity Interests of Holdings;
provided that such Affiliate is treated the same as other non-affiliated holders
of Indebtedness or Equity Interests; (g) transactions for which Holdings or its
Subsidiary, as the case may be, obtains a favorable written opinion from a
nationally recognized investment banking firm as to the fairness of the
transaction to Holdings and its Subsidiaries from a financial point of view; and
(h) transactions arising in connection with the Tax Restructuring Plan and the
transactions contemplated thereby.
7.5.    Subsidiaries.
(a)    Form or acquire any Subsidiary unless within twenty (20) Business Days
(or such longer period as Agent may consent to) after formation or acquisition
(i) if such Subsidiary is not an Excluded Subsidiary or an Immaterial Subsidiary
either (as determined by Agent in its Permitted Discretion), (A) such Subsidiary
expressly joins in this Agreement as a “Borrower” and becomes jointly and
severally liable for the Obligations hereunder, under the Notes, and under any
other agreement among any Borrower, Agent or Lenders or (B) becomes a
“Guarantor” by executing a Guaranty (and, simultaneously therewith, a Guarantor
Security Agreement), or (ii) if such Subsidiary is a first-tier Foreign
Subsidiary, its Equity Interests are pledged to Agent to the extent set forth in
the definition of “Subsidiary Stock” and, in the case of clauses (i) and (ii)
Agent shall have received all documents, including, without limitation, legal
opinions and appraisals, it may reasonably require in connection therewith;
provided that, notwithstanding the foregoing, (x) no Subsidiary that is a
Foreign Subsidiary shall be permitted to become a “Borrower” hereunder without
the prior written consent of each Lender and (y) any such Subsidiary that
intends to become a “Borrower” hereunder shall (directly or through the
Borrowing Agent) deliver to Agent and the Lenders such supporting resolutions,
incumbency certificates, opinions of counsel and other documents or information
(including all reasonably requested information necessary for Lenders to
complete any “know your customer” or similar account opening requirements), in
each case, in form, content and scope reasonably satisfactory to Agent.
(a)    Enter into any partnership, joint venture or similar arrangement, other
than any such arrangement, which in each case, is (i) on terms and conditions
satisfactory to Agent in its Permitted Discretion or (ii) an investment not
prohibited by Section 7.4.
Notwithstanding anything to the contrary in this Section 7.11, the foregoing
requirements of this Section 7.11 shall not apply to any of the transactions
contemplated by or relating to the Tax Restructuring Plan and the transactions
contemplated thereby.
7.6.    Fiscal Year and Accounting Changes. Change its fiscal year from December
31 or make any significant change (i) in financial accounting treatment and
reporting practices except as required by GAAP or (ii) in Tax accounting method
and reporting treatment except as required by Applicable Law.
7.7.    Pledge of Credit. Now or hereafter pledge Agent’s or any Lender’s credit
on any purchases, commitments or contracts or for any purpose whatsoever.
7.8.    Amendment of Certain Documents. Amend, modify or waive any term or
provision of its Organizational Documents or any Material Contract in a manner
material and adverse to Agent, unless (a) required by Applicable Law or
consented to by Agent and (b) a copy of such amendment, modification or waiver
has been provided to Agent; provided that a Credit Party may amend its
Organizational Documents to change its legal name so long as Agent has received
(x) thirty (30) days prior written notice thereof and (y) upon the effectiveness
of such amendment, a copy of such amendment as filed with the applicable officer
of the jurisdiction of formation of such Credit Party and any other documents or
instruments requested by Agent to maintain the perfection of Agent’s Liens on
the Collateral.
7.9.    Compliance with ERISA. (i) (x) Maintain, or permit any member of the
Controlled Group to maintain, or (y) become obligated to contribute, or permit
any member of the Controlled Group to become obligated to contribute, to any
Pension Benefit Plan or Multiemployer Plan, other than those Pension Benefit
Plans or Multiemployer Plans disclosed on Schedule 5.8(d) for which there could
reasonably be material liability, which may be updated from time to time with
the consent of the Agent, which consent shall not be unreasonably withheld, (ii)
engage, or permit any member of the Controlled Group to engage, in any
non-exempt “prohibited transaction”, as that term is defined in Section 406 of
ERISA or Section 4975 of the Code, (iii) terminate, or permit any member of the
Controlled Group to terminate, any Pension Benefit Plan where such event could
result in any material liability of any Credit Party or any member of the
Controlled Group or the imposition of a lien on the property of any Credit Party
or any member of the Controlled Group pursuant to Section 4068 of ERISA, (iv)
incur, or permit any member of the Controlled Group to incur, any material
withdrawal liability to any Multiemployer Plan; (v) fail promptly to notify
Agent of the occurrence of any Termination Event, (vi) fail to comply, or permit
a member of the Controlled Group to fail to comply, with the requirements of
ERISA or the Code or other Applicable Laws in respect of any Plan and such
failure to comply could reasonably be expected to result in a Material Adverse
Effect.
7.10.    Prepayment of Indebtedness. At any time, directly or indirectly,
voluntarily prepay any principal amount of Indebtedness incurred pursuant to
clauses (d), (o) and (p) of the definition of Permitted Indebtedness, or
repurchase, redeem, retire or otherwise acquire any such Indebtedness of any
Borrower prior to its stated maturity, except (i) refinancings, refundings or
renewals of such Indebtedness to the extent such refinancing, refunding or
renewal is permitted by Section 7.8, (ii) the conversion to or exchange for
Equity Interests of convertible or exchangeable debt securities permitted
hereunder or (iii) in connection with the Tax Restructuring Plan and the
transactions contemplated thereby. Notwithstanding any of the foregoing to the
contrary in this Section, so long as no Event of Default exists or would occur
after giving pro forma effect thereto, the Credit Parties and their Subsidiaries
prepay, repurchase, redeem, retire or otherwise acquire Indebtedness in an
unlimited amount to the extent either
(x) Excess Availability for the immediately preceding thirty-day period exceeds
the greater of (I) $40,000,000 and (II) 20% of the Maximum Available Credit, or
(y) (I) Excess Availability for the immediately preceding thirty-day period
exceeds the greater of (A) $30,000,000 and (B) 15% of the Maximum Available
Credit and (II) the Fixed Charge Coverage Ratio for such period shall be at
least 1.00 to 1.00,
in all cases, calculated after giving pro forma effect to the payment or making
of such prepayment, repurchase, redemption or retirement, as demonstrated in a
Compliance Certificate delivered to Agent for distribution to the Lenders.
7.11.    Bank Accounts. Establish or otherwise acquire any deposit accounts or
securities accounts of a Borrower, other than Excluded Deposit Accounts, without
first providing to Agent an updated Schedule 5.24 and a Deposit Account Control
Agreement with respect thereto in form and substance satisfactory to Agent in
its Permitted Discretion.
7.12.    Capital Expenditures. Contract for, purchase or make any expenditure or
commitments for Capital Expenditures; provided that, so long as no Event of
Default exists or would occur after giving pro forma effect thereto, the Credit
Parties and their Subsidiaries may contract for, purchase or make any
expenditure or commitments for Capital Expenditures in an unlimited amount.
VIII.    CONDITIONS PRECEDENT.
8.1.    Conditions to Initial Advances. The agreement of Lenders to make the
initial Advances requested to be made on the Closing Date is subject to the
satisfaction, or waiver by Agent, immediately prior to or concurrently with the
making of such Advances, of the following conditions precedent:
(a)    Note. Agent shall have received, for the account of each Lender that
requests a Note no later than two (2) Business Days prior to the Closing Date,
the Notes duly executed and delivered by an Authorized Officer of each Borrower;
(b)    Other Documents. Agent shall have received each of the executed Other
Documents, as applicable, that are required to be executed and delivered on the
Closing Date;
(c)    Financial Condition Certificates. Agent and each Lender shall have
received an executed Financial Condition Certificate in the form of Exhibit
8.1(c).
(d)    Closing Certificate. Agent shall have received a closing certificate
signed by the Chief Financial Officer of each Borrower, dated as of the Closing
Date, stating that (i) all representations and warranties set forth in this
Agreement and the Other Documents are true and correct on and as of the Closing
Date, and (ii) on the Closing Date, no Default or Event of Default has occurred
or is continuing;
(e)    Borrowing Base. Agent and each Lender shall have received evidence from
Borrowers that the aggregate amount of Eligible Receivables, Eligible Inventory
and Eligible Unbilled Receivables is sufficient in value and amount to support
Advances in the amount requested by Borrowers on the Closing Date;
(f)    Equity Contributions. Agent shall have received evidence satisfactory to
it that Holdings shall have received net cash proceeds of at least $190,000,000
in connection with its equity offering on terms and conditions reasonably
satisfactory to the Agent;
(g)    Collection Accounts. Agent shall have received a certificate from the
Borrowers confirming that, as of the Closing Date, Borrowers have no Depository
Accounts other than Excluded Deposit Accounts and Depository Accounts (i) with
Agent or (ii) with other financial institutions which, in the case of clause
(ii), are subject to a control agreement among the Agent, the applicable
Borrower and the applicable financial institution;
(h)    Filings, Registrations and Recordings. Each document (including any
Uniform Commercial Code financing statement) required by this Agreement, any
related agreement or under law or reasonably requested by Agent to be filed,
registered or recorded in order to create, maintain or continue, in favor of
Agent, a perfected security interest in or Lien upon the Collateral shall have
been properly filed, registered or recorded in each jurisdiction in which the
filing, registration or recordation thereof is so required or requested, and
Agent shall have received an acknowledgment copy, or other evidence satisfactory
to it, of each such filing, registration or recordation and satisfactory
evidence of the payment of any necessary fee, tax or expense relating thereto;
(i)    Lien Waiver Agreements. To the extent not previously delivered in
connection with the Original Credit Agreement or, if so delivered, no longer in
full force and effect on the Closing Date, Borrowers shall have exercised
commercially reasonable efforts to obtain Lien Waiver Agreements with respect to
all applicable locations or places in the United States at which Inventory,
Equipment and books and records of the Borrowers are located;
(j)    Secretary’s Certificates, Authorizing Resolutions and Good Standings of
Borrowers. Agent shall have received a certificate of the Secretary or Assistant
Secretary (or other equivalent officer, partner or manager) of each Borrower in
form and substance satisfactory to Agent dated as of the Closing Date which
shall certify (i) copies of resolutions in form and substance reasonably
satisfactory to Agent, of the board of directors (or other equivalent governing
body, member or partner) of such Borrower authorizing (x) the execution,
delivery and performance of this Agreement, the Notes and each Other Document to
which such Borrower is a party (including authorization of the incurrence of
indebtedness, borrowing of Revolving Advances and Swing Loans and requesting of
Letters of Credit on a joint and several basis with all Borrowers as provided
for herein), and (y) the granting by such Borrower of the security interests in
and liens upon the Collateral to secure all of the joint and several Obligations
of Borrowers (and such certificate shall state that such resolutions have not
been amended, modified, revoked or rescinded as of the date of such
certificate), (ii) the incumbency and signature of the officers of such Borrower
authorized to execute this Agreement and the Other Documents, (iii) copies of
the Organizational Documents of such Borrower as in effect on such date,
complete with all amendments thereto, and (iv) the good standing (or equivalent
status) of such Borrower in its jurisdiction of organization dated not more than
20 days prior to the Closing Date, issued by the Secretary of State or other
appropriate official of each such jurisdiction;
(k)    Secretary’s Certificates, Authorizing Resolutions and Good Standings of
Guarantors. Agent shall have received a certificate of the Secretary or
Assistant Secretary (or other equivalent officer, partner or manager) of each
Guarantor in form and substance satisfactory to Agent dated as of the Closing
Date which shall certify (i) copies of resolutions in form and substance
reasonably satisfactory to Agent, of the board of directors (or other equivalent
governing body, member or partner) of each Guarantor authorizing (x) the
execution, delivery and performance of such Guarantor’s Guaranty and each Other
Document to which such Guarantor is a party and (y) the granting by such
Guarantor of the security interests in and liens upon the Collateral to secure
its obligations under its Guaranty (and such certificate shall state that such
resolutions have not been amended, modified, revoked or rescinded as of the date
of such certificate), (ii) the incumbency and signature of the officers of such
Guarantor authorized to execute this Agreement and the Other Documents, (iii)
copies of the Organizational Documents of such Guarantor as in effect on such
date, complete with all amendments thereto, and (iv) the good standing (or
equivalent status) of such Guarantor in its jurisdiction of organization and
each applicable jurisdiction where the conduct of such Guarantor’s business
activities or the ownership of its properties necessitates qualification, as
evidenced by good standing certificate(s) (or the equivalent thereof issued by
any applicable jurisdiction) dated not more than 20 days prior to the Closing
Date, issued by the Secretary of State or other appropriate official of each
such jurisdiction;
(l)    No Litigation. (i) No litigation, investigation or proceeding before or
by any arbitrator or Governmental Body shall be continuing or, to the knowledge
of the Credit Parties, threatened against any Credit Party or against the
officers or directors of any Credit Party (A) in connection with this Agreement,
the Other Documents or any of the Transactions and which, in the reasonable
opinion of Agent, is deemed material or (B) which could, in the reasonable
opinion of Agent, have a Material Adverse Effect; and (ii) no injunction, writ,
restraining order or other order of any nature materially adverse to any Credit
Party or the conduct of its business or inconsistent with the due consummation
of the Transactions shall have been issued by any Governmental Body;
(m)    No Material Adverse Effect. Since the January 6, 2017, there shall not
have occurred any event, condition or state of facts which could reasonably be
expected to have a Material Adverse Effect;
(n)    Legal Opinions. The Agent shall have received one or more customary
opinions of counsel for the Credit Parties, dated the Closing Date and addressed
to the Agent and the Lenders, in form and substance reasonably acceptable to the
Agent and its counsel;
(o)    Fees. Agent shall have received all fees payable to Agent and Lenders on
or prior to the Closing Date hereunder, including pursuant to Article III;
(p)    Payment Instructions. Agent shall have received written instructions from
Borrowing Agent directing the application of proceeds of the initial Advances
made pursuant to this Agreement;
(q)    Consents. Agent shall have received any and all Consents necessary to
permit the effectuation of the transactions contemplated by this Agreement and
the Other Documents; and, Agent shall have received such Consents and waivers of
such third parties as might assert claims with respect to the Collateral, as
Agent and its counsel shall deem necessary;
(r)    Accuracy of Information. No representations made or information supplied
to Agent or Lenders shall have been proven to be inaccurate or misleading in any
material respect;
(s)    Compliance with Laws. Agent shall be reasonably satisfied that each
Borrower is in compliance with Applicable Laws in all material respects,
including those with respect to the Federal Occupational Safety and Health Act,
Environmental Laws, ERISA, and the Anti-Terrorism Laws; and
(t)    Other. All corporate and other proceedings, and all documents,
instruments and other legal matters in connection with the Transactions shall be
satisfactory in form and substance to Agent and its counsel.
8.2.    Conditions to Each Advance. The agreement of Lenders to make any Advance
requested to be made on any date (including the initial Advance), is subject to
the satisfaction of the following conditions precedent as of the date such
Advance is made:
(a)    Representations and Warranties. Each of the representations and
warranties made by any Borrower in or pursuant to this Agreement, the Other
Documents and any related agreements to which it is a party, and each of the
representations and warranties contained in any certificate, document or
financial or other statement furnished at any time under or in connection with
this Agreement, the Other Documents or any related agreement shall be true and
correct in all material respects (without duplication of any materiality or
Material Adverse Effect qualifiers) on and as of such date as if made on and as
of such date (except to the extent any such representation or warranty expressly
relates only to any earlier and/or specified date);
(b)    No Default. No Event of Default or Default shall have occurred and be
continuing on such date, or would exist after giving effect to the Advances
requested to be made, on such date; provided, however that Agent, in its sole
discretion, may continue to make Advances notwithstanding the existence of an
Event of Default or Default and that any Advances so made shall not be deemed a
waiver of any such Event of Default or Default;
(c)    Maximum Advances. In the case of any type of Advance requested to be
made, after giving effect thereto, the aggregate amount of such type of Advance
shall not exceed the maximum amount of such type of Advance permitted under this
Agreement.
Each request for an Advance by any Borrower hereunder shall constitute a
representation and warranty by each Borrower as of the date of such Advance that
the conditions contained in this Section shall have been satisfied.
IX.    INFORMATION AS TO BORROWERS.
Each Credit Party shall, or (except with respect to Section 9.11) shall cause
Borrowing Agent on its behalf to, until satisfaction in full of the Obligations
(other than continuing future indemnities or other contingent obligations for
which no claim has then been made) and the termination of this Agreement:
9.1.    Disclosure of Material Matters. Promptly upon learning thereof, report
to Agent all matters materially affecting the value, enforceability or
collectability of any portion of the Collateral, including any Borrower’s
reclamation or repossession of, or the return to any Borrower of, a material
amount of goods or claims or disputes asserted by any Customer or other obligor
or any Lien, other than any Permitted Encumbrance, placed upon or asserted
against any Borrower or any Collateral.
9.2.    Schedules. Deliver to Agent on or before the twenty-fifth (25th) day of
each month, as and for the prior month (a) accounts receivable agings inclusive
of reconciliations to the general ledger, (b) accounts payable schedules
inclusive of reconciliations to the general ledger, (c) Inventory reports, (d)
progress billings, (e) utilization reports and (f) a Borrowing Base Certificate
in form and substance reasonably satisfactory to Agent (which shall be
calculated as of the last day of the prior month, shall include the calculation
of Average Excess Availability for such prior month, and which shall not be
binding upon Agent or restrictive of Agent’s rights under this Agreement);
provided, however, that (i) during any Trigger Period, Borrower shall deliver
all Borrowing Base Certificates in form and substance reasonably satisfactory to
