Exhibit 10.1

 

Execution Version

 

    J.P.Morgan  [logo.jpg]

  

 

CREDIT AGREEMENT

 

dated as of

 

November 30, 2017

 

among

 

FIESTA RESTAURANT GROUP, INC.,
as Borrower

 

The Lenders Party Hereto

 

and

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

___________________________

 

JPMORGAN CHASE BANK, N.A., and

WELLS FARGO SECURITIES, LLC
as Joint Lead Bookrunners and Joint Lead Arrangers

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Syndication Agent

 

 

 

 

 

  

TABLE OF CONTENTS

 

Page

 

ARTICLE I Definitions 1 SECTION 1.01. Defined Terms 1 SECTION 1.02.
Classification of Loans and Borrowings 25 SECTION 1.03. Terms Generally 25
SECTION 1.04. Accounting Terms; GAAP 26 SECTION 1.05. Financial Covenant
Calculations 26 SECTION 1.06. Status of Obligations 26     ARTICLE II The
Credits 27 SECTION 2.01. Revolving Commitments 27 SECTION 2.02. Loans and
Borrowings 27 SECTION 2.03. Requests for Borrowings 27 SECTION 2.04. Letters of
Credit 28 SECTION 2.05. Funding of Borrowings 33 SECTION 2.06. Interest
Elections 34 SECTION 2.07. Termination and Reduction of Commitments; Increase in
Revolving Commitments 35 SECTION 2.08. Repayment of Loans; Evidence of Debt 37
SECTION 2.09. Prepayment of Loans 37 SECTION 2.10. Fees 38 SECTION 2.11.
Interest 39 SECTION 2.12. Alternate Rate of Interest; Illegality 40 SECTION
2.13. Increased Costs 41 SECTION 2.14. Break Funding Payments 42 SECTION 2.15.
Taxes 42 SECTION 2.16. Payments Generally; Allocation of Proceeds; Sharing of
Set-offs 46 SECTION 2.17. Mitigation Obligations; Replacement of Lenders 48
SECTION 2.18. Defaulting Lenders 49 SECTION 2.19. Returned Payments 50 SECTION
2.20. Banking Services and Swap Agreements 50     ARTICLE III Representations
and Warranties 51 SECTION 3.01. Financial Condition 51 SECTION 3.02. No Material
Adverse Effect 51 SECTION 3.03. Corporate Existence; Compliance with Law;
Patriot Act Information 51 SECTION 3.04. Corporate Power; Authorization;
Enforceable Obligations 52 SECTION 3.05. No Legal Bar; No Default 52 SECTION
3.06. No Material Litigation. 52 SECTION 3.07. Investment Company Act; etc 53
SECTION 3.08. Margin Regulations 53 SECTION 3.09. ERISA 53 SECTION 3.10.
Environmental Matters 53 SECTION 3.11. Use of Proceeds 54 SECTION 3.12.
Subsidiaries; Joint Ventures; Partnerships 54 SECTION 3.13. Ownership 54 SECTION
3.14. Consent; Governmental Authorizations 54 SECTION 3.15. Taxes 55 SECTION
3.16. Collateral Representations 55

 

i 

 

 

SECTION 3.17. Employment Matters 55 SECTION 3.18. Brokers’ Fees 56 SECTION 3.19.
Labor Matters 56 SECTION 3.20. Accuracy and Completeness of Information 56
SECTION 3.21. Anti-Corruption Laws and Sanctions 56 SECTION 3.22. Material
Contracts 57 SECTION 3.23. Insurance 57 SECTION 3.24. EEA Financial Institutions
57 SECTION 3.25. Classification of Senior Indebtedness 57 SECTION 3.26.
Anti-Terrorism Laws 57 SECTION 3.27. Authorized Officer 57 SECTION 3.28. EEA
Financial Institutions 58     ARTICLE IV Conditions 58 SECTION 4.01. Effective
Date 58 SECTION 4.02. Each Credit Event 61     ARTICLE V Affirmative Covenants
61 SECTION 5.01. Financial Statements 61 SECTION 5.02. Certificates; Other
Information 62 SECTION 5.03. Payment of Taxes and Other Obligations 64 SECTION
5.04. Conduct of Business and Maintenance of Existence 64 SECTION 5.05.
Maintenance of Property; Insurance 64 SECTION 5.06. Maintenance of Books and
Records 64 SECTION 5.07. Notices 64 SECTION 5.08. Use of Proceeds 65 SECTION
5.09. Environmental Laws 66 SECTION 5.10. Financial Covenants 66 SECTION 5.11.
Additional Guarantors 66 SECTION 5.12. Compliance with Law 67 SECTION 5.13.
Pledged Assets 67 SECTION 5.14. Further Assurances and Post-Closing Covenants 67
SECTION 5.15. New Restaurants. 68 SECTION 5.16. Subordination of Intercompany
Debt 68 SECTION 5.17. Post-Closing Matters. 68     ARTICLE VI Negative Covenants
68 SECTION 6.01. Indebtedness 69 SECTION 6.02. Liens 69 SECTION 6.03. Nature of
Business 71 SECTION 6.04. Consolidation, Merger, Sale or Purchase of Assets, etc
71 SECTION 6.05. Advances, Investments and Loans 72 SECTION 6.06. Transactions
with Affiliates 73 SECTION 6.07. Ownership of Subsidiaries; Restrictions 73
SECTION 6.08. Corporate Changes; Material Contracts 73 SECTION 6.09. Limitation
on Restricted Actions 74 SECTION 6.10. Restricted Payments 74 SECTION 6.11.
Amendment of Subordinated Indebtedness 75 SECTION 6.12. Sale Leasebacks 75
SECTION 6.12. No Further Negative Pledge 75

 

ii 

 

 

    ARTICLE VII Events of Default 75     ARTICLE VIII The Administrative Agent
78 SECTION 8.01. Appointment 78 SECTION 8.02. Rights as a Lender 78 SECTION
8.03. Duties and Obligations 79 SECTION 8.04. Reliance 79 SECTION 8.05. Actions
through Sub-Agents 79 SECTION 8.06. Resignation 79 SECTION 8.07. Non-Reliance 80
SECTION 8.08. Other Agency Titles 81 SECTION 8.09. Not Partners or Co-Venturers;
Administrative Agent as Representative of the Secured Parties 81 SECTION 8.10.
Credit Bidding 82     ARTICLE IX Miscellaneous 83 SECTION 9.01. Notices 83
SECTION 9.02. Waivers; Amendments 85 SECTION 9.03. Expenses; Indemnity; Damage
Waiver 87 SECTION 9.04. Successors and Assigns 88 SECTION 9.05. Survival 92
SECTION 9.06. Counterparts; Integration; Effectiveness; Electronic Execution 92
SECTION 9.07. Severability 93 SECTION 9.08. Right of Setoff 93 SECTION 9.09.
Governing Law; Jurisdiction; Consent to Service of Process 93 SECTION 9.10.
WAIVER OF JURY TRIAL 94 SECTION 9.11. Headings 94 SECTION 9.12. Confidentiality
94 SECTION 9.13. Several Obligations; Nonreliance; Violation of Law 95 SECTION
9.14. PATRIOT Act 95 SECTION 9.15. Disclosure 95 SECTION 9.16. Appointment for
Perfection 95 SECTION 9.17. Interest Rate Limitation 95 SECTION 9.18. No
Fiduciary Duty, etc 95 SECTION 9.19. Marketing Consent 96 SECTION 9.20.
Acknowledgement and Consent to Bail-In of EEA Financial Institutions 96    
ARTICLE X Loan Guaranty 97 SECTION 10.01. Guaranty 97 SECTION 10.02. Guaranty of
Payment 97 SECTION 10.03. No Discharge or Diminishment of Loan Guaranty 97
SECTION 10.04. Defenses Waived 98 SECTION 10.05. Rights of Subrogation 98
SECTION 10.06. Reinstatement; Stay of Acceleration 98 SECTION 10.07. Information
99 SECTION 10.08. Termination 99 SECTION 10.09. Taxes 99 SECTION 10.10. Maximum
Liability 99 SECTION 10.11. Contribution 99 SECTION 10.12. Liability Cumulative
100 SECTION 10.13. Keepwell 100

 

iii 

 

 

SCHEDULES:

 

Commitment Schedule

Schedule 1.01(a) – Investments

Schedule 1.01(b) – Liens

Schedule 1.01(c) – Existing Letters of Credit

Schedule 3.03 – Corporate Existence

Schedule 3.12 – Capitalization and Subsidiaries

Schedule 3.16(a) – Intellectual Property

Schedule 3.16(b) – Documents, Instruments and Tangible Chattel Paper

Schedule 3.16(c) – Commercial Tort Claims

Schedule 3.16(d) – Pledged Equity Interests

Schedule 3.16(e) – Collateral Locations

Schedule 3.22 – Material Contracts

Schedule 3.23 – Insurance

Schedule 3.27 – Authorized Officers

Schedule 6.01(b) – Indebtedness

 

EXHIBITS:

 

Exhibit A – Assignment and Assumption

Exhibit B – Opinion of Counsel for the Loan Parties

Exhibit C-1 – U.S. Tax Compliance Certificate (For Foreign Lenders That Are Not
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit C-2 – U.S. Tax Compliance Certificate (For Foreign Participants That Are
Not Partnerships For U.S. Federal Income Tax Purposes)

Exhibit C-3 – U.S. Tax Compliance Certificate (For Foreign Participants That Are
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit C-4 – U.S. Tax Compliance Certificate (For Foreign Lenders That Are
Partnerships For U.S. Federal Income Tax Purposes)

Exhibit D – Compliance Certificate

Exhibit E – Joinder Agreement

 

iv 

 

 

CREDIT AGREEMENT dated as of November 30, 2017 (as it may be amended or modified
from time to time, this "Agreement"), among FIESTA RESTAURANT GROUP, INC., a
Delaware corporation, as Borrower, the other Loan Parties party hereto, the
Lenders party hereto, and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

 

The parties hereto agree as follows:

 

ARTICLE I

Definitions

 

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

 

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

 

"Additional Loan Party" means each Person that becomes a Guarantor by execution
of a Joinder Agreement in accordance with Section 5.11.

 

"Adjusted Leverage Ratio" means, as of any date of determination, for the Loan
Parties and their Subsidiaries on a Consolidated basis, the ratio of (a) the sum
of (i) Consolidated Funded Debt on such date plus (ii) the product of eight (8)
multiplied by Consolidated Rent Expense for the four (4) consecutive quarters
ending on such date to (b) Consolidated EBITDAR for the four (4) consecutive
quarters ending on such date.

 

"Adjusted LIBO Rate" means, with respect to any Eurodollar Borrowing for any
Interest Period or for any ABR Borrowing, an interest rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for
such Interest Period multiplied by (b) the Statutory Reserve Rate.

 

"Administrative Agent" means JPMorgan Chase Bank, N.A. (and its subsidiaries and
Affiliates), in its capacity as administrative agent for the Lenders hereunder.

 

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

 

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

 

"Aggregate Credit Exposure" means, at any time, the aggregate Credit Exposure of
all the Lenders at such time.

 

"Aggregate Revolving Exposure" means, at any time, the aggregate Revolving
Exposure of all the Lenders at such time.

 

"Alternate Base Rate" means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on
such day plus ½ of 1% and (c) the Adjusted LIBO Rate for a one month Interest
Period on such day (or if such day is not a Business Day, the immediately
preceding Business Day) plus 1%, provided that, for the purpose of this
definition, the Adjusted LIBO Rate for any day shall be based on the LIBO Screen
Rate (or if the LIBO Screen Rate is not available for such one month Interest
Period, the Interpolated Rate) at approximately 11:00 a.m. London time on such
day. Any change in the Alternate Base Rate due to a change in the Prime Rate,
the NYFRB Rate or the Adjusted LIBO Rate shall be effective from and including
the effective date of such change in the Prime Rate, the NYFRB Rate or the
Adjusted LIBO Rate, respectively. If the Alternate Base Rate is being used as an
alternate rate of interest pursuant to Section 2.12 hereof, then the Alternate
Base Rate shall be the greater of clause (a) and (b) above and shall be
determined without reference to clause (c) above. For the avoidance of doubt, if
the Alternate Base Rate shall be less than zero, such rate shall be deemed to be
zero for purposes of this Agreement.

 

CREDIT AGREEMENT – Page 1 

 

 

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

 

"Anti-Terrorism Order" means that certain Executive Order 13224 signed into law
on September 23, 2001.

 

"Applicable Percentage" means, at any time with respect to any Lender, a
percentage equal to a fraction the numerator of which is such Lender’s Revolving
Commitment at such time and the denominator of which is the aggregate Revolving
Commitments at such time (provided that, if the Revolving Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon
such Lender’s share of the Aggregate Revolving Exposure at such time); provided
that, in accordance with Section 2.18, so long as any Lender shall be a
Defaulting Lender, such Defaulting Lender’s Commitment shall be disregarded in
the calculations above.

 

"Applicable Rate" means, for any day, with respect to any Loan, or with respect
to the commitment fees payable hereunder, as the case may be, the applicable
rate per annum set forth below under the caption "Revolving Commitment ABR
Spread", "Revolving Commitment Eurodollar Spread" or "Commitment Fee Rate", as
the case may be, based upon the Borrower’s Adjusted Leverage Ratio as of the
most recent determination date, provided that until the delivery to the
Administrative Agent, pursuant to Section 5.01, of the Borrower’s consolidated
financial information for the Borrower’s first full fiscal quarter ending after
the Effective Date, the "Applicable Rate" shall be the applicable rates per
annum set forth below in Category 2:

 

Adjusted

Leverage

Ratio

Revolving

Commitment

ABR Spread

Revolving

Commitment

Eurodollar

Spread

Commitment

Fee Rate

Category 1

> 4.0 to 1.0

1.50% 2.50% 0.35%

Category 2

> 3.5 to 1.0 but

< 4.0 to 1.0

1.25% 2.25% 0.30%

Category 3

> 2.5 to 1.0 but

< 3.5 to 1.0

1.00% 2.00% 0.30%

Category 4

< 2.5 to 1.0

0.75% 1.75% 0.25%

 

For purposes of the foregoing, (a) the Applicable Rate shall be determined as of
the end of each fiscal quarter of the Borrower, based upon the Borrower’s annual
or quarterly Consolidated financial statements delivered pursuant to
Section 5.01 and (b) each change in the Applicable Rate resulting from a change
in the Adjusted Leverage Ratio shall be effective during the period commencing
on and including the date of delivery to the Administrative Agent of such
Consolidated financial statements indicating such change and ending on the date
immediately preceding the effective date of the next such change, provided that
(A) at any time that an Event of Default has occurred and is continuing or
(B) at the option of the Administrative Agent or at the request of the Required
Lenders, if the Borrower fails to deliver the annual or quarterly Consolidated
financial statements required to be delivered by it pursuant to Section 5.01,
the Adjusted Leverage Ratio shall be deemed to be in Category 1 during the
period from the expiration of the time for delivery thereof until such
Consolidated financial statements are delivered.

 

CREDIT AGREEMENT – Page 2 

 

 

If at any time the Administrative Agent determines that the financial statements
upon which the Applicable Rate was determined were incorrect (whether based on a
restatement, fraud or otherwise), the Borrower shall be required to
retroactively pay any additional amount that the Borrower would have been
required to pay if such financial statements had been accurate at the time they
were delivered.

 

"Approved Bank" has the meaning assigned to the term in the definition of "Cash
Equivalents."

 

"Approved Fund" has the meaning assigned to the term in Section 9.04(b).

 

"ASC Section 840-40" means Accounting Standards Codification Section 840-40
(Leases-Sale-Leaseback Transactions) issued by the Financial Accounting
Standards Board, as now or hereafter in effect or any successor pronouncements.

 

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

 

"Authorized Officers" means the Responsible Officers set forth on Schedule 3.27.

 

"Availability" means, at any time, an amount equal to the aggregate Revolving
Commitments minus the Aggregate Revolving Exposure (calculated, with respect to
any Defaulting Lender, as if such Defaulting Lender had funded its Applicable
Percentage of all outstanding Borrowings).

 

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

 

"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.

 

"Banking Services" means each and any of the following bank services provided to
any Loan Party or any Subsidiary by Chase and any other Lender or any of their
respective Affiliates: (a) credit cards for commercial customers (including,
without limitation, "commercial credit cards" and purchasing cards), (b) stored
value cards, (c) merchant processing services, and (d) treasury management
services (including, without limitation, controlled disbursement, automated
clearinghouse transactions, return items, overdrafts and interstate depository
network services and cash pooling services).

 

"Banking Services Obligations" means any and all obligations of the Loan Parties
or their Subsidiaries, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor) in connection
with Banking Services.

 

CREDIT AGREEMENT – Page 3 

 

 

"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United States
Code, as amended, modified, succeeded or replaced from time to time.

 

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

 

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

 

"Board" means the Board of Governors of the Federal Reserve System of the U.S.

 

"Borrower" means Fiesta Restaurant Group, Inc., a Delaware corporation.

 

"Borrowing" means Revolving Loans of the same Type, made, converted or continued
on the same date and, in the case of Eurodollar Loans, as to which a single
Interest Period is in effect.

 

"Borrowing Request" means a request by the Borrower for a Borrowing in
accordance with Section 2.03.

 

"Business" has the meaning assigned to the term in Section 3.10(b).

 

"Business Day" means any day that is not a Saturday, Sunday or other day on
which commercial banks in Boston, Massachusetts, San Francisco, California or
New York, New York are authorized or required by law to remain closed; provided
that, when used in connection with a Eurodollar Loan, the term "Business Day"
shall also exclude any day on which banks are not open for general business in
London.

 

"Capital Lease" means any lease of property, real or personal, the obligations
with respect to which are required to be capitalized on a balance sheet of the
lessee in accordance with GAAP.

 

"Capital Lease Obligations" means the capitalized lease obligations relating to
a Capital Lease determined in accordance with GAAP.

 

"Cash Equivalents" means (a) securities issued or directly and fully guaranteed
or insured by the United States of America or any agency or instrumentality
thereof (provided that the full faith and credit of the United States of America
is pledged in support thereof) having maturities of not more than twelve months
from the date of acquisition ("Government Obligations"), (b) dollar denominated
time deposits, certificates of deposit, Eurodollar time deposits and Eurodollar
certificates of deposit of (i) any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000 or (ii) any bank
whose short-term commercial paper rating at the time of the acquisition thereof
is at least A-1 or the equivalent thereof from S&P or from Moody’s is at least
P-1 or the equivalent thereof from Moody’s (any such bank being an "Approved
Bank"), in each case with maturities of not more than 364 days from the date of
acquisition, (c) commercial paper and variable or fixed rate notes issued by any
Approved Bank (or by the parent company thereof) or any variable rate notes
issued by, or guaranteed by any domestic corporation rated A-1 (or the
equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody’s and maturing within six months of the date of acquisition, (d)
repurchase agreements with a term of not more than thirty (30) days with a bank
or trust company (including a Lender) or a recognized securities dealer having
capital and surplus in excess of $500,000,000 for direct obligations issued by
or fully guaranteed by the United States of America, (e) obligations of any
state of the United States or any political subdivision thereof for the payment
of the principal and redemption price of and interest on which there shall have
been irrevocably deposited Government Obligations maturing as to principal and
interest at times and in amounts sufficient to provide such payment, (f) money
market accounts subject to Rule 2a-7 of the Investment Company Act of 1940
("Rule 2a-7") which consist primarily of cash and cash equivalents set forth in
clauses (a) through (e) above and of which 95% shall at all times be comprised
of First Tier Securities (as defined in Rule 2a-7) and any remaining amount
shall at all times be comprised of Second Tier Securities (as defined in Rule
2a-7) and (g) shares of any so-called "money market fund"; provided that such
fund is registered under the Investment Company Act of 1940, has net assets of
at least $500,000,000 and has an investment portfolio with an average maturity
of 365 days or less.

 

CREDIT AGREEMENT – Page 4 

 

 

"Change in Control" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the SEC
thereunder as in effect on the date hereof), of Equity Interests representing
more than 40% of the aggregate ordinary voting power represented by the issued
and outstanding Equity Interests of the Borrower; (b) occupation at any time of
a majority of the seats (other than vacant seats) on the board of directors of
the Borrower by Persons who were neither (i) directors of the Borrower on the
date of this Agreement nor (ii) nominated or appointed by the board of directors
of the Borrower or (c) the acquisition of direct or indirect Control of the
Borrower by any Person or group.

 

"Change in Law" means the occurrence after the date of this Agreement (or, with
respect to any Lender, such later date on which such Lender becomes a party to
this Agreement) of any of the following: (a) the adoption of or taking effect of
any law, rule, regulation or treaty, (b) any change in any law, rule, regulation
or treaty or in the administration, interpretation or application thereof by any
Governmental Authority or (c) compliance by any Lender or the Issuing Bank (or,
for purposes of Section 2.13(b), by any lending office of such Lender or by such
Lender’s or the Issuing Bank’s holding company, if any) with any request,
guideline, requirement or directive (whether or not having the force of law) of
any Governmental Authority made or issued after the date of this Agreement;
provided that, notwithstanding anything herein to the contrary, (x) the
Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines, requirements or directives thereunder or issued in connection
therewith or in the implementation thereof, and (y) all requests, rules,
guidelines, requirements or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the U.S. or foreign regulatory authorities, in each case
pursuant to Basel III, shall in each case be deemed to be a "Change in Law",
regardless of the date enacted, adopted, issued or implemented.

 

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

 

"Chase" means JPMorgan Chase Bank, N.A., a national banking association, in its
individual capacity, and its successors.

 

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

 

"Collateral" means any and all property owned, leased or operated by a Person
covered by the Collateral Documents and any and all other property of any Loan
Party, now existing or hereafter acquired, that may at any time be, become or
intended to be, subject to a security interest or Lien in favor of the
Administrative Agent, on behalf of itself and the Lenders and other Secured
Parties, to secure the Secured Obligations; provided that there shall be
excluded from the Collateral (a) any account, instrument, chattel paper or other
obligation or property of any kind due from, owed by, or belonging to, a
Sanctioned Person, (b) any lease in which the lessee is a Sanctioned Person,
(c) all leased real property interests of the Loan Parties, (d) all fee owned
real property interests of the Loan Parties and (e) any other property
specifically excluded from the grant of a security interest in the Collateral
Documents. For the avoidance of doubt, account control agreements and securities
account control agreements shall not be required with respect to any of the Loan
Parties’ deposit accounts and securities accounts.

 

CREDIT AGREEMENT – Page 5 

 

 

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

 

"Collateral Documents" means, collectively, the Security Agreement and any other
agreements, instruments and documents executed in connection with this Agreement
that are intended to create, perfect or evidence Liens to secure all or any part
of the Secured Obligations, including, without limitation, all other security
agreements, pledge agreements, mortgages, deeds of trust, loan agreements,
notes, guarantees, subordination agreements, pledges, powers of attorney,
consents, assignments, contracts, fee letters, notices, leases, financing
statements and all other written matter whether theretofore, now or hereafter
executed by any Loan Party or any Subsidiary and delivered to the Administrative
Agent.