Agent on a weekly basis (which shall be calculated as of the last day of the
prior week and which shall not be binding upon Agent or restrictive of Agent’s
rights under this Agreement) and (ii) prior to consummation of any Disposition
of Receivables or Inventory (other than Inventory Disposed of in the ordinary
course) otherwise permitted under this Agreement having a value exceeding
$5,000,000 for any transaction or series of related transactions, Borrower shall
deliver a Borrowing Base Certificate in form and substance reasonably
satisfactory to Agent (which shall be calculated as of the last day of the
immediately preceding week and giving pro forma effect to such Disposition). In
addition, if requested by Agent, each Borrower will deliver to Agent at such
intervals as Agent may reasonably require: (i) confirmatory assignment
schedules; (ii) copies of Customer’s invoices; (iii) evidence of shipment or
delivery; and (iv) such further schedules, documents and/or information
regarding the Collateral as Agent may require including trial balances and test
verifications. After the occurrence and during the continuance of an Event of
Default, Agent shall have the right to confirm and verify all Receivables by any
manner and through any medium it considers advisable and do whatever it may deem
reasonably necessary to protect its interests hereunder. The items to be
provided under this Section are to be in form reasonably satisfactory to Agent
and executed by each Borrower and delivered to Agent from time to time solely
for Agent’s convenience in maintaining records of the Collateral, and any
Borrower’s failure to deliver any of such items to Agent shall not affect,
terminate, modify or otherwise limit Agent’s Lien with respect to the
Collateral. Unless otherwise agreed to by Agent, the items to be provided under
this Section shall be delivered to Agent by the specific method of Approved
Electronic Communication designated by Agent.
9.3.    Environmental Reports.
(a)    In the event any Borrower (i) obtains, gives or receives notice of any
Release or threat of Release of a reportable quantity of any Hazardous Substance
at the Real Property (any such event being hereinafter referred to as a
“Hazardous Discharge”) or (ii) receives any written notice of violation, request
for information or notification that it is potentially responsible for
investigation or cleanup of environmental conditions at the Real Property,
demand letter or complaint, order, citation, or other written notice with regard
to any Hazardous Discharge or violation of Environmental Laws affecting the Real
Property or any Borrower’s interest therein or the operations or the business
(any of the foregoing is referred to herein as an “Environmental Complaint”)
from any Person, including any Governmental Body, and in each case of (i) and
(ii) such Hazardous Discharge or Environmental Complaint could reasonably be
likely to result in a Material Adverse Effect, then Borrowing Agent shall
promptly give written notice of same to Agent providing reasonable detail
regarding facts and circumstances of which any Borrower is aware giving rise to
the Hazardous Discharge or Environmental Complaint. Such information is to be
provided to allow Agent to protect its security interest in and Lien on the
Collateral and is not intended to create nor shall it create any obligation upon
Agent or any Lender with respect thereto.
(b)    Borrowing Agent shall promptly forward to Agent copies of any request for
information, notification of potential liability, demand letter relating to
potential responsibility with respect to the investigation or cleanup of
Hazardous Substances at any other site owned, operated or used by any Borrower
to manage Hazardous Substances, in each case which request for information,
notification of potential liability or demand letter could reasonably be likely
to result in a Material Adverse Effect, and shall continue to forward copies of
any material correspondence between any Borrower and the Governmental Body
regarding such claims to Agent until the claim is resolved. Borrowing Agent
shall promptly forward to Agent copies of all material, non-privileged documents
and reports concerning a Hazardous Discharge or Environmental Complaint that any
Borrower is required to provide notice to Agent pursuant to Section 9.3(a). Such
information is to be provided solely to allow Agent to protect Agent’s security
interest in and Lien on the Collateral.
9.4.    Litigation. Promptly notify Agent in writing of any claim, litigation,
suit or administrative proceeding affecting any Borrower, whether or not the
claim is covered by insurance, and of any litigation, suit or administrative
proceeding, which in any such case affects the Collateral in any material and
adverse respect or which could reasonably be expected to have a Material Adverse
Effect.
9.5.    Material Occurrences. Promptly notify Agent in writing upon the
occurrence of: (a) any Event of Default or Default; (b) any event, development
or circumstance whereby any financial statements or other reports furnished to
Agent fail in any material respect to present fairly, in accordance with GAAP
consistently applied, the financial condition or operating results of any
Borrower as of the date of such statements; (c) any accumulated retirement plan
funding deficiency which, if such deficiency continued for two plan years and
was not corrected as provided in Section 4971 of the Code, could subject any
Borrower to a tax imposed by Section 4971 of the Code; (d) each and every
default by any Borrower which might result in the acceleration of the maturity
of any Indebtedness having a principal amount exceeding $5,000,000, including
the names and addresses of the holders of such Indebtedness with respect to
which there is a default existing or with respect to which the maturity has been
or could be accelerated, and the amount of such Indebtedness; and (e) any other
development in the business or affairs of any Borrower or any Guarantor, which
could reasonably be expected to have a Material Adverse Effect; in each case
describing the nature thereof and the action Borrowers propose to take with
respect thereto.
9.6.    Government Receivables. Notify Agent promptly if any of its Receivables
arise out of contracts between any Borrower and the United States, any state or
any department, agency or instrumentality of any of them.
9.7.    Annual Financial Statements. Furnish Agent within one hundred twenty
(120) days after the end of each fiscal year of Holdings, financial statements
of Holdings on a consolidated basis including, but not limited to, statements of
income and stockholders’ equity and cash flow from the beginning of the current
fiscal year to the end of such fiscal year and the balance sheet as at the end
of such fiscal year, all prepared in accordance with GAAP applied on a basis
consistent with prior practices, and in reasonable detail and, with respect to
such consolidated financial statements, reported upon without qualification as
to the scope of the audit (except with respect to any pending maturity of
Indebtedness or any prospective inability to satisfy the covenants set forth in
Section 6.5) by an independent certified public accounting firm selected by
Borrowers and reasonably satisfactory to Agent (the “Accountants”). In addition,
the reports shall be accompanied by a Compliance Certificate.
9.8.    Quarterly Compliance. Furnish Agent within forty-five (45) days after
the end of each of the first three fiscal quarters of each fiscal year (or sixty
(60) days after the end of such fiscal quarter for the fiscal quarters ending
March 31, 2017, June 30, 2017 and September 30, 2017), an unaudited balance
sheet of Holdings on a consolidated basis and unaudited statements of income and
stockholders’ equity and cash flow of Holdings on a consolidated basis
reflecting results of operations from the beginning of the fiscal year to the
end of such quarter and for such quarter, prepared on a basis consistent with
prior practices and complete and correct in all material respects, subject to
normal and recurring year-end adjustments that individually and in the aggregate
are not material to Borrowers’ business operations and setting forth in
comparative form the respective financial statements for the corresponding date
and period in the previous fiscal year. The reports shall be accompanied by a
Compliance Certificate.
9.9.    Monthly Financial Statements. Furnish Agent within thirty (30) days
after the end of each of the first two months of each fiscal quarter, an
unaudited balance sheet of Borrowers on a consolidated basis and unaudited
statements of income and stockholders’ equity and cash flow of such Borrowers on
a consolidated basis reflecting results of operations from the beginning of the
fiscal year to the end of such month and for such month, prepared on a basis
consistent with prior practices and complete and correct in all material
respects, subject to normal and recurring year-end adjustments that individually
and in the aggregate are not material to Borrowers’ business operations and
setting forth in comparative form the respective financial statements for the
corresponding date and period in the previous fiscal year. The reports shall be
accompanied by a Compliance Certificate.
9.10.    Other Reports. At Agent’s request, furnish Agent as soon as available,
but in any event within ten (10) days after the issuance thereof, with copies of
such financial statements, reports and returns as each Borrower shall send to
its shareholders.
9.11.    Additional Information. Furnish Agent with such additional information
as Agent shall reasonably request in order to enable Agent to determine whether
the terms, covenants, provisions and conditions of this Agreement and the Notes
have been complied with by Borrowers including, without the necessity of any
request by Agent, (a) at least ten (10) days prior thereto, notice of any
Borrower’s opening of any new chief executive office or the establishment of any
new location of (i) books and records or (ii) Inventory having an aggregate
value at such location in excess of $2,500,000, and (b) promptly upon any
Borrower’s learning thereof, notice of any labor dispute to which any Borrower
may become a party, any strikes or walkouts relating to any of its plants or
other facilities, and the expiration of any labor contract to which any Borrower
is a party or by which any Borrower is bound.
9.12.    Projected Operating Budget. Furnish Agent and Lenders, no later than
sixty (60) days following the beginning of each Borrower’s fiscal years
commencing with the fiscal year beginning on or about January 1, 2017, a month
by month projected operating budget and cash flow of Borrowers on a consolidated
and consolidating basis for such fiscal year (including an income statement for
each month and a balance sheet as at the end of the last month in each fiscal
quarter), such projections to be accompanied by a certificate signed by the
President or Chief Financial Officer of each Borrower to the effect that such
projections have been prepared on the basis of sound financial planning practice
consistent with past budgets and financial statements and that such officer has
no reason to question the reasonableness of any material assumptions on which
such projections were prepared.
9.13.    Variances From Operating Budget. At Agent’s request, furnish Agent,
concurrently with the delivery of the financial statements referred to in
Sections 9.7 and 9.9, a written report summarizing all material variances from
budgets submitted by Borrowers pursuant to Section 9.12 and a discussion and
analysis by management with respect to such variances.
9.14.    Notice of Suits, Adverse Events. Furnish Agent with prompt written
notice of (i) any lapse or other termination of any Consent issued to any
Borrower by any Governmental Body or any other Person that is material to the
operation of any Borrower’s business, (ii) any refusal by any Governmental Body
or any other Person to renew or extend any such Consent; and (iii) copies of any
periodic or special reports filed by any Borrower or any Guarantor with any
Governmental Body or Person, if such reports indicate any material change in the
business, operations, affairs or condition of any Borrower or any Guarantor, or
if copies thereof are requested by Lender, and (iv) copies of any material
notices and other communications from any Governmental Body or Person which
specifically relate to any Borrower or any Guarantor.
9.15.    ERISA Notices and Requests. Furnish Agent with prompt written notice in
the event that (i) any Borrower or any member of the Controlled Group knows that
a Termination Event, that could reasonably be expected to result in a material
liability to any Borrower, has occurred together with a written statement
describing such Termination Event and the action, if any, which such Borrower or
any member of the Controlled Group has taken, is taking, or proposes to take
with respect thereto and, when known, any action taken or threatened by the
Internal Revenue Service, Department of Labor or PBGC with respect thereto, (ii)
any Borrower or any member of the Controlled Group knows that a non-exempt
prohibited transaction (as defined in Sections 406 of ERISA and 4975 of the
Code), that could reasonably be expected to result in a material liability to
any Borrower, has occurred, together with a written statement describing such
transaction and the action which such Borrower or any member of the Controlled
Group has taken, is taking or proposes to take with respect thereto, (iii) a
funding waiver request has been filed with respect to any Pension Benefit Plan
together with all communications received by any Borrower or any member of the
Controlled Group with respect to such request, (iv) any Borrower or any member
of the Controlled Group shall receive from the PBGC a notice of intention to
terminate a Plan or to have a trustee appointed to administer a Plan, together
with copies of each such notice, (v) any Borrower or any member of the
Controlled Group shall receive any favorable or unfavorable determination letter
from the Internal Revenue Service regarding the qualification of a Plan under
Section 401(a) of the Code, together with copies of each such letter; (vi) any
Borrower or any member of the Controlled Group shall receive a notice regarding
the imposition of any material withdrawal liability, together with copies of
each such notice; or (vii) any Borrower or any member of the Controlled Group
knows that (a) a Multiemployer Plan has been terminated, (b) the administrator
or plan sponsor of a Multiemployer Plan intends to terminate a Multiemployer
Plan, (c) the PBGC has instituted or will institute proceedings under Section
4042 of ERISA to terminate a Multiemployer Plan or (d) a Multiemployer Plan is
subject to Section 432 of the Code or Section 305 of ERISA.
9.16.    Additional Documents. Execute and deliver to Agent, upon request, such
documents and agreements as Agent may, from time to time, reasonably request to
carry out the purposes, terms or conditions of this Agreement.
9.17.    Updates to Certain Schedules. Deliver to Agent promptly as shall be
required to maintain the related representations and warranties as true and
correct in all material respects, updates to Schedules 4.4 (Locations of
equipment and Inventory), 5.9 (Intellectual Property, Source Code Escrow
Agreements), 5.21 (Equity Interests), 5.22 (Commercial Tort Claims), and 5.23
(Letter-of-Credit Rights); provided that absent the occurrence and continuance
of any Event of Default, Borrowers shall only be required to provide such
updates on an annual basis in connection with delivery of a Compliance
Certificate with respect to the applicable fiscal year. Any such updated
Schedules delivered by Borrowers to Agent in accordance with this Section shall
automatically and immediately be deemed to amend and restate the prior version
of such Schedule previously delivered to Agent and attached to and made part of
this Agreement.
9.18.    Appraisals and Field Examinations. Permit Agent or Agent’s
representatives to (i) perform one appraisal per fiscal year on Collateral which
will be identified by Borrowers to be included in the calculation of the Formula
Amount described in Section 4.7, and (ii) conduct one field examination per
fiscal year, in each case, at Borrowers’ cost and expense as Agent deems
appropriate in Agent’s sole discretion; provided that if at any time (x) Excess
Availability is less than the greater of (I) $40,000,000 and (II) 20% of the
Maximum Available Credit, Agent may conduct two (2) appraisals and two (2) field
exams per fiscal year, or (y) an Event of Default has occurred and is
continuing, appraisals and field exams may be conducted by the Agent or its
representatives at any time and from time to time without limit (and which shall
not be limited to Collateral but may include appraisals of and field exams as to
other assets of the Credit Parties) during the continuance of any such Event of
Default.
Notwithstanding any of the foregoing to the contrary (and without counting as an
appraisal required or otherwise permitted under clause (i) of this Section), the
Borrowers shall permit Agent or Agent’s representative, within a reasonable
period of time after the Closing Date, to perform appraisals on the machinery
and Equipment of the Borrowers at Borrowers’ cost and expense.
X.    EVENTS OF DEFAULT.
The occurrence of any one or more of the following events shall constitute an
“Event of Default”:
10.1.    Nonpayment. Failure by any Credit Party to pay (a) when and as required
to be paid herein, any amount of principal of any Loan, any Reimbursement
Obligation or any amount due and owing under Section 2.9, or (b) within three
(3) days after the same becomes due, any interest, fee, charge, liability or
other amount (other than those set forth in clause (a)) due and payable
hereunder or under any Other Document, in any such case, whether at maturity, by
reason of acceleration pursuant to the terms of this Agreement or such Other
Document, by notice of intention to prepay or by required prepayment;
10.2.    Breach of Representation. Any representation or warranty made or deemed
made by any Borrower or any Guarantor in this Agreement, any Other Document or
any related agreement or in any certificate, document or financial or other
statement furnished at any time in connection herewith or therewith shall prove
to have been incorrect or misleading in any material respect on the date when
made or deemed to have been made;
10.3.    Financial Information. Failure by any Borrower to (i) furnish financial
information when due or within five (5) days after requested, or (ii) permit the
inspection of its books or records or access to its premises for audits and
appraisals in accordance with the terms hereof;
10.4.    Noncompliance. Except as otherwise provided for in Sections 10.1, 10.3
and clause (ii) of this Section, (i) failure or neglect of any Borrower, any
Guarantor or any Person to perform, keep or observe any term, provision,
condition, covenant herein contained or (ii) failure or neglect of any Borrower
to perform, keep or observe any term, provision, condition or covenant,
contained in Section 4.5, 4.6, 4.7, 4.10, 4.11, 6.1, 6.2, 6.3, 6.4, 6.6, 6.7,
6.8, 6.10, 7.11, 9.3, 9.4, 9.5, 9.6, 9.15 or 9.16, or contained in any Other
Document or any other agreement or arrangement, now or hereafter entered into
between any Borrower, any Guarantor or such Person, and Agent or any Lender,
which is not cured within thirty (30) days from the earlier of (x) the date on
which a Borrower became aware or should have become aware of such failure or
neglect and (y) the date on which Agent or any Lender shall have provided
written notice of such failure or neglect to the Borrowers;
10.5.    Judgments. Any judgment or judgments are rendered against any Credit
Party for an aggregate amount in excess of $15,000,000 in each case to the
extent not fully covered by a third party insurer and (i) enforcement
proceedings shall have been commenced by a creditor upon such judgment, (ii)
unless adequate reserves in accordance with GAAP are being maintained by the
applicable Credit Party in respect of such judgment, there shall be any period
of sixty (60) consecutive days during which a stay of enforcement of such
judgment, by reason of a pending appeal or otherwise, shall not be in effect, or
(iii) any such judgment results in the creation of a Lien upon any of the
Collateral (other than a Permitted Encumbrance);
10.6.    Bankruptcy. Any Credit Party shall (i) apply for, consent to or suffer
the appointment of, or the taking of possession by, a receiver, custodian,
trustee, liquidator or similar fiduciary of itself or of all or a substantial
part of its property, (ii) admit in writing its inability, or be generally
unable, to pay its debts as they become due or cease operations of its present
business, (iii) make a general assignment for the benefit of creditors, (iv)