 

"Commitment" means, with respect to each Lender, its Revolving Commitment. The
initial amount of each Lender’s Commitment is set forth on the Commitment
Schedule, or in the Assignment and Assumption pursuant to which such Lender
shall have assumed its Commitment, as applicable.

 

"Commitment Schedule" means the Schedule attached hereto identified as such.

 

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

 

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

 

"Compliance Certificate" means a compliance certificate prepared in accordance
with Section 5.02(a) in substantially the form of Exhibit D or any other form
approved by the Administrative Agent.

 

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

 

"Consolidated" means, when used with reference to financial statements or
financial statement items of the Borrower and its Subsidiaries or any other
Person, such statements or items on a consolidated basis in accordance with the
consolidation principles of GAAP.

 

"Consolidated Capital Expenditures" means, as of any date of determination for
the four (4) consecutive fiscal quarter period ending on such date, all
expenditures of the Loan Parties and their Subsidiaries on a Consolidated basis
for such period that in accordance with GAAP would be classified as capital
expenditures, including, without limitation, Capital Lease Obligations.

 

"Consolidated EBITDAR" means, in each case for the Loan Parties and their
Subsidiaries on a Consolidated basis, as of any date of determination for the
four (4) consecutive fiscal quarter period ending on such date, without
duplication, (a) Consolidated Net Income for such period plus (b) the sum of the
following to the extent deducted in calculating Consolidated Net Income for such
period: (i) Consolidated Interest Expense for such period, (ii) tax expense
(including, without limitation, any federal, state, local and foreign income and
similar taxes) of the Loan Parties and their Subsidiaries for such period,
(iii) depreciation and amortization expense of the Loan Parties and their
Subsidiaries for such period, (iv) Consolidated Rent Expense for such period,
(v) Other Designated Expenses for such period, (vi) Pre-Opening Costs for such
period and (vii) other non-cash charges (excluding reserves for future cash
charges) for such period (including, without limitation, non-cash expense
related to stock option or other equity compensation plans or grants) minus (c)
non-cash charges previously added back to Consolidated Net Income in determining
Consolidated EBITDAR to the extent such non-cash charges have become cash
charges during such period.

 

CREDIT AGREEMENT – Page 6 

 

 

"Consolidated Funded Debt" means, as of any date of determination, Funded Debt
of the Loan Parties and their Subsidiaries on a Consolidated basis.

 

"Consolidated Interest Expense" means, as of any date of determination for the
four (4) consecutive fiscal quarter period ending on such date, all interest
expense (excluding amortization of debt discount and premium, but including the
interest component under Capital Leases and synthetic leases, tax retention
operating leases, off-balance sheet loans and similar off-balance sheet
financing products) for such period of the Loan Parties and their Subsidiaries
on a Consolidated basis.

 

"Consolidated Maintenance Capital Expenditures" means, for any four (4)
consecutive fiscal quarter period ending on any date of the determination of the
Fixed Charge Coverage Ratio, the sum of $30,000 multiplied by each restaurant
location.

 

"Consolidated Net Income" means, as of any date of determination for the four
(4) consecutive fiscal quarter period ending on such date, the net income
(excluding (i) extraordinary losses and gains, (ii) gains from Dispositions not
in the ordinary course of business, (iii) gains from the early extinguishment of
Indebtedness, (iv) all non-cash income (other than amortization of deferred
gains from Sale Leaseback transactions), (v) interest income, (vi) tax credits,
rebates and other benefits and (vii) income received from joint venture
investments to the extent not received in cash) of the Loan Parties and their
Subsidiaries on a Consolidated basis for such period, all as determined in
accordance with GAAP.

 

"Consolidated Rent Expense" means, as of any date of determination for any
period, all rent expense for such period of the Loan Parties and their
Subsidiaries on a Consolidated basis with respect to the Restaurants.

 

"Contractual Obligation" means, as to any Person, any provision of any security
issued by such Person or of any contract, agreement, instrument or undertaking
to which such Person is a party or by which it or any of its property is bound.

 

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

 

"Credit Exposure" means, as to any Lender at any time, such Lender’s Revolving
Exposure at such time.

 

"Credit Party" means the Administrative Agent, the Issuing Bank or any other
Lender.

 

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

 

CREDIT AGREEMENT – Page 7 

 

 

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

 

"Disposition" has the meaning assigned to the term in Section 6.04(a).

 

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

 

"dollars" or "$" refers to lawful money of the U.S.

 

"Domestic Subsidiary" means any Subsidiary that is organized and existing under
the laws of the United States or any state or commonwealth thereof or under the
laws of the District of Columbia, other than an Excluded Holding Subsidiary.

 

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

 

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

 

"EEA Member Country" 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" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).

 

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

 

CREDIT AGREEMENT – Page 8 

 

 

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

 

"Environmental Laws" means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, Release or threatened Release of any Hazardous Material or to health
and safety matters.

 

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

 

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

 

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

 

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

 

"ERISA Event" means (a) any "reportable event", as defined in Section 4043 of
ERISA or the regulations issued thereunder, with respect to a Plan (other than
an event for which the 30-day notice period is waived); (b) the failure to
satisfy the "minimum funding standard" (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (c) the filing pursuant to
Section 412(c) of the Code or Section 302(c) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (d) the
incurrence by the Borrower or any ERISA Affiliate of any liability under
Title IV of ERISA with respect to the termination of any Plan; (e) the receipt
by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of
any notice relating to an intention to terminate any Plan or Plans or to appoint
a trustee to administer any Plan; (f) the incurrence by the Borrower or any
ERISA Affiliate of any liability with respect to the withdrawal or partial
withdrawal of the Borrower or any ERISA Affiliate from any Plan or Multiemployer
Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice,
or the receipt by any Multiemployer Plan from the Borrower or any ERISA
Affiliate of any notice, concerning the imposition upon the Borrower or any
ERISA Affiliate of Withdrawal Liability or a determination that a Multiemployer
Plan is, or is expected to be, insolvent, in critical status or in
reorganization, within the meaning of Title IV of ERISA.

 

"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.

 

CREDIT AGREEMENT – Page 9 

 

 

"Eurodollar", when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, bear interest at a rate
determined by reference to the Adjusted LIBO Rate.

 

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

 

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

 

"Excluded Holding Subsidiary" means a Subsidiary that has no material assets
other than the Equity Interests in one or more Foreign Subsidiaries.

 

"Excluded Subsidiaries" means Cabana Club of Pasadena, Inc.

 

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

 

"Excluded Taxes" means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient: (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its applicable lending office located in,
the jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal
withholding Taxes imposed on amounts payable to or for the account of such
Lender with respect to an applicable interest in a Loan, Letter of Credit or
Commitment pursuant to a law in effect on the date on which (i) such Lender
acquires such interest in the Loan, Letter of Credit or Commitment (other than
pursuant to an assignment request by the Borrower under Section 2.17(b)) or (ii)
such Lender changes its lending office, except in each case to the extent that,
pursuant to Section 2.15, amounts with respect to such Taxes were payable either
to such Lender’s assignor immediately before such Lender acquired the applicable
interest in a Loan, Letter of Credit or Commitment or to such Lender immediately
before it changed its lending office, (c) Taxes attributable to such Recipient’s
failure to comply with Section 2.15(f) and (d) any U.S. federal withholding
Taxes imposed under FATCA.

 

"Existing Letter of Credit" means each of the letters of credit described by
applicant, date of issuance, letter of credit number, amount, beneficiary and
the date of expiry on Schedule 1.01(c) hereto.

 

"Existing Credit Agreement" means the Credit Agreement dated as of December 11,
2013, among the Borrower, certain Domestic Subsidiaries of the Borrower, the
lenders party thereto, Wells Fargo Bank, National Association as administrative
agent and JPMorgan Chase Bank, N.A., as syndication agent.

 

"Extension of Credit" means, as to any Lender, the making of a Revolving Loan by
such Lender, any conversion of a Revolving Loan from one Type to another Type,
any extension of any Revolving Loan or the issuance, extension or renewal of, or
participation in, a Letter of Credit by such Lender.

 

CREDIT AGREEMENT – Page 10 

 

 

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

 

"Federal Funds Effective Rate" means, for any day, the rate calculated by the
NYFRB based on such day’s federal funds transactions by depositary institutions
(as determined in such manner as the NYFRB shall set forth on its public website
from time to time) and published on the next succeeding Business Day by the
NYFRB as the federal funds effective rate; provided that, if the Federal Funds
Effective Rate shall be less than zero, such rate shall be deemed to zero for
the purposes of this Agreement.

 

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

 

"Fixed Charge Coverage Ratio" means, as of any date of determination, for the
Loan Parties and their Subsidiaries on a Consolidated basis, the ratio of (a)
Consolidated EBITDAR for the four (4) consecutive fiscal quarters ending on such
date minus all Income Taxes paid in cash during the four (4) consecutive fiscal
quarter period ending on such date minus Consolidated Maintenance Capital
Expenditures to (b) the sum of (i) Consolidated Interest Expense paid or payable
in cash during the four (4) consecutive fiscal quarter period ending on such
date, (ii) Scheduled Funded Debt Payments made during the four (4) consecutive
fiscal quarter period ending on such date (including the principal component of
payments due on Capital Leases) and (iii) Consolidated Rent Expense during the
four (4) consecutive fiscal quarter period ending on such date.

 

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

 

"Foreign Subsidiary" means any Subsidiary that is not a Domestic Subsidiary.

 

"Funded Debt" means, with respect to any Person, without duplication, all
Indebtedness of such Person (other than Indebtedness set forth in clauses (m),
(n), and (p) of such definition); provided, that Funded Debt shall only include
Indebtedness set forth in clauses (i) and (j) of the definition thereof to the
extent of unreimbursed drawings under such letters of credit or bankers’
acceptances facilities.

 

"Funding Account" has the meaning assigned to such term in Section 4.01(h).

 

"GAAP" means generally accepted accounting principles in effect in the United
States of America (or, in the case of Foreign Subsidiaries with significant
operations outside the United States of America, generally accepted accounting
principles in effect from time to time in their respective jurisdictions of
organization or formation) applied on a consistent basis, subject, however, in
the case of determination of compliance with the financial covenants set out in
Section 5.10, and in the case of determining the Applicable Rate, to the
provisions of Section 1.04.

 

"Government Obligations" has the meaning assigned to the term in the definition
of "Cash Equivalents."

 

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

 

CREDIT AGREEMENT – Page 11 

 

 

"Guarantee" of or by any Person (the "guarantor") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

 

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

 

"Guarantors" means all Loan Guarantors and all non-Loan Parties who have
delivered an Obligation Guaranty, and the term "Guarantor" means each or any one
of them individually. On the Effective Date, the "Guarantors" are the Borrower,
Cabana Beverages, Inc., a Texas corporation, Cabana Bevco LLC, a Texas limited
liability company, Cabana Grill, Inc., a Delaware corporation, Pollo Tropical
Management, LLC, a Texas limited liability company, Pollo Tropical Beverages,
LLC, a Texas limited liability company, Pollo Franchise, Inc., a Florida
corporation, Pollo Operations, Inc., a Florida corporation, Taco Cabana, Inc., a
Delaware corporation, TP Acquisition Corp., a Texas corporation, TC Bevco LLC, a
Texas limited liability company, T.C. Management, Inc., a Delaware corporation,
TPAQ Holding Corporation, a Delaware corporation and Texas Taco Cabana, L.P., a
Texas limited partnership.

 

"Hazardous Materials" means: (a) any substance, material, or waste that is
included within the definitions of "hazardous substances," "hazardous
materials," "hazardous waste," "toxic substances," "toxic materials," "toxic
waste," or words of similar import in any Environmental Law; (b) those
substances listed as hazardous substances by the United States Department of
Transportation (or any successor agency) (49 C.F.R. 172.101 and amendments
thereto) or by the Environmental Protection Agency (or any successor agency) (40
C.F.R. Part 302 and amendments thereto); and (c) any substance, material, or
waste that is petroleum, petroleum-related, or a petroleum by-product, asbestos
or asbestos-containing material, polychlorinated biphenyls, flammable,
explosive, radioactive, freon gas, radon, or a pesticide, herbicide, or any
other agricultural chemical.

 

"Impacted Interest Period" has the meaning assigned to such term in the
definition of "LIBO Rate".

 

"Income Taxes" means federal, state, local and foreign income and similar taxes
(including franchise taxes, to the extent such franchise taxes are based on the
income or revenues of the Loan Parties and their Subsidiaries).

 

"Indebtedness" of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property
acquired by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (e) all obligations of such Person in respect of the deferred
purchase price of property or services (excluding trade debt, accrued expenses
and current accounts payable incurred in the ordinary course of business and due
within six months of the incurrence thereof), (f) all Indebtedness of others
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, property owned or acquired by such Person, whether
or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations of such
Person plus any accrued interest thereon, (i) all obligations, contingent or
otherwise, of such Person as an account party in respect of letters of credit
and letters of guaranty, (j) all obligations, contingent or otherwise, of such
Person in respect of bankers’ acceptances, (k) obligations under any earn-out
(which for all purposes of this Agreement shall be valued at the maximum
potential payable with respect to each such earn-out), (l) any other Off-Balance
Sheet Liability, (m) obligations, whether absolute or contingent and howsoever
and whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor), under (i) any
and all Swap Agreements, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Swap Agreement transaction,
(n) all obligations of such Person under take or pay or similar arrangements or
under commodities agreements, (o) all preferred Equity Interests issued by such
Person and which by the terms thereof could be (at the request of the holders
thereof or otherwise) subject to mandatory sinking fund payments, redemption or
acceleration on or prior to the Revolving Credit Maturity Date, (p) obligations
of such Person under non-compete agreements to the extent such obligations are
quantifiable contingent obligations of such Person under GAAP principles,
(q) all ASC Section 840-40 lease financing obligations. The Indebtedness of any
Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner or a joint venturer) to
the extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.

 

CREDIT AGREEMENT – Page 12 

 

 

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

 

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

 

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

 

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

 

"Intellectual Property" has the meaning assigned to such term in the Security
Agreement.

 

"Intercompany Debt" has the meaning assigned to the term in Section 5.16.

 

"Interest Election Request" means a request by the Borrower to convert or
continue a Borrowing in accordance with Section 2.06.

 

"Interest Payment Date" means (a) with respect to any ABR Loan, the last
Business Day of each fiscal quarter of the Borrower and the Revolving Credit
Maturity Date, and (b) with respect to any Eurodollar Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and, in
the case of a Eurodollar Borrowing with an Interest Period of more than three
months’ duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months’ duration after the first day of such
Interest Period and the Revolving Credit Maturity Date.

 

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

 

CREDIT AGREEMENT – Page 13 

 

 

"Interpolated Rate" means, at any time, for any Interest Period, the rate per
annum (rounded to the same number of decimal places as the LIBO Screen Rate)
determined by the Administrative Agent (which determination shall be conclusive
and binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the LIBO Screen Rate for the
longest period (for which the LIBO Screen Rate is available) that is shorter
than the Impacted Interest Period and (b) the LIBO Screen Rate for the shortest
period (for which the LIBO Screen Rate is available) that exceeds the Impacted
Interest Period, in each case, at such time; provided that, if any Interpolated
Rate shall be less than zero, such rate shall be deemed to be zero for purposes
of this Agreement.

 

"Investment" means (a) the acquisition (whether for cash, property, services,
assumption of Indebtedness, securities or otherwise) of Equity Interests, other
ownership interests or other securities of any Person or bonds, notes,
debentures or all or substantially all of the assets of any Person, (b) any
deposit with, or advance, loan or other extension of credit to, any Person
(other than deposits made in the ordinary course of business), (c) the
construction or development of, or the entering into of a binding commitment to
construct or develop, a new Restaurant, or (d) any other capital contribution to
or investment in any Person, including, without limitation, any Guarantees
(including any support for a letter of credit issued on behalf of such Person)
incurred for the benefit of such Person.

 

"IRS" means the United States Internal Revenue Service.

 

"Issuing Bank" means, individually and collectively, each of (a) Chase, in its
capacity as the issuer of Letters of Credit hereunder, and any other Revolving
Lender from time to time designated by the Borrower as an Issuing Bank, with the
consent of such Revolving Lender and the Administrative Agent, (b) with respect
to the Existing Letters of Credit only, Wells Fargo Bank, National Association
and (c) their respective successors in such capacity as provided in
Section 2.04(i). Any Issuing Bank may, in its discretion, arrange for one or
more Letters of Credit to be issued by its Affiliates, in which case the term
"Issuing Bank" shall include any such Affiliate with respect to Letters of
Credit issued by such Affiliate (it being agreed that such Issuing Bank shall,
or shall cause such Affiliate to, comply with the requirements of Section 2.04
with respect to such Letters of Credit). At any time there is more than one
Issuing Bank, all singular references to the Issuing Bank shall mean any Issuing
Bank, either Issuing Bank, each Issuing Bank, the Issuing Bank that has issued
the applicable Letter of Credit, or both (or all) Issuing Banks, as the context
may require.

 

"Issuing Bank Sublimits" means, as of the Effective Date, (i) $15,000,000, in
the case of Chase, (ii) the greater of $4,841,731 or the outstanding amount of
the Existing Letters of Credit on the Effective Date, in the case of Wells Fargo
Bank, National Association and (iii) such amount as shall be designated to the
Administrative Agent and the Borrower in writing by an Issuing Bank; provided
that any Issuing Bank shall be permitted at any time to increase or reduce its
Issuing Bank Sublimit upon providing five (5) days’ prior written notice thereof
to the Administrative Agent and the Borrower.

 

CREDIT AGREEMENT – Page 14 

 

 

"Joinder Agreement" means a Joinder Agreement in substantially the form of
Exhibit E or any other form approved by the Administrative Agent.

 

"LC Collateral Account" has the meaning assigned to such term in Section
2.04(j).

 

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

 

"LC Exposure" means, at any time, the sum of (a) the aggregate undrawn amount of
all standby Letters of Credit outstanding at such time plus (b) the aggregate
amount of all LC Disbursements relating to standby Letters of Credit that have
not yet been reimbursed by or on behalf of the Borrower at such time. The LC
Exposure of any Revolving Lender at any time shall be its Applicable Percentage
of the aggregate LC Exposure at such time.

 

"Lenders" means the Persons listed on the Commitment Schedule and any other
Person that shall have become a Lender hereunder pursuant to Section 2.07 or an
Assignment and Assumption, other than any such Person that ceases to be a Lender
hereunder pursuant to an Assignment and Assumption. Unless the context otherwise
requires, the term "Lenders" includes the Issuing Bank.

 

"Letters of Credit" means the standby letters of credit issued pursuant to this
Agreement, and each Existing Letter of Credit, and the term "Letter of Credit"
means any one of them or each of them singularly, as the context may require.

 

"LIBO Rate" means, with respect to any Eurodollar Borrowing for any applicable
Interest Period or for any ABR Borrowing, the LIBO Screen Rate at approximately
11:00 a.m., London time, two (2) Business Days prior to the commencement of such
Interest Period; provided that, if the LIBO Screen Rate shall not be available
at such time for such Interest Period (an "Impacted Interest Period"), then the
LIBO Rate shall be the Interpolated Rate, subject to Section 2.12 in the event
that the Administrative Agent shall conclude that it shall not be possible to
determine such Interpolated Rate (which conclusion shall be conclusive and
binding absent manifest error). Notwithstanding the above, to the extent that
"LIBO Rate" or "Adjusted LIBO Rate" is used in connection with an ABR Borrowing,
such rate shall be determined as modified by the definition of Alternate Base
Rate.

 

"LIBO Screen Rate" means, for any day and time, with respect to any Eurodollar
Borrowing for any Interest Period or for any ABR Borrowing, the London interbank
offered rate as administered by ICE Benchmark Administration (or any other
Person that takes over the administration of such rate for dollars) for a period
equal in length to such Interest Period as displayed on such day and time on
pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in
the event such rate does not appear on a Reuters page or screen, on any
successor or substitute page on such screen that displays such rate, or on the
appropriate page of such other information service that publishes such rate from
time to time as selected by the Administrative Agent in its reasonable
discretion); provided that, if the LIBO Screen Rate shall be less than zero,
such rate shall be deemed to zero for the purposes of this Agreement.

 

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

 

CREDIT AGREEMENT – Page 15 

 

 

"Loan Documents" means, collectively, this Agreement, each Revolving Loan Note,
any Letter of Credit application, each Collateral Document, the Loan Guaranty,
any Obligation Guaranty, and each other agreement, instrument, document and
certificate identified in Section 4.01 executed and delivered to, or in favor
of, the Administrative Agent or any Lender and including each other pledge,
power of attorney, consent, assignment, contract, notice, letter of credit
agreement, letter of credit applications and any agreements between the Borrower
and the Issuing Bank regarding the Issuing Bank’s Issuing Bank Sublimit or the
respective rights and obligations between the Borrower and the Issuing Bank in
connection with the issuance of Letters of Credit, and each other written matter
whether heretofore, now or hereafter executed by or on behalf of any Loan Party,
or any employee of any Loan Party, and delivered to the Administrative Agent or
any Lender in connection with this Agreement or the transactions contemplated
hereby (other than any agreement, document, certificate of instrument related to
Banking Services or any Swap Agreement). Any reference in this Agreement or any
other Loan Document to a Loan Document shall include all appendices, exhibits or
schedules thereto, and all amendments, restatements, supplements or other
modifications thereto, and shall refer to this Agreement or such Loan Document
as the same may be in effect at any and all times such reference becomes
operative.

 

"Loan Guarantor" means each Loan Party.

 

"Loan Guaranty" means Article X of this Agreement.

 

"Loan Parties" means, collectively, the Borrower, the Borrower’s Domestic
Subsidiaries (other than any Excluded Subsidiary and any Domestic Subsidiary
owned by a Foreign Subsidiary) and any other Person who becomes a party to this
Agreement pursuant to a Joinder Agreement and their respective successors and
assigns, and the term "Loan Party" shall mean any one of them or all of them
individually, as the context may require. On the Effective Date, the "Loan
Parties" are the Borrower, Cabana Beverages, Inc., a Texas corporation, Cabana
Bevco LLC, a Texas limited liability company, Cabana Grill, Inc., a Delaware
corporation, Pollo Tropical Management, LLC, a Texas limited liability company,
Pollo Tropical Beverages, LLC, a Texas limited liability company, Pollo
Franchise, Inc., a Florida corporation, Pollo Operations, Inc., a Florida
corporation, Taco Cabana, Inc., a Delaware corporation, TP Acquisition Corp., a
Texas corporation, TC Bevco LLC, a Texas limited liability company, T.C.
Management, Inc., a Delaware corporation, TPAQ Holding Corporation, a Delaware
corporation and Texas Taco Cabana, L.P., a Texas limited partnership.

 

"Loans" means the loans and advances made by the Lenders pursuant to this
Agreement.

 

"Material Adverse Effect" means a material adverse effect on (a) the business,
operations, property, assets or condition (financial or otherwise) of the Loan
Parties and their Subsidiaries taken as a whole, (b) the ability of the Borrower
or any Guarantor to perform its obligations, when such obligations are required
to be performed, under this Agreement, any of the Revolving Loan Notes or any
other Loan Document or (c) the validity or enforceability of this Agreement, any
of the Revolving Loan Notes or any of the other Loan Documents, the
Administrative Agent’s Liens (for the benefit of the Secured Parties) on the
Collateral or the priority of such Liens or the rights or remedies of the
Administrative Agent or the Lenders hereunder or thereunder.

 

"Material Contract" means any contract or agreement of the Loan Parties or any
of their Subsidiaries as to which the breach, nonperformance, cancellation or
failure to renew by any party thereto, could reasonably be expected to have a
Material Adverse Effect. The parties acknowledge that no individual Restaurant
real property lease is a Material Contract for purposes of this Agreement.

 

"Materials of Environmental Concern" means any gasoline or petroleum (including
crude oil or any extraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Law, including, without limitation, asbestos, perchlorate,
polychlorinated biphenyls and urea-formaldehyde insulation.

 

CREDIT AGREEMENT – Page 16 

 

 

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

 

"Moody’s" means Moody’s Investors Service, Inc.

 

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

 

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

 

"Non-Defaulting Lender" means, at any time, each Lender that is not a Defaulting
Lender at such time.

 

"NYFRB" means the Federal Reserve Bank of New York.

 

"NYFRB Rate" means, for any day, the greater of (a) the Federal Funds Effective
Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on
such day(or for any day that is not a Business Day, for the immediately
preceding Business Day); provided that if none of such rates are published for
any day that is a Business Day, the term "NYFRB Rate" means the rate for a
federal funds transaction quoted at 11:00 a.m. on such day received to the
Administrative Agent from a Federal funds broker of recognized standing selected
by it; provided, further, that if any of the aforesaid rates shall be less than
zero, such rate shall be deemed to be zero for purposes of this Agreement.

 

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

 

"Obligation Guaranty" means any Guarantee of all or any portion of the Secured
Obligations executed and delivered to the Administrative Agent for the benefit
of the Secured Parties by a guarantor who is not a Loan Party.

 

"Obligations" means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations and indebtedness (including
interest and fees accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), obligations and liabilities of any of the Loan
Parties to any of the Lenders, the Administrative Agent, the Issuing Bank or any
indemnified party, individually or collectively, existing on the Effective Date
or arising thereafter, direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Agreement or any of the other Loan Documents or in respect
of any of the Loans made or reimbursement or other obligations incurred or any
of the Letters of Credit or other instruments at any time evidencing any
thereof.

 

"OFAC" means the Office of Foreign Assets Control of the United States
Department of the Treasury.

 

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

 

"Operating Lease" means, as applied to any Person, any lease (including, without
limitation, leases which may be terminated by the lessee at any time) of any
property (whether real, personal or mixed) which is not a Capital Lease or a
lease in connection with an ASC 840-40 lease financing obligation other than any
such lease in which that Person is the lessor.

 

CREDIT AGREEMENT – Page 17 

 

 

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

 

"Other Designated Expenses" means, for any period, (a) consolidated impairment
charges recorded in connection with the application of Financial Accounting
Standard No. 142 "Goodwill and Other Intangibles" and Financial Accounting
Standard No. 144 "Accounting for the Impairment or Disposal of Long Lived
Assets," or any successor pronouncements, (b) amortization associated with the
excess of purchase price over the value allocated to tangible property or assets
acquired by the Borrower or its consolidated Subsidiaries and (c) any
non-recurring cash fees, charges or other expenses made or incurred in
connection with the credit facilities under this Agreement.

 

"Other Taxes" means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 2.17).

 

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

 

"Paid in Full" or "Payment in Full" means, (i) the indefeasible payment in full
in cash of all outstanding Loans and LC Disbursements, together with accrued and
unpaid interest thereon, (ii) the termination, expiration, or cancellation and
return of all outstanding Letters of Credit (or alternatively, with respect to
each such Letter of Credit, the furnishing to the Administrative Agent of a cash
deposit, or at the discretion of the Administrative Agent a backup standby
letter of credit satisfactory to the Administrative Agent and the Issuing Bank,
in an amount equal to 105% of the LC Exposure as of the date of such payment),
(iii) the indefeasible payment in full in cash of the accrued and unpaid fees,
(iv) the indefeasible payment in full in cash of all reimbursable expenses and
other Secured Obligations (other than Unliquidated Obligations for which no
claim has been made and other obligations expressly stated to survive such
payment and termination of this Agreement), together with accrued and unpaid
interest thereon, (v) the termination of all Commitments, and (vi) the
termination of the Swap Agreement Obligations and the Banking Services
Obligations or entering into other arrangements satisfactory to the Secured
Parties counterparties thereto.

 

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

 

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

 

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

 

CREDIT AGREEMENT – Page 18 

 

 

"Patriot Act" means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT)
Act of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26,
2001)), as amended or modified from time to time.

 

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

 

"Permitted Acquisition" means an acquisition or any series of related
acquisitions by a Loan Party of (a) all or substantially all of the assets or a
majority of the outstanding Voting Stock or economic interests of a Person that
is incorporated, formed or organized in the United States, (b) a Person that is
incorporated, formed or organized in the United States by a merger, amalgamation
or consolidation or any other combination with such Person, (c) any division,
line of business or other business unit of a Person that is incorporated, formed
or organized in the United States (such Person or such division, line of
business or other business unit of such Person shall be referred to herein as
the "Target"), in each case that is a type of business (or assets used in a type
of business) permitted to be engaged in by the Loan Parties and their
Subsidiaries pursuant to Section 6.03 or (d) one or more Restaurants not part of
a transaction described in clause (a), (b) or (c) above, in each case so long
as:

 

(i)       no Default or Event of Default shall then exist or would exist after
giving effect thereto;

 

(ii)       the Loan Parties shall demonstrate to the reasonable satisfaction of
the Administrative Agent that, after giving effect to the acquisition on a Pro
Forma Basis, (A) the Loan Parties are in compliance with each of the financial
covenants set forth in Section 5.10 and (B) the Adjusted Leverage Ratio shall be
less than or equal to 4.50 to 1.00;

 

(iii)       the Administrative Agent, on behalf of the Secured Parties, shall
have received (or shall receive in connection with the closing of such
acquisition) a first priority perfected security interest in all property
(including, without limitation, Equity Interests) acquired with respect to the
Target in accordance with the terms of Sections 5.11 and 5.13 and the Target, if
a Person, shall have executed a Joinder Agreement in accordance with the terms
of Section 5.11;

 

(iv)       in connection with any Permitted Acquisition with a purchase price in
excess of $5,000,000, the Administrative Agent and the Lenders shall have
received (A) a description of the material terms of such acquisition, (B) with
respect to Permitted Acquisitions referred to in clause (a) above, audited
financial statements (or, if unavailable, unaudited financial statements
prepared by management of the Target) of the Target for the periods available to
the Borrower (which shall not exceed its two most recent fiscal years) and for
any fiscal quarters ended within the fiscal year to date (which quarters
financial statements shall be unaudited), (C) with respect to Permitted
Acquisitions referred to in clauses (b) or (c) above, financial statements of
the Target that are made available to the Borrower (or such other financial
information reasonably acceptable to the Administrative Agent) for its most
recent fiscal year, (D) with respect to Permitted Acquisitions referred to in
clause (d) above, profit and loss statements with respect to each Restaurant
acquired and (E) not less than five (5) Business Days prior to the consummation
of any such Permitted Acquisition, a certificate in form and substance
satisfactory to the Administrative Agent, executed by an Authorized Officer of
the Borrower certifying that such Permitted Acquisition complies with the
requirements of this Agreement; and

 

(v)       such acquisition shall not be a "hostile" acquisition and shall have
been approved by the Board of Directors (or equivalent) and/or shareholders (or
equivalent) of the applicable Loan Party and the Target.

 

CREDIT AGREEMENT – Page 19 

 

 

"Permitted Construction Transaction" has the meaning assigned to the term in
Section 6.05(h).

 

"Permitted Investments" has the meaning assigned to the term in Section 6.05.

 

"Permitted Liens" has the meaning assigned to the term in Section 6.02.

 

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

 

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

 

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

 

"Pre-Opening Costs" means "start-up costs" (such term used herein as defined in
ASC 705.15 published by the American Institute of Certified Public Accountants)
related to the acquisition, opening and organizing of new restaurants,
including, without limitation, the cost of feasibility studies, staff-training,
recruiting, travel costs for employees engaged in such start-up activities,
advertising and rent accrued prior to opening.

 

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

 

"Pro Forma Basis" means, with respect to any transaction, that such transaction
shall be deemed to have occurred as of the first day of the four-quarter period
(or twelve month period, as applicable) ending as of the most recent quarter end
(or month end, as applicable) preceding the date of such transaction for which
financial statement information is available.

 

"Properties" has the meaning assigned to the term in Section 3.10(a).

 

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

 

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

 

"Register" has the meaning assigned to such term in Section 9.04(b).

 

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

 

CREDIT AGREEMENT – Page 20 

 

 

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

 

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

 

"Required Lenders" means, at any time, Lenders (other than Defaulting Lenders)
having Credit Exposure and unused Commitments representing at least 50% of the
sum of the Aggregate Credit Exposure and unused Commitments at such time;
provided that, as long as there are only two Lenders, Required Lenders shall
mean both Lenders.

 

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

 

"Responsible Officer" means, for any Loan Party, the chief executive officer,
the president, chief operating officer, chief financial officer, general
counsel, secretary, treasurer or any vice president of such Loan Party and any
additional responsible officer that is designated as such to the Administrative
Agent.

 

"Restaurant" means any restaurant owned or leased by the Borrower or any of its
Subsidiaries.

 

"Restricted Payment" means (a) any dividend or other distribution (whether in
cash, securities or other property) with respect to any Equity Interests in the
Borrower or any Subsidiary, (b) any payment (whether in cash, securities or
other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, acquisition, cancellation or termination
of any such Equity Interests or any option, warrant or other right to acquire
any such Equity Interests, (c) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of Equity Interests of any Loan Party or any of its
Subsidiaries, now or hereafter outstanding and (d) any payment or prepayment of
principal of, premium, if any, or interest on, redemption, purchase, retirement,
defeasance, sinking fund or similar payment with respect to, any Subordinated
Indebtedness of any Loan Party or any of its Subsidiaries.

 

"Revolving Commitment" means, with respect to each Lender, the commitment, if
any, of such Lender to make Revolving Loans and to acquire participations in
Letters of Credit hereunder, expressed as an amount representing the maximum
aggregate permitted amount of such Lender’s Revolving Exposure hereunder, as
such commitment may be reduced or increased from time to time pursuant to
(a) Section 2.07 and (b) assignments by or to such Lender pursuant to Section
9.04. The initial amount of each Lender’s Revolving Commitment is set forth on
the Commitment Schedule, or in the Assignment and Assumption pursuant to which
such Lender shall have assumed its Revolving Commitment, as applicable. On the
Effective Date, the aggregate amount of the Lenders’ Revolving Commitments is
$150,000,000.

 

CREDIT AGREEMENT – Page 21 

 

 

"Revolving Credit Maturity Date" means November 30, 2022 (if the same is a
Business Day, or if not then the immediately next succeeding Business Day), or
any earlier date on which the Revolving Commitments are reduced to zero or
otherwise terminated pursuant to the terms hereof.

 

"Revolving Exposure" means, with respect to any Lender, at any time, the sum of
the aggregate outstanding principal amount of such Lender’s Revolving Loans and
its LC Exposure at such time.

 

"Revolving Lender" means, as of any date of determination, a Lender with a
Revolving Commitment or, if the Revolving Commitments have terminated or
expired, a Lender with Revolving Exposure.

 

"Revolving Loan" means a Loan made pursuant to Section 2.01.

 

"Revolving Loan Note" or "Revolving Loan Notes" means the promissory notes of
the Borrower provided pursuant to Section 2.08(f) in favor of any of the Lenders
evidencing the Revolving Loan provided by any such Lender pursuant to Section
2.01, individually or collectively, as appropriate, as such promissory notes may
be amended, modified, extended, restated, replaced, or supplemented from time to
time.

 

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

 

"Sale Leaseback" has the meaning assigned to the term in Section 6.12.

 

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

 

"Sanctioned Person" means, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by OFAC, the U.S.
Department of State or by the United Nations Security Council, the European
Union, any European Union member state, Her Majesty’s Treasury of the United
Kingdom or other relevant sanctions authority, (b) any Person operating,
organized or resident in a Sanctioned Country or (c) any Person owned or
controlled by any such Person or Persons described in the foregoing clauses (a)
or (b).

 

"Sanctions" means all economic or financial sanctions or trade embargoes
imposed, administered or enforced from time to time by (a) the U.S. government,
including those administered by OFAC or the U.S. Department of State, or (b) the
United Nations Security Council, the European Union, any European Union member
state or Her Majesty’s Treasury of the United Kingdom or other relevant
sanctions authority.

 

"Scheduled Funded Debt Payments" means, as of any date of determination for the
four (4) consecutive fiscal quarter period ending on such date, the sum of all
regularly scheduled payments of principal on Funded Debt of the Loan Parties and
their Subsidiaries on a Consolidated basis for the applicable period ending on
the date of determination (including the principal component of payments due on
Capital Leases during the applicable period ending on the date of determination)
to the extent actually paid in cash.

 

"SEC" means the Securities and Exchange Commission or any successor Governmental
Authority.

 

CREDIT AGREEMENT – Page 22 

 

 

"Secured Obligations" means all Obligations, together with all (i) Banking
Services Obligations and (ii) Swap Agreement Obligations owing to one or more
Lenders or their respective Affiliates; provided, however, that the definition
of "Secured Obligations" shall not create any guarantee by any Guarantor of (or
grant of security interest by any Guarantor to support, as applicable) any
Excluded Swap Obligations of such Guarantor for purposes of determining any
obligations of any Guarantor.

 

"Secured Parties" means (a) the Lenders, (b) the Administrative Agent, (c) each
Issuing Bank, (d) each provider of Banking Services, to the extent the Banking
Services Obligations in respect thereof constitute Secured Obligations, (e) each
counterparty to any Swap Agreement, to the extent the obligations thereunder
constitute Secured Obligations, (f) the beneficiaries of each indemnification
obligation undertaken by any Loan Party under any Loan Document and (g) the
successors and assigns of each of the foregoing.

 

"Securities Act" means the Securities Act of 1933, together with any amendment
thereto or replacement thereof and any rules or regulations promulgated
thereunder.

 

"Securities Laws" means the Securities Act, the Exchange Act, Sarbanes-Oxley and
the applicable accounting and auditing principles, rules, standards and
practices promulgated, approved or incorporated by the SEC or the Public Company
Accounting Oversight Board, as each of the foregoing may be amended and in
effect on any applicable date hereunder.

 

"Security Agreement" means that certain Pledge and Security Agreement (including
any and all supplements thereto), dated as of the date hereof, among the Loan
Parties and the Administrative Agent, for the benefit of the Administrative
Agent and the other Secured Parties, and any other pledge or security agreement
entered into, after the date of this Agreement by any other Loan Party (as
required by this Agreement or any other Loan Document) or any other Person for
the benefit of the Administrative Agent and the other Secured Parties, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.

 

"Statement" has the meaning assigned to such term in Section 2.16(g).

 

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

 

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

 

"subsidiary" means, with respect to any Person (the "parent") at any date, any
corporation, limited liability company, partnership, association or other entity
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or, in the case of a
partnership, more than 50% of the general partnership interests are, as of such
date, owned, controlled or held , or (b) that is, as of such date, otherwise
Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.

 

CREDIT AGREEMENT – Page 23 

 

 

"Subsidiary" means any direct or indirect subsidiary of the Borrower or of any
other Loan Party, as applicable.

 

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

 

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

 

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

 

"Target" has the meaning assigned to the term in the definition of "Permitted
Acquisition."

 

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

 

"Transactions" means (a) the execution, delivery and performance by the Borrower
and the other Loan Parties of this Agreement and the other Loan Documents, the
borrowing of Loans and other credit extensions, the use of the proceeds thereof
and the issuance of Letters of Credit hereunder and (b) all other transactions
related to any of the foregoing (including payment of fees and expenses related
to the foregoing).

 

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

 

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

 

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

 

CREDIT AGREEMENT – Page 24 

 

 

"U.S." means the United States of America.

 

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

 

"U.S. Tax Compliance Certificate" has the meaning assigned to such term in
Section 2.15(f)(ii)(B)(3).

 

"Voting Stock" means, with respect to any Person, Equity Interests issued by
such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
may be or have been suspended by the happening of such a contingency.

 

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

 

"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.

 

SECTION 1.02.Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Type (e.g., a "Eurodollar
Loan"). Borrowings also may be classified and referred to by Type (e.g., a
"Eurodollar Borrowing").

 

SECTION 1.03.Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "law"
shall be construed as referring to all statutes, rules, regulations, codes and
other laws (including official rulings and interpretations thereunder having the
force of law or with which affected Persons customarily comply) and all
judgments, orders and decrees of all Governmental Authorities. The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
restated, supplemented or otherwise modified (subject to any restrictions on
such amendments, restatements, supplements or modifications set forth herein),
(b) any definition of or reference to any statute, rule or regulation shall be
construed as referring thereto as from time to time amended, supplemented or
otherwise modified (including by succession of comparable successor laws), (c)
any reference herein to any Person shall be construed to include such Person’s
successors and assigns (subject to any restrictions on assignments set forth
herein) and, in the case of any Governmental Authority, any other Governmental
Authority that shall have succeeded to any or all functions thereof, (d) the
words "herein", "hereof" and "hereunder", and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (e) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement, (f) any reference in any definition to the
phrase "at any time" or "for any period" shall refer to the same time or period
for all calculations or determinations within such definition, and (g) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.

 

CREDIT AGREEMENT – Page 25 

 

 

SECTION 1.04.Accounting Terms; GAAP .

 

(a)                Except as otherwise expressly provided herein, all terms of
an accounting or financial nature shall be construed in accordance with GAAP, as
in effect from time to time; provided that, if after the date hereof there
occurs any change in GAAP or in the application thereof on the operation of any
provision hereof and the Borrower notifies the Administrative Agent that the
Borrower requests an amendment to any provision hereof to eliminate the effect
of such change in GAAP or in the application thereof (or if the Administrative
Agent notifies the Borrower that the Required Lenders request an amendment to
any provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith. Notwithstanding any other provision contained herein, all terms of an
accounting or financial nature used herein shall be construed, and all
computations of amounts and ratios referred to herein shall be made (i) without
giving effect to any election under Financial Accounting Standards Board
Accounting Standards Codification 825-10-25 (or any other Accounting Standards
Codification or Financial Accounting Standard having a similar result or effect)
to value any Indebtedness or other liabilities of any Loan Party, the Borrower
or any Subsidiary at "fair value", as defined therein and (ii) without giving
effect to any treatment of Indebtedness in respect of convertible debt
instruments under Financial Accounting Standards Board Accounting Standards
Codification 470-20 (or any other Accounting Standards Codification or Financial
Accounting Standard having a similar result or effect) to value any such
Indebtedness in a reduced or bifurcated manner as described therein, and such
Indebtedness shall at all times be valued at the full stated principal amount
thereof. Notwithstanding the foregoing for purposes of this Agreement, no effect
shall be given to any change in GAAP arising out of the change described in the
Proposed Accounting Standards Update to Leases (Topic 840) dated August 17,
2010.

 

SECTION 1.05.Financial Covenant Calculations. The parties hereto acknowledge and
agree that, for purposes of all calculations made in determining compliance for
any applicable period with the covenants set forth in Section 5.10 and for
purposes of determining the Applicable Rate, (i) after consummation of any
Permitted Acquisition, (A) Consolidated EBITDAR shall be calculated after giving
effect thereto on a Pro Forma Basis (subject to adjustments mutually and
reasonably acceptable to the Borrower and the Administrative Agent),
(B) Consolidated Interest Expense shall be calculated after giving effect
thereto (including the effect of any related incurrence of Indebtedness) on a
Pro Forma Basis and (C) Consolidated Rent Expense shall be calculated after
giving effect thereto on a Pro Forma Basis (subject to adjustments mutually and
reasonably acceptable to the Borrower and the Administrative Agent) and
(ii) after any Disposition permitted by Section 6.04(a)(vii) and (viii) in an
amount in excess of $2,500,000, (A) Consolidated EBITDAR shall be calculated
after giving effect thereto on a Pro Forma Basis (to the extent the property or
assets subject to such Disposition were owned during the applicable period of
calculation) (subject to adjustments mutually and reasonably acceptable to the
Borrower and the Administrative Agent), (B) Consolidated Interest Expense shall
be calculated after giving effect thereto (including the effect of any related
incurrence of Indebtedness) on a Pro Forma Basis and (C) Consolidated Rent
Expense shall be calculated after giving effect thereto on a Pro Forma Basis
(subject to adjustments mutually acceptable to the Borrower and the
Administrative Agent).

 

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

 

CREDIT AGREEMENT – Page 26 

 

 

ARTICLE II

The Credits

 

SECTION 2.01.Revolving Commitments.Subject to the terms and conditions set forth
herein, each Lender severally (and not jointly) agrees to make Revolving Loans
in dollars to the Borrower from time to time during the Availability Period in
an aggregate principal amount that will not result in (i) such Lender’s
Revolving Exposure exceeding such Lender’s Revolving Commitment or (ii) the
Aggregate Revolving Exposure exceeding the aggregate Revolving Commitments.
Within the foregoing limits and subject to the terms and conditions set forth
herein, the Borrower may borrow, prepay and reborrow Revolving Loans.

 

SECTION 2.02.Loans and Borrowings.

 

(a)                Each Loan shall be made as part of a Borrowing consisting of
Loans of the same Type made by the Lenders ratably in accordance with their
respective Commitments. The failure of any Lender to make any Loan required to
be made by it shall not relieve any other Lender of its obligations hereunder;
provided that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender’s failure to make Loans as required.

 

(b)                Subject to Section 2.12, each Revolving Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith, provided that all Revolving Borrowings made on the
Effective Date must be made as ABR Borrowings but may be converted into
Eurodollar Borrowings in accordance with Section 2.06. Each Lender at its option
may make any Eurodollar Loan by causing any domestic or foreign branch or
Affiliate of such Lender to make such Loan (and in the case of an Affiliate, the
provisions of Sections 2.12, 2.13, 2.14 and 2.15 shall apply to such Affiliate
to the same extent as to such Lender); provided that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in accordance
with the terms of this Agreement.

 

(c)                At the commencement of each Interest Period for any
Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $500,000 and not less than $1,000,000. ABR Borrowings may
be in any amount. Borrowings of more than one Type may be outstanding at the
same time; provided that there shall not at any time be more than a total of six
Eurodollar Borrowings outstanding.