commence a voluntary case under any state or federal bankruptcy or receivership
laws (as now or hereafter in effect), (v) be adjudicated a bankrupt or insolvent
(including by entry of any order for relief in any involuntary bankruptcy or
insolvency proceeding commenced against it), (vi) file a petition seeking to
take advantage of any other law providing for the relief of debtors, (vii)
acquiesce to, or fail to have dismissed, within sixty (60) days, any petition
filed against it in any involuntary case under such bankruptcy laws, or (viii)
take any action for the purpose of effecting any of the foregoing;
10.7.    Lien Priority. Any Lien created hereunder or provided for hereby or
under any related agreement for any reason ceases to be or is not a valid and
perfected Lien having a first priority interest (subject only to Permitted
Encumbrances that have priority as a matter of Applicable Law to the extent such
Liens only attach to Collateral other than Receivables or Inventory);
10.8.    Cross Default. Any “event of default” under any Indebtedness (other
than the Obligations) of any Credit Party with a then-outstanding principal
balance or, in the case of any Hedge Termination Value (or, in the case of any
other Indebtedness not so denominated, with a then-outstanding total obligation
amount) of $15,000,000 or more, or any other event or circumstance which would
permit the holder of any such Indebtedness to accelerate such Indebtedness
(and/or the obligations of any Credit party thereunder) prior to the scheduled
maturity or termination thereof, shall occur (regardless of whether the holder
of such Indebtedness shall actually accelerate, terminate or otherwise exercise
any rights or remedies with respect to such Indebtedness);
10.9.    Breach of Guaranty or Pledge Agreement. Termination of any Guaranty,
security agreement, Pledge Agreement or similar agreement executed and delivered
to Agent in connection with the Obligations of any Borrower, or if any Guarantor
attempts to terminate, challenges in writing the validity of, or its liability
under, any such Guaranty, security agreement Pledge Agreement or similar
agreement or if any breach of the terms of any such agreement occurs which is
not remedied within twenty (20) Business Days after the occurrence thereof;
10.10.    Change of Control. Any Change of Control shall occur;
10.11.    Invalidity. Any material provision of this Agreement or any Other
Document shall, for any reason, cease to be valid and binding on any Credit
Party and any Credit Party shall so claim in writing to Agent or any Lender; or
any Term Intercreditor Agreement or any material provision thereof shall for any
reason be revoked or invalidated, or otherwise cease to be in full force and
effect, or any Credit Party or Term Lender shall contest in any manner the
validity or enforceability thereof or deny that it has any further liability or
obligation thereunder, or the Collateral, for any reason, shall not have the
priority contemplated by this Agreement, such Term Intercreditor Agreement or
such material provisions; or
10.12.    Seizures. Any (a) material portion of the Collateral shall be seized,
subject to garnishment or taken by a Governmental Body (other than pursuant to
any condemnation proceeding to the extent the net Disposition proceeds received
in connection therewith are applied in accordance with Section 2.20(c)), or any
Credit Party, or (b) the title and rights of any Credit Party which is the owner
of any material portion of the Collateral shall have become the subject matter
of claim, litigation, suit, garnishment or other proceeding (other than
Permitted Encumbrances) which could reasonably be expected, upon final
determination, to result in impairment or loss of the security provided by this
Agreement or the Other Documents;
10.13.    Pension Plans. A Termination Event or other event or condition
specified in Section 7.15 or 9.15 shall occur or exist with respect to any Plan
and, as a result of such event or condition, together with all other such events
or conditions, any Borrower or any member of the Controlled Group shall incur, a
liability to a Plan or the PBGC (or both) which, would reasonably be expected to
have a Material Adverse Effect; or
10.14.    Anti-Money Laundering/International Trade Law Compliance. Any
representation or warranty contained in Section 16.18 is or becomes false or
misleading at any time.
XI.    LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT.
11.1.    Rights and Remedies.
(a)    Upon the occurrence and continuance of: (i) an Event of Default pursuant
to Section 10.6, all Obligations shall be immediately due and payable and this
Agreement and the obligation of Lenders to make Advances shall be deemed
terminated; and, (ii) any of the other Events of Default and at any time
thereafter, at the option of Agent or at the direction of Required Lenders all
Obligations shall be immediately due and payable and Lenders shall have the
right to terminate this Agreement and to terminate the obligation of Lenders to
make Advances; and (iii) a filing of a petition against any Borrower in any
involuntary case under any state or federal bankruptcy laws, all Obligations
shall be immediately due and payable and the obligation of Lenders to make
Advances hereunder shall be terminated other than as may be required by an
appropriate order of the bankruptcy court having jurisdiction over such
Borrower. Upon the occurrence and during the continuation of any Event of
Default, subject to Applicable Law, Agent shall have the right to exercise any
and all rights and remedies provided for herein, under the Other Documents,
under the Uniform Commercial Code, and at law or equity generally, including the
right to foreclose the security interests granted herein and to realize upon any
Collateral by any available judicial procedure and/or to take possession of and
sell any or all of the Collateral with or without judicial process. Agent may
enter any of any Borrower’s premises or other premises without legal process and
without incurring liability to any Borrower therefor, and Agent may thereupon,
or at any time thereafter, in its discretion without notice or demand, take the
Collateral and remove the same to such place as Agent may deem advisable and
Agent may require Borrowers to make the Collateral available to Agent at a
convenient place. With or without having the Collateral at the time or place of
sale, Agent may sell the Collateral, or any part thereof, at public or private
sale, at any time or place, in one or more sales, at such price or prices, and
upon such terms, either for cash, credit or future delivery, as Agent may elect.
Except as to that part of the Collateral which is perishable or threatens to
decline speedily in value or is of a type customarily sold on a recognized
market, Agent shall give Borrowers reasonable notification of such sale or
sales, it being agreed that in all events written notice mailed to Borrowing
Agent at least ten (10) days prior to such sale or sales is reasonable
notification. At any public sale Agent or any Lender may bid (including credit
bid) for and become the purchaser, and Agent, any Lender or any other purchaser
at any such sale thereafter shall hold the Collateral sold absolutely free from
any claim or right of whatsoever kind, including any equity of redemption and
all such claims, rights and equities are hereby expressly waived and released by
each Borrower. In connection with the exercise of the foregoing remedies,
including the sale of Inventory, Agent is granted a perpetual nonrevocable,
royalty free, nonexclusive license and Agent is granted permission to use all of
each Borrower’s (a) Intellectual Property which is used or useful in connection
with Inventory for the purpose of marketing, advertising for sale and selling or
otherwise disposing of such Inventory and (b) Equipment for the purpose of
completing the manufacture of unfinished goods. The cash proceeds realized from
the sale of any Collateral shall be applied to the Obligations in the order set
forth in Section 11.5 unless required otherwise by Applicable Law. Noncash
proceeds will only be applied to the Obligations as they are converted into
cash. If any deficiency shall arise, Borrowers shall remain liable to Agent and
Lenders therefor.
(b)    To the extent that Applicable Law imposes duties on Agent to exercise
remedies in a commercially reasonable manner, each Borrower acknowledges and
agrees that it is not commercially unreasonable for Agent: (i) to fail to incur
expenses reasonably deemed significant by Agent to prepare Collateral for
disposition or otherwise to complete raw material or work in process into
finished goods or other finished products for disposition; (ii) to fail to
obtain third party consents for access to Collateral to be disposed of, or to
obtain or, if not required by other law, to fail to obtain governmental or third
party consents for the collection or disposition of Collateral to be collected
or disposed of; (iii) to fail to exercise collection remedies against Customers
or other Persons obligated on Collateral or to remove Liens on or any adverse
claims against Collateral; (iv) to exercise collection remedies against
Customers and other Persons obligated on Collateral directly or through the use
of collection agencies and other collection specialists; (v) to advertise
dispositions of Collateral through publications or media of general circulation,
whether or not the Collateral is of a specialized nature; (vi) to contact other
Persons, whether or not in the same business as any Borrower, for expressions of
interest in acquiring all or any portion of such Collateral; (vii) to hire one
or more professional auctioneers to assist in the disposition of Collateral,
whether or not the Collateral is of a specialized nature; (viii) to dispose of
Collateral by utilizing internet sites that provide for the auction of assets of
the types included in the Collateral or that have the reasonable capacity of
doing so, or that match buyers and sellers of assets; (ix) to dispose of assets
in wholesale rather than retail markets; (x) to disclaim disposition warranties,
such as title, possession or quiet enjoyment, (xi) to purchase insurance or
credit enhancements to insure Agent against risks of loss, collection or
disposition of Collateral or to provide to Agent a guaranteed return from the
collection or disposition of Collateral; or (xii) to the extent deemed
appropriate by the Agent, to obtain the services of other brokers, investment
bankers, consultants and other professionals to assist Agent in the collection
or disposition of any of the Collateral. Each Borrower acknowledges that the
purpose of this clause (b) is to provide non-exhaustive indications of what
actions or omissions by Agent would not be commercially unreasonable in Agent’s
exercise of remedies against the Collateral and that other actions or omissions
by Agent shall not be deemed commercially unreasonable solely on account of not
being indicated in this clause (b). Without limitation upon the foregoing,
nothing contained in this clause (b) shall be construed to grant any rights to
any Borrower or to impose any duties on Agent that would not have been granted
or imposed by this Agreement or by Applicable Law in the absence of this clause
(b).
11.2.    Agent’s Discretion. Agent shall have the right in its sole discretion
to determine which rights, Liens, security interests or remedies Agent may at
any time pursue, relinquish, subordinate, or modify, which procedures, timing
and methodologies to employ, and what any other action to take with respect to
any or all of the Collateral and in what order, thereto and such determination
will not in any way modify or affect any of Agent’s or Lenders’ rights hereunder
as against Borrowers or each other.
11.3.    Setoff.
(a)    Subject to Section 14.13, in addition to any other rights which Agent or
any Lender may have under Applicable Law, upon the occurrence and during the
continuance of an Event of Default hereunder, Agent and such Lender shall have a
right, immediately and without notice of any kind, to apply any Borrower’s
property held by Agent and such Lender or any of their Affiliates to reduce the
Obligations, and to exercise any and all rights of setoff which may be available
to Agent and such Lender with respect to any deposits held by Agent or such
Lender.
(b)    If any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of any of the Advances
made by it resulting in such Lender’s receiving payment of a proportion of the
aggregate amount of such Advances, greater than its pro rata share thereof as
provided herein, then the Lender receiving such greater proportion shall (a)
notify the Agent in writing of such fact, and (b) purchase (for cash at face
value) a pro rata portion of the outstanding Advances (and participation
interests in Letters of Credit) of each of the other Lenders (and such Lenders
hereby agree to sell and to take all such further action to effectuate such
sale) such that each Lender shall hold its pro rata share of the outstanding
Advances (and participation interests) after giving effect to such purchase.
(c)    Each Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable Law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Borrower rights of setoff and counterclaim with respect to such participation as
fully as if such Lender were a direct creditor of such Borrower in the amount of
such participation.
11.4.    Rights and Remedies not Exclusive. The enumeration of the foregoing
rights and remedies is not intended to be exhaustive and the exercise of any
rights or remedy shall not preclude the exercise of any other right or remedies
provided for herein or otherwise provided by law, all of which shall be
cumulative and not alternative.
11.5.    Allocation of Payments After Event of Default. Notwithstanding any
other provisions of this Agreement to the contrary, after the occurrence and
during the continuance of an Event of Default, all amounts collected or received
by Agent on account of the Obligations (including without limitation any amounts
on account of any of Cash Management Liabilities or Hedge Liabilities), or in
respect of the Collateral may, at Agent’s discretion, be paid over or delivered
as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and expenses
(including reasonable attorneys’ fees) of Agent in connection with enforcing its
rights and the rights of Lenders under this Agreement and the Other Documents,
and any Out-of-Formula Loans and Protective Advances funded by Agent with
respect to the Collateral under or pursuant to the terms of this Agreement;
SECOND, to payment of any fees owed to Agent;
THIRD, to the payment of all reasonable out-of-pocket costs and expenses
(including reasonable attorneys’ fees) of each of the Lenders to the extent
owing to such Lender pursuant to the terms of this Agreement;
FOURTH, to the payment of all of the Obligations consisting of accrued interest
on account of the Swing Loans;
FIFTH, to the payment of the outstanding principal amount of the Obligations
consisting of Swing Loans;
SIXTH, to the payment of all Obligations arising under this Agreement and the
Other Documents consisting of accrued fees and interest (other than interest in
respect of Swing Loans paid pursuant to clause FOURTH above);
SEVENTH, to the payment of the outstanding principal amount of the Obligations
(other than principal in respect of Swing Loans paid pursuant to clause FIFTH
above) arising under this Agreement (other than Cash Management Liabilities and
Hedge Liabilities) (including the payment or cash collateralization of any
outstanding Letters of Credit in accordance with Section 3.2(b)).
EIGHTH, to all other Obligations arising under this Agreement (other than Cash
Management Liabilities and Hedge Liabilities) which shall have become due and
payable (hereunder, under the Other Documents or otherwise) and not repaid
pursuant to clauses “FIRST” through “SEVENTH” above;
NINTH, to any Cash Management Liabilities and Hedge Liabilities which shall have
become due and payable or otherwise and not repaid pursuant to Clauses “FIRST”
through “EIGHTH” above; and
TENTH, to all other Obligations which shall have become due and payable and not
repaid pursuant to clauses “FIRST” through “NINTH”; and
ELEVENTH, to the payment of the surplus, if any, to whoever may be lawfully
entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Lenders shall receive (so long as it is
not a Defaulting Lender) an amount equal to its pro rata share (based on the
proportion that the then outstanding Advances held by such Lender bears to the
aggregate then outstanding Advances) of amounts available to be applied pursuant
to clauses “SIXTH”, “SEVENTH”, “EIGHTH” and “TENTH” above; and, with respect to
clause “NINTH” above, an amount equal to its pro rata share based on the
proportion that the then outstanding Cash Management Liabilities and Hedge
Liabilities held by such Lender bears to the aggregate then outstanding Cash
Management Liabilities and Hedge Liabilities; and (iii) notwithstanding anything
to the contrary in this Section, no Swap Obligations of any Non-Qualifying Party
shall be paid with amounts received from such Non-Qualifying Party under its
Guaranty (including sums received as a result of the exercise of remedies with
respect to such Guaranty) or from the proceeds of such Non-Qualifying Party’s
Collateral if such Swap Obligations would constitute Excluded Hedge Liabilities,
provided that, to the extent possible, appropriate adjustments shall be made
with respect to payments and/or the proceeds of Collateral from other Credit
Parties that are Eligible Contract Participants with respect to such Swap
Obligations to preserve the allocation to Obligations otherwise set forth above
in this Section; and (iv) to the extent that any amounts available for
distribution pursuant to clause “SEVENTH” above are attributable to the issued
but undrawn amount of outstanding Letters of Credit, such amounts shall be held
by Agent as cash collateral for the Letters of Credit pursuant to Section 3.2(b)
and applied (A) first, to reimburse Issuer from time to time for any drawings
under such Letters of Credit and (B) then, following the expiration of all
Letters of Credit, to all other obligations of the types described in clauses
“SEVENTH,” “EIGHTH”, “NINTH”, and “TENTH” above in the manner provided in this
Section.
11.6.    Right to Cure. Notwithstanding anything to the contrary contained in
Article XI, in the event of any Event of Default under the covenants set forth
in Section 6.5, any cash equity contribution made to Holdings or the proceeds of
the issuance of any Equity Interests received by any Borrower after the last day
of any fiscal month and on or prior to the day that is ten Business Days after
the day on which financial statements are required to be delivered for such
fiscal month will, at the request of Holdings, be included in the calculation of
(x) EBITDA, as to any Event of Default under Section 6.5(a) or (y) Free Cash, as
to any Event of Default under Section 6.5(b), in either case, solely for the
purposes of determining compliance with such financial covenant at the end of
such fiscal month and any subsequent period that includes such fiscal month (any
such equity contribution, a “Specified Equity Contribution”); provided that (a)
the Borrowers shall not be permitted to request more than two Specified Equity
Contributions be made in any Relevant Twelve Month Period (as hereinafter
defined) and not in consecutive months; (b) the amount of any Specified Equity
Contribution and the use of proceeds therefrom will be no greater than the
amount required to cause the Borrowers to be in pro forma compliance with the
financial covenant; (c) all Specified Equity Contributions and the use of
proceeds therefrom will be disregarded for all other purposes under the Other
Documents (including with respect to (i) pricing or (ii) determining the
availability of any baskets with respect to the covenants contained in this
Agreement or any Other Documents); (d) there shall be no pro forma or other
reduction in Indebtedness with the proceeds of any Specified Equity Contribution
for determining compliance with the covenants set forth in Section 6.5 in
respect of which such Specified Equity Contribution is made; and (e) there shall
be no more than five Specified Equity Contributions made in the aggregate after
the Closing Date. For purposes of this paragraph, the term “Relevant Twelve
Month Period” shall mean, with respect to any requested Specified Equity
Contribution, the twelve fiscal month period of Holdings ending on (and
including) the fiscal month in which EBITDA or Free Cash, as applicable, and
each subsequent twelve (12) fiscal month period containing such fiscal month,
will be increased as a result of such Specified Equity Contribution.
Notwithstanding anything to the contrary contained in this Agreement, from the