 

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

 

SECTION 2.03.Requests for Borrowings. To request a Borrowing, the Borrower shall
notify the Administrative Agent of such request either in writing (delivered by
hand or fax) in a form approved by the Administrative Agent and signed by the
Borrower or by telephone or through Electronic System, if arrangements for doing
so have been approved by the Administrative Agent, (a) in the case of a
Eurodollar Borrowing, not later than 11:00 a.m., eastern time, three Business
Days before the date of the proposed Borrowing or (b) in the case of an ABR
Borrowing, not later than noon, eastern time, on the date of the proposed
Borrowing; provided that any such notice of an ABR Revolving Borrowing to
finance the reimbursement of an LC Disbursement as contemplated by
Section 2.04(e) may be given not later than 9:00 a.m., eastern time, on the date
of the proposed Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery, fax or a
communication through Electronic System to the Administrative Agent of a written
Borrowing Request in a form approved by the Administrative Agent and signed by
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.01:

 

CREDIT AGREEMENT – Page 27 

 

 

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

 

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

 

(iii)whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and

 

(iv)in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term "Interest Period."

 

If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of one month’s duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

SECTION 2.04.Letters of Credit.

 

(a)                General. Subject to the terms and conditions set forth
herein, the Borrower may request the issuance of standby Letters of Credit
denominated in dollars as the applicant thereof for the support of its or its
Subsidiaries’ obligations, in a form reasonably acceptable to the Administrative
Agent and the Issuing Bank, at any time and from time to time during the
Availability Period. In the event of any inconsistency between the terms and
conditions of this Agreement and the terms and conditions of any form of letter
of credit application or other agreement submitted by the Borrower to, or
entered into by the Borrower with, the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control. The Borrower
unconditionally and irrevocably agrees that, in connection with any Letter of
Credit issued for the support of any Subsidiary’s obligations as provided in the
first sentence of this paragraph, the Borrower will be fully responsible for the
reimbursement of LC Disbursements in accordance with the terms hereof, the
payment of interest thereon and the payment of fees due under Section 2.10(b) to
the same extent as if it were the sole account party in respect of such Letter
of Credit (the Borrower hereby irrevocably waiving any defenses that might
otherwise be available to it as a guarantor or surety of the obligations of such
Subsidiary that is an account party in respect of any such Letter of Credit).
Notwithstanding anything herein to the contrary, the Issuing Bank shall have no
obligation hereunder to issue, and shall not issue, any Letter of Credit (i) the
proceeds of which would be made available to any Person (A) to fund any activity
or business of or with any Sanctioned Person, or in any country or territory
that, at the time of such funding, is the subject of any Sanctions or (B) in any
manner that would result in a violation of any Sanctions by any party to this
Agreement, (ii) if any order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank
from issuing such Letter of Credit, or any Requirement of Law relating to the
Issuing Bank or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over the Issuing Bank
shall prohibit, or request that the Issuing Bank refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon the Issuing Bank with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the Issuing Bank is not
otherwise compensated hereunder) not in effect on the Effective Date, or shall
impose upon the Issuing Bank any unreimbursed loss, cost or expense which was
not applicable on the Effective Date and which the Issuing Bank in good faith
deems material to it, or (iii) if the issuance of such Letter of Credit would
violate one or more policies of the Issuing Bank applicable to letters of credit
generally; provided that, notwithstanding anything herein to the contrary, (x)
the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines, requirements or directives thereunder or issued in connection
therewith or in the implementation thereof, and (y) all requests, rules,
guidelines, requirements or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States or foreign regulatory authorities, in
each case pursuant to Basel III, shall in each case be deemed not to be in
effect on the Effective Date for purposes of clause (ii) above, regardless of
the date enacted, adopted, issued or implemented. Existing Letters of Credit are
Letters of Credit deemed to be issued hereunder for all intents and purposes.
The Loan Parties and the Issuing Banks each agree that each Existing Letter of
Credit will be terminated and reissued pursuant to the terms of this Section on
before the date that is six months after the Effective Date of this Agreement.

 

CREDIT AGREEMENT – Page 28 

 

 

(b)                Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or fax (or transmit through Electronic System, if arrangements for
doing so have been approved by the Issuing Bank) to the Issuing Bank and the
Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension, but in any event no less than three Business
Days) a notice requesting the issuance of a Letter of Credit, or identifying the
Letter of Credit to be amended, renewed or extended, and specifying the date of
issuance, amendment, renewal or extension (which shall be a Business Day), the
date on which such Letter of Credit is to expire (which shall comply with
paragraph (c) of this Section), the amount of such Letter of Credit, the name
and address of the beneficiary thereof, and such other information as shall be
necessary to prepare, amend, renew or extend such Letter of Credit. If requested
by the Issuing Bank, the Borrower also shall submit a letter of credit
application on the Issuing Bank’s standard form in connection with any request
for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or
extended only if (and upon issuance, amendment, renewal or extension of each
Letter of Credit the Borrower shall be deemed to represent and warrant that),
after giving effect to such issuance, amendment, renewal or extension (i) the
aggregate LC Exposure shall not exceed $15,000,000, (ii) no Revolving Lender’s
Revolving Exposure shall exceed its Revolving Commitment and (iii) the Aggregate
Revolving Exposure shall not exceed the aggregate Revolving Commitments.
Notwithstanding the foregoing or anything to the contrary contained herein, no
Issuing Bank shall be obligated to issue or modify any Letter of Credit if,
immediately after giving effect thereto, the outstanding LC Exposure in respect
of all Letters of Credit issued by such Person and its Affiliates would exceed
such Issuing Bank’s Issuing Bank Sublimit. Without limiting the foregoing and
without affecting the limitations contained herein, it is understood and agreed
that the Borrower may from time to time request that an Issuing Bank issue
Letters of Credit in excess of its individual Issuing Bank Sublimit in effect at
the time of such request, and each Issuing Bank agrees to consider any such
request in good faith. Any Letter of Credit so issued by an Issuing Bank in
excess of its individual Issuing Bank Sublimit then in effect shall nonetheless
constitute a Letter of Credit for all purposes of the Credit Agreement, and
shall not affect the Issuing Bank Sublimit of any other Issuing Bank, subject to
the limitations on the aggregate LC Exposure set forth in clause (i) of this
Section 2.04(b).

 

CREDIT AGREEMENT – Page 29 

 

 

(c)                Expiration Date. Each Letter of Credit shall expire (or be
subject to termination or non-renewal by notice from the Issuing Bank to the
beneficiary thereof) at or prior to the close of business on the earlier of
(i) the date one year after the date of the issuance of such Letter of Credit
(or, in the case of any renewal or extension thereof, including, without
limitation, any automatic renewal provision, one year after such renewal or
extension) and (ii) the date that is five Business Days prior to the Revolving
Credit Maturity Date; provided, that notwithstanding clause (ii) above, a Letter
of Credit with a one year maturity date issued under clause (i) above may expire
after the Revolving Credit Maturity Date (a "Cash Collateralized LC") if the
Borrower has delivered cash collateral to the Issuing Bank no later than the
date that is thirty (30) days prior to the Revolving Credit Maturity Date (the
"LC Expiration Date") in an amount equal to 105% of the face amount of any such
Letter of Credit (the "LC Cash Collateral").  To the extent the Borrower fails
to provide the LC Cash Collateral on the LC Expiration Date, the Borrower shall
be deemed to have requested an ABR Revolving Borrowing in accordance with the
terms of Section 2.03 hereof in an amount equal to 105% of the face amount of
the Cash Collateralized LC, the proceeds of which will be delivered to the
Issuing Bank as cash collateral.  In the event that any such ABR Revolving
Borrowing cannot be made for any reason on the LC Expiration Date, then each
Lender hereby agrees that it shall promptly fund its participation interest
acquired pursuant to Section 2.04(d) in such Cash Collateralized LC (which shall
be delivered to the Issuing Bank as cash collateral).  Upon the cash
collateralization of any Letter of Credit pursuant to this Section, such Cash
Collateralized LC shall be deemed to be issued outside of this Agreement;
provided, that, the fees associated with such Letter of Credit under the terms
hereof shall continue to accrue, but shall thereafter be solely for the benefit
of the Issuing Bank.

 

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

 

CREDIT AGREEMENT – Page 30 

 

 

(e)                Reimbursement. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
LC Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 1:00 p.m., eastern time, on (i) the Business Day
that the Borrower receives notice of such LC Disbursement, if such notice is
received prior to 9:00 a.m., eastern time, on the day of receipt, or (ii) the
Business Day immediately following the day that the Borrower receives such
notice, if such notice is received after 9:00 a.m., eastern time, on the day of
receipt; provided that the Borrower may, subject to the conditions to borrowing
set forth herein, request in accordance with Section 2.03 that such payment be
financed with an ABR Revolving Borrowing in an equivalent amount and, to the
extent so financed, the Borrower’s obligation to make such payment shall be
discharged and replaced by the resulting ABR Revolving Borrowing. If the
Borrower fails to make such payment when due, the Administrative Agent shall
notify each Revolving Lender of the applicable LC Disbursement, the payment then
due from the Borrower in respect thereof, and such Lender’s Applicable
Percentage thereof. Promptly following receipt of such notice, each Revolving
Lender shall pay to the Administrative Agent its Applicable Percentage of the
payment then due from the Borrower, in the same manner as provided in
Section 2.05 with respect to Loans made by such Lender (and Section 2.05 shall
apply, mutatis mutandis, to the payment obligations of the Revolving Lenders),
and the Administrative Agent shall promptly pay to the Issuing Bank the amounts
so received by it from the Revolving Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing
Bank or, to the extent that Revolving Lenders have made payments pursuant to
this paragraph to reimburse the Issuing Bank, then to such Lenders and the
Issuing Bank, as their interests may appear. Any payment made by a Revolving
Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC
Disbursement (other than the funding of ABR Revolving Loans as contemplated
above) shall not constitute a Loan and shall not relieve the Borrower of its
obligation to reimburse such LC Disbursement.

 

(f)                 Obligations Absolute. The Borrower’s obligation to reimburse
LC Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein or herein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) any payment by the Issuing Bank under a Letter
of Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower’s obligations hereunder. None of
the Administrative Agent, the Revolving Lenders or the Issuing Bank, or any of
their Related Parties, shall have any liability or responsibility by reason of
or in connection with the issuance or transfer of any Letter of Credit, or any
payment or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to special, indirect, consequential or punitive damages, claims in
respect of which are hereby waived by the Borrower to the extent permitted by
applicable law) suffered by the Borrower that are caused by the Issuing Bank’s
failure to exercise care when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof. The parties
hereto expressly agree that, in the absence of gross negligence or willful
misconduct on the part of the Issuing Bank (as finally determined by a court of
competent jurisdiction), the Issuing Bank shall be deemed to have exercised care
in each such determination. In furtherance of the foregoing and without limiting
the generality thereof, the parties agree that, with respect to documents
presented which appear on their face to be in substantial compliance with the
terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for
further investigation, regardless of any notice or information to the contrary,
or refuse to accept and make payment upon such documents if such documents are
not in strict compliance with the terms of such Letter of Credit.

 

CREDIT AGREEMENT – Page 31 

 

 

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

 

(h)                Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans and
such interest shall be due and payable on the date when such reimbursement is
due; provided that, if the Borrower fails to reimburse such LC Disbursement when
due pursuant to paragraph (e) of this Section, then Section 2.11(c) shall apply.
Interest accrued pursuant to this paragraph shall be for the account of the
Issuing Bank, except that interest accrued on and after the date of payment by
any Revolving Lender pursuant to paragraph (e) of this Section to reimburse the
Issuing Bank shall be for the account of such Lender to the extent of such
payment.

 

(i)                 Replacement of the Issuing Bank.(i) The Issuing Bank may be
replaced at any time by written agreement among the Borrower, the Administrative
Agent, the replaced Issuing Bank and the successor Issuing Bank. The
Administrative Agent shall notify the Revolving Lenders of any such replacement
of the Issuing Bank. At the time any such replacement shall become effective,
the Borrower shall pay all unpaid fees accrued for the account of the replaced
Issuing Bank pursuant to Section 2.10(b). From and after the effective date of
any such replacement, (i) the successor Issuing Bank shall have all the rights
and obligations of the Issuing Bank under this Agreement with respect to Letters
of Credit to be issued thereafter and (ii) references herein to the term
"Issuing Bank" shall be deemed to refer to such successor or to any previous
Issuing Bank, or to such successor and all previous Issuing Banks, as the
context shall require. After the replacement of an Issuing Bank hereunder, the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit then outstanding and issued by it prior to such
replacement, but shall not be required to issue additional Letters of Credit.

 

(ii)               Subject to the appointment and acceptance of a successor
Issuing Bank, the Issuing Bank may resign as an Issuing Bank at any time upon
thirty days’ prior written notice to the Administrative Agent, the Borrower and
the Lenders, in which case, such Issuing Bank shall be replaced in accordance
with Section 2.04(i) above.

 

(j)                 Cash Collateralization. If any Event of Default shall occur
and be continuing, on the Business Day that the Borrower receives notice from
the Administrative Agent or the Required Lenders (or, if the maturity of the
Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the aggregate LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrower shall deposit in an account
with the Administrative Agent, in the name of the Administrative Agent and for
the benefit of the Revolving Lenders (the "LC Collateral Account"), an amount in
cash equal to 105% of the amount of the LC Exposure as of such date plus accrued
and unpaid interest thereon; provided that the obligation to deposit such cash
collateral shall become effective immediately, and such deposit shall become
immediately due and payable, without demand or other notice of any kind, upon
the occurrence of any Event of Default with respect to the Borrower described in
clause (f) of Article VII. The Borrower also shall deposit cash collateral in
accordance with this paragraph as and to the extent required by Section 2.09(b)
or 2.18. Each such deposit shall be held by the Administrative Agent as
collateral for the payment and performance of the Secured Obligations. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over the LC Collateral Account and the Borrower
hereby grants the Administrative Agent a security interest in the LC Collateral
Account and all moneys or other assets on deposit therein or credited thereto.
Other than any interest earned on the investment of such deposits, which
investments shall be made at the option and sole discretion of the
Administrative Agent and at the Borrower’s risk and expense, such deposits shall
not bear interest. Interest or profits, if any, on such investments shall
accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Bank for LC Disbursements for
which it has not been reimbursed and, to the extent not so applied, shall be
held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been
accelerated (but subject to the consent of Revolving Lenders with LC Exposure
representing greater than 50% of the aggregate LC Exposure), be applied to
satisfy other Secured Obligations. If the Borrower is required to provide an
amount of cash collateral hereunder as a result of the occurrence of an Event of
Default, such amount (to the extent not applied as aforesaid) shall be returned
to the Borrower within three (3) Business Days after all such Events of Default
have been cured or waived as confirmed in writing by the Administrative Agent.

 

CREDIT AGREEMENT – Page 32 

 

 

(k)                Issuing Bank Reports to the Administrative Agent. Unless
otherwise agreed by the Administrative Agent, each Issuing Bank shall, in
addition to its notification obligations set forth elsewhere in this Section,
report in writing to the Administrative Agent (i) periodic activity (for such
period or recurrent periods as shall be requested by the Administrative Agent)
in respect of Letters of Credit issued by such Issuing Bank, including all
issuances, extensions, amendments and renewals, all expirations and cancelations
and all disbursements and reimbursements, (ii) reasonably prior to the time that
such Issuing Bank issues, amends, renews or extends any Letter of Credit, the
date of such issuance, amendment, renewal or extension, and the stated amount of
the Letters of Credit issued, amended, renewed or extended by it and outstanding
after giving effect to such issuance, amendment, renewal or extension (and
whether the amounts thereof shall have changed), (iii) on each Business Day on
which such Issuing Bank makes any LC Disbursement, the date and amount of such
LC Disbursement, (iv) on any Business Day on which the Borrower fails to
reimburse an LC Disbursement required to be reimbursed to such Issuing Bank on
such day, the date of such failure and the amount of such LC Disbursement, and
(v) on any other Business Day, such other information as the Administrative
Agent shall reasonably request as to the Letters of Credit issued by such
Issuing Bank.

 

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

 

SECTION 2.05.Funding of Borrowings.

 

(a)                Each Lender shall make each Loan to be made by such Lender
hereunder on the proposed date thereof solely by wire transfer of immediately
available funds by 1:00 p.m., eastern time, to the account of the Administrative
Agent most recently designated by it for such purpose by notice to the Lenders
in an amount equal to such Lender’s Applicable Percentage. The Administrative
Agent will make such Loans available to the Borrower by promptly crediting the
funds so received in the aforesaid account of the Administrative Agent to the
Funding Account(s); provided that ABR Revolving Loans made to finance the
reimbursement of an LC Disbursement as provided in Section 2.04(e) shall be
remitted by the Administrative Agent to the Issuing Bank.

 

CREDIT AGREEMENT – Page 33 

 

 

(b)                Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender’s share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation or (ii) in the case of the Borrower,
the interest rate applicable to ABR Revolving Loans. If such Lender pays such
amount to the Administrative Agent, then such amount shall constitute such
Lender’s Loan included in such Borrowing. Any payment by the Borrower shall be
without prejudice to any claim the Borrower may have against a Lender that shall
have failed to make such payment to the Administrative Agent.

 

SECTION 2.06.Interest Elections.

 

(a)                Each Borrowing initially shall be of the Type specified in
the applicable Borrowing Request and, in the case of a Eurodollar Borrowing,
shall have an initial Interest Period as specified in such Borrowing Request.
Thereafter, the Borrower may elect to convert such Borrowing to a different Type
or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may
elect Interest Periods therefor, all as provided in this Section. The Borrower
may elect different options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated ratably among the
Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Borrowing.

 

(b)                To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone or through
Electronic System, if arrangements for doing so have been approved by the
Administrative Agent, by the time that a Borrowing Request would be required
under Section 2.03 if the Borrower were requesting a Borrowing of the Type
resulting from such election to be made on the effective date of such election.
Each such telephonic Interest Election Request shall be irrevocable and shall be
confirmed promptly by hand delivery, Electronic System or fax to the
Administrative Agent of a written Interest Election Request in a form approved
by the Administrative Agent and signed by the Borrower.

 

(c)                Each telephonic and written Interest Election Request
(including requests submitted through Electronic System) shall specify the
following information in compliance with Section 2.02:

 

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

 

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

 

(iii)             whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and

 

CREDIT AGREEMENT – Page 34 

 

 

(iv)              if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such election,
which shall be a period contemplated by the definition of the term "Interest
Period".

 

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

 

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

 

(e)                If the Borrower fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies the Borrower, then, so long as an
Event of Default is continuing (i) no outstanding Borrowing may be converted to
or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.

 

SECTION 2.07.Termination and Reduction of Commitments; Increase in Revolving
Commitments.

 

(a)                Unless previously terminated, all the Revolving Commitments
shall terminate on the Revolving Credit Maturity Date.

 

(b)                The Borrower may at any time terminate the Revolving
Commitments upon (i) the indefeasible payment in full in cash of all outstanding
Loans and LC Disbursements, together with accrued and unpaid interest thereon,
(ii) the termination, expiration, or cancellation and return of all outstanding
Letters of Credit (or alternatively, with respect to each such Letter of Credit,
the furnishing to the Administrative Agent of a cash deposit, or at the
discretion of the Administrative Agent a backup standby letter of credit
satisfactory to the Administrative Agent and the Issuing Bank, in an amount
equal to 105% of the LC Exposure as of the date of such payment), (iii) the
indefeasible payment in full in cash of the accrued and unpaid fees, and
(iv) the indefeasible payment in full in cash of all reimbursable expenses and
other Secured Obligations (other than Unliquidated Obligations for which no
claim has been made and other obligations expressly stated to survive such
payment and termination of this Agreement), together with accrued and unpaid
interest thereon.

 

(c)                The Borrower may from time to time reduce the Revolving
Commitments; provided that (i) each reduction of the Revolving Commitments shall
be in an amount that is an integral multiple of $1,000,000 and not less than
$5,000,000 and (ii) the Borrower shall not terminate or reduce the Revolving
Commitments if, after giving effect to any concurrent prepayment of the
Revolving Loans in accordance with Section 2.09, the Aggregate Revolving
Exposure would exceed Revolving Commitments

 

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

 

CREDIT AGREEMENT – Page 35 

 

 

(e)                The Borrower shall have the right to increase the Revolving
Commitments by obtaining additional Revolving Commitments, either from one or
more of the Lenders or another lending institution (it being understood and
agreed that participation in any such increase may be offered to the existing
Lenders, but no such Lender shall have any obligation to provide all or any
portion of such increase), provided that (i) any such request for an increase
shall be in an amount that is an integral multiple of $1,000,000 and not less
than $5,000,000, (ii) after giving effect thereto, the sum of the total of the
additional Commitments does not exceed $50,000,000, (iii) the Administrative
Agent and the Issuing Bank have approved the identity of any such new Lender,
such approvals not to be unreasonably withheld, (iv) any such new Lender assumes
all of the rights and obligations of a "Lender" hereunder, and (v) the
procedures described in Section 2.07(f) below have been satisfied. Nothing
contained in this Section 2.07 shall constitute, or otherwise be deemed to be, a
commitment on the part of any Lender to increase its Commitment hereunder at any
time.

 

(f)                 Any amendment hereto for such an increase or addition shall
be in form and substance satisfactory to the Administrative Agent and shall only
require the written signatures of the Administrative Agent, the Borrower and
each Lender being added or increasing its Commitment, subject only to the
approval of all Lenders if any such increase or addition would cause the
Revolving Commitments to exceed $200,000,000. Each Loan pursuant to any increase
in the Revolving Commitment shall constitute Secured Obligations of the Borrower
and shall be guaranteed and treated the same in all other respects as the other
extensions of credit on a pari passu basis. As a condition precedent to such an
increase or addition, the Borrower shall deliver to the Administrative Agent (i)
a certificate of each Loan Party signed by an authorized officer of such Loan
Party (A) certifying and attaching the resolutions adopted by such Loan Party
approving or consenting to such increase, and (B) in the case of the Borrower,
certifying that, before and after giving effect to such increase or addition,
(1) the representations and warranties contained in Article III and the other
Loan Documents are true and correct, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, (2) no Default exists
and (3) the Borrower is in compliance (on a pro forma basis) with the covenants
contained in Section 5.01 and (ii) legal opinions and documents consistent with
those delivered on the Effective Date, to the extent requested by the
Administrative Agent.

 

(g)                On the effective date of any such increase or addition, (i)
any Lender increasing (or, in the case of any newly added Lender, extending) its
Revolving Commitment shall make available to the Administrative Agent such
amounts in immediately available funds as the Administrative Agent shall
determine, for the benefit of the other Lenders, as being required in order to
cause, after giving effect to such increase or addition and the use of such
amounts to make payments to such other Lenders, each Lender’s portion of the
outstanding Revolving Loans of all the Lenders to equal its revised Applicable
Percentage of such outstanding Revolving Loans, and the Administrative Agent
shall make such other adjustments among the Lenders with respect to the
Revolving Loans then outstanding and amounts of principal, interest, commitment
fees and other amounts paid or payable with respect thereto as shall be
necessary, in the opinion of the Administrative Agent, in order to effect such
reallocation and (ii) the Borrower shall be deemed to have repaid and reborrowed
all outstanding Revolving Loans as of the date of any increase (or addition) in
the Revolving Commitments (with such reborrowing to consist of the Types of
Revolving Loans, with related Interest Periods if applicable, specified in a
notice delivered by the Borrower, in accordance with the requirements of
Section 2.03). The deemed payments made pursuant to clause (ii) of the
immediately preceding sentence shall be accompanied by payment of all accrued
interest on the amount prepaid and, in respect of each Eurodollar Loan, shall be
subject to indemnification by the Borrower pursuant to the provisions of
Section 2.14 if the deemed payment occurs other than on the last day of the
related Interest Periods. Within a reasonable time after the effective date of
any increase or addition, the Administrative Agent shall, and is hereby
authorized and directed to, revise the Commitment Schedule to reflect such
increase or addition and shall distribute such revised Commitment Schedule to
each of the Lenders and the Borrower, whereupon such revised Commitment Schedule
shall replace the old Commitment Schedule and become part of this Agreement.

 

CREDIT AGREEMENT – Page 36 

 

 

SECTION 2.08.Repayment of Loans; Evidence of Debt.

 

(a)                The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Revolving Lender the then unpaid
principal amount of each Revolving Loan on the Revolving Credit Maturity Date.

 

(b)                The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of the Obligations on the Revolving Credit Maturity Date.

 

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

 

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

 

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

 

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

 

SECTION 2.09.Prepayment of Loans.

 

(a)                The Borrower shall have the right at any time and from time
to time to prepay any Borrowing in whole or in part, subject to prior notice in
accordance with paragraph (c) of this Section and, if applicable, payment of any
break funding expenses under Section 2.14.

 

(b)                In the event and on such occasion that the Aggregate
Revolving Exposure exceeds the aggregate Revolving Commitments, the Borrower
shall prepay the Revolving Loans, and/or LC Exposure in the aggregate amount
equal to such excess (or, if no such Borrowings are outstanding, deposit cash
collateral in the LC Collateral Account in an aggregate amount equal to such
excess, in accordance with Section 2.04(j)).

 

CREDIT AGREEMENT – Page 37 

 

 

(c)                The Borrower shall notify the Administrative Agent by
telephone (confirmed by fax) or through Electronic System, if arrangements for
doing so have been approved by the Administrative Agent, of any prepayment under
this Section: (i) in the case of prepayment of a Eurodollar Borrowing, not later
than 10:00 a.m., eastern time, three (3) Business Days before the date of
prepayment, or (ii) in the case of prepayment of an ABR Borrowing, not later
than 10:00 a.m., eastern time, one (1) Business Day before the date of
prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof to
be prepaid; provided that if a notice of prepayment is given in connection with
a conditional notice of termination of the Revolving Commitments as contemplated
by Section 2.07, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.07. Promptly following
receipt of any such notice, the Administrative Agent shall advise the Lenders of
the contents thereof. Each partial prepayment of any Revolving Borrowing shall
be in an amount that would be permitted in the case of an advance of a Borrowing
of the same Type as provided in Section 2.02, except as necessary to apply fully
the required amount of a mandatory prepayment. Each prepayment of a Borrowing
shall be applied ratably to the Loans included in the prepaid Borrowing.
Prepayments shall be accompanied by (i) accrued interest to the extent required
by Section 2.11 and (ii) break funding payments pursuant to Section 2.14.

 

SECTION 2.10.Fees.

 

(a)                The Borrower agrees to pay to the Administrative Agent a
commitment fee for the account of each Revolving Lender, which shall accrue at
the Applicable Rate on the daily amount of the undrawn portion of the Revolving
Commitment of such Lender during the period from and including the Effective
Date to but excluding the date on which the Lenders’ Revolving Commitments
terminate; it being understood that the LC Exposure of a Lender shall be
included in the drawn portion of the Revolving Commitment of such Lender for
purposes of calculating the commitment fee. Accrued commitment fees shall be
payable in arrears on the last day of March, June, September and December of
each year and on the date on which the Revolving Commitments terminate,
commencing on the first such date to occur after the date hereof. All commitment
fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding the
last day).

 

(b)                The Borrower agrees to pay (i) to the Administrative Agent
for the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable
Rate used to determine the interest rate applicable to Eurodollar Revolving
Loans on the daily amount of such Lender’s LC Exposure (excluding any portion
thereof attributable to unreimbursed LC Disbursements) during the period from
and including the Effective Date to but excluding the later of the date on which
such Lender’s Revolving Commitment terminates and the date on which such Lender
ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee,
which shall accrue at the rate of 0.125% per annum on the daily amount of the LC
Exposure attributable to Letters of Credit issued by such Issuing Bank
(excluding any portion thereof attributable to unreimbursed LC Disbursements)
during the period from and including the Effective Date to but excluding the
later of the date of termination of the Commitments and the date on which there
ceases to be any LC Exposure, as well as the Issuing Bank’s standard fees and
commissions with respect to the issuance, amendment, cancellation, negotiation,
transfer, presentment, renewal or extension of any Letter of Credit or
processing of drawings thereunder. Participation fees and fronting fees accrued
through and including the last day of March, June, September and December of
each year shall be payable on the third Business Day following such last day,
commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be payable within
ten (10) days after demand. All participation fees and fronting fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

 

CREDIT AGREEMENT – Page 38 

 

 

(c)                The Borrower agrees to pay to the Administrative Agent or any
other Lender, for its own account, fees payable in the amounts and at the times
separately agreed upon between the Borrower and the Administrative Agent or such
other Lender.

 

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

 

SECTION 2.11.Interest.

 

(a)                The Loans comprising each ABR Borrowing shall bear interest
at the sum of the Alternate Base Rate plus the Applicable Rate.

 

(b)                The Loans comprising each Eurodollar Borrowing shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.

 

(c)                Notwithstanding the foregoing, during the occurrence and
continuance of an Event of Default, the Administrative Agent or the Required
Lenders may, at their option, by notice to the Borrower (which notice may be
revoked at the option of the Required Lenders notwithstanding any provision of
Section 9.02 requiring the consent of "each Lender affected thereby" for
reductions in interest rates), declare that (i) all Loans shall bear interest at
2% plus the rate otherwise applicable to such Loans as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount outstanding
hereunder, such amount shall accrue at 2% plus the rate applicable to such fee
or other obligation as provided hereunder.

 

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

 

(e)                All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall
be computed on the basis of a year of 365 days (or 366 days in a leap year), and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO
Rate or LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.

 

CREDIT AGREEMENT – Page 39 

 

 

SECTION 2.12.Alternate Rate of Interest; Illegality.

 

(a)                If prior to the commencement of any Interest Period for a
Eurodollar Borrowing:

 

(i)                 the Administrative Agent determines (which determination
shall be conclusive and binding absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the
LIBO Rate, as applicable (including, without limitation, by means of an
Interpolated Rate or because the LIBO Screen Rate is not available or published
on a current basis) for such Interest Period; or

 

(ii)               the Administrative Agent is advised by the Required Lenders
that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest
Period will not adequately and fairly reflect the cost to such Lenders (or
Lender) of making or maintaining their Loans (or its Loan) included in such
Borrowing for such Interest Period;

 

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders through Electronic System as provided in Section 9.01 as promptly as
practicable thereafter and, until the Administrative Agent notifies the Borrower
and the Lenders that the circumstances giving rise to such notice no longer
exist, (A) any Interest Election Request that requests the conversion of any
Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall
be ineffective and any such Eurodollar Borrowing shall be repaid or converted
into an ABR Borrowing on the last day of the then current Interest Period
applicable thereto, and (B) if any Borrowing Request requests a Eurodollar
Borrowing, such Borrowing shall be made as an ABR Borrowing.

 

(b)                If any Lender determines that any Requirement of Law has made
it unlawful, or if any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable lending office to make, maintain, fund or
continue any Eurodollar Borrowing, or any Governmental Authority has imposed
material restrictions on the authority of such Lender to purchase or sell, or to
take deposits of, dollars in the London interbank market, then, on notice
thereof by such Lender to the Borrower through the Administrative Agent, any
obligations of such Lender to make, maintain, fund or continue Eurodollar Loans
or to convert ABR Borrowings to Eurodollar Borrowings will be suspended until
such Lender notifies the Administrative Agent and the Borrower that the
circumstances giving rise to such determination no longer exist. Upon receipt of
such notice, the Borrower will upon demand from such Lender (with a copy to the
Administrative Agent), either convert or prepay all Eurodollar Borrowings of
such Lender to ABR Borrowings, either on the last day of the Interest Period
therefor, if such Lender may lawfully continue to maintain such Eurodollar
Borrowings to such day, or immediately, if such Lender may not lawfully continue
to maintain such Loans. Upon any such conversion or prepayment, the Borrower
will also pay accrued interest on the amount so converted or prepaid.

 

(c)                If at any time the Administrative Agent determines (which
determination shall be conclusive absent manifest error) that (i) the
circumstances set forth in clause (a)(i) have arisen and such circumstances are
unlikely to be temporary or (ii) the circumstances set forth in clause (a)(i)
have not arisen but the supervisor for the administrator of the LIBO Screen Rate
or a Governmental Authority having jurisdiction over the Administrative Agent
has made a public statement identifying a specific date after which the LIBO
Screen Rate shall no longer be used for determining interest rates for loans,
then the Administrative Agent and the Borrower shall endeavor to establish an
alternate rate of interest to the LIBO Rate that gives due consideration to the
then prevailing market convention for determining a rate of interest for
syndicated loans in the United States at such time, and shall enter into an
amendment to this Agreement to reflect such alternate rate of interest and such
other related changes to this Agreement as may be applicable. Notwithstanding
anything to the contrary in Section 9.02, such amendment shall become effective
without any further action or consent of any other party to this Agreement so
long as the Administrative Agent shall not have received, within five Business
Days of the date notice of such alternate rate of interest is provided to the
Lenders, a written notice from the Required Lenders stating that such Required
Lenders object to such amendment. Until an alternate rate of interest shall be
determined in accordance with this clause (c) (but, in the case of the
circumstances described in clause (ii) of the first sentence of this Section
2.12(c), only to the extent the LIBO Screen Rate for such Interest Period is not
available or published at such time on a current basis), (x) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective,
and (y) if any Borrowing Request requests a Eurodollar Borrowing, such Borrowing
shall be made as an ABR Borrowing; provided that, if such alternate rate of
interest shall be less than zero, such rate shall be deemed to be zero for the
purposes of this Agreement.

 

CREDIT AGREEMENT – Page 40 

 

 

SECTION 2.13.Increased Costs. (a) If any Change in Law shall:

 

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

 

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

 

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

 

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

 

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

 

CREDIT AGREEMENT – Page 41 

 

 

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

 

(d)                Failure or delay on the part of any Lender or the Issuing
Bank to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender’s or the Issuing Bank’s right to demand such compensation;
provided that the Borrower shall not be required to compensate a Lender or the
Issuing Bank pursuant to this Section for any increased costs or reductions
incurred more than 270 days prior to the date that such Lender or the Issuing
Bank, as the case may be, notifies the Borrower of the Change in Law giving rise
to such increased costs or reductions and of such Lender’s or the Issuing Bank’s
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall be extended to include the period of
retroactive effect thereof.

 

SECTION 2.14.Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default or as a
result of any prepayment pursuant to Section 2.09), (b) the conversion of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto, (c) the failure to borrow, convert, continue or prepay any Eurodollar
Loan on the date specified in any notice delivered pursuant hereto (regardless
of whether such notice may be revoked under Section 2.07(c) and is revoked in
accordance therewith), or (d) the assignment of any Eurodollar Loan other than
on the last day of the Interest Period applicable thereto as a result of a
request by the Borrower pursuant to Section 2.17 or 9.02(d), then, in any such
event, the Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event. In the case of a Eurodollar Loan, such loss, cost or
expense to any Lender shall be deemed to include an amount determined by such
Lender to be the excess, if any, of (i) the amount of interest which would have
accrued on the principal amount of such Eurodollar Loan had such event not
occurred, at the Adjusted LIBO Rate that would have been applicable to such
Eurodollar Loan, for the period from the date of such event to the last day of
the then current Interest Period therefor (or, in the case of a failure to
borrow, convert or continue, for the period that would have been the Interest
Period for such Eurodollar Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within ten
(10) days after receipt thereof.

 

SECTION 2.15.Taxes.

 

(a)                Withholding Taxes; Gross-Up; Payments Free of Taxes.Any and
all payments by or on account of any obligation of any Loan Party under any Loan
Document shall be made without deduction or withholding for any Taxes, except as
required by applicable law. If any applicable law (as determined in the good
faith discretion of an applicable withholding agent) requires the deduction or
withholding of any Tax from any such payment by a withholding agent, then the
applicable withholding agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party
shall be increased as necessary so that after such deduction or withholding has
been made (including such deductions and withholdings applicable to additional
sums payable under this Section 2.15), the applicable Recipient receives an
amount equal to the sum it would have received had no such deduction or
withholding been made.

 

CREDIT AGREEMENT – Page 42 

 

 

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

 

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

 

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

 

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

 

(f)                 Status of Lenders.

 

(i)                 Any Lender that is entitled to an exemption from or
reduction of withholding Tax with respect to payments made under any Loan
Document shall deliver to the Borrower and the Administrative Agent, at the time
or times reasonably requested by the Borrower or the Administrative Agent, such
properly completed and executed documentation reasonably requested by the
Borrower or the Administrative Agent as will permit such payments to be made
without withholding or at a reduced rate of withholding. In addition, any
Lender, if reasonably requested by the Borrower or the Administrative Agent,
shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent as will enable
the Borrower or the Administrative Agent to determine whether or not such Lender
is subject to backup withholding or information reporting requirements.
Notwithstanding anything to the contrary in the preceding two sentences, the
completion, execution and submission of such documentation (other than such
documentation set forth in Section 2.15(f)(ii)(A), (ii)(B) and (ii)(D) below)
shall not be required if in the Lender’s reasonable judgment such completion,
execution or submission would subject such Lender to any material unreimbursed
cost or expense or would materially prejudice the legal or commercial position
of such Lender.

 

CREDIT AGREEMENT – Page 43 

 

 

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

 

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

 

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

 

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

 

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

 

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

 

(4)                to the extent a Foreign Lender is not the Beneficial Owner,
an executed IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or
IRS Form W-8BEN-E, as applicable, a U.S. Tax Compliance Certificate
substantially in the form of Exhibit C-2 or any other form approved by the
Administrative Agent or Exhibit C-3 or any other form approved by the
Administrative Agent, 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 C-4 or any
other form approved by the Administrative Agent on behalf of each such direct
and indirect partner;

 

CREDIT AGREEMENT – Page 44 

 

 

(C)              any Foreign Lender shall, to the extent it is legally entitled
to do so, deliver to the Borrower and the Administrative Agent (in such number
of copies as shall be requested by the recipient) on or prior to the date on
which such Foreign Lender becomes a Lender under this Agreement (and from time
to time thereafter upon the reasonable request of the Borrower or the
Administrative Agent), executed originals of any other form prescribed by
applicable law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable law to permit the Borrower or
the Administrative Agent to determine the withholding or deduction required to
be made; and

 

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

 

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

 

(g)                Treatment of Certain Refunds. If any party determines, in its
sole discretion exercised in good faith, that it has received a refund of any
Taxes as to which it has been indemnified pursuant to this Section 2.15
(including by the payment of additional amounts pursuant to this Section 2.15),
it shall pay to the indemnifying party an amount equal to such refund (but only
to the extent of indemnity payments made under this Section 2.15 with respect to
the Taxes giving rise to such refund), net of all out-of-pocket expenses
(including Taxes) of such indemnified party and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund). Such indemnifying party, upon the request of such indemnified party,
shall repay to such indemnified party the amount paid over pursuant to this
paragraph (g) (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) in the event that such indemnified party is
required to repay such refund to such Governmental Authority. Notwithstanding
anything to the contrary in this paragraph (g), in no event will the indemnified
party be required to pay any amount to an indemnifying party pursuant to this
paragraph (g) the payment of which would place the indemnified party in a less
favorable net after-Tax position than the indemnified party would have been in
if the Tax subject to indemnification and giving rise to such refund had not
been deducted, withheld or otherwise imposed and the indemnification payments or
additional amounts giving rise to such refund had never been paid. This
paragraph (g) shall not be construed to require any indemnified party to make
available its Tax returns (or any other information relating to its Taxes that
it deems confidential) to the indemnifying party or any other Person.

 

CREDIT AGREEMENT – Page 45 

 

 

(h)                Survival. Each party’s obligations under this Section 2.15
shall survive the resignation or replacement of the Administrative Agent or any
assignment of rights by, or the replacement of, a Lender, the termination of the
Commitments and the repayment, satisfaction or discharge of all obligations
under any Loan Document (including the Payment in Full of the Secured
Obligations).

 

(i)                 Defined Terms. For purposes of this Section 2.15, the term
"Lender" includes any Issuing Bank and the term "applicable law" includes FATCA.

 

SECTION 2.16.Payments Generally; Allocation of Proceeds; Sharing of Set-offs.

 

(a)                The Borrower shall make each payment required to be made by
it hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Sections 2.13, 2.14 or 2.15, or
otherwise) prior to 2:00 p.m., eastern time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent pursuant to payment instructions
provided by the Administrative Agent, except payments to be made directly to the
Issuing Bank as expressly provided herein and except that payments pursuant to
Sections 2.13, 2.14, 2.15 and 9.03 shall be made directly to the Persons
entitled thereto. The Administrative Agent shall distribute any such payments
received by it for the account of any other Person to the appropriate recipient
promptly following receipt thereof. Unless otherwise provided for herein, if any
payment hereunder shall be due on a day that is not a Business Day, the date for
payment shall be extended to the next succeeding Business Day, and, in the case
of any payment accruing interest, interest thereon shall be payable for the
period of such extension. All payments hereunder shall be made in dollars.

 

(b)                Any proceeds of Collateral received by the Administrative
Agent (i) not constituting either (A) a specific payment of principal, interest,
fees or other sum payable under the Loan Documents (which shall be applied as
specified by the Borrower), or (B) a mandatory prepayment (which shall be
applied in accordance with Section 2.09) or (ii) after an Event of Default has
occurred and is continuing and the Administrative Agent so elects or the
Required Lenders so direct, shall be applied ratably first, to pay any fees,
indemnities, or expense reimbursements then due to the Administrative Agent and
the Issuing Bank from the Borrower (other than in connection with Banking
Services Obligations or Swap Agreement Obligations), second, to pay any fees,
indemnities, or expense reimbursements then due to the Lenders from the Borrower
(other than in connection with Banking Services Obligations or Swap Agreement
Obligations), third, to pay interest then due and payable on the Loans ratably,
fourth, to prepay principal on the Loans and unreimbursed LC Disbursements and
to pay any amounts owing in respect of Swap Agreement Obligations and Banking
Services Obligations up to and including the amount most recently provided to
the Administrative Agent pursuant to Section 2.20, ratably, fifth, to pay an
amount to the Administrative Agent equal to one hundred five percent (105%) of
the aggregate LC Exposure, to be held as cash collateral for such Obligations,
and sixth, to the payment of any other Secured Obligation due to the
Administrative Agent or any Lender from the Borrower or any other Loan Party.
Notwithstanding anything to the contrary contained in this Agreement, unless so
directed by the Borrower, or unless a Default is in existence, neither the
Administrative Agent nor any Lender shall apply any payment which it receives to
any Eurodollar Loan, except (i) on the expiration date of the Interest Period
applicable thereto, or (ii) in the event, and only to the extent, that there are
no outstanding ABR Loans and, in any such event, the Borrower shall pay the
break funding payment required in accordance with Section 2.14. The
Administrative Agent and the Lenders shall have the continuing and exclusive
right to apply and reverse and reapply any and all such proceeds and payments to
any portion of the Secured Obligations.

 

CREDIT AGREEMENT – Page 46 

 

 

Notwithstanding the foregoing, Secured Obligations arising under Banking
Services Obligations or Swap Agreement Obligations shall be excluded from the
application described above and paid in clause sixth if the Administrative Agent
has not received written notice thereof, together with such supporting
documentation as the Administrative Agent may have reasonably requested from the
applicable provider of such Banking Services or Swap Agreements.

 

(c)                At the election of the Administrative Agent, all payments of
principal, interest, LC Disbursements, fees, premiums, reimbursable expenses
(including, without limitation, all reimbursement for fees, costs and expenses
pursuant to Section 9.03), and other sums payable under the Loan Documents, may
be paid from the proceeds of Borrowings made hereunder, whether made following a
request by the Borrower pursuant to Section 2.03 or a deemed request as provided
in this Section or may be deducted from any deposit account of the Borrower
maintained with the Administrative Agent. The Borrower hereby irrevocably
authorizes (i) the Administrative Agent to make a Borrowing for the purpose of
paying each payment of principal, interest and fees as it becomes due hereunder
or any other amount due under the Loan Documents and agrees that all such
amounts charged shall constitute Loans, and that all such Borrowings shall be
deemed to have been requested pursuant to Sections 2.03, and (ii) the
Administrative Agent to charge any deposit account of the Borrower maintained
with the Administrative Agent for each payment of principal, interest and fees
as it becomes due hereunder or any other amount due under the Loan Documents.

 

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

 

CREDIT AGREEMENT – Page 47 

 

 

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

 

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

 

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

 

SECTION 2.17.Mitigation Obligations; Replacement of Lenders

 

(a)                If any Lender requests compensation under Section 2.13, or if
the Borrower is required to pay any Indemnified Taxes or additional amounts to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.15, then such Lender shall use commercially reasonable efforts to
designate a different lending office for funding or booking its Loans hereunder
or to assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Sections
2.13 or 2.15, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.

 

(b)                If any Lender requests compensation under Section 2.13, or if
the Borrower is required to pay any Indemnified Taxes or additional amounts to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.15, or if any Lender becomes a Defaulting Lender, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights (other than its existing rights to
payments pursuant to Sections 2.13 or 2.15) and obligations under this Agreement
and other Loan Documents to an assignee that shall assume such obligations
(which assignee may be another Lender, if a Lender accepts such assignment);
provided that (i) the Borrower shall have received the prior written consent of
the Administrative Agent (and in circumstances where its consent would be
required under Section 9.04, the Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and funded participations
in LC Disbursements, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder, from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.13 or payments required
to be made pursuant to Section 2.15, such assignment will result in a reduction
in such compensation or payments. A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.