date of receipt of notice of a Specified Equity Contribution under this Section
until the tenth Business Day subsequent to the date such financial statements
are required to be delivered (the “Cure Period”), none of the Agent, any Lender
or the Issuer shall exercise rights or remedies with respect to any Event of
Default solely on the basis of an Event of Default having occurred and be
continuing under Section 6.5, unless the Agent is notified by the Borrowers that
such Specified Equity Contribution will not be made or such Specified Equity
Contribution is made in an amount less than the amount necessary to cause the
Borrowers to be in compliance with the covenants set forth in Section 6.5;
provided that, notwithstanding the foregoing, the Borrowers acknowledge and
agree that they shall not be permitted to request, and no Lender shall be
required to make or otherwise advance, any Loan or other Advance at any time
during the Cure Period if either before or after giving effect to any such
Advance, the Excess Availability shall be less than $10,000,000. In furtherance
of the foregoing (but subject in any event to the proviso to the immediately
preceding sentence), in the event that the Borrowers represented and warranted
that the conditions specified in Sections 8.2(a) and (b) were true and correct
at any point on or after the last day of a month but prior to giving effect to a
Specified Equity Contribution, and such representation was not true and correct
solely because of a breach of a financial covenant that was cured as a result of
a Specified Equity Contribution made in accordance with this Section, such
breach of such representation shall not constitute a Default or Event of
Default.
XII.    WAIVERS AND JUDICIAL PROCEEDINGS.
12.1.    Waiver of Notice. To the fullest extent permitted by Applicable Law,
each Borrower hereby waives notice of non-payment of any of the Receivables,
demand, presentment, protest and notice thereof with respect to any and all
instruments, notice of acceptance hereof, notice of loans or advances made,
credit extended, Collateral received or delivered, or any other action taken in
reliance hereon, and all other demands and notices of any description, except
such as are expressly provided for herein.
12.2.    Delay. No delay or omission on Agent’s or any Lender’s part in
exercising any right, remedy or option shall operate as a waiver of such or any
other right, remedy or option or of any Default or Event of Default.
12.3.    Jury Waiver. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY
RIGHT TO TRIAL BY JURY OF ANY CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF
ACTION (A) ARISING UNDER THIS AGREEMENT, ANY OTHER DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH,
OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT, ANY OTHER DOCUMENT
OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE AND EACH PARTY HEREBY CONSENTS THAT ANY SUCH CLAIM,
COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENTS OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
XIII.    EFFECTIVE DATE AND TERMINATION.
13.1.    Term. This Agreement, which shall inure to the benefit of and shall be
binding upon the respective successors and permitted assigns of each Borrower,
Agent and each Lender, shall become effective on the date hereof and shall
continue in full force and effect until May 4, 2022 (the “Term”) unless sooner
terminated as herein provided. Borrowers may terminate this Agreement at any
time upon three (3) Business Days’ prior written notice to Agent upon payment in
full of the Obligations (other than contingent indemnity claims not yet asserted
or threatened). Each notice delivered by the Borrowing Agent under this Section
may state that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrowers (by notice
to the Agent on or prior to the specified effective date) if such condition is
not satisfied.
13.2.    Termination. The termination of the Agreement shall not affect Agent’s
or any Lender’s rights, or any of the Obligations having their inception prior
to the effective date of such termination or any Obligations which pursuant to
the terms hereof continue to accrue after such date, and the provisions hereof
shall continue to be fully operative until all transactions entered into, rights
or interests created and Obligations have been fully and indefeasibly paid,
disposed of, concluded or liquidated. The security interests, Liens and rights
granted to Agent and Lenders hereunder and the financing statements filed
hereunder shall continue in full force and effect, notwithstanding the
termination of this Agreement or the fact that Borrowers’ Accounts may from time
to time be temporarily in a zero or credit position, until all of the
Obligations of each Borrower have been indefeasibly paid and performed in full
after the termination of this Agreement or each Borrower has furnished Agent and
Lenders with an indemnification satisfactory to Agent and Lenders with respect
thereto. Accordingly, each Borrower waives any rights which it may have under
the Uniform Commercial Code to demand the filing of termination statements with
respect to the Collateral, and Agent shall not be required to send such
termination statements to each Borrower, or to file them with any filing office,
unless and until this Agreement shall have been terminated in accordance with
its terms and all Obligations have been indefeasibly paid in full in immediately
available funds. All representations, warranties, covenants, waivers and
agreements contained herein shall survive termination hereof until all
Obligations are indefeasibly paid and performed in full.
XIV.    REGARDING AGENT.
14.1.    Appointment. Each Lender hereby designates PNC to act as Agent for such
Lender under this Agreement and the Other Documents. Each Lender hereby
irrevocably authorizes Agent to take such action on its behalf under the
provisions of this Agreement and the Other Documents and to exercise such powers
and to perform such duties hereunder and thereunder as are specifically
delegated to or required of Agent by the terms hereof and thereof and such other
powers as are reasonably incidental thereto and Agent shall hold all Collateral,
payments of principal and interest, fees (except the fees set forth in Sections
2.8(b)), charges and collections received pursuant to this Agreement, for the
ratable benefit of Lenders. Agent may perform any of its duties hereunder by or
through its agents or employees. As to any matters not expressly provided for by
this Agreement (including collection of the Note) Agent shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of Required Lenders, and such instructions
shall be binding; provided, however, that Agent shall not be required to take
any action which, in Agent’s discretion, exposes Agent to liability or which is
contrary to this Agreement or the Other Documents or Applicable Law unless Agent
is furnished with an indemnification reasonably satisfactory to Agent with
respect thereto.
14.2.    Nature of Duties. Agent shall have no duties or responsibilities except
those expressly set forth in this Agreement and the Other Documents. Neither
Agent nor any of its officers, directors, employees or agents shall be (i)
liable for any action taken or omitted by them as such hereunder or in
connection herewith, unless caused by their gross (not mere) negligence or
willful misconduct (as determined by a court of competent jurisdiction in a
final non-appealable judgment), or (ii) responsible in any manner for any
recitals, statements, representations or warranties made by any Borrower or any
officer thereof contained in this Agreement, or in any of the Other Documents or
in any certificate, report, statement or other document referred to or provided
for in, or received by Agent under or in connection with, this Agreement or any
of the Other Documents or for the value, validity, effectiveness, genuineness,
due execution, enforceability or sufficiency of this Agreement, or any of the
Other Documents or for any failure of any Borrower to perform its obligations
hereunder or under any Other Document. Agent shall not be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any of
the Other Documents, or to inspect the properties, books or records of any
Borrower. The duties of Agent as respects the Advances to Borrowers shall be
mechanical and administrative in nature; Agent shall not have by reason of this
Agreement a fiduciary relationship in respect of any Lender; and nothing in this
Agreement, expressed or implied, is intended to or shall be so construed as to
impose upon Agent any obligations in respect of this Agreement or the
transactions described herein except as expressly set forth herein.
Without limiting the foregoing, the Agent shall not be required to act hereunder
or to advance its own funds or otherwise incur any financial liability in the
performance of its duties or the exercise of its rights hereunder and under any
Other Document, and shall in all cases be fully justified in failing or refusing
to act hereunder unless it shall receive further assurances to its satisfaction
from the Lenders of their indemnification obligations under and in accordance
with the provisions of Section 14.7 against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take or
refraining from taking any such action. The Agent shall be fully justified in
requesting direction from the Required Lenders in the event this Agreement or
any Other Document is silent or vague with respect to Agent’s duties, rights or
obligations. The Agent shall not be liable for any action taken or not taken by
it (i) with the consent or at the request of the Required Lenders or (ii) in the
absence of its own gross negligence or willful misconduct, as determined by a
court of competent jurisdiction in a final and non-appealable decision. In no
instance shall the Agent have any liability for special, consequential or
indirect damages or penalties (including lost profits) even if it has been
advised of the likelihood of the same. Without prejudice to the generality of
the foregoing, the Agent shall not be liable for any damage or loss resulting
from or caused by events or circumstances beyond the Agent’s reasonable control,
including nationalization, expropriation, currency restrictions, the
interruption, disruption or suspension of the normal procedures and practices of
any securities market, power, mechanical, communications or other technological
failures or interruptions, computer viruses or the like, acts of war or
terrorism, riots, revolution, acts of God, work stoppages, strikes, national
disasters of any kind, or other similar events or acts.
14.3.    Lack of Reliance on Agent. Independently and without reliance upon
Agent or any other Lender, each Lender has made and shall continue to make (i)
its own independent investigation of the financial condition and affairs of each
Credit Party in connection with the making and the continuance of the Advances
hereunder and the taking or not taking of any action in connection herewith, and
(ii) its own appraisal of the creditworthiness of each Credit Party. Agent shall
have no duty or responsibility, either initially or on a continuing basis, to
provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before making of the Advances or at any time
or times thereafter except as shall be provided by any Credit Party pursuant to
the terms hereof. Agent shall not be responsible to any Lender for any recitals,
statements, information, representations or warranties herein or in any
agreement, document, certificate or a statement delivered in connection with or
for the execution, effectiveness, genuineness, validity, enforceability,
collectability, sufficiency or value of this Agreement or any Other Document or
any other instrument or document furnished pursuant hereto or thereto, or of the
financial condition of any Credit Party, or be required to make any inquiry
concerning either the performance or observance of any of the terms, provisions
or conditions of this Agreement, the Note, the Other Documents or the financial
condition of any Borrower, or the existence of any Event of Default or any
Default.
14.4.    Resignation of Agent; Successor Agent. Agent may resign on sixty (60)
days written notice to each Lender and Borrowing Agent and upon such
resignation, Required Lenders will promptly designate a successor Agent
reasonably satisfactory to Borrowers (provided that no such approval by
Borrowers shall be required (i) in any case where the successor Agent is one of
the Lenders or (ii) after the occurrence and during the continuance of any Event
of Default). Any such successor Agent shall succeed to the rights, powers and
duties of Agent, and shall in particular succeed to all of Agent’s right, title
and interest in and to all of the Liens in the Collateral securing the
Obligations created hereunder or any Other Document (including the Pledge
Agreement and all account control agreements), and the term “Agent” shall mean
such successor agent effective upon its appointment, and the former Agent’s
rights, powers and duties as Agent shall be terminated, without any other or
further act or deed on the part of such former Agent. However, notwithstanding
the foregoing, if at the time of the effectiveness of the new Agent’s
appointment, any further actions need to be taken in order to provide for the
legally binding and valid transfer of any Liens in the Collateral from former
Agent to new Agent and/or for the perfection of any Liens in the Collateral as
held by new Agent or it is otherwise not then possible for new Agent to become
the holder of a fully valid, enforceable and perfected Lien as to any of the
Collateral, former Agent shall continue to hold such Liens solely as agent for
perfection of such Liens on behalf of new Agent until such time as new Agent can
obtain a fully valid, enforceable and perfected Lien on all Collateral, provided
that Agent shall not be required to or have any liability or responsibility to
take any further actions after such date as such agent for perfection to
continue the perfection of any such Liens (other than to forego from taking any
affirmative action to release any such Liens). After any Agent’s resignation as
Agent, the provisions of this Article XIV, and any indemnification rights under
this Agreement, including without limitation, rights arising under Section 16.5,
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement (and in the event resigning Agent
continues to hold any Liens pursuant to the provisions of the immediately
preceding sentence, the provisions of this Article and any indemnification
rights under this Agreement, including without limitation, rights arising under
Section 16.5, shall inure to its benefit as to any actions taken or omitted to
be taken by it in connection with such Liens).
14.5.    Certain Rights of Agent. If Agent shall request instructions from
Lenders with respect to any act or action (including failure to act) in
connection with this Agreement or any Other Document, Agent shall be entitled to
refrain from such act or taking such action unless and until Agent shall have
received instructions from Required Lenders; and Agent shall not incur liability
to any Person by reason of so refraining. Without limiting the foregoing,
Lenders shall not have any right of action whatsoever against Agent as a result
of its acting or refraining from acting hereunder in accordance with the
instructions of Required Lenders.
14.6.    Reliance. Agent shall be entitled to rely, and shall be fully protected
in relying, upon any note, writing, resolution, notice, statement, certificate,
telex, teletype or telecopier message, cablegram, order or other document or
telephone message believed by it to be genuine and correct and to have been
signed, sent or made by the proper person or entity, and, with respect to all
legal matters pertaining to this Agreement and the Other Documents and its
duties hereunder, upon advice of counsel selected by it. Agent may employ agents
and attorneys-in-fact and shall not be liable for the acts, omissions,
negligence or misconduct of any such agents or attorneys-in-fact selected by
Agent with reasonable care. In determining compliance with any condition
hereunder, the Agent shall be entitled to receive, and shall not incur any
liability for relying upon, a certificate of an Authorized Officer or an opinion
of counsel or both certifying as to compliance with such condition. The Agent
may consult with legal counsel (who may be counsel for the Credit Parties or any
Lender), independent accountants and other experts selected by it, and shall not
be liable for any action taken or not taken by it in accordance with the advice
of any such counsel, accountants or experts.
14.7.    Notice of Default. Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder or under
the Other Documents, unless Agent has received notice from a Lender or Borrowing
Agent referring to this Agreement or the Other Documents, describing such
Default or Event of Default and stating that such notice is a “notice of
default”. In the event that Agent receives such a notice, Agent shall give
notice thereof to Lenders. Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by Required Lenders;
provided, that, unless and until Agent shall have received such directions,
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 Lenders.
14.8.    Indemnification. To the extent Agent is not reimbursed and indemnified
by Borrowers, each Lender will reimburse and indemnify Agent in proportion to
its respective portion of the outstanding Advances and its respective
Participation Commitments in the outstanding Letters of Credit and outstanding
Swing Loans (or, if no Advances are outstanding, pro rata according to the
percentage that its Commitment Amount constitutes of the total aggregate
Commitment Amounts), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against Agent in performing its duties hereunder, or in any way
relating to or arising out of this Agreement or any Other Document; provided
that Lenders shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from Agent’s gross (not mere) negligence or
willful misconduct (as determined by a court of competent jurisdiction in a
final non-appealable judgment).
14.9.    Agent in its Individual Capacity. With respect to the obligation of
Agent to lend under this Agreement, the Advances made by it shall have the same
rights and powers hereunder as any other Lender and as if it were not performing
the duties as Agent specified herein; and the term “Lender” or any similar term
shall, unless the context clearly otherwise indicates, include Agent in its
individual capacity as a Lender. Agent may engage in business with any Borrower
as if it were not performing the duties specified herein, and may accept fees
and other consideration from any Borrower for services in connection with this
Agreement or otherwise without having to account for the same to Lenders.
14.10.    Delivery of Documents. To the extent Agent receives financial
statements required under Sections 9.7, 9.8, 9.9, 9.12 and 9.13 or Borrowing
Base Certificates from any Borrower pursuant to the terms of this Agreement
which any Borrower is not obligated to deliver to each Lender, Agent will
promptly furnish such documents and information to Lenders.
14.11.    Borrowers’ Undertaking to Agent. Without prejudice to their respective
obligations to Lenders under the other provisions of this Agreement, each
Borrower hereby undertakes with Agent to pay to Agent from time to time on
demand all amounts from time to time due and payable by it for the account of
Agent or Lenders or any of them pursuant to this Agreement to the extent not
already paid. Any payment made pursuant to any such demand shall pro tanto
satisfy the relevant Borrower’s obligations to make payments for the account of
Lenders or the relevant one or more of them pursuant to this Agreement.
14.12.    No Reliance on Agent’s Customer Identification Program. To the extent
the Advances or this Agreement is, or becomes, syndicated in cooperation with
other Lenders, each Lender acknowledges and agrees that neither such Lender, nor
any of its Affiliates, participants or assignees, may rely on Agent to carry out
such Lender’s, Affiliate’s, participant’s or assignee’s customer identification
program, or other obligations required or imposed under or pursuant to the USA
PATRIOT Act or the regulations thereunder, including the regulations contained
in 31 CFR 103.121 (as hereafter amended or replaced, the “CIP Regulations”), or
any other Anti‑Terrorism Law, including any programs involving any of the
following items relating to or in connection with any of Borrowers, their
Affiliates or their agents, the Other Documents or the transactions hereunder or
contemplated hereby: (i) any identity verification procedures, (ii) any
recordkeeping, (iii) comparisons with government lists, (iv) customer notices or
(v) other procedures required under the CIP Regulations or such Anti-Terrorism
Laws.
14.13.    Other Agreements. Each of the Lenders agrees that it shall not,
without the express consent of Agent, and that it shall, to the extent it is
lawfully entitled to do so, upon the request of Agent, set off against the
Obligations, any amounts owing by such Lender to any Borrower or any deposit
accounts of any Borrower now or hereafter maintained with such Lender. Anything
in this Agreement to the contrary notwithstanding, each of the Lenders further
agrees that it shall not, unless specifically requested to do so by Agent, take
any action to protect or enforce its rights arising out of this Agreement or the
Other Documents, it being the intent of Lenders that any such action to protect
or enforce rights under this Agreement and the Other Documents shall be taken in
concert and at the direction or with the consent of Agent or Required Lenders.
XV.    BORROWING AGENCY.
15.1.    Borrowing Agency Provisions.
(a)    Each Borrower hereby irrevocably designates Borrowing Agent to be its
attorney and agent and in such capacity to (i) borrow, (ii) request advances,
(iii) request the issuance of Letters of Credit, (iv) sign and endorse notes,
(v) execute and deliver all instruments, documents, applications, security
agreements, reimbursement agreements and letter of credit agreements for Letters
of Credit and all other certificates, notice, writings and further assurances
now or hereafter required hereunder, (vi) make elections regarding interest
rates, (vii) give instructions regarding Letters of Credit and agree with Issuer
upon any amendment, extension or renewal of any Letter of Credit and (viii)
otherwise take action under and in connection with this Agreement and the Other
Documents, all on behalf of and in the name such Borrower or Borrowers, and
hereby authorizes Agent to pay over or credit all loan proceeds hereunder in
accordance with the request of Borrowing Agent.
(b)    The handling of this credit facility as a co-borrowing facility with a
borrowing agent in the manner set forth in this Agreement is solely as an
accommodation to Borrowers and at their request. Neither Agent nor any Lender
shall incur liability to Borrowers as a result thereof. To induce Agent and
Lenders to do so and in consideration thereof, each Borrower hereby indemnifies
Agent and each Lender and holds Agent and each Lender harmless from and against
any and all liabilities, expenses, losses, damages and claims of damage or
injury asserted against Agent or any Lender by any Person arising from or
incurred by reason of the handling of the financing arrangements of Borrowers as
provided herein, reliance by Agent or any Lender on any request or instruction
from Borrowing Agent or any other action taken by Agent or any Lender with
respect to this Section except due to willful misconduct or gross (not mere)
negligence by the indemnified party (as determined by a court of competent
jurisdiction in a final and non-appealable judgment).
(c)    All Obligations shall be joint and several, and each Borrower shall make
payment upon the maturity of the Obligations by acceleration or otherwise, and
such obligation and liability on the part of each Borrower shall in no way be
affected by any extensions, renewals and forbearance granted by Agent or any
Lender to any Borrower, failure of Agent or any Lender to give any Borrower
notice of borrowing or any other notice, any failure of Agent or any Lender to
pursue or preserve its rights against any Borrower, the release by Agent or any
Lender of any Collateral now or thereafter acquired from any Borrower, and such
agreement by each Borrower to pay upon any notice issued pursuant thereto is
unconditional and unaffected by prior recourse by Agent or any Lender to the
other Borrowers or any Collateral for such Borrower’s Obligations or the lack
thereof. Each Borrower waives all suretyship defenses.
15.2.    Waiver of Subrogation. Each Borrower expressly waives any and all
rights of subrogation, reimbursement, indemnity, exoneration, contribution of
any other claim which such Borrower may now or hereafter have against any other
Borrower or any other Person directly or contingently liable for the Obligations
hereunder, or against or with respect to any other Borrowers’ property
(including, without limitation, any property which is Collateral for the
Obligations), arising from the existence or performance of this Agreement, until
termination of this Agreement and repayment in full of the Obligations (other
than contingent indemnification obligations in respect of which no assertion of
liability has been made).
15.3.    Common Enterprise. The successful operation and condition of each of
the Borrowers is dependent on the continued successful performance of the
functions of the group of Borrowers as a whole and the successful operation of
each Borrower is dependent on the successful performance and operation of each
other Borrower. Each of the Borrowers expects to derive benefit (and its board
of directors or other governing body has determined that it may reasonably be
expected to derive benefit), directly and indirectly, from successful operations
of each of the Borrowers. Each Borrower expects to derive benefit (and the
boards of directors or other governing body of each such Borrower have
determined that it may reasonably be expected to derive benefit), directly and
indirectly, from the credit extended by the Lenders to the Borrowers hereunder,
both in their separate capacities and as members of the group of companies. Each
Borrower has determined that execution, delivery, and performance of this
Agreement and any Other Documents to be executed by such Borrower is within its
corporate purpose, will be of direct and indirect benefit to such Borrower, and
is in its best interest.
XVI.    MISCELLANEOUS.
16.1.    Governing Law. This Agreement and each Other Document (unless and
except to the extent expressly provided otherwise in any such Other Document),
and all matters relating hereto or thereto or arising herefrom or therefrom
(whether arising under contract law, tort law or otherwise) shall be governed by
and construed in accordance with the laws of the State of New York. Any judicial
proceeding brought by or against any party hereto with respect to any of the
Obligations, this Agreement, the Other Documents or any related agreement may be
brought in any court of competent jurisdiction in the State of New York, United
States of America, and, by execution and delivery of this Agreement, each party
hereto accepts for itself and in connection with its properties, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts, and
irrevocably agrees to be bound by any judgment rendered thereby in connection
with this Agreement. Each party hereto hereby waives personal service of any and
all process upon it and consents that all such service of process may be made by
certified or registered mail (return receipt requested) directed to the
applicable address set forth in Section 16.6 and service so made shall be deemed
completed five (5) days after the same shall have been so deposited in the mails
of the United States of America or by service upon such Person as shall have
been appointed as the relevant party as its agent for the purpose of accepting
service within the State of New York. Nothing herein shall affect the right to
serve process in any manner permitted by law or shall limit the right of any
party hereto to bring proceedings against any other party in the courts of any
other jurisdiction. Each party hereto waives any objection to jurisdiction and
venue of any action instituted hereunder and shall not assert any defense based
on lack of jurisdiction or venue or based upon forum non conveniens. Each party
hereto waives the right to remove any judicial proceeding brought against such
party in any state court to any federal court. Any judicial proceeding by any
party hereto involving, directly or indirectly, any matter or claim in any way
arising out of, related to or connected with this Agreement or any related
agreement, shall be brought only in a federal or state court located in the
County of New York, State of New York.
16.2.    Entire Understanding.
(a)    THIS AGREEMENT AND THE DOCUMENTS EXECUTED CONCURRENTLY HEREWITH CONTAIN
THE ENTIRE UNDERSTANDING BETWEEN EACH BORROWER, AGENT AND EACH LENDER AND
SUPERSEDES ALL PRIOR AGREEMENTS AND UNDERSTANDINGS, IF ANY, RELATING TO THE
SUBJECT MATTER HEREOF. ANY PROMISES, REPRESENTATIONS, WARRANTIES OR GUARANTEES
NOT HEREIN CONTAINED AND HEREINAFTER MADE SHALL HAVE NO FORCE AND EFFECT UNLESS
IN WRITING, SIGNED BY EACH BORROWER’S, AGENT’S AND EACH LENDER’S RESPECTIVE
OFFICERS. Neither this Agreement nor any portion or provisions hereof may be
changed, modified, amended, waived, supplemented, discharged, cancelled or
terminated orally or by any course of dealing, or in any manner other than by an
agreement in writing, signed by the party to be charged. Notwithstanding the
foregoing, Agent may modify this Agreement or any of the Other Documents for the
purposes of completing missing content or correcting erroneous content of an
administrative nature, without the need for a written amendment, provided that
the Agent shall send a copy of any such modification to the Borrowers and each
Lender (which copy may be provided by electronic mail). Each Borrower
acknowledges that it has been advised by counsel in connection with the
execution of this Agreement and Other Documents and is not relying upon oral
representations or statements inconsistent with the terms and provisions of this
Agreement.
(b)    Required Lenders, Agent with the consent in writing of Required Lenders,
and Borrowers may, subject to the provisions of this clause (b), from time to
time enter into written supplemental agreements to this Agreement or the Other
Documents (other than with respect to Cash Management Products and Services, or
other similar agreements, which shall require only the consent of the parties
thereto) executed by the applicable Credit Parties, for the purpose of adding or
deleting any provisions or otherwise changing, varying or waiving in any manner
the rights of Lenders, Agent or Borrowers thereunder or the conditions,
provisions or terms thereof or waiving any Event of Default thereunder, but only
to the extent specified in such written agreements; provided, however, that no
such supplemental agreement shall:
(i)    increase the Commitment Percentage, or the maximum dollar amount of the
Commitment Amount of any Lender without the consent of such Lender directly
affected thereby;
(ii)    whether or not any Advances are outstanding, extend the Term or the time
for payment of principal or interest of any Advance (excluding the due date of
any mandatory prepayment of an Advance), or any fee payable to any Lender, or
reduce the principal amount of or the rate of interest borne by any Advances or
reduce any fee payable to any Lender, without the consent of each Lender
directly affected thereby (except that Required Lenders may elect to waive or
rescind any imposition of the Default Rate under Section 3.1 or of default rates
of Letter of Credit fees under Section 3.2 (unless imposed by Agent));
(iii)    except in connection with any increase pursuant to Section 2.24,
increase the Maximum Revolving Advance Amount without the consent of each Lender
directly affected thereby;
(iv)    alter the definition of the term Required Lenders or alter, amend or
modify this clause (b) without the consent of all Lenders;
(v)    alter, amend or modify the provisions of Section 11.5 without the consent
of all Lenders directly affected thereby;
(vi)    release any Collateral during any calendar year (other than in
accordance with the provisions of this Agreement) having (A) in the case of
Collateral constituting Receivables or Inventory, an aggregate value in excess
of $5,000,000, or (B) in the case of Collateral other than Receivables or
Inventory, an aggregate value in excess of $25,000,000, in each case without the
consent of all Lenders;
(vii)    change the rights and duties of Agent without the consent of all
Lenders;
(viii)    subject to clauses (e) and (f) below, permit any Revolving Advance
(inclusive of amounts outstanding pursuant to clause (f) below) to be made if
after giving effect thereto the total of Revolving Advances outstanding
hereunder would exceed the Formula Amount for more than thirty (30) consecutive
Business Days or exceed the lesser of (x) one hundred and ten percent (110%) of
the Formula Amount or (y) the Maximum Revolving Advance Amount, in each case,
without the consent of each Lender directly affected thereby;
(ix)    increase the Advance Rates above the Advance Rates in effect on the
Closing Date without the consent of all affected Lenders;
(x)    modify the definitions of Eligible Receivables, Eligible Inventory,
Eligible Unbilled Receivables, Letter of Credit Sublimit or the Maximum Swing
Loan Advance Amount in effect on the Closing Date without the consent of all
affected Lenders; or
(xi)    release any Credit Party (other than in accordance with the provisions
of this Agreement) without the consent of all Lenders.
Notwithstanding anything to the contrary in this Agreement, if as a result of
any transaction not prohibited by this Agreement any Credit Party becomes an
Excluded Subsidiary, an Immaterial Subsidiary or is otherwise no longer required
to be a Guarantor pursuant Section 7.11 or any provision of any Other Document,
then such Credit Party’s obligations hereunder and under the Other Documents
shall be automatically released. If as a result of any transaction not
prohibited by this Agreement the property of (including Equity Interests held
by) any Person is no longer required to be pledged pursuant to Section 7.11 or
any provision of any Other Document, then the security interest of the Agent and
the other Secured Parties therein shall be automatically released. In connection
with any termination or release pursuant to this clause (b), the Agent and any
applicable Lender shall promptly execute and deliver to any Credit Party, at
such Credit Party’s expense, all documents that such Credit Party shall
reasonably request to evidence such termination or release. Any execution and
delivery of documents pursuant to this clause (b) shall be without recourse to
or warranty by the Agent or any Lender.
(c)    Any such supplemental agreement shall apply equally to each Lender and
shall be binding upon Borrowers, Lenders and Agent and all future holders of the
Obligations. In the case of any waiver, Borrowers, Agent and Lenders shall be
restored to their former positions and rights, and any Event of Default waived
shall be deemed to be cured and not continuing, but no waiver of a specific
Event of Default shall extend to any subsequent Event of Default (whether or not
the subsequent Event of Default is the same as the Event of Default which was
waived), or impair any right consequent thereon.
(d)    In the event that Agent requests the consent of a Lender pursuant to this
Section and such consent is denied, then Borrowing Agent may, at its option,
require such Lender to assign its interest in the Advances to (and subject to
the agreement of) another Lender or any other Person satisfactory to the Agent
(the “Designated Lender”), for a price equal to (i) the then outstanding
principal amount thereof plus (ii) accrued and unpaid interest and fees due such
Lender, which interest and fees shall be paid when collected from Borrowers. In
the event Borrowing Agent elects to require any Lender to assign its interest to
the Designated Lender, Agent will so notify such Lender in writing within forty
five (45) days following such Lender’s denial, and such Lender will assign its
interest to the Designated Lender no later than five (5) days following receipt
of such notice pursuant to a Commitment Transfer Supplement executed by such
Lender, the Designated Lender, Agent and the Borrowing Agent.
(e)    Notwithstanding (i) the existence of a Default or an Event of Default,
(ii) that any of the other applicable conditions precedent set forth in Section
8.2 have not been satisfied or (iii) any other provision of this Agreement,
Agent may at its discretion and without the consent of the Required Lenders,
voluntarily permit the outstanding Revolving Advances at any time to exceed the
Formula Amount by up to ten percent (10%) of the Formula Amount for up to thirty
(30) consecutive Business Days (the “Out-of-Formula Loans”). If Agent is willing
in its sole and absolute discretion to make such Out-of-Formula Loans, Lenders
holding the Commitments shall be obligated to fund such Out-of-Formula Loans in
accordance with their respective Commitment Percentages, and such Out-of-Formula
Loans shall be payable on demand and shall bear interest at the Default Rate for
Revolving Advances consisting of Domestic Rate Loans; provided that if Agent
does permit Out-of-Formula Loans, neither Agent nor Lenders shall be deemed
thereby to have changed the limits of Section 2.1(a) nor shall any Lender be
obligated to fund Revolving Advances in excess of its Commitment Amount. For
purposes of this paragraph, the discretion granted to Agent hereunder shall not
preclude involuntary overadvances that may result from time to time due to the
fact that the Formula Amount was unintentionally exceeded for any reason,
including, but not limited to, Collateral previously deemed to be either
“Eligible Receivables”, “Eligible Inventory” or “Eligible Unbilled Receivables”,
as applicable, becomes ineligible, collections of Receivables applied to reduce
outstanding Revolving Advances are thereafter returned for insufficient funds or
overadvances are made to protect or preserve the Collateral. In the event Agent
involuntarily permits the outstanding Revolving Advances to exceed the Formula
Amount by more than ten percent (10%), Agent shall use its efforts to have
Borrowers decrease such excess in as expeditious a manner as is practicable
under the circumstances and not inconsistent with the reason for such excess.
Revolving Advances made after Agent has determined the existence of involuntary
overadvances shall be deemed to be involuntary overadvances and shall be
decreased in accordance with the preceding sentence. To the extent any
Out-of-Formula Loans are not actually funded by the other Lenders as provided
for in this clause (e), Agent may elect in its discretion to fund such
Out-of-Formula Loans and any such Out-of-Formula Loans so funded by Agent shall
be deemed to be Revolving Advances made by and owing to Agent, and Agent shall
be entitled to all rights (including accrual of interest) and remedies of a
Lender holding a Commitment under this Agreement and the Other Documents with
respect to such Revolving Advances.
(f)    In addition to (and not in substitution of) the discretionary Revolving
Advances permitted above in Section 16.2, the Agent is hereby authorized by
Borrowers and the Lenders, at any time in the Agent’s sole discretion,
regardless of (i) the existence of a Default or an Event of Default, (ii)
whether any of the other applicable conditions precedent set forth in Section
8.2 have not been satisfied or the commitments of Lenders to make Revolving
Advances hereunder have been terminated for any reason, or (iii) any other
contrary provision of this Agreement, to make Revolving Advances (“Protective
Advances”) to Borrowers, subject to Section 2.1(a), on behalf of the Lenders
which Agent, in its reasonable business judgment, deems necessary or desirable
(a) to preserve or protect the Collateral, or any portion thereof, (b) to
enhance the likelihood of, or maximize the amount of, repayment of the Advances
and other Obligations, or (c) to pay any other amount chargeable to Borrowers
pursuant to the terms of this Agreement; provided that the Protective Advances
made hereunder shall not exceed, in the aggregate, 10% of the Maximum Revolving
Advance Amount; and provided further that at any time after giving effect to any
such Protective Advances, the outstanding Revolving Advances, Swing Loans
Maximum Undrawn Amount of all outstanding Letters of Credit do not exceed the
Maximum Revolving Advance Amount. The Lenders holding the Commitments shall be
obligated to fund such Protective Advances and effect a settlement with Agent
therefor upon demand of Agent in accordance with their respective Commitment
Percentages. To the extent any Protective Advances are not actually funded by
the other Lenders as provided for in this clause (f), any such Protective
Advances funded by Agent shall be deemed to be Revolving Advances made by and
owing to Agent, and Agent shall be entitled to all rights (including accrual of
interest) and remedies of a Lender holding a Commitment under this Agreement and
the Other Documents with respect to such Revolving Advances.
16.3.    Successors and Assigns; Participations; New Lenders.
(a)    This Agreement shall be binding upon and inure to the benefit of each