 

CREDIT AGREEMENT – Page 48 

 

 

SECTION 2.18.Defaulting Lenders.Notwithstanding any provision of this Agreement
to the contrary, if any Lender becomes a Defaulting Lender, then the following
provisions shall apply for so long as such Lender is a Defaulting Lender:

 

(a)                fees shall cease to accrue on the unfunded portion of the
Revolving Commitment of such Defaulting Lender pursuant to Section 2.10(a);

 

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

 

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

 

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

 

(ii)               if the reallocation described in clause (i) above cannot, or
can only partially, be effected, the Borrower shall within one (1) Business Day
following notice by the Administrative Agent cash collateralize, for the benefit
of the Issuing Bank, the Borrower’s obligations corresponding to such Defaulting
Lender’s LC Exposure (after giving effect to any partial reallocation pursuant
to clause (i) above) in accordance with the procedures set forth in Section
2.04(j) for so long as such LC Exposure is outstanding;

 

(iii)             if the Borrower cash collateralizes any portion of such
Defaulting Lender’s LC Exposure pursuant to clause (ii) above, the Borrower
shall not be required to pay any fees to such Defaulting Lender pursuant to
Section 2.10(b) with respect to such Defaulting Lender’s LC Exposure during the
period such Defaulting Lender’s LC Exposure is cash collateralized;

 

CREDIT AGREEMENT – Page 49 

 

 

(iv)              if the LC Exposure of the Non-Defaulting Lenders is
reallocated pursuant to clause (i) above, then the fees payable to the Lenders
pursuant to Sections 2.10(a) and 2.10(b) shall be adjusted in accordance with
such Non-Defaulting Lenders’ Applicable Percentages; and

 

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

 

(d)                so long as such Lender is a Defaulting Lender, the Issuing
Bank shall not be required to issue, amend, renew, extend or increase any Letter
of Credit, unless it is satisfied that the related exposure and such Defaulting
Lender’s then outstanding LC Exposure will be 100% covered by the Commitments of
the Non-Defaulting Lenders and/or cash collateral will be provided by the
Borrower in accordance with Section 2.18(c), and the LC Exposure related to any
newly issued or increased Letter of Credit shall be allocated among
Non-Defaulting Lenders in a manner consistent with Section 2.18(c)(i) (and such
Defaulting Lender shall not participate therein).

 

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

 

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

 

SECTION 2.19.Returned Payments. If, after receipt of any payment which is
applied to the payment of all or any part of the Obligations (including a
payment effected through exercise of a right of setoff), the Administrative
Agent or any Lender is for any reason compelled to surrender such payment or
proceeds to any Person because such payment or application of proceeds is
invalidated, declared fraudulent, set aside, determined to be void or voidable
as a preference, impermissible setoff, or a diversion of trust funds, or for any
other reason (including pursuant to any settlement entered into by the
Administrative Agent or such Lender in its discretion), then the Obligations or
part thereof intended to be satisfied shall be revived and continued and this
Agreement shall continue in full force as if such payment or proceeds had not
been received by the Administrative Agent or such Lender. The provisions of this
Section 2.19 shall be and remain effective notwithstanding any contrary action
which may have been taken by the Administrative Agent or any Lender in reliance
upon such payment or application of proceeds. The provisions of this Section
2.19 shall survive the termination of this Agreement.

 

SECTION 2.20.Banking Services and Swap Agreements. Each Lender or Affiliate
thereof providing Banking Services for, or having Swap Agreements with, any Loan
Party or any Subsidiary or Affiliate of a Loan Party shall deliver to the
Administrative Agent, promptly after entering into such Banking Services or Swap
Agreements, written notice setting forth the aggregate amount of all Banking
Services Obligations and Swap Agreement Obligations of such Loan Party or
Subsidiary or Affiliate thereof to such Lender or Affiliate (whether matured or
unmatured, absolute or contingent). In furtherance of that requirement, each
such Lender or Affiliate thereof shall furnish the Administrative Agent, from
time to time after a significant change therein or upon a request therefor, a
summary of the amounts due or to become due in respect of such Banking Services
Obligations and Swap Agreement Obligations. The most recent information provided
to the Administrative Agent shall be used in determining which tier of the
waterfall, contained in Section 2.16(b), such Banking Services Obligations
and/or Swap Agreement Obligations will be placed.

 

CREDIT AGREEMENT – Page 50 

 

 

ARTICLE III

Representations and Warranties

 

Each Loan Party represents and warrants to the Lenders that (and where
applicable, agrees):

 

SECTION 3.01.Financial Condition.

 

(a)                (i) The audited Consolidated and consolidating financial
statements of the Borrower and its Subsidiaries for the fiscal years ended 2014,
2015 and 2016 as set forth in the Borrower’s Annual Report on Form 10-K for the
fiscal year ended January 1, 2017 filed with the SEC, (ii) the unaudited
Consolidated and consolidating financial statements of the Borrower and its
Subsidiaries for the year-to-date period ending on July 2, 2017, together with
the related Consolidated and consolidating statements of income or operations,
equity and cash flows for the year-to-date period ending on such date as set
forth in the Borrower’s Quarterly Report on Form 10-Q for the fiscal quarter
ended July 2, 2017 filed with the SEC and (iii) a pro forma balance sheet of the
Borrower and its Subsidiaries as of July 2, 2017:

 

(A)              with respect to clauses (a)(i) and (a)(ii) above, were prepared
in accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein; and

 

(B)              with respect to clauses (a)(i) and (a)(ii) above, fairly
present, in all material respects, the financial condition of the Borrower and
its Subsidiaries as of the date thereof (subject, in the case of the unaudited
financial statements, to normal year-end adjustments) and results of operations
for the period covered thereby.

 

(b)                The five-year projections of the Loan Parties and their
Subsidiaries (prepared annually for the term of this Agreement) delivered to the
Lenders on or prior to the Effective Date have been prepared in good faith based
upon reasonable assumptions (i) in light of then existing conditions and (ii) of
future results of operations which may or may not in fact occur and no assurance
can be given that such results will be achieved.

 

SECTION 3.02.No Material Adverse Effect. Since January 1, 2017 (and, in
addition, after (x) any subsequent public disclosure by the Borrower made after
January 1, 2017 and prior to the Effective Date and (y) delivery of annual
audited financial statements in accordance with Section 5.01(a), from the date
of the most recently delivered annual audited financial statements), there has
been no development or event which has had or could reasonably be expected to
have a Material Adverse Effect.

 

SECTION 3.03.Corporate Existence; Compliance with Law; Patriot Act Information.
Each of the Loan Parties (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, organization
or formation, (b) has the requisite corporate, limited liability company or
partnership power and authority and the legal right to own and operate all its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged and has taken all actions necessary to
maintain all rights, privileges, licenses and franchises necessary or required
in the normal conduct of its business except where the failure to take any such
action could not reasonably be expected to have a Material Adverse Effect,
(c) is duly qualified to conduct business and in good standing under the laws of
(i) the jurisdiction of its organization or formation, (ii) the jurisdiction
where its chief executive office is located and (iii) each other jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification except to the extent that the failure to so
qualify or be in good standing in any such other jurisdiction could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect and (d) is in compliance with all applicable Requirements of Law,
organizational documents, government permits and government licenses except to
the extent such non-compliance could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. Set forth on Schedule
3.03 as of the Effective Date, or as of the last date such Schedule was required
to be updated in accordance with Section 5.02, is the following information for
each Loan Party: the exact legal name and any former legal names of such Loan
Party in the four (4) months prior to the Effective Date, the state of
incorporation or organization, the type of organization, the jurisdictions in
which such Loan Party is qualified to do business, the chief executive office,
the principal place of business, the business phone number, the organization
identification number, the federal tax identification number and ownership
information (e.g. publicly held, if private or partnership, the owners and
partners of each of the Loan Parties).

 

CREDIT AGREEMENT – Page 51 

 

 

SECTION 3.04.Corporate Power; Authorization; Enforceable Obligations. Each of
the Loan Parties has full corporate, partnership or limited liability company
power and authority and the legal right to make, deliver and perform the Loan
Documents to which it is party and has taken all necessary limited liability
company, partnership or corporate action to authorize the execution, delivery
and performance by it of the Loan Documents to which it is party. Each Loan
Document to which it is a party has been duly executed and delivered on behalf
of each Loan Party. Each Loan Document to which it is a party constitutes a
legal, valid and binding obligation of each Loan Party, enforceable against such
Loan Party in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).

 

SECTION 3.05.No Legal Bar; No Default. The execution, delivery and performance
by each Loan Party of the Loan Documents to which such Loan Party is a party,
the borrowings thereunder and the use of the proceeds of the Revolving Loans (a)
will not violate any applicable Requirement of Law of any Loan Party (except
those as to which waivers or consents have been obtained), (b) will not conflict
with, result in a breach of or constitute a default under the articles of
incorporation, bylaws, articles of organization, operating agreement or other
organization documents of the Loan Parties or any Material Contract to which
such Person is a party or by which any of its properties may be bound or any
material approval or material consent from any Governmental Authority relating
to such Person, and (c) will not result in, or require, the creation or
imposition of any Lien on any Loan Party’s properties or revenues pursuant to
any Requirement of Law or Contractual Obligation other than the Liens arising
under or contemplated in connection with the Loan Documents or Permitted Liens.
No Loan Party is in default under or with respect to any of its Contractual
Obligations except where such default could not reasonably be expected to have a
Material Adverse Effect.

 

SECTION 3.06.No Material Litigation. No litigation, investigation, claim,
criminal prosecution, civil investigative demand, imposition of criminal or
civil fines and penalties, or any other proceeding of or before any arbitrator
or Governmental Authority is pending or, to the best knowledge of the Loan
Parties, threatened by or against any Loan Party or any of its Subsidiaries or
against any of its or their respective properties or revenues (a) with respect
to the Loan Documents, any Extension of Credit or any of the Transactions, or
(b) which, if adversely determined, could reasonably be expected to have a
Material Adverse Effect. No permanent injunction, temporary restraining order or
similar decree has been issued against any Loan Party or any of its Subsidiaries
which could reasonably be expected to have a Material Adverse Effect.

 

CREDIT AGREEMENT – Page 52 

 

 

SECTION 3.07.Investment Company Act; etc. No Loan Party is an "investment
company", or a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940, as amended. No Loan Party is
subject to regulation limiting its ability to incur Secured Obligations.

 

SECTION 3.08.Margin Regulations. No part of the proceeds of any Extension of
Credit hereunder will be used directly or indirectly for any purpose that
violates, or that would require any Lender to make any filings in accordance
with, the provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System as now and from time to time hereafter in effect. The
Loan Parties and their Subsidiaries (a) are not engaged, principally or as one
of their important activities, in the business of extending credit for the
purpose of "purchasing" or "carrying" "margin stock" within the respective
meanings of each of such terms under Regulation U and (b) taken as a group do
not own "margin stock" except as identified in the financial statements referred
to in Section 3.01 or delivered pursuant to Section 5.01 and the aggregate value
of all "margin stock" owned by the Loan Parties and their Subsidiaries taken as
a group does not exceed 25% of the value of their assets.

 

SECTION 3.09.ERISA. No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed the fair
market value of the assets of such Plan.

 

SECTION 3.10.Environmental Matters. Except as could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect:

 

(a)                The facilities and properties owned, leased or operated by
the Loan Parties or any of their Subsidiaries (the "Properties") do not contain
any Materials of Environmental Concern in amounts or concentrations which (i)
constitute a violation of, or (ii) could give rise to liability on behalf of any
Loan Party under, any Environmental Law.

 

(b)                The Properties and all operations of the Loan Parties and/or
their Subsidiaries at the Properties are in compliance, and have in the last
five years been in compliance, with all applicable Environmental Laws, and there
is no contamination at, under or about the Properties or violation of any
Environmental Law with respect to the Properties or the business operated by the
Loan Parties or any of their Subsidiaries (the "Business").

 

(c)                Neither the Loan Parties nor their Subsidiaries have received
any written or actual notice of violation, alleged violation, non-compliance,
liability or potential liability on behalf of any Loan Party with respect to
environmental matters or Environmental Laws regarding any of the Properties or
the Business, nor do the Loan Parties or their Subsidiaries have knowledge or
reason to believe that any such notice will be received or is being threatened.

 

(d)                Materials of Environmental Concern have not been transported
or disposed of from the Properties in violation of, or in a manner or to a
location that could give rise to liability on behalf of any Loan Party under any
Environmental Law, and no Materials of Environmental Concern have been
generated, treated, stored or disposed of at, on or under any of the Properties
in violation of, or in a manner that could give rise to liability on behalf of
any Loan Party under, any applicable Environmental Law.

 

CREDIT AGREEMENT – Page 53 

 

 

(e)                No judicial proceeding or governmental or administrative
action is pending or, to the knowledge of the Loan Parties and their
Subsidiaries, threatened, under any Environmental Law to which any Loan Party or
any Subsidiary is or will be named as a party with respect to the Properties or
the Business, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect to
the Properties or the Business.

 

(f)                 There has been no release or threat of release of Materials
of Environmental Concern at or from the Properties, or arising from or related
to the operations of any Loan Party or any Subsidiary in connection with the
Properties or otherwise in connection with the Business, in violation of or in
amounts or in a manner that could give rise to liability on behalf of any Loan
Party under Environmental Laws.

 

SECTION 3.11.Use of Proceeds. The proceeds of the Loans have been used and will
be used, whether directly or indirectly as set forth in Section 5.08.

 

SECTION 3.12.Subsidiaries; Joint Ventures; Partnerships. Set forth on Schedule
3.12 is a complete and accurate list of all Subsidiaries, joint ventures and
partnerships of the Loan Parties as of the Effective Date and as of the last
date such Schedule was required to be updated in accordance with Section 5.02.
Information on the attached Schedule includes the following: (a) the number of
shares of each class of Equity Interests of each Subsidiary outstanding and (b)
the number and percentage of outstanding shares of each class of Equity
Interests owned by the Loan Parties and their Subsidiaries. The outstanding
Equity Interests of all such Subsidiaries are validly issued, fully paid and
non-assessable and are owned free and clear of all Liens (other than those
arising under or contemplated in connection with the Loan Documents). There are
no outstanding subscriptions, options, warrants, calls, rights or other
agreements or commitments (other than stock options or restricted stock granted
to employees or directors and directors’ qualifying shares) of any nature
relating to any Equity Interests of any Loan Party or any Subsidiary thereof,
except as contemplated in connection with the Loan Documents.

 

SECTION 3.13.Ownership. Each of the Loan Parties and its Subsidiaries is the
owner of, and has good and marketable title to or a valid leasehold interest in,
all of its respective assets, which, together with assets leased or licensed by
the Loan Parties and their Subsidiaries, represents all assets in the aggregate
material to the conduct of the business of the Loan Parties and their
Subsidiaries. Each Loan Party and its Subsidiaries enjoys peaceful and
undisturbed possession under all of its leases and all such leases are valid and
subsisting and in full force and effect except as could not reasonably be
expected to have a Material Adverse Effect.

 

SECTION 3.14.Consent; Governmental Authorizations. No approval, consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with
acceptance of Extensions of Credit by the Borrower or the making of the Loan
Guaranty hereunder or with the execution, delivery or performance of any Loan
Document by the Loan Parties (other than those which have been obtained) or with
the validity or enforceability of any Loan Document against the Loan Parties
(except such filings as are necessary in connection with the perfection of the
Liens created by such Loan Documents).

 

CREDIT AGREEMENT – Page 54 

 

 

SECTION 3.15.Taxes. Each of the Loan Parties and its Subsidiaries has filed, or
caused to be filed, all federal income tax returns and all other material tax
returns (federal, state, local and foreign) required to be filed and paid (a)
all amounts of taxes shown thereon to be due (including interest and penalties)
and (b) all other material taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) owing by it, except for such taxes (i) that are not yet
delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. None of the Loan Parties or their Subsidiaries has
received written notice as of the Effective Date of any material tax assessments
against it or any of its Subsidiaries.

 

SECTION 3.16.Collateral Representations.

 

(a)                Intellectual Property. Set forth on Schedule 3.16(a), as of
the Effective Date and as of the last date such Schedule was required to be
updated in accordance with Section 5.02, is a list of all registered or issued
Intellectual Property (including all applications for registration and issuance)
owned by each of the Loan Parties or that each of the Loan Parties has the right
to (including the name/title, current owner, registration or application number,
and registration or application date and such other information as reasonably
requested by the Administrative Agent).

 

(b)                Documents, Instrument, and Tangible Chattel Paper. Set forth
on Schedule 3.16(b), as of the Effective Date and as of the last date such
Schedule was required to be updated in accordance with Section 5.02, is a
description of all Documents (as defined in the UCC), Instruments (as defined in
the UCC), and Tangible Chattel Paper (as defined in the UCC) of the Loan Parties
(including the Loan Party owning such Document, Instrument and Tangible Chattel
Paper and such other information as reasonably requested by the Administrative
Agent), in each case to the extent with a value in excess of $100,000.

 

(c)                Commercial Tort Claims. Set forth on Schedule 3.16(c), as of
the Effective Date and as of the last date such Schedule was required to be
updated in accordance with Section 5.02, is a description of all Commercial Tort
Claims (as defined in the UCC) of the Loan Parties (detailing such Commercial
Tort Claim in such detail as reasonably requested by the Administrative Agent).

 

(d)                Pledged Equity Interests. Set forth on Schedule 3.16(d), as
of the Effective Date and as of the last date such Schedule was required to be
updated in accordance with Section 5.02, is a list of (i) 100% (or, if less, the
full amount owned by such Loan Party) of the issued and outstanding Equity
Interests owned by such Loan Party of each Domestic Subsidiary (other than
Excluded Subsidiaries), (ii) 66% (or, if less, the full amount owned by such
Loan Party) 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)) and
100% (or, if less, the full amount owned by such pledgor) 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)) owned by such Loan Party of each
first-tier Foreign Subsidiary and (iii) all other Equity Interests required to
be pledged to the Administrative Agent pursuant to the Collateral Documents.

 

(e)                Properties. Set forth on Schedule 3.16(e) is a list of (i)
each headquarter location of the Loan Parties (and an indication if such
location is leased or owned) and (ii) each other location where any significant
administrative functions are performed (and an indication if such location is
leased or owned).

 

SECTION 3.17.Solvency. The Loan Parties taken as a whole are solvent and are
able to pay their debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, and the fair
saleable value of the Loan Parties assets, taken as a whole and measured on a
going concern basis, exceeds all probable liabilities, including those to be
incurred pursuant to this Agreement. The Loan Parties taken as a whole do not
have unreasonably small capital in relation to the business in which they are or
propose to be engaged. The Loan Parties taken as a whole have not incurred, or
believe that they will incur debts beyond its ability to pay such debts as they
become due. In executing the Loan Documents and consummating the Transactions,
none of the Loan Parties intends to hinder, delay or defraud either present or
future creditors or other Persons to which one or more of the Loan Parties is or
will become indebted. On the Effective Date, the foregoing representations and
warranties shall be made both before and after giving effect to the
Transactions.

 

CREDIT AGREEMENT – Page 55 

 

 

SECTION 3.18.Brokers’ Fees. None of the Loan Parties or their Subsidiaries has
any obligation to any Person in respect of any finder’s, broker’s, investment
banking or other similar fee in connection with any of the Transactions, the
closing and other fees payable pursuant to this Agreement and as set forth in
any fee letter.

 

SECTION 3.19.Labor Matters. Except as could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect, (a) there
are no collective bargaining agreements or Multiemployer Plans covering the
employees of the Loan Parties or any of their Subsidiaries as of the Effective
Date and none of the Loan Parties or their Subsidiaries (i) has suffered any
strikes, walkouts, work stoppages or other material labor difficulty within the
last five years or (ii) has knowledge of any potential or pending strike,
walkout or work stoppage, (b) no unfair labor practice complaint is pending
against any Loan Party or any of its Subsidiaries and (c) there are no strikes,
walkouts, work stoppages or other material labor difficulty pending or
threatened against any Loan Party.

 

SECTION 3.20.Accuracy and Completeness of Information. No representation or
warranty made by the Borrower or any other Loan Party in any Loan Document or in
any document, instrument or other writing furnished to the Lenders by or on
behalf of any Loan Party in connection with the transactions contemplated in any
Loan Document does or will contain any untrue material statement of fact or will
omit to state any such fact (of which any executive officer of any Loan Party
has knowledge) necessary to make the representations, warranties and other
statements contained herein or in such other document, instrument or writing not
misleading in any material respect.

 

SECTION 3.21.Anti-Corruption Laws and Sanctions. Each Loan Party has implemented
and maintains in effect policies and procedures designed to ensure compliance by
such Loan Party, its Subsidiaries and their respective directors, officers,
employees and agents with Anti-Corruption Laws, including, but not limited to
with the Foreign Corrupt Practices Act, 15 U.S.C. §§ 78dd-1, et seq., and any
foreign counterpart thereto, and applicable Sanctions, and such Loan Party, its
Subsidiaries and their respective officers and directors and, to the knowledge
of such Loan Party, its employees and agents, are in compliance with
Anti-Corruption Laws and applicable Sanctions in all material respects and are
not knowingly engaged in any activity that would reasonably be expected to
result in any Loan Party being designated as a Sanctioned Person. None of (a)
any Loan Party, any Subsidiary or any of their respective directors, officers or
employees, or (b) to the knowledge of any such Loan Party or Subsidiary, any
agent of such Loan Party or any Subsidiary that will act in any capacity in
connection with or benefit from the credit facility established hereby, is a
Sanctioned Person. No Borrowing or Letter of Credit, use of proceeds,
Transaction or other transaction contemplated by this Agreement or the other
Loan Documents will violate Anti-Corruption Laws or applicable Sanctions. None
of the Loan Parties or their Subsidiaries has made a payment, offering, or
promise to pay, or authorized the payment of, money or anything of value (a) in
order to assist in obtaining or retaining business for or with, or directing
business to, any foreign official, foreign political party, party official or
candidate for foreign political office, (b) to a foreign official, foreign
political party or party official or any candidate for foreign political office,
and (c) with the intent to induce the recipient to misuse his or her official
position to direct business wrongfully to such Loan Party or its Subsidiary or
to any other Person, in violation of the Foreign Corrupt Practices Act, 15
U.S.C. §§ 78dd-1, et seq.

 

CREDIT AGREEMENT – Page 56 

 

 

SECTION 3.22.Material Contracts. Schedule 3.22 sets forth a complete and
accurate list of all Material Contracts of the Loan Parties and their
Subsidiaries in effect as of the Effective Date and as of the last date such
Schedule was required to be updated in accordance with Section 5.02. Each
Material Contract is, and after giving effect to the Transactions will be, in
full force and effect in accordance with the terms thereof.

 

SECTION 3.23.Insurance. The insurance coverage of the Loan Parties and their
Subsidiaries is outlined as to carrier, policy number, expiration date, type and
amount on Schedule 3.23 as of the Effective Date and as of the last date such
Schedule was required to be updated in accordance with Section 5.02 and such
insurance coverage complies in all material respects with the requirements set
forth in Section 5.05(b).

 

SECTION 3.24.Collateral Documents. The Collateral Documents create valid and
enforceable security interests in, and Liens on, the Collateral purported to be
covered thereby. Except as set forth in the Collateral Documents, such security
interests and Liens are currently (or will be, upon (a) the filing of
appropriate financing statements with the Secretary of State of the state of
incorporation or organization for each Loan Party and the filing of appropriate
assignments or notices with the United States Patent and Trademark Office and
the United States Copyright Office, in each case in favor of the Administrative
Agent, on behalf of the Lenders, and (b) the Administrative Agent obtaining
control or possession over those items of Collateral in which a security
interest is perfected through control or possession) perfected security
interests and Liens in favor of the Administrative Agent, for the benefit of the
Secured Parties, prior to all other Liens other than Permitted Liens other than
with respect to any of the Loan Parties’ deposit accounts, commodities accounts
and securities accounts as to which no deposit account control agreement,
commodities account control agreement and securities account control agreement,
respectively, are required to be executed and delivered.