Borrower, Agent, each Lender, all future holders of the Obligations and their
respective successors and permitted assigns, except that Borrowers may not
assign or transfer any of their rights or obligations under this Agreement
without the prior written consent of Agent and each Lender.
(b)    Each Borrower acknowledges that in the regular course of commercial
banking business one or more Lenders may at any time and from time to time sell
participating interests in the Advances (other than Swing Loans) to other banks
or financial institutions (each such transferee or purchaser of a participating
interest, a “Participant”). Each Participant may exercise all rights of payment
(including rights of set-off to the extent permitted by Applicable Law) with
respect to the portion of such Advances (other than Swing Loans) held by it or
other Obligations payable hereunder as fully as if such Participant were the
direct holder thereof provided that (i) Borrowers shall not be required to pay
to any Participant more than the amount which it would have been required to pay
to Lender which granted an interest in its Advances or other Obligations payable
hereunder to such Participant had such Lender retained such interest in the
Advances hereunder or other Obligations payable hereunder unless the sale of the
participation to such Participant is made with Borrowers’ prior written consent,
and (ii) in no event shall Borrowers be required to pay any such amount arising
from the same circumstances and with respect to the same Advances or other
Obligations payable hereunder to both such Lender and such Participant. Each
Participant shall have the benefits of Section 3.10, provided it complies with
the provisions thereof. Each Borrower hereby grants to any Participant a
continuing security interest in any deposits, moneys or other property actually
or constructively held by such Participant as security for the Participant’s
interest in the Advances. No Lenders shall transfer, grant or sell any
participation under which the participant shall have the right to approve any
amendment or waiver of this Agreement except to the extent such amendment or
waiver would require the approval of all Lenders pursuant to Section 16.2(b).
Each Lender that sells a participation shall, acting solely for this purpose as
a non-fiduciary agent of the Borrowers, maintain a register on which it enters
the name and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the Advances or other obligations
under this Agreement and the Other Documents (the “Participant Register”);
provided that no Lender shall have any obligation to disclose all or any portion
of the Participant Register (including the identity of any Participant or any
information relating to a Participant’s interest in any commitments, loans,
letters of credit or its other obligations under this Agreement or any Other
Document) to any Person except to the extent that such disclosure is necessary
to establish that such commitment, loan, letter of credit or other obligation is
in registered form under Section 5f.103-1(c) of the United States Treasury
Regulations. The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender shall treat each Person whose name is recorded
in the Participant Register as the owner of such participation for all purposes
of this Agreement notwithstanding any notice to the contrary. For the avoidance
of doubt, the Agent (in its capacity as Agent) shall have no responsibility for
maintaining a Participant Register.
(c)    Any Lender, with the consent of Agent and, so long as no Event of Default
then exists, Borrowing Agent (other than with respect to any sale, assignment or
transfer from any Lender to any Affiliate of such Lender or to any other Lender
or any other Lender’s Affiliates), which shall not be unreasonably withheld,
conditioned or delayed, may sell, assign or transfer all or any part of its
rights and obligations under or relating to Revolving Advances (other than Swing
Loans) under this Agreement and the Other Documents to one or more additional
banks or financial institutions and one or more additional banks or financial
institutions may commit to make Advances hereunder (each a “Purchasing Lender”),
in minimum amounts of not less than $5,000,000, pursuant to a Commitment
Transfer Supplement, executed by a Purchasing Lender, the transferor Lender, and
Agent and delivered to Agent for recording. Upon such execution, delivery,
acceptance and recording, from and after the transfer effective date determined
pursuant to such Commitment Transfer Supplement, (i) Purchasing Lender
thereunder shall be a party hereto and, to the extent provided in such
Commitment Transfer Supplement, have the rights and obligations of a Lender
thereunder with a Commitment Percentage as set forth therein, and (ii) the
transferor Lender thereunder shall, to the extent provided in such Commitment
Transfer Supplement, be released from its obligations under this Agreement, the
Commitment Transfer Supplement creating a novation for that purpose. Such
Commitment Transfer Supplement shall be deemed to amend this Agreement to the
extent, and only to the extent, necessary to reflect the addition of such
Purchasing Lender and the resulting adjustment of the Commitment Percentages
arising from the purchase by such Purchasing Lender of all or a portion of the
rights and obligations of such transferor Lender under this Agreement and the
Other Documents. Each Borrower hereby consents to the addition of such
Purchasing Lender and the resulting adjustment of the Commitment Percentages
arising from the purchase by such Purchasing Lender of all or a portion of the
rights and obligations of such transferor Lender under this Agreement and the
Other Documents. Borrowers shall execute and deliver such further documents and
do such further acts and things in order to effectuate the foregoing.
Notwithstanding any of the foregoing to the contrary, the Borrowing Agent shall
be deemed to have consented to any assignment unless it shall object thereto by
written notice to the Agent within five (5) Business Days after having received
notice thereof.
(d)    Any Lender, with the consent of Agent which shall not be unreasonably
withheld or delayed, may directly or indirectly sell, assign or transfer all or
any portion of its rights and obligations under or relating to Revolving
Advances under this Agreement and the Other Documents to an entity, whether a
corporation, partnership, trust, limited liability company or other entity that
(i) is engaged in making, purchasing, holding or otherwise investing in bank
loans and similar extensions of credit in the ordinary course of its business
and (ii) is administered, serviced or managed by the assigning Lender or an
Affiliate of such Lender (a “Purchasing CLO” and together with each Participant
and Purchasing Lender, each a “Transferee” and collectively the “Transferees”),
pursuant to a Commitment Transfer Supplement modified as appropriate to reflect
the interest being assigned (“Modified Commitment Transfer Supplement”),
executed by any intermediate purchaser, the Purchasing CLO, the transferor
Lender, and Agent as appropriate and delivered to Agent for recording. Upon such
execution and delivery, from and after the transfer effective date determined
pursuant to such Modified Commitment Transfer Supplement, (i) Purchasing CLO
thereunder shall be a party hereto and, to the extent provided in such Modified
Commitment Transfer Supplement, have the rights and obligations of a Lender
thereunder and (ii) the transferor Lender thereunder shall, to the extent
provided in such Modified Commitment Transfer Supplement, be released from its
obligations under this Agreement, the Modified Commitment Transfer Supplement
creating a novation for that purpose. Such Modified Commitment Transfer
Supplement shall be deemed to amend this Agreement to the extent, and only to
the extent, necessary to reflect the addition of such Purchasing CLO. Each
Borrower hereby consents to the addition of such Purchasing CLO. Borrowers shall
execute and deliver such further documents and do such further acts and things
in order to effectuate the foregoing.
(e)    Agent shall maintain at its address a copy of each Commitment Transfer
Supplement and Modified Commitment Transfer Supplement delivered to it and a
register (the “Register”) for the recordation of the names and addresses of each
Lender and the outstanding principal, accrued and unpaid interest and other fees
due hereunder. The entries in the Register shall be conclusive, in the absence
of manifest error, and each Borrower, Agent and Lenders may treat each Person
whose name is recorded in the Register as the owner of the Advance recorded
therein for the purposes of this Agreement. The Register shall be available for
inspection by any Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice. Agent shall receive a fee in the amount of
$3,500 payable by the applicable Purchasing Lender and/or Purchasing CLO upon
the effective date of each transfer or assignment (other than to an intermediate
purchaser) to such Purchasing Lender and/or Purchasing CLO.
(f)    Each Borrower authorizes each Lender to disclose to any Transferee and
any prospective Transferee any and all financial information in such Lender’s
possession concerning such Borrower which has been delivered to such Lender by
or on behalf of such Borrower pursuant to this Agreement or in connection with
such Lender’s credit evaluation of such Borrower.
(g)    Notwithstanding anything to the contrary in this Section, (i) no sale,
transfer or assignment of all or any portion of any Lender’s rights and
obligations under or relating to Advances under this Agreement shall be made to
any Credit Party or any of their respective Affiliates and (ii) any Lender may
at any time and from time to 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; provided that no such pledge or assignment shall release such
Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.
16.4.    Application of Payments. Subject to application of payments and
proceeds in accordance with Section 11.5, Agent shall have the continuing and
exclusive right to apply or reverse and re-apply any payment and any and all
proceeds of Collateral to any portion of the Obligations. To the extent that any
Borrower makes a payment or Agent or any Lender receives any payment or proceeds
of the Collateral for any Borrower’s benefit, which are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required to
be repaid to a trustee, debtor in possession, receiver, custodian or any other
party under any bankruptcy law, common law or equitable cause, then, to such
extent, the Obligations or part thereof intended to be satisfied shall be
revived and continue as if such payment or proceeds had not been received by
Agent or such Lender.
16.5.    Indemnity. Each Credit Party shall defend, protect, indemnify, pay and
save harmless Agent, Issuer, each Lender and each of their respective officers,
directors, Affiliates, attorneys, employees and agents (each an “Indemnified
Party”) for and from and against any and all claims, demands, liabilities,
obligations, losses, damages, penalties, fines, actions, judgments, suits,
costs, charges, expenses and disbursements of any kind or nature whatsoever
(excluding reasonable fees and disbursements of counsel (including allocated
costs of internal counsel)) (collectively, “Claims”) which may be imposed on,
incurred by, or asserted against any Indemnified Party in, arising out of, or in
any way relating to, or as a consequence, direct or indirect, of: (a) this
Agreement, the Other Documents, the Advances and other Obligations and/or the
transactions contemplated hereby including the Transactions, (b) any action or
failure to act or action taken only after delay or the satisfaction of any
conditions by any Indemnified Party in connection with and/or relating to the
negotiation, execution, delivery or administration of the Agreement and the
Other Documents, the credit facilities established hereunder and thereunder
and/or the transactions contemplated hereby including the Transactions, (c) any
Credit Party’s failure to observe, perform or discharge any of its covenants,
obligations, agreements or duties under or breach of any of the representations
or warranties made in this Agreement and the Other Documents, (d) the
enforcement of any of the rights and remedies of Agent, Issuer or any Lender
under the Agreement and the Other Documents, (e) any threatened or actual
imposition of fines or penalties, or disgorgement of benefits, for violation of
any Anti-Terrorism Law by any Credit Party or Subsidiary of any Credit Party,
(f) any claim, litigation, proceeding or investigation instituted or conducted
by any Governmental Body or instrumentality or any other Person with respect to
any aspect of, or any transaction contemplated by, or referred to in, or any
matter related to, this Agreement or the Other Documents, whether or not brought
by any Credit Party, any director, equity holder or creditor thereof, any
Indemnified Party or any other Person and whether or not any Indemnified Party
is a party thereto and (g) arising from or incurred by reason of the handling of
the financing arrangements of Borrowers as provided in Section 15.1, reliance by
Agent or any Lender on any request or instruction from Borrowing Agent or any
other action taken by Agent or any Lender with respect to Section 15.1; provided
that, notwithstanding anything in this Section, to the contrary, no Credit Party
shall be required to indemnify any Indemnified Party for any Claim which, in
each case is found in a final non-appealable judgment by a court of competent
jurisdiction to have resulted from (x) such Indemnified Party’s own gross
negligence or willful misconduct or that of its respective Affiliates or each of
their respective officers, directors, employees, advisors and agents, (y) a
claim brought by Borrower against an Indemnified Party for a material breach, in
bad faith, of such Indemnified Party’s obligations to make Advances hereunder,
or (z) any dispute solely among Indemnified Parties and not involving a Credit
Party or any Subsidiary or Affiliate thereof and not arising out of or in
connection with, in each case is found in a final non-appealable judgment by a
court of competent jurisdiction, (i) the Agent’s or its Affiliates’ respective
capacities in connection with this Agreement or in fulfilling their roles as
Agent, arranger or bookrunner or (ii) any action or inaction of a Credit Party,
any of its Subsidiaries or Affiliates. Without limiting the generality of any of
the foregoing (but subject to subclauses (x), (y) and (z) of this proviso), each
Credit Party shall defend, protect, indemnify, pay and save harmless each
Indemnified Party from any Claims which may be imposed on, incurred by, or
asserted against any Indemnified Party arising out of or in any way relating to
or as a consequence, direct or indirect, of the issuance of any Letter of Credit
hereunder and (B) any Claims which may be imposed on, incurred by, or asserted
against any Indemnified Party under any Environmental Laws with respect to or in
connection with the Real Property, any Hazardous Discharge, the presence of any
Hazardous Substances affecting the Real Property (whether or not the same
originates or emerges from the Real Property or any contiguous real estate),
including any Claims consisting of or relating to the imposition or assertion of
any Lien on any of the Real Property under any Environmental Laws; in each case,
except to the extent such loss, liability, damage and expense (x) is
attributable to any Hazardous Discharge resulting from actions on the part of
Agent or any Lender; (y) results solely from acts or omissions by Persons other
than Borrower or its respective Affiliates or each of their respective officers,
directors, employees, advisors and agents with respect to the applicable Real
Property after the Agent sells the respective Real Property pursuant to a
foreclosure or has accepted a deed in lieu of foreclosure; or (z) arises out of
such Indemnified Party’s own gross negligence or willful misconduct (as
determined by a court of competent jurisdiction in a final and non-appealable
judgment). No Indemnified Party shall be liable for any damage arising from the
use by others of information relating to the Credit Parties obtained through
electronic, telecommunications or other information systems, except to the
extent such damages are found by a final, non-appealable judgment of a court to
arise from the gross negligence or willful misconduct of such Indemnified Party.
This Section shall not apply to Taxes. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING (BUT SUBJECT TO SUBCLAUSES (x), (y) AND (z) OF THE PROVISO ABOVE),
THIS INDEMNITY SHALL EXTEND TO ANY LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES AND DISBURSEMENTS OF ANY
KIND OR NATURE WHATSOEVER (INCLUDING FEES AND DISBURSEMENTS OF COUNSEL) ASSERTED
AGAINST OR INCURRED BY ANY OF THE INDEMNIFIED PARTIES BY ANY PERSON UNDER ANY
ENVIRONMENTAL LAWS BY REASON OF ANY BORROWER’S OR ANY OTHER PERSON’S FAILURE TO
COMPLY WITH ANY LAWS APPLICABLE TO HAZARDOUS SUBSTANCES WITH RESPECT TO ANY REAL
PROPERTY OF ANY CREDIT PARTY.
16.6.    Notice. Any notice or request hereunder to any Credit Party may be
given to Borrowing Agent at its address set forth below or at such other address
as may hereafter be specified in a notice designated as a notice of change of
address under this Section. Any notice or request hereunder to Agent or any
Lender at their respective addresses set forth below or at such other address as
may hereafter be specified in a notice designated as a notice of change of
address under this Section. Any notice, request, demand, direction or other
communication (for purposes of this Section only, a “Notice”) to be given to or
made upon any party hereto under any provision of this Agreement shall be given
or made by telephone or in writing (which includes by means of electronic
transmission (i.e., “e-mail”) or facsimile transmission or by setting forth such
Notice on a site on the World Wide Web (a “Website Posting”) if Notice of such
Website Posting (including the information necessary to access such site) has
previously been delivered to the applicable parties hereto by another means set
forth in this Section) in accordance with this Section. Any such Notice must be
delivered to the applicable parties hereto at the addresses and numbers set
forth under their respective names in this Section or in accordance with any
subsequent unrevoked Notice from any such party that is given in accordance with
this Section. Any Notice shall be effective:
(a)    In the case of hand-delivery, when delivered;
(b)    If given by mail, four (4) days after such Notice is deposited with the
United States Postal Service, with first-class postage prepaid, return receipt
requested;
(c)    In the case of a telephonic Notice, when a party is contacted by
telephone, if delivery of such telephonic Notice is confirmed no later than the
next Business Day by hand delivery, a facsimile or electronic transmission, a
Website Posting or an overnight courier delivery of a confirmatory Notice
(received at or before noon on such next Business Day);
(d)    In the case of a facsimile transmission, when sent to the applicable
party’s facsimile machine’s telephone number, if the party sending such Notice
receives confirmation of the delivery thereof from its own facsimile machine;
(e)    In the case of electronic transmission, when actually received;
(f)    In the case of a Website Posting, upon delivery of a Notice of such
posting (including the information necessary to access such site) by another
means set forth in this Section; and
(g)    If given by any other means (including by overnight courier), when
actually received.
Any Lender giving a Notice to Borrowing Agent or any Borrower shall concurrently
send a copy thereof to Agent, and Agent shall promptly notify the other Lenders
of its receipt of such Notice.
(A)    If to Agent or PNC at:
PNC Bank, National Association
2100 Ross Avenue, Suite 1850
Dallas, Texas 75201
Attention:    Relationship Manager
Telephone:    (713) 658-3962
Facsimile:    (855) 254-1087
with a copy to:    
PNC Bank, National Association
PNC Agency Services
PNC Firstside Center
500 First Avenue, 4th Floor
Pittsburgh, Pennsylvania 15219
Attention:     Agency Services
Telephone:    (713) 658-3962
Facsimile:    (855) 254-1087
with an additional copy to:
Holland & Knight LLP
200 Crescent Court
Suite 1600
Dallas, Texas 75201
Attention: Michelle W. Suarez
Telephone:     (214) 964-9500
Facsimile:     (214) 964-9501
(B)    If to a Lender other than Agent, as specified on the signature pages
hereof
(C)    If to Borrowing Agent or any Borrower:
CJ Holding Co.
3990 Rogerdale
Houston, Texas 77042
Attention: Mark Cashiola, Chief Financial Officer
Telephone:     (281) 450-7533
Facsimile:     (713) 325-5920