 

SECTION 3.25.Classification of Senior Indebtedness. The Secured Obligations
constitute "Senior Indebtedness", "Designated Senior Indebtedness" or any
similar designation under and as defined in any agreement governing any
Subordinated Indebtedness and the subordination provisions set forth in each
such agreement are legally valid and enforceable against the parties thereto.

 

SECTION 3.26.Anti-Terrorism Laws. Neither any Loan Party nor any of its
Subsidiaries is an "enemy" or an "ally of the enemy" within the meaning of
Section 2 of the Trading with the Enemy Act of the United States of America (50
U.S.C. App. §§ 1 et seq.) (the "Trading with the Enemy Act"), as amended.
Neither any Loan Party nor any of its Subsidiaries is in violation of (a) the
Trading with the Enemy Act, as amended, (b) any of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) or any enabling legislation or executive order relating
thereto or (c) the Patriot Act. None of the Loan Parties (i) is a blocked person
described in Section 1 of the Anti-Terrorism Order or (ii) to the best of its
knowledge, engages in any dealings or transactions, or is otherwise associated,
with any such blocked person.

 

SECTION 3.27.Authorized Officer Set forth on Schedule 3.27 are Responsible
Officers that are permitted to sign Loan Documents on behalf of the Loan
Parties, holding the offices indicated next to their respective names, as of the
Effective Date and as of the last date such Schedule was required to be updated
in accordance with Section 5.02. Such Authorized Officers are the duly elected
and qualified officers of such Loan Party and are duly authorized to execute and
deliver, on behalf of the respective Loan Party, the Credit Agreement, the
Revolving Loan Notes and the other Loan Documents.

 

CREDIT AGREEMENT – Page 57 

 

 

SECTION 3.28.EEA Financial Institutions. No Loan Party is an EEA Financial
Institution.

 

ARTICLE IV

Conditions

 

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

 

(a)                Credit Agreement and Loan Documents. The Administrative Agent
(or its counsel, Winstead PC) shall have received (i) from each party hereto
either (A) a counterpart of this Agreement signed on behalf of such party or (B)
written evidence satisfactory to the Administrative Agent (which may include fax
or other electronic transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of this Agreement and (ii) duly
executed copies of the Loan Documents and such other certificates, documents,
instruments and agreements as the Administrative Agent shall reasonably request
in connection with the transactions contemplated by this Agreement and the other
Loan Documents, including any promissory notes requested by a Lender pursuant to
Section 2.08 payable to the order of each such requesting Lender and a written
opinion of the Loan Parties’ counsel (including the opinion of the Loan Parties'
Associate Counsel), addressed to the Administrative Agent, the Issuing Bank and
the Lenders in substantially the form of Exhibit B or any other form approved by
the Administrative Agent (which shall include, without limitation, opinions with
respect to the due organization and valid existence of each Loan Party, opinions
as to perfection of certain of the Liens granted to the Administrative Agent
pursuant to the Collateral Documents and opinions as to the non-contravention of
the Loan Parties’ organizational documents and Material Contracts), each of
which shall be in form and substance satisfactory to the Administrative Agent.

 

(b)                Financial Statements. The Administrative Agent and the
Lenders shall have received copies of the financial statements referred to in
Section 3.01, each in form and substance reasonably satisfactory to each of
them.

 

(c)                Closing Certificates; Certified Certificate of Incorporation
or Formation; Good Standing Certificates. The Administrative Agent shall have
received (i) a certificate, in form and substance satisfactory to the
Administrative Agent, of each Loan Party, dated the Effective Date and executed
by its Secretary or Assistant Secretary or, in the case of any Subsidiary that
is a partnership or limited liability company, its general partner, manager or
member, which shall (A) certify the resolutions of its Board of Directors,
members or other body authorizing the execution, delivery and performance of the
Loan Documents to which it is a party, (B) identify by name and title and bear
the signatures of the officers of such Loan Party or its manager or member, as
applicable, authorized to sign the Loan Documents to which it is a party and, in
the case of the Borrower, its Financial Officers, and (C) contain appropriate
attachments, including the charter, articles or certificate of organization or
incorporation of each Loan Party certified by the relevant authority of the
jurisdiction of organization of such Loan Party and a true and correct copy of
its bylaws or operating, management or partnership agreement, or other
organizational or governing documents, and (ii) a long form good standing
certificate for each Loan Party from its jurisdiction of organization and each
other state in which the failure to so qualify and be in good standing could
reasonably be expected to have a Material Adverse Effect.

 

CREDIT AGREEMENT – Page 58 

 

 

(d)                Financial Condition Certificate. The Administrative Agent
shall have received a certificate or certificates executed by an Authorized
Officer of the Borrower as of the Effective Date, in form and substance
reasonably acceptable to the Administrative Agent stating that (i) there does
not exist any pending or ongoing, action, suit, investigation, litigation or
proceeding in any court or before any other Governmental Authority (A) affecting
this Agreement or the other Loan Documents, that has not been settled,
dismissed, vacated, discharged or terminated prior to the Effective Date or (B)
that purports to affect any Loan Party or any of its Subsidiaries, or any
Transaction, which action, suit, investigation, litigation or proceeding which,
if adversely determined, could reasonably be expected to have a Material Adverse
Effect, that has not been settled, dismissed, vacated, discharged or terminated
prior to the Effective Date, (ii) immediately after giving effect to this
Agreement, the other Loan Documents, and all the Transactions contemplated to
occur on such date, (A) no Default or Event of Default exists and (B) all
representations and warranties contained herein and in the other Loan Documents
are true and correct in all material respects, and (iii) each of the other
conditions precedent in this Section 4.01 have been satisfied, except to the
extent the satisfaction of any such condition is subject to the judgment or
discretion of the Administrative Agent or any Lender.

 

(e)                Fees. The Lenders and the Administrative Agent shall have
received all fees required to be paid, and all expenses required to be
reimbursed for which invoices have been presented (including the reasonable fees
and expenses of legal counsel), on or before the Effective Date. All such
amounts will be paid with proceeds of Loans made on the Effective Date and will
be reflected in the funding instructions given by the Borrower to the
Administrative Agent on or before the Effective Date.

 

(f)                 Personal Property Collateral. The Administrative Agent shall
have received, in form and substance reasonably satisfactory to the
Administrative Agent:

 

(i)                 (A) searches of UCC filings in the jurisdiction of
incorporation or formation, as applicable, of each Loan Party and each
jurisdiction where any Collateral is located or where a filing would need to be
made in order to perfect the Administrative Agent’s security interest in the
Collateral, copies of the financing statements on file in such jurisdictions and
evidence that no Liens exist other than Permitted Liens and (B) tax lien and
judgment searches;

 

(ii)               searches of ownership of Intellectual Property in the
appropriate governmental offices and such patent/trademark/copyright filings as
requested by the Administrative Agent in order to perfect the Administrative
Agent’s security interest in the Intellectual Property;

 

(iii)             completed UCC financing statements for each appropriate
jurisdiction as is necessary, in the Administrative Agent’s sole discretion, to
perfect the Administrative Agent’s security interest in the Collateral;

 

(iv)              stock or membership certificates, if any, evidencing the
Equity Interests pledged to the Administrative Agent pursuant to the Security
Agreement and undated stock or transfer powers duly executed in blank;

 

(v)                each promissory note (if any) pledged to the Administrative
Agent pursuant to the Security Agreement endorsed (without recourse) in blank
(or accompanied by an executed transfer form in blank) by the pledgor thereof

 

(vi)              duly executed consents as are necessary, in the Administrative
Agent’s sole discretion, to perfect the Lenders’ security interest in the
Collateral;

 

(vii)            to the extent required to be delivered pursuant to the terms of
the Collateral Documents, all instruments, documents and chattel paper in the
possession of any of the Loan Parties, together with allonges or assignments as
may be necessary or appropriate to perfect the Administrative Agent’s and the
Lenders’ security interest in the Collateral;

 

CREDIT AGREEMENT – Page 59 

 

 

(g)                Pay-Off Letter. The Administrative Agent shall have received
satisfactory pay-off letters for all existing Indebtedness (other than
Indebtedness permitted to exist pursuant to Section 6.01) required to be repaid
(including, but not limited to the Indebtedness evidenced by the Existing Credit
Agreement) and which confirms that all Liens upon any of the property of the
Loan Parties constituting Collateral will be terminated concurrently with such
payment and all letters of credit issued or guaranteed as part of such
Indebtedness shall have been cash collateralized or supported by a Letter of
Credit, except for Existing Letters of Credit.

 

(h)                Funding Account. The Administrative Agent shall have received
a notice setting forth the deposit account of the Borrower (the "Funding
Account") to which the Administrative Agent is authorized by the Borrower to
transfer the proceeds of any Borrowings requested or authorized pursuant to this
Agreement.

 

(i)                 Collateral Access. The Administrative Agent shall have
received a Collateral Access Agreement for the Borrower's headquarters
buildings.

 

(j)                 Solvency Certificate. The Administrative Agent shall have
received an officer’s certificate prepared by a Financial Officer of the
Borrower as to the financial condition, solvency and related matters of the Loan
Parties and their Subsidiaries, after giving effect to the Transactions and the
initial borrowings under the Loan Documents, in form and substance acceptable to
the Administrative Agent.

 

(k)                [Intentionally Omitted]

 

(l)                 Letter of Credit Application. The Administrative Agent shall
have received a properly completed letter of credit application (whether
standalone or pursuant to a master agreement, as applicable) if the issuance of
a Letter of Credit will be required on the Effective Date.

 

(m)              Legal and Regulatory Due Diligence. The Administrative Agent
and its counsel, Winstead PC, shall have completed all legal due diligence, the
results of which shall be satisfactory to Administrative Agent in its sole
discretion. All legal (including tax implications) and regulatory matters shall
be satisfactory to the Administrative Agent and Lenders, including but not
limited to compliance with all applicable requirements of Regulations U, T and X
of the Board of Governors of the Federal Reserve System.

 

(n)                PATRIOT Act, Etc. The Administrative Agent and Lenders shall
have received all documentation and other information required by bank
regulatory authorities under applicable "know your customer" and anti-money
laundering rules and regulations, including PATRIOT Act, and a properly
completed and signed IRS Form W-8 or W-9, as applicable, for each Loan Party.

 

(o)                Consents. The Administrative Agent shall have received
evidence that all boards of directors, governmental, shareholder and material
third party consents and approvals necessary in connection with the Transactions
have been obtained and all applicable waiting periods have expired without any
action being taken by any authority that could restrain, prevent or impose any
material adverse conditions on such transactions or that could seek or threaten
any of the foregoing.

 

(p)                Structure. The pro forma capital, ownership and management
structure and shareholding arrangement of the Borrower and its Subsidiaries (and
all agreements relating thereto) shall be reasonably satisfactory to the
Administrative Agent.

 

CREDIT AGREEMENT – Page 60 

 

 

(q)                Other Documents. The Administrative Agent shall have received
such other documents as the Administrative Agent, the Issuing Bank or their
respective counsel may have reasonably requested.

 

For purposes of determining compliance with the conditions specified in this
Section 4.01, each Lender that has signed this Agreement shall be deemed to have
consented to, approved and accepted, or to be satisfied with, each document or
other matter required hereunder to be consented to or approved or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
written notice from such Lender prior to the Effective Date specifying its
objections thereto. The Administrative Agent shall notify the Borrower, the
Lenders and the Issuing Bank of the Effective Date, and such notice shall be
conclusive and binding. Notwithstanding the foregoing, the obligations of the
Lenders to make Loans and of the Issuing Bank to issue Letters of Credit
hereunder shall not become effective unless each of the foregoing conditions is
satisfied (or waived pursuant to Section 9.02) at or prior to 2:00 p.m., eastern
time, on December 31, 2017 (and, in the event such conditions are not so
satisfied or waived, the Commitments shall terminate at such time).

 

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

 

(a)                The representations and warranties of the Loan Parties set
forth in the Loan Documents shall be true and correct in all material respects
with the same effect as though made on and as of the date of such Borrowing or
the date of issuance, amendment, renewal or extension of such Letter of Credit,
as applicable (it being understood and agreed that any representation or
warranty which by its terms is made as of a specified date shall be required to
be true and correct in all material respects only as of such specified date, and
that any representation or warranty which is subject to any materiality
qualifier shall be required to be true and correct in all respects).

 

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

 

(c)                After giving effect to any Borrowing or the issuance,
amendment, renewal or extension of any Letter of Credit, Availability shall not
be less than zero.

 

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

 

ARTICLE V

Affirmative Covenants

 

Until all of the Secured Obligations shall have been Paid in Full, each Loan
Party executing this Agreement covenants and agrees, jointly and severally with
all of the other Loan Parties, with the Lenders that it shall:

 

SECTION 5.01.Financial Statement. Furnish to the Administrative Agent and each
of the Lenders:

 

CREDIT AGREEMENT – Page 61 

 

 

(a)                Annual Financial Statements. As soon as available and in any
event no later than ninety (90) days after the end of each fiscal year of the
Borrower (beginning with fiscal year 2017), a copy of the Consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of such fiscal year and
the related Consolidated statements of income and retained earnings and of cash
flows of the Borrower and its Subsidiaries for such year, which shall be audited
by a firm of independent certified public accountants of nationally recognized
standing reasonably acceptable to the Administrative Agent (and the
Administrative Agent hereby acknowledges that Deloitte LLP is acceptable to it),
setting forth in each case in comparative form the figures for the previous
year, reported on without a "going concern" or like qualification or exception,
or qualification indicating that the scope of the audit was inadequate to permit
such independent certified public accountants to certify such financial
statements without such qualification;

 

(b)                Quarterly Financial Statements. As soon as available and in
any event no later than forty-five (45) days after the end of each of the first
three fiscal quarters of each fiscal year of the Borrower, a copy of the
Consolidated balance sheet of the Borrower and its Subsidiaries as of the end of
such period and related Consolidated statements of income and retained earnings
and of cash flows for the Borrower and its Subsidiaries for such quarterly
period and for the portion of the fiscal year ending with such period, in each
case setting forth in comparative form Consolidated figures for the
corresponding period or periods of the preceding fiscal year (subject to normal
recurring year-end audit adjustments); and

 

(c)                Annual Operating Budget and Cash Flow. As soon as available,
but in any event no later than sixty (60) days after the beginning of each
fiscal year (including fiscal year 2018), a copy of the detailed annual
operating budget or plan including cash flow projections of the Borrower and its
Subsidiaries for such fiscal year prepared on a quarterly basis, in form and
detail reasonably acceptable to the Administrative Agent and the Lenders,
together with a summary of the material assumptions made in the preparation of
such annual budget or plan; all such financial statements furnished pursuant to
subsections (a) and (b) above shall be complete and correct in all material
respects (subject, in the case of interim statements, to normal recurring
year-end audit adjustments and except that such statements are condensed and
exclude detailed footnote disclosures) and to be prepared in reasonable detail
and, in the case of the annual and quarterly financial statements provided in
accordance with subsections (a) and (b) above, in accordance in all material
respects with GAAP applied consistently throughout the periods reflected therein
and further accompanied by a description of, and an estimation of the effect on
the financial statements on account of, a change, if any, in GAAP as provided in
Section 1.04.

 

Notwithstanding the foregoing, financial statements and reports required to be
delivered pursuant to the foregoing provisions of this Section may be delivered
electronically and if so, shall be deemed to have been delivered on the date on
which the Administrative Agent receives such reports from the Borrower through
electronic mail; provided that, upon the Administrative Agent’s request, the
Borrower shall provide paper copies of any documents required hereby to the
Administrative Agent.

 

SECTION 5.02.Certificates; Other Information. Furnish to the Administrative
Agent and each of the Lenders:

 

(a)                Officer’s Certificate. Concurrently with the delivery of the
financial statements referred to in Sections 5.01(a) and 5.01(b) above, a
certificate of an Authorized Officer substantially in the form of Exhibit D
(i) certifying, in the case of the financial statements delivered under 5.01(b)
above, as presenting fairly in all material respects the financial condition and
results of operations of the Borrower and its consolidated Subsidiaries on a
Consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes, (ii) certifying
as to whether a Default has occurred and, if a Default has occurred, specifying
the details thereof and any action taken or proposed to be taken with respect
thereto, (iii) setting forth reasonably detailed calculations demonstrating
compliance with Section 5.10 and (iv) stating whether any change in GAAP or in
the application thereof has occurred since the date of the audited financial
statements referred to in Section 3.01 and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate (which specification may be a cross-reference to any publically
filed financial statements).

 

CREDIT AGREEMENT – Page 62 

 

 

(b)                Updated Schedules. Concurrently with or prior to the delivery
of the financial statements referred to in Sections 5.01(a) and 5.01(b) above,
(i) an updated copy of Schedule 3.03 and Schedule 3.12 if the Loan Parties or
any of their Subsidiaries has formed or acquired a new Subsidiary since the
Effective Date or since such Schedule was last updated, as applicable, (ii) an
updated copy of Schedule 3.16(a) if the Loan Parties have registered, applied
for registration of, acquired or otherwise obtained ownership of any new
Intellectual Property since the Effective Date or since such Schedule was last
updated, as applicable, (iii) an updated copy of Schedule 3.16(b) if the Loan
Parties have obtained any Documents (as defined in the UCC), Instruments (as
defined in the UCC) or Tangible Chattel Paper (as defined in the UCC) since the
Effective Date or since such Schedule was last updated, as applicable, (iv) an
updated copy of Schedule 3.16(d) if the Loan Parties have any Commercial Tort
Claims (as defined in the UCC) not otherwise set forth on such Schedule as of
the Effective Date or since such Schedule was last updated, as applicable, (v)
an updated copy of Schedule 3.16(e) to the extent required to be updated to make
the representation in Section 3.16(e) true and correct, (vi) an updated copy of
Schedule 3.16(f) to the extent any Loan Party has a (1) headquarter location and
(2) location where any significant administrative functions are performed (and
an indication whether such location is leased or owned), to the extent not
otherwise set forth on such Schedule as of the Effective Date or since such
Schedule was last updated, as applicable, (vii) an updated copy of Schedule 3.22
if any new Material Contract has been entered into or any Material Contract has
been terminated since the Effective Date or since such Schedule was last
updated, as applicable, together with a copy of each new Material Contract, and
(viii) an updated copy of Schedule 3.23 if the Loan Parties or any of their
Subsidiaries has altered or acquired any insurance policies since the Effective
Date or since such Schedule was last updated.

 

(c)                Reports; SEC Filings; Regulatory Reports; Press Releases;
Etc. Promptly upon their becoming available, (i) copies of all reports (other
than those provided pursuant to Section 5.01 and those which are of a
promotional nature) and other financial information which any Loan Party sends
to its shareholders, (ii) copies of all reports and all registration statements
and prospectuses, if any, which any Loan Party may make to, or file with, the
SEC (or any successor or analogous Governmental Authority) or any securities
exchange or other private regulatory authority, (iii) all material regulatory
reports and (iv) all press releases and other statements made available by any
of the Loan Parties to the public concerning material developments in the
business of any of the Loan Parties.

 

(d)                Calculations. Within ninety (90) days after the end of each
fiscal year of the Borrower, a certificate containing information including the
amount of all Restricted Payments and Investments (including Permitted
Acquisitions and Permitted Construction Transactions), that were made during the
prior fiscal year.

 

(e)                Changes in Corporate Structure. Within ten days prior to any
merger, consolidation, dissolution or other change in corporate structure of any
Loan Party or any of its subsidiaries permitted pursuant to the terms hereof,
provide notice of such change in corporate structure to the Administrative
Agent.

 

(f)                 General Information. Promptly, such additional financial and
other information as the Administrative Agent, on behalf of any Lender, may from
time to time reasonably request.

 

CREDIT AGREEMENT – Page 63 

 

 

SECTION 5.03.Payment of Taxes and Other Obligations. Pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case may
be, subject, where applicable, to specified grace periods, (a) all of its
material taxes (Federal, state, local and any other taxes), (b) all of its other
obligations and liabilities of whatever nature in accordance with industry
practice to the extent failure to pay could reasonably be expected to have a
Material Adverse Effect and (c) any additional costs that are imposed as a
result of any failure to so pay, discharge or otherwise satisfy such taxes,
obligations and liabilities, except when the amount or validity of any such
taxes, obligations and liabilities is currently being contested in good faith by
appropriate proceedings and reserves, if applicable, in conformity with GAAP
with respect thereto have been provided on the books of the Loan Parties.

 

SECTION 5.04.Conduct of Business and Maintenance of Existence. Except as
expressly permitted under Section 6.04, continue to engage in business of the
same general type as now conducted by it on the Effective Date and preserve,
renew and keep in full force and effect its corporate or other formative
existence and good standing, take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business and to maintain its goodwill and comply in all material respects with
Requirements of Law.

 

SECTION 5.05.Maintenance of Property; Insurance. Maintain with financially sound
and reputable insurance companies liability, casualty, property and business
interruption insurance (including, without limitation, insurance with respect to
its tangible Collateral) in at least such amounts and against at least such
risks as are usually insured against in the same general area by companies
engaged in the same or a similar business; and furnish to the Administrative
Agent, upon the request of the Administrative Agent, full information as to the
insurance carried. To the extent permitted under applicable laws, the
Administrative Agent shall be named (i) as lenders’ loss payee, as its interest
may appear with respect to any property insurance, and (ii) as additional
insured, as its interest may appear, with respect to any such liability
insurance, and each provider of any such insurance shall agree, by endorsement
upon the policy or policies issued by it or by independent instruments to be
furnished to the Administrative Agent, that it will give the Administrative
Agent thirty (30) days prior written notice before any such policy or policies
shall be altered or canceled, and such policies shall provide that no act or
default of the Loan Parties or any of their Subsidiaries or any other Person
shall affect the rights of the Administrative Agent or the Lenders under such
policy or policies.

 

SECTION 5.06.Maintenance of Books and Records. Keep proper books, records and
accounts which permit financial statements to be prepared in accordance with
GAAP.