with a copy to:    

Fried, Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
New York, New York 10004
Attention: J. Christian Nahr
Telephone:     (212) 859-8264
Facsimile:     (212) 859-4000
16.7.    Survival. The obligations of Borrowers under Sections 2.2(g), 2.2(h),
3.7, 3.8, 3.9, 3.10, 16.5 and 16.9 and the obligations of Lenders under Sections
2.2, 2.15(b), 2.16, 2.18, 2.19, 14.8 and 16.5, shall survive termination of this
Agreement and the Other Documents and payment in full of the Obligations.
16.8.    Severability. If any part of this Agreement is contrary to, prohibited
by, or deemed invalid under Applicable Laws, such provision shall be
inapplicable and deemed omitted to the extent so contrary, prohibited or
invalid, but the remainder hereof shall not be invalidated thereby and shall be
given effect so far as possible.
16.9.    Expenses. Borrowers shall pay (i) all reasonable and documented
out-of-pocket expenses incurred by Agent and its Affiliates (including the
reasonable fees, charges and disbursements of counsel for Agent), and shall pay
all fees and time charges and disbursements for attorneys who may be employees
of Agent, in connection with the syndication of the credit facilities provided
for herein, the preparation, negotiation, execution, delivery and administration
of this Agreement and the Other Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all reasonable and
documented out-of-pocket expenses incurred by Issuer in connection with the
issuance, amendment, renewal or extension of any Letter of Credit or any demand
for payment thereunder, (iii) all documented out-of-pocket expenses incurred by
Agent, any Lender or Issuer (including the fees, charges and disbursements of
any counsel for Agent, any Lender or Issuer), and shall pay all fees and time
charges for attorneys who may be employees of Agent, any Lender or Issuer, in
connection with the enforcement or protection of its rights (A) in connection
with this Agreement and the Other Documents, including its rights under this
Section, or (B) in connection with the Advances made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Advances or Letters of
Credit, and (iv) all reasonable and documented out-of-pocket expenses of Agent’s
regular employees and agents engaged periodically to perform audits of the any
Borrower’s or any Borrower’s Affiliate’s or Subsidiary’s books, records and
business properties.
16.10.    Injunctive Relief. Each Borrower recognizes that, in the event any
Borrower fails to perform, observe or discharge any of its obligations or
liabilities under this Agreement, or threatens to fail to perform, observe or
discharge such obligations or liabilities, any remedy at law may prove to be
inadequate relief to Lenders; therefore, Agent, if Agent so requests, shall be
entitled to temporary and permanent injunctive relief in any such case without
the necessity of proving that actual damages are not an adequate remedy.
16.11.    Consequential Damages. Neither Agent nor any Lender, nor any agent or
attorney for any of them, shall be liable to any Credit Party (or any Subsidiary
of any such Person) for indirect, punitive, exemplary or consequential damages
arising from any breach of contract, tort or other wrong relating to the
establishment, administration or collection of the Obligations or as a result of
any transaction contemplated under this Agreement or any Other Document.
16.12.    Captions. The captions at various places in this Agreement are
intended for convenience only and do not constitute and shall not be interpreted
as part of this Agreement.
16.13.    Counterparts; Facsimile Signatures. This Agreement may be executed in
any number of and by different parties hereto on separate counterparts, all of
which, when so executed, shall be deemed an original, but all such counterparts
shall constitute one and the same agreement. Any signature delivered by a party
by facsimile or electronic transmission (including email transmission of a PDF
image) shall be deemed to be an original signature hereto.
16.14.    Construction. The parties acknowledge that each party and its counsel
have reviewed this Agreement and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Agreement or any amendments,
schedules or exhibits thereto.
16.15.    Confidentiality; Sharing Information. Agent, each Lender and each
Transferee shall hold all non-public information obtained by Agent, such Lender
or such Transferee pursuant to the requirements of this Agreement in accordance
with Agent’s, such Lender’s and such Transferee’s customary procedures for
handling confidential information of this nature; provided that Agent, each
Lender and each Transferee may disclose such confidential information (a) to its
agents, directors, officers, employees, examiners, Affiliates, outside auditors,
counsel and other professional advisors, (b) to Agent, any Lender or to any
prospective Transferees, (c) in connection with the exercise of any remedies
hereunder or under any Other Document or any action or proceeding relating to
this Agreement or any Other Document or the enforcement of rights hereunder or
thereunder, (d) with the consent of the Borrowers, and (e) as required or
requested by any Governmental Body or representative thereof or pursuant to
legal process; provided, further that (i) unless specifically prohibited by
Applicable Law, Agent, each Lender and each Transferee shall use its reasonable
best efforts prior to disclosure thereof, to notify the applicable Borrower of
the applicable request for disclosure of such non-public information (A) by a
Governmental Body or representative thereof (other than any such request in
connection with an examination of the financial condition of a Lender or a
Transferee by such Governmental Body) or (B) pursuant to legal process and (ii)
in no event shall Agent, any Lender or any Transferee be obligated to return any
materials furnished by any Borrower other than those documents and instruments
in possession of Agent or any Lender in order to perfect its Lien on the
Collateral once the Obligations have been paid in full and this Agreement has
been terminated. Each Borrower acknowledges that from time to time financial
advisory, investment banking and other services may be offered or provided to
such Borrower or one or more of its Affiliates (in connection with this
Agreement or otherwise) by any Lender or by one or more Subsidiaries or
Affiliates of such Lender and each Borrower hereby authorizes each Lender to
share any information delivered to such Lender by such Borrower and its
Subsidiaries pursuant to this Agreement, or in connection with the decision of
such Lender to enter into this Agreement, to any such Subsidiary or Affiliate of
such Lender, it being understood that any such Subsidiary or Affiliate of any
Lender receiving such information shall be bound by the provisions of this
Section as if it were a Lender hereunder. Such authorization shall survive the
repayment of the other Obligations and the termination of this Agreement.
Notwithstanding any non-disclosure agreement or similar document executed by
Agent in favor of any Borrower or any of any Borrower’s affiliates, the
provisions of this Agreement shall supersede such agreements.
16.16.    Publicity. Each Borrower and each Lender hereby authorizes Agent to
make appropriate announcements of the financial arrangement entered into among
Borrowers, Agent and Lenders, including announcements which are commonly known
as tombstones, in such publications and to such selected parties as Agent shall
in its sole and absolute discretion deem appropriate.
16.17.    Certifications From Banks and Participants; USA PATRIOT Act.
(a)    Each Lender or assignee or participant of a Lender that is not
incorporated under the Laws of the United States of America or a state thereof
(and is not excepted from the certification requirement contained in Section 313
of the USA PATRIOT Act and the applicable regulations because it is both (i) an
affiliate of a depository institution or foreign bank that maintains a physical
presence in the United States or foreign country, and (ii) subject to
supervision by a banking authority regulating such affiliated depository
institution or foreign bank) shall deliver to the Agent the certification, or,
if applicable, recertification, certifying that such Lender is not a “shell” and
certifying to other matters as required by Section 313 of the USA PATRIOT Act
and the applicable regulations: (1) within ten (10) days after the Closing Date,
and (2) as such other times as are required under the USA PATRIOT Act.
(b)    Each Lender that is subject to the PATRIOT Act and Agent (for itself and
not on behalf of any Lender) hereby notifies the Borrowers that pursuant to the
requirements of the PATRIOT Act, it is required to obtain, verify and record
information that identifies the Borrowers, which information includes the name
and address of the Borrowers and other information that will allow such Lender
or Agent, as applicable, to identify the Borrowers in accordance with the
PATRIOT Act. The Borrowers shall, promptly following a request by Agent or any
Lender, provide all documentation and other information that Agent or such
Lender reasonably requests in order to comply with its ongoing obligations under
applicable “know your customer” and anti-money-laundering rules and regulations,
including the PATRIOT Act.
16.18.    Anti-Terrorism Laws.
(a)    Each Borrower represents and warrants that (i) no Covered Entity is a
Sanctioned Person and (ii) no Covered Entity, either in its own right or through
any third party, (A) has any of its assets in a Sanctioned Country or in the
possession, custody or control of a Sanctioned Person in violation of any
Anti-Terrorism Law; (B) does business in or with, or derives any of its income
from investments in or transactions with, any Sanctioned Country or Sanctioned
Person in violation of any Anti-Terrorism Law; or (C) engages in any dealings or
transactions prohibited by any Anti-Terrorism Law.
(b)    Each Borrower covenants and agrees that (i) no Covered Entity will become
a Sanctioned Person, (ii) no Covered Entity, either in its own right or through
any third party, will (A) have any of its assets in a Sanctioned Country or in
the possession, custody or control of a Sanctioned Person in violation of any
Anti-Terrorism Law; (B) do business in or with, or derive any of its income from
investments in or transactions with, any Sanctioned Country or Sanctioned Person
in violation of any Anti-Terrorism Law; (C) engage in any dealings or
transactions prohibited by any Anti-Terrorism Law or (D) use the Advances to
fund any operations in, finance any investments or activities in, or, make any
payments to, a Sanctioned Country or Sanctioned Person in violation of any
Anti-Terrorism Law, (iii) the funds used to repay the Obligations will not be
derived from any unlawful activity, (iv) each Covered Entity shall comply with
all Anti-Terrorism Laws and (v) the Borrowers shall promptly notify the Agent in
writing upon the occurrence of a Reportable Compliance Event.
16.19.    Concerning Joint and Several Liability of Borrowers.
(a)    Each of Borrowers is accepting joint and several liability hereunder in
consideration of the financial accommodations to be provided by Lenders under
this Agreement, for the mutual benefit, directly and indirectly, of each of
Borrowers and in consideration of the undertakings of each of Borrowers to
accept joint and several liability for the obligations of each of them.
(b)    Each of Borrowers jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor and
primary obligor, joint and several liability with the other Borrowers with
respect to the payment and performance of all of the Obligations, it being the
intention of the parties hereto that all the Obligations shall be the joint and
several obligations of each of Borrowers without preferences or distinction
among them.
(c)    If and to the extent that any of the Borrowers shall fail to make any
payment with respect to any of the Obligations as and when due or to perform any
of the Obligations in accordance with the terms thereof, then in each such
event, the other Borrowers will make such payment with respect to, or perform,
such Obligation.
(d)    The obligations of each Borrower under the provisions of this Section
constitute full recourse obligations of such Borrower, enforceable against it to
the full extent of its properties and assets, irrespective of the validity,
regularity or enforceability of this Agreement or any other circumstances
whatsoever.
(e)    Except as otherwise expressly provided herein, each Borrower hereby
waives notice of acceptance of its joint and several liability, notice of any
Advance made under this Agreement, notice of occurrence of any Event of Default,
or of any demand for any payment under this Agreement (except as otherwise
provided herein), notice of any action at any time taken or omitted by any
Lender under or in respect of any of the Obligations, any requirement of
diligence and, generally, all demands, notices and other formalities of every
kind in connection with this Agreement. Each Borrower hereby assents to, and
waives notice of, any extension or postponement of the time for the payment of
any of the Obligations, the acceptance of any partial payment thereon, any
waiver, consent or other action or acquiescence by any Lender at any time or
times in respect of any default by any Borrower in the performance or
satisfaction of any term, covenant, condition or provision of this Agreement,
any and all other indulgences whatsoever by any Lender in respect of any of the
Obligations, and the taking, addition, substitution or release, in whole or in
part, at any time or times, of any security for any of the Obligations or in
part, at any time or times, of any security for any of the Obligations or the
addition, substitution or release, in whole or in part, of any Borrower. Without
limiting the generality of the foregoing, each Borrower assents to any other
action or delay in acting or failure to act on the part of any Lender,
including, without limitation, any failure strictly or diligently to assert any
right or to pursue any remedy or to comply fully with the applicable laws or
regulations thereunder which might, but for the provisions of this Section,
afford grounds for terminating, discharging or relieving such Borrower, in whole
or in part, from any of its obligations under this Section, it being the
intention of each Borrower that, so long as any of the Obligations remain
unsatisfied, the obligations of such Borrower under this Section shall not be
discharged except by performance and then only to the extent of such performance
or except as otherwise agreed in writing in accordance with Section 16.2. The
Obligations of each Borrower under this Section shall not be diminished or
rendered unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect to any Borrower
or any Lender. The joint and several liability of Borrowers hereunder shall
continue in full force and effect notwithstanding any absorption, merger,
amalgamation or any other change whatsoever in the name, membership,
constitution or place of formation of any Borrower or any Lender.
(f)    The provisions of this Section are made for the benefit of the Lenders
and their respective successors and assigns, and may be enforced by any such
Person from time to time against any of the Borrowers as often as occasion
therefor may arise and without requirement on the part of any Lender first to
marshal any of its claims or to exercise any of its rights against any of the
other Borrowers or to exhaust any remedies available to it against any of the
other Borrowers or to resort to any other source or means of obtaining payment
of any of the Obligations or to elect any other remedy. The provisions of this
Section 16.19 shall remain in effect until all the Obligations shall have been
paid in full or otherwise fully satisfied. If at any time, any payment, or any
part thereof, made in respect of any of the Obligations, is rescinded or must
otherwise be restored or returned by any Lender upon the insolvency, bankruptcy
or reorganization of any of the Borrowers, or otherwise, the provisions of this
Section will forthwith be reinstated in effect, as though such payment had not
been made.
(g)    Notwithstanding any provision to the contrary contained herein or in any
other of the Other Documents, to the extent the joint obligations of a Borrower
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each Borrower
hereunder shall be limited to the maximum amount that is permissible under
Applicable Law (whether federal or state and including, without limitation, any
federal or state bankruptcy laws).
(h)    Borrowers hereby agree, as among themselves, that if any Borrower shall
become an Excess Funding Borrower (as defined below), each other Borrower shall,
on demand of such Excess Funding Borrower (but subject to the next sentence
hereof and to subsection (B) below), pay to such Excess Funding Borrower an
amount equal to such Borrower’s Pro Rata Share (as defined below and determined,
for this purpose, without reference to the properties, assets, liabilities and
debts of such Excess Funding Borrower) of such Excess Payment (as defined
below). The payment obligation of any Borrower to any Excess Funding Borrower
under this clause (h) shall be subordinate and subject in right of payment to
the prior payment in full of the Obligations of such Borrower under the other
provisions of this Agreement, and such Excess Funding Borrower shall not
exercise any right or remedy with respect to such excess until payment and
satisfaction in full of all of such Obligations. For purposes hereof, (i)
“Excess Funding Borrower” shall mean, in respect of any Obligations arising
under the other provisions of this Agreement (hereafter, the “Joint
Obligations”), a Borrower that has paid an amount in excess of its Pro Rata
Share of the Joint Obligations; (ii) “Excess Payment” shall mean, in respect of
any Joint Obligations, the amount paid by an Excess Funding Borrower in excess
of its Pro Rata Share of such Joint Obligations; and (iii) “Pro Rata Share”, for
the purposes of this clause (h), shall mean, for any Borrower, the ratio
(expressed as a percentage) of (A) the amount by which the aggregate present
fair salable value of all of its assets and properties exceeds the amount of all
debts and liabilities of such Borrower (including contingent, subordinated,
unmatured, and unliquidated liabilities, but excluding the obligations of such
Borrower hereunder) to (B) the amount by which the aggregate present fair
salable value of all assets and other properties of such Borrower and all of the
other Borrowers exceeds the amount of all of the debts and liabilities
(including contingent, subordinated, unmatured, and unliquidated liabilities,
but excluding the obligations of such Borrower and the other Borrowers
hereunder) of such Borrower and all of the other Borrowers, all as of the
Closing Date (if any Borrower becomes a party hereto subsequent to the Closing
Date, then for the purposes of this clause (h) such subsequent Borrower shall be
deemed to have been a Borrower as of the Closing Date and the information
pertaining to, and only pertaining to, such Borrower as of the date such
Borrower became a Borrower shall be deemed true as of the Closing Date)
notwithstanding the payment obligations imposed on Borrowers in this Section,
the failure of a Borrower to make any payment to an Excess Funding Borrower as
required under this Section shall not constitute an Event of Default.
16.20.    No Advisory or Fiduciary Responsibility. In connection with all
aspects of each transaction contemplated hereby (including in connection with
any amendment, waiver or other modification hereof or of any Other Document),
each Borrower acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (a) (i) no fiduciary, advisory or agency relationship
between the Borrowers and their Subsidiaries and Agent, any Issuer, any Swing
Loan Lender or any Lender is intended to be or has been created in respect of
the transactions contemplated hereby or by the Other Documents, irrespective of
whether Agent, any Issuer, any Swing Loan Lender or any Lender has advised or is
advising the Borrowers or any Subsidiary on other matters, (ii) the arranging
and other services regarding this Agreement provided by the Agent, the Issuers,
the Swing Loan Lenders and the Lenders are arm’s-length commercial transactions
between the Borrowers and their Affiliates, on the one hand, and the Agent, the
Issuers, the Swing Loan Lenders and the Lenders, on the other hand, (iii) the
Borrowers have consulted their own legal, accounting, regulatory and tax
advisors to the extent that each has deemed appropriate and (iv) the Borrowers
are capable of evaluating, and understands and accepts, the terms, risks and
conditions of the transactions contemplated hereby and by the Other Documents;
and (b) (i) the Agent, the Issuers, the Swing Loan Lenders and the Lenders each
is and has been acting solely as a principal and, except as expressly agreed in
writing by the relevant parties, has not been, is not, and will not be acting as
an advisor, agent or fiduciary for the Borrowers or any of their Affiliates, or
any other Person; (ii) none of the Agent, the Issuers, the Swing Loan Lenders
and the Lenders has any obligation to the Borrowers or any of their Affiliates
with respect to the transactions contemplated hereby except those obligations
expressly set forth herein and in the Other Documents; and (iii) the Agent, the
Issuers, the Swing Loan Lenders and the Lenders and their respective Affiliates
may be engaged, for their own accounts or the accounts of customers, in a broad
range of transactions that involve interests that differ from those of the
Borrowers and their Affiliates, and none of the Agent, the Issuers, the Swing
Loan Lenders and the Lenders has any obligation to disclose any of such
interests to the Borrowers or their Affiliates. To the fullest extent permitted
by Law, each Borrower hereby waives and releases any claims that it may have
against the Agent, the Issuers, the Swing Loan Lenders and the Lenders with
respect to any breach or alleged breach of agency or fiduciary duty in
connection with any aspect of any transaction contemplated hereby.
16.21.    Acknowledgement and Consent to Bail-In of EEA Financial Institutions.
Solely to the extent any Lender or Issuer that is an EEA Financial Institution
is a party to this Agreement and notwithstanding anything to the contrary in
this Agreement or any Other Document or in any other agreement, arrangement or
understanding among any such parties, each party hereto acknowledges that any
liability of any Lender or Issuer that is an EEA Financial Institution arising
under this Agreement or any Other Document, to the extent such liability is
unsecured, 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 Lender or Issuer 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
undertaking, 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 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.
16.22.    Effect of Amendment and Restatement; Reaffirmation.
(a)    On the Closing Date, (i) the Original Credit Agreement shall be amended
and restated in its entirety by this Agreement and (ii) each of the outstanding
commitments of the lenders under the Original Credit Agreement shall be
terminated and, to the extent that such lenders constitute Lenders hereunder,
shall be replaced with their respective Commitments hereunder.
(b)    The parties hereto acknowledge and agree that (i) the obligations
incurred under the Original Credit Agreement shall, to the extent outstanding on
the Closing Date, continue outstanding as obligations of the same type under
this Agreement and shall not be deemed to be paid, released, discharged, or
otherwise satisfied by the execution of this Agreement, and this Agreement shall
not constitute a refinancing, substitution or novation of such obligations or
any of the other rights, duties, and obligations of the parties hereunder, (ii)
the Liens and security interests as granted by the Credit Parties securing
payment of all Obligations under the Original Credit Agreement and under the
Other Documents (as defined in the Original Credit Agreement) are in all
respects continuing and in full force and effect and are reaffirmed hereby,
(iii) this Agreement shall not in any way release or impair the rights, duties,
Obligations or Liens created pursuant to the Original Credit Agreement or any
Other Document (as defined in the Original Credit Agreement) or affect the
relative priorities thereof, in each case to the extent in force and effect
thereunder as of the Closing Date, except as modified, amended, or amended and
restated, as the case may be, hereby or by documents, instruments and agreements
executed and delivered in connection herewith, and all of such rights, duties,
Obligations and Liens are assumed, ratified and affirmed by the Credit Parties
in all respects and (iv) all indemnification obligations of the Credit Parties
that were party to the Original Credit Agreement and any Other Documents (as
defined in the Original Credit Agreement) shall survive the execution and
delivery of this Agreement and shall continue in full force and effect for the
benefit of the Lenders, the Agent, and any other Person indemnified under the
Original Credit Agreement or any Other Document (as defined in the Original
Credit Agreement) at any time in place on and immediately prior to the Closing
Date.
(c)    On and after the Closing Date, (i) all references to the Original Credit
Agreement or the “Credit Agreement” in the Other Documents (other than this
Agreement) shall be deemed to refer to the Original Credit Agreement, as amended
and restated hereby, (ii) all references to any section (or subsection) of the
Original Credit Agreement or the Credit Agreement in any Other Document (but not
herein) shall be amended to become, mutatis mutandis, references to the
corresponding provisions of this Agreement and (iii) except as the context
otherwise provides, on or after the Closing Date, all references to this
Agreement herein (including for purposes of indemnification and reimbursement of
fees) shall be deemed to be references to the Original Credit Agreement as
amended and restated hereby.
(d)    The execution, delivery and effectiveness of this Agreement shall not
operate as a waiver of any right, power or remedy of the Lenders or the Agent
under the Original Credit Agreement, nor constitute a waiver of any covenant,
agreement, or obligation under the Original Credit Agreement, except to the
extent that any such covenant, agreement, or obligation is no longer set forth
herein or is modified hereby.
16.23.    Release. EACH CREDIT PARTY HEREBY ACKNOWLEDGES THAT IT HAS NO DEFENSE,
RECOUPMENT, COUNTERCLAIM, OFFSET, CROSS­COMPLAINT, CLAIM OR DEMAND OF ANY KIND
OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL, OR ANY
PART OF, ITS LIABILITY TO REPAY THE OBLIGATIONS ARISING UNDER THE ORIGINAL
CREDIT AGREEMENT, THIS AGREEMENT OR ANY OTHER DOCUMENT OR TO SEEK AFFIRMATIVE
RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM THE AGENT, THE LENDERS AND THEIR
RESPECTIVE AFFILIATES AND APPROVED FUNDS, IN EACH CASE IN WHATEVER CAPACITY
(EACH A “LENDER PARTY”) (OR ANY LENDER PARTY) ARISING UNDER OR IN CONNECTION
WITH THE ORIGINAL CREDIT AGREEMENT, THIS AGREEMENT OR ANY OTHER DOCUMENT. EACH
CREDIT PARTY HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES
EACH LENDER PARTY AND EACH OF THEIR RESPECTIVE RELATED PARTIES, IN EACH CASE IN
WHATEVER CAPACITY (COLLECTIVELY, THE “RELEASED PARTIES”), FROM ALL POSSIBLE
CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND
LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED,
SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN
EQUITY, ORIGINATING IN WHOLE OR IN PART BEFORE THE DATE THIS AGREEMENT IS
ORIGINATED, TAKEN OR EXECUTED, WHICH SUCH CREDIT PARTY MAY NOW OR HEREAFTER HAVE
AGAINST ANY RELEASED PARTY, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS
ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND
ARISING FROM OR ARISING IN CONNECTION WITH OR RELATING TO ANY “LOANS”,
INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR, CHARGING, TAKING, RESERVING,
COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE HIGHEST LAWFUL RATE
APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE ORIGINAL CREDIT
AGREEMENT, THIS AGREEMENT OR OTHER DOCUMENTS, AND/OR NEGOTIATION OF, OR
EXECUTION OF, THIS AGREEMENT. IT IS AGREED THAT THE SCOPE OF THIS RELEASE SHALL
INCLUDE ALL CLAIMS, DEMANDS OR CAUSES OF ACTION ARISING IN WHOLE OR PART FROM
THE NEGLIGENCE OR STRICT LIABILITY OF ANY LENDER PARTY OR ANY OTHER RELEASED
PARTY. EACH CREDIT PARTY HEREBY COVENANTS AND AGREES NEVER TO INSTITUTE ANY
ACTION OR SUIT AT LAW OR IN EQUITY, NOR INSTITUTE, PROSECUTE, OR IN ANY WAY AID
IN THE INSTITUTION OR PROSECUTION OF, ANY CLAIM, ACTION OR CAUSE OF ACTION,
RIGHTS TO RECOVER DEBTS OR DEMANDS OF ANY NATURE AGAINST ANY OF THE RELEASED
PARTIES ARISING OUT OF OR RELATED TO A RELEASED PARTY’S ACTIONS, OMISSIONS,
STATEMENTS, REQUESTS OR DEMANDS AND OCCURRING PRIOR TO EFFECTIVENESS OF THIS
AGREEMENT IN ADMINISTERING, ENFORCING, MONITORING, COLLECTING OR ATTEMPTING TO
COLLECT, THE OBLIGATIONS OF SUCH CREDIT PARTY TO A RELEASED PARTY WHICH
OBLIGATIONS WERE EVIDENCED BY THIS AGREEMENT, THE ORIGINAL CREDIT AGREEMENT OR
THE OTHER DOCUMENTS. EACH CREDIT PARTY AGREES TO INDEMNIFY AND HOLD EACH LENDER
PARTY AND EACH OTHER RELEASED PARTY HARMLESS FROM ANY AND ALL MATTERS RELEASED
PURSUANT TO THIS SECTION. EACH CREDIT PARTY ACKNOWLEDGES THAT THE AGREEMENTS IN
THIS SECTION ARE INTENDED TO BE IN FULL SATISFACTION OF ALL OR ANY ALLEGED
INJURIES OR DAMAGES TO SUCH CREDIT PARTY, ITS RELATED PERSONS ARISING IN
CONNECTION WITH SUCH MATTERS RELEASED PURSUANT TO THE OTHER PROVISIONS OF THIS
SECTION. EACH CREDIT PARTY REPRESENTS AND WARRANTS TO LENDER PARTIES THAT IT HAS
NOT PURPORTED TO TRANSFER, ASSIGN OR OTHERWISE CONVEY ANY RIGHT, TITLE OR
INTEREST OF SUCH LOAN PARTY IN ANY RELEASED MATTER TO ANY OTHER PERSON AND THAT
THE FOREGOING CONSTITUTES A FULL AND COMPLETE RELEASE OF SUCH CREDIT PARTY’S
CLAIMS WITH RESPECT TO ALL SUCH MATTERS. THE PROVISIONS OF THIS RELEASE AND THE
REPRESENTATIONS, WARRANTIES, RELEASES, WAIVERS, ACQUITTANCES, DISCHARGES,
COVENANTS, AGREEMENTS AND INDEMNIFICATIONS CONTAINED HEREIN (A) CONSTITUTE A
MATERIAL CONSIDERATION FOR AND INDUCEMENT TO LENDER PARTIES ENTERING INTO THIS
AGREEMENT, (B) DO NOT CONSTITUTE AN ADMISSION OF OR BASIS FOR ESTABLISHING ANY
DUTY, OBLIGATION OR LIABILITY OF ANY LENDER PARTY TO ANY CREDIT PARTY OR ANY
OTHER PERSON, (C) DO NOT CONSTITUTE AN ADMISSION OF OR BASIS FOR ESTABLISHING
ANY LIABILITY, WRONGDOING; OR VIOLATION OF ANY OBLIGATION, DUTY OR AGREEMENT OF
ANY LENDER PARTY TO ANY CREDIT PARTY OR ANY OTHER PERSON, AND (D) SHALL NOT BE
USED AS EVIDENCE AGAINST ANY LENDER PARTY BY ANY CREDIT PARTY OR ANY OTHER
PERSON FOR ANY PURPOSE.

[Remainder of page intentionally left blank]

Each of the parties has signed this Agreement as of the day and year first above
written.

 
 
C&J ENERGY SERVICES, INC., as Holdings and a Borrower

 
 
 
 
By: /s/ Danielle Hunter
          Name: Danielle Hunter
          Title: Executive Vice President, General Counsel,
Chief Risk & Compliance Officer and
Corporate Secretary
 
 
 

CJ HOLDING CO.
C&J SPEC-RENT SERVICES, INC.
C&J WELL SERVICES, INC.
ESP COMPLETION TECHNOLOGIES LLC
KVS TRANSPORTATION, INC.
TELLUS OILFIELD INC.
TIGER CASED HOLE SERVICES, INC.
TOTAL E&S INC., as Borrowers

 
 
By: /s/ Danielle Hunter
          Name: Danielle Hunter
          Title: Executive Vice President, General Counsel and
Chief Risk & Compliance Officer

 
PNC Bank, National Association,
as a Lender
 
By: /s/ Renae Sinclair
Name: Renae Sinclair
Title: VP
Address:

PNC Bank, National Association
Two Allen Center
1200 Smith St., Suite 830
Houston, TX 77002
Attention: Renae Sinclair
Telephone: (713) 658-3962
Facsimile: (713) 658-3985
Commitment Percentage: ____%
Commitment Amount: $____________

 
CITIBANK, N.A. ,
as a Lender
 
By: /s/ William H. Moul, Jr.
Name: William H. Moul, Jr.
Title: Authorized Signatory 

 
Address:

One Court Square, 49th Floor
Long Island City, NY 11101
Attention: Portfolio Manager
Telephone: 718-248-4236
Facsimile: 718-248-8411
Commitment Percentage: 12.50%
Commitment Amount: $25,000,000

 
MORGAN STANLEY BANK, N.A.,
as a Lender
 
By: /s/ Michael King
Name: Michael King
Title: Authorized Signatory
One Utah Center
201 South Main Street, 5th Floor
Salt Lake City, Utah 8411

Attention: Morgan Stanley Loan Servicing
Telephone: 443-627-4355
Facsimile: 718-233-2140
Commitment Percentage: 13%
Commitment Amount: $25,000,000.00

 
Credit Suisse AG, Cayman Islands Branch,
as a Lender
 
By: /s/ Nupur Kumar
Name: Nupur Kumar
Title: Authorized Signatory

By: /s/ Lea Baerlocher
Name: Lea Baerlocher
Title: Authorized Signatory

 
BARCLAYS BANK PLC,
as a Lender
 
By: /s/ Marguerite Sutton
Name: Marguerite Sutton
Title: Vice President
Address:

745 7th Avenue
New York, NY 10019
Attention: Oksana Shtogrin
Telephone: 212.526.7648
Facsimile: 212.526.5115
Commitment Percentage: 7.5%
Commitment Amount: $15,000,000

 
DEUTSCHE BANK AG NEW YORK BRANCH,
as a Lender
 
By: /s/ Dusan Lazarov
Name: Dusan Lazarov
Title: Director
By: /s/ Peter Cucchiara
Name: Peter Cucchiara
Title: Vice President
Address:

60 Wall Street
New York, NY 10005

Attention: Matthew Snyder
Telephone: (212) 250-9088

Commitment Percentage: 7.50%
Commitment Amount: $15,000,000.00

 
 

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CJ Holding Co. Amended & Restated Credit Agreement