 

SECTION 5.07.Notices . Give notice in writing to the Administrative Agent (which
shall promptly transmit such notice to each Lender):

 

(a)                promptly, but in any event within two (2) Business Days after
any Loan Party knows thereof, the occurrence of any Default or Event of Default;

 

(b)                promptly after becoming aware of any default or event of
default under any Contractual Obligation of any Loan Party or any of its
Subsidiaries which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect or involve a monetary claim in excess
of $2,500,000;

 

(c)                promptly after becoming aware of any litigation, or any
investigation or proceeding known or threatened to any Loan Party (i) affecting
any Loan Party or any of its Subsidiaries which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect or
involve a monetary claim in excess of $5,000,000 or involving injunctions or
requesting injunctive relief by or against any Loan Party or any Subsidiary of
any Loan Party, (ii) affecting or with respect to this Agreement, any other Loan
Document or any security interest or Lien created thereunder, (iii)involving an
environmental claim or potential liability under Environmental Laws which could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, or (iv) by any Governmental Authority relating to any Loan Party
or any Subsidiary thereof and alleging fraud, deception or willful misconduct by
such Person;

 

CREDIT AGREEMENT – Page 64 

 

 

(d)                of any labor controversy that has resulted in, or threatens
to result in, a strike or other work action against any Loan Party which could
reasonably be expected to have a Material Adverse Effect;

 

(e)                of any attachment, judgment, lien, levy or order exceeding
$5,000,000 that may be assessed against or threatened against any Loan Party
other than Permitted Liens;

 

(f)                 as soon as possible and in any event within thirty (30) days
after any Loan Party knows or has reason to know thereof, the occurrence of any
ERISA Event that, alone or together with any other ERISA Events that have
occurred, in each case which could reasonably be expected to have a Material
Adverse Effect;

 

(g)                promptly, any notice of any violation received by any Loan
Party from any Governmental Authority including, without limitation, any notice
of violation of Environmental Laws which could reasonably be expected to have a
Material Adverse Effect; and

 

(h)                promptly, any other development or event which could
reasonably be expected to have a Material Adverse Effect.

 

Each notice pursuant to this Section shall be accompanied by a statement of an
Authorized Officer setting forth details of the occurrence referred to therein
and stating what action the Loan Parties propose to take with respect thereto.
In the case of any notice of a Default or Event of Default, the Borrower shall
specify that such notice is a Default or Event of Default notice on the face
thereof.

 

SECTION 5.08.Use of Proceeds.

 

(a)                The proceeds of the Loans will be used only to refinance in
full the Indebtedness existing under the Existing Credit Agreement, to finance
the working capital needs of the Borrower and its Subsidiaries in the ordinary
course of business and for general corporate purposes in the ordinary course of
business. No part of the proceeds of any Loan and no Letter of Credit will be
used, whether directly or indirectly, (i) for any purpose that entails a
violation of any of the Regulations of the Board, including Regulations T, U and
X or (ii) to make any acquisition, other than a Permitted Acquisition. Letters
of Credit will be issued only to support working capital needs of the Borrower
and its Subsidiaries in the ordinary course of business and for general
corporate purposes in the ordinary course of business.

 

(b)                The Borrower will not request any Borrowing or Letter of
Credit, and the Borrower shall not use, and shall procure that its Subsidiaries
and its or their respective directors, officers, employees and agents shall not
use, the proceeds of any Borrowing or Letter of Credit (a) in furtherance of an
offer, payment, promise to pay, or authorization of the payment or giving of
money, or anything else of value, to any Person in violation of any
Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating
any activities, business or transaction of or with any Sanctioned Person, or in
any Sanctioned Country, to the extent that such activities, business or
transaction would be prohibited by Sanctions if conducted by a corporation
incorporated in the United States or the European Union, or (c) in any manner
that would result in the violation of any Sanctions applicable to any party
hereto.

 

CREDIT AGREEMENT – Page 65 

 

 

SECTION 5.09.Environmental Laws.

 

(a)                Except as could not reasonably be expected, either
individually or in the aggregate, to have a Material Adverse Effect, comply with
all applicable Environmental Laws and obtain and comply with and maintain any
and all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws;

 

(b)                Except as could not reasonably be expected, either
individually or in the aggregate, to have a Material Adverse Effect, conduct and
complete all investigations, studies, sampling and testing, and all remedial,
removal and other actions required under Environmental Laws and promptly comply
with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws except to the extent that the same are being contested in
good faith by appropriate proceedings; and

 

(c)                Defend, indemnify and hold harmless the Administrative Agent
and the Lenders, and their respective employees, agents, officers and directors
and affiliates, from and against any and all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, known or unknown, contingent or otherwise, arising out of, or in any way
relating to the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of the Loan Parties or any of
their Subsidiaries or the Properties, or any orders, requirements or demands of
Governmental Authorities related thereto, including, without limitation,
reasonable attorney’s and consultant’s fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that
any of the foregoing arise out of the gross negligence or willful misconduct of
the party seeking indemnification therefor. The agreements in this paragraph
shall survive repayment of the Secured Obligations and all other amounts payable
hereunder and termination of the Commitments and the Loan Documents.

 

SECTION 5.10.Financial Covenants. Comply with the following financial covenants:

 

(a)                Adjusted Leverage Ratio. The Adjusted Leverage Ratio,
calculated as of the last day of each fiscal quarter shall be less than or equal
to 4.75 to 1.00.

 

(b)                Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio,
calculated as of the last day of each fiscal quarter, shall be greater than or
equal to 1.50 to 1.00.

 

SECTION 5.11.Additional Guarantors. The Loan Parties will cause each of their
Domestic Subsidiaries (other than Excluded Subsidiaries), whether newly formed,
after acquired or otherwise existing to promptly (and in any event within thirty
(30) days after such Subsidiary is formed or acquired (or such longer period of
time as agreed to by the Administrative Agent in its reasonable discretion))
become a Guarantor hereunder by way of execution of a Joinder Agreement. In
connection therewith, the Loan Parties shall give notice to the Administrative
Agent not less than ten (10) days prior to creating a Subsidiary (or such
shorter period of time as agreed to by the Administrative Agent in its
reasonable discretion), or acquiring the Equity Interests of any other Person.
The Secured Obligations shall be secured by, among other things, a first
priority perfected security interest in the Collateral of such new Guarantor and
a pledge of 100% of the Equity Interests of such new Guarantor and its Domestic
Subsidiaries (other than any Domestic Subsidiary that is owned by a Foreign
Subsidiary) and 66% of the voting Equity Interests and 100% of the non-voting
Equity Interests of its first-tier Foreign Subsidiaries. In connection with the
foregoing, the Loan Parties shall deliver to the Administrative Agent, with
respect to each new Guarantor to the extent applicable, substantially the same
documentation required pursuant to Sections 4.01(a), 4.01(c), 4.01(d), 4.01(f),
4.01(j), 4.01(k), 4.01(n), 4.01(o), 4.01(q) and 5.13 and such other documents or
agreements as the Administrative Agent may reasonably request.

 

CREDIT AGREEMENT – Page 66 

 

 

SECTION 5.12.Compliance with Law. Comply with all Requirements of Law and orders
(including Environmental Laws), and all applicable restrictions imposed by all
Governmental Authorities, applicable to it and the Collateral if noncompliance
with any such Requirements of Law, order or restriction could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

SECTION 5.13.Pledged Assets.

 

(a)                Equity Interests. Each Loan Party will cause 100% of the
Equity Interests in each of its direct or indirect Domestic Subsidiaries (other
than any Excluded Subsidiary and any Domestic Subsidiary that is owned by a
Foreign Subsidiary) and 66% of the voting Equity Interests and 100% of the
non-voting Equity Interests of its first-tier Foreign Subsidiaries, in each case
to the extent owned by such Loan Party, to be subject at all times to a first
priority, perfected Lien in favor of the Administrative Agent pursuant to the
terms and conditions of the Collateral Documents or such other security
documents as the Administrative Agent shall reasonably request.

 

(b)                Personal Property. Subject to any exclusions set forth in the
Collateral Documents, each Loan Party will cause all of its tangible and
intangible personal property (other than real property leases) now owned or
hereafter acquired by it to be subject at all times to a first priority,
perfected Lien (subject in each case to Permitted Liens) in favor of the
Administrative Agent for the benefit of the Secured Parties to secure the
Secured Obligations pursuant to the terms and conditions of the Collateral
Documents or such other security documents as the Administrative Agent shall
reasonably request. Each Loan Party shall, and shall cause each of its
Subsidiaries to, adhere to the covenants set forth in the Collateral Documents.

 

(c)                Leases and other Agreements. Each Loan Party shall timely and
fully pay and perform its obligations under all leases and other agreements with
respect to each leased location or public warehouse where any Collateral is or
may be located except where the failure to pay or perform could not reasonably
be expected to have a Material Adverse Effect.

 

SECTION 5.14.Further Assurances.

 

(a)                Public/Private Designation. The Loan Parties will cooperate
with the Administrative Agent in connection with the publication of certain
materials and/or information provided by or on behalf of the Loan Parties to the
Administrative Agent and Lenders (collectively, "Information Materials") and
will designate Information Materials (i) that are either available to the public
or not material with respect to the Loan Parties and their Subsidiaries or any
of their respective securities for purposes of United States federal and state
securities laws, as "Public Information" and (ii) that are not Public
Information as "Private Information".

 

(b)                Additional Information. The Loan Parties shall provide such
information regarding the operations, business affairs and financial condition
of the Loan Parties and their Subsidiaries as the Administrative Agent or any
Lender may reasonably request.

 

(c)                Visits and Inspections. The Loan Parties shall permit
representatives of the Administrative Agent or any Lender, from time to time
upon prior reasonable notice and at such times during normal business hours, to
visit and inspect its properties (including the Collateral); inspect, audit and
make extracts from its books, records and files; and discuss with its principal
officers, and its independent accountants, its business, assets, liabilities,
financial condition, results of operations and business prospects. Upon the
occurrence and during the continuance of an Event of Default, the Administrative
Agent or any Lender may do any of the foregoing at any time without advance
notice.

 

CREDIT AGREEMENT – Page 67 

 

 

(d)                Further Assurances. Upon the reasonable request of the
Administrative Agent, promptly perform or cause to be performed any and all acts
and execute or cause to be executed any and all documents for filing under the
provisions of the UCC or any other Requirement of Law which are necessary or
advisable to maintain in favor of the Administrative Agent, for the benefit of
the Secured Parties, Liens on the Collateral that are duly perfected in
accordance with the requirements of, or the obligations of the Loan Parties
under, the Loan Documents and all applicable Requirements of Law.

 

SECTION 5.15.New Restaurants. Provide the Administrative Agent, as of the end of
each fiscal quarter (beginning with the end of the fourth quarter of the 2017
fiscal year), notice of the acquisition, lease or construction (or binding
commitment to construct) of any new Restaurant by the Borrower or any
Subsidiary.

 

SECTION 5.16.Subordination of Intercompany Debt. Each Loan Party agrees that all
intercompany Indebtedness among Loan Parties (the "Intercompany Debt") is
subordinated in right of payment, to the prior payment in full of all Secured
Obligations. Notwithstanding any provision of this Agreement to the contrary,
provided that no Event of Default has occurred and is continuing, Loan Parties
may make and receive payments with respect to the Intercompany Debt to the
extent otherwise permitted by this Agreement; provided that in the event of and
during the continuation of any Event of Default, no payment shall be made by or
on behalf of any Loan Party on account of any Intercompany Debt. In the event
that any Loan Party receives any payment of any Intercompany Debt at a time when
such payment is prohibited by this Section, such payment shall be held by such
Loan Party, in trust for the benefit of, and shall be paid forthwith over and
delivered, upon written request, to, the Administrative Agent.

 

SECTION 5.17.Post-Closing Matters

 

(a)                Deliver to the Administrative Agent, in form and substance
and pursuant to documentation acceptable to the Administrative Agent, a
re-issued stock certificate for each Subsidiary whose stock certificate bears
any legend not acceptable to the Administrative Agent, together with powers,
undated and executed in blank, on or prior to December 14, 2017 (or such later
date agreed to in writing by the Administrative Agent in its sole discretion).

 

(b)                Deliver to the Administrative Agent copies of insurance
policies or certificates and endorsements of insurance evidencing liability,
casualty, property and business interruption insurance meeting the requirements
set forth herein or in the Collateral Documents, on or prior to December 14,
2017 (or such later date agreed to in writing by the Administrative Agent in its
sole discretion). The Administrative Agent shall be named (i) as lenders’ loss
payee, as its interest may appear, with respect to any such insurance providing
coverage in respect of any Collateral and (ii) as additional insured, as its
interest may appear, with respect to any such insurance providing liability
coverage, and the Loan Parties will use their commercially reasonable efforts to
have each provider of any such insurance agree, by endorsement upon the policy
or policies issued by it or by independent instruments to be furnished to the
Administrative Agent, that it will give the Administrative Agent thirty (30)
days prior written notice before any such policy or policies shall be altered or
cancelled.

 

ARTICLE VI

Negative Covenants

 

Until all of the Secured Obligations shall have been Paid in Full, each Loan
Party executing this Agreement covenants and agrees, jointly and severally with
all of the other Loan Parties, with the Lenders that:

 

CREDIT AGREEMENT – Page 68 

 

 

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

 

(a)                Indebtedness arising or existing under this Agreement and the
other Loan Documents;

 

(b)                Indebtedness of the Loan Parties and their Subsidiaries
existing as of the Effective Date as referred to in the financial statements
referenced in Section 3.01 (and set out more specifically in Schedule 6.01(b)
hereto) and any renewals, refinancings or extensions thereof in a principal
amount not in excess of that outstanding as of the date of such renewal,
refinancing or extension and the terms of any such renewal, refinancing or
extension are not less favorable in any material respect to the obligor
thereunder;

 

(c)                Indebtedness of the Loan Parties and their Subsidiaries
incurred after the Effective Date consisting of Capital Leases or Indebtedness
incurred to provide all or a portion of the purchase price or cost of
construction of an asset; provided that (i) such Indebtedness when incurred
shall not exceed the purchase price or cost of construction of such asset; (ii)
no such Indebtedness shall be renewed, refinanced or extended for a principal
amount in excess of the principal balance outstanding thereon at the time of
such renewal, refinancing or extension; and (iii) the total amount of all such
Indebtedness shall not exceed $10,000,000 at any time outstanding;

 

(d)                Unsecured intercompany Indebtedness among the Loan Parties;

 

(e)                Indebtedness and obligations owing under (i) Banking Services
and (ii) other Swap Agreements entered into in the ordinary course of business
in order to manage existing or anticipated interest rate, exchange rate or
commodity price risks and not for speculative purposes;

 

(f)                 Indebtedness of a Person existing at the time such Person
becomes a Subsidiary of a Loan Party in a transaction permitted hereunder in an
aggregate principal amount not to exceed $10,000,000 for all such Persons;
provided that any such Indebtedness was not created in anticipation of or in
connection with the transaction or series of transactions pursuant to which such
Person became a Subsidiary of a Loan Party;

 

(g)                all ASC Section 840-40 lease financing obligations;

 

(h)                Guarantees in respect of Indebtedness of a Loan Party to the
extent such Indebtedness is permitted to exist or be incurred pursuant to this
Section; and

 

(i)                 other unsecured Indebtedness of Loan Parties in an aggregate
amount not to exceed $15,000,000; provided that the Loan Parties are in pro
forma compliance with each of the financial covenants set forth in Section 5.10.

 

SECTION 6.02.Liens. The Loan Parties will not, nor will they permit any
Subsidiary to, contract, create, incur, assume or permit to exist any Lien with
respect to any of their respective property or assets of any kind (whether real
or personal, tangible or intangible), whether now owned or hereafter acquired,
except for the following (the "Permitted Liens"):

 

(a)                Liens created by or otherwise existing under or in connection
with this Agreement or the other Loan Documents in favor of the Administrative
Agent on behalf of the Secured Parties;

 

CREDIT AGREEMENT – Page 69 

 

 

(b)                Liens in favor of a provider of Banking Services in
connection with Banking Services; provided that such Liens shall secure the
Secured Obligations on a pari passu basis;

 

(c)                Liens securing purchase money Indebtedness and Capital Lease
Obligations (and refinancings thereof) to the extent permitted under Section
6.01(c); provided, that (i) any such Lien attaches to such property concurrently
with or within thirty (30) days after the acquisition thereof and (ii) such Lien
attaches solely to the property so acquired in such transaction;

 

(d)                Liens for taxes, assessments, charges or other governmental
levies not yet due or as to which the period of grace, if any, related thereto
has not expired or which are being contested in good faith by appropriate
proceedings; provided that adequate reserves with respect to such contested
amounts are maintained on the books of any Loan Party or its Subsidiaries, as
the case may be, in conformity with GAAP;

 

(e)                statutory Liens such as carriers’, warehousemen’s,
mechanics’, materialmen’s, landlords’, repairmen’s or other like Liens arising
in the ordinary course of business which are not overdue for a period of more
than thirty (30) days or which are being contested in good faith by appropriate
proceedings;

 

(f)                 pledges or deposits in connection with workers’
compensation, unemployment insurance and other social security legislation
(other than any Lien imposed by ERISA) and deposits securing liability to
insurance carriers under insurance or self-insurance arrangements in an
aggregate amount not to exceed $500,000;

 

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

 

(h)                easements, rights of way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;

 

(i)                 (i) Liens existing on the Effective Date and set forth on
Schedule 1.01(b); provided that (i) no such Lien shall at any time be extended
to cover property or assets other than the property or assets subject thereto on
the Effective Date and improvements thereon and (ii) the principal amount of the
Indebtedness secured by such Lien shall not be extended, renewed, refunded or
refinanced;

 

(j)                 any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any Lien referred
to in this definition (other than Liens set forth on Schedule 1.01(b)); provided
that such extension, renewal or replacement Lien shall be limited to all or a
part of the property which secured the Lien so extended, renewed or replaced
(plus improvements on such property);

 

(k)                Liens arising in the ordinary course of business by virtue of
any contractual, statutory or common law provision relating to banker’s Liens,
rights of set-off or similar rights and remedies covering deposit or securities
accounts (including funds or other assets credited thereto) or other funds
maintained with a depository institution or securities intermediary;

 

(l)                 any zoning, building or similar laws or rights reserved to
or vested in any Governmental Authority;

 

CREDIT AGREEMENT – Page 70 

 

 

(m)              restrictions on transfers of securities imposed by applicable
Securities Laws;

 

(n)                Liens arising out of judgments or awards not resulting in an
Event of Default;

 

(o)                Liens on the property of a Person existing at the time such
Person becomes a Subsidiary of a Loan Party in a transaction permitted hereunder
securing Indebtedness in an aggregate principal amount not to exceed $10,000,000
for all such Persons; provided, however, that any such Lien may not extend to
any other property of any Loan Party or any other Subsidiary that is not a
Subsidiary of such Person; provided, further, that any such Lien was not created
in anticipation of or in connection with the transaction or series of
transactions pursuant to which such Person became a Subsidiary of a Loan Party;

 

(p)                any interest or title of a lessor, licensor or sublessor
under any lease, license or sublease entered into by any Loan Party or any
Subsidiary thereof in the ordinary course of its business and covering only the
assets so leased, licensed or subleased;

 

(q)                Liens in favor of the Administrative Agent and/or Issuing
Bank to cash collateralize or otherwise secure the obligations of a Defaulting
Lender to fund risk participations hereunder;

 

(r)                 assignments of insurance or condemnation proceeds provided
to landlords (or their mortgagees) pursuant to the terms of any lease and Liens
or rights reserved in any lease for rent or for compliance with the terms of
such lease; and

 

(s)                 additional Liens so long as the principal amount of
Indebtedness and other obligations secured thereby does not exceed $5,000,000 in
the aggregate.

 

Notwithstanding the foregoing, if a Loan Party shall grant a Lien on any of its
assets in violation of this Section, then it shall be deemed to have
simultaneously granted an equal and ratable Lien on any such assets in favor of
the Administrative Agent for the ratable benefit of the Secured Parties, to the
extent such Lien has not already been granted to the Administrative Agent.

 

SECTION 6.03.Nature of Business. No Loan Party will, nor will it permit any
Subsidiary (other than the Excluded Subsidiaries) to, alter the character of its
business in any material respect from that conducted as of the Effective Date.

 

SECTION 6.04.Consolidation, Merger, Sale or Purchase of Assets, etc. The Loan
Parties will not, nor will they permit any Subsidiary to,

 

(a)                dissolve, liquidate or wind up its affairs, or sell,
transfer, lease or otherwise dispose of its property or assets (each a
"Disposition") or agree to do so at a future time, except the following, without
duplication, shall be expressly permitted:

 

(i)                 (A) the sale, transfer, lease or other disposition of
inventory and materials in the ordinary course of business and (B) the
conversion of cash into Cash Equivalents and Cash Equivalents into cash;

 

(ii)               the sale, transfer or other disposition of property or assets
to an unrelated party not in the ordinary course of business where and to the
extent that such sale, transfer or other disposition is the result of theft,
loss, physical destruction or damage, taking or similar event with respect to
any of the Loan Parties or any of their Subsidiaries’ respective property or
assets;

 

CREDIT AGREEMENT – Page 71 

 

 

(iii)             the sale, lease, transfer or other disposition of machinery,
parts and equipment no longer used or useful in the conduct of the business of
the Loan Parties or any of their Subsidiaries;

 

(iv)              the sale, lease or transfer of property or assets from one
Loan Party to another Loan Party or dissolution of any Loan Party (other than
the Borrower) to the extent any and all assets of such Loan Party are
distributed to another Loan Party;

 

(v)                the termination of any Swap Agreement;

 

(vi)              the sale, lease, transfer, closure or other disposition
(including, without limitation, refranchising) of Restaurants and real property
related thereto, the termination or non-renewal of leases or the subletting of
Restaurants, in each case as determined to be prudent in the reasonable judgment
of the senior officers of the Borrower;

 

(vii)            Sale Leaseback transactions to the extent permitted under
Section 6.12; and

 

(viii)          any other sale, lease or transfer of property or assets not to
exceed $2,500,000 in the aggregate in any fiscal year;

 

provided that (A) with respect to clauses (iii), (vi), (vii) and (viii) above,
at least 75% of the consideration received therefor by the Loan Parties or any
such Subsidiary shall be in the form of cash or Cash Equivalents, assets used in
the business or capital stock, (B) after giving effect to any Disposition
pursuant to clause (vii) above, the Loan Parties shall be in compliance on a Pro
Forma Basis with the financial covenants set forth in Section 5.10 hereof,
recalculated for the most recently ended fiscal quarter for which information is
available and (C) with respect to clause (vii) above, no Default or Event of
Default shall exist or shall result therefrom; provided, further, that with
respect to sales of assets permitted hereunder only, the Administrative Agent
shall, without the consent of any Lender, release its Liens relating to the
particular assets sold; or

 

(b)                (i) purchase, lease or otherwise acquire (in a single
transaction or a series of related transactions) the property or assets of any
Person, other than (A) Permitted Acquisitions, (B) the lease or acquisition of
real property in connection with Permitted Construction Transactions; (C) except
as otherwise limited or prohibited herein, purchases or other acquisitions of
inventory, materials, property and equipment in the ordinary course of business
and (D) Investments permitted by Section 6.05 or (ii) enter into any transaction
of merger or consolidation, except for (A) Investments or acquisitions permitted
pursuant to Section 6.05 so long as the Loan Party subject to such merger or
consolidation is the surviving entity, (B) (y) the merger or consolidation of a
Subsidiary that is not a Loan Party with and into a Loan Party; provided that
such Loan Party will be the surviving entity and (z) the merger or consolidation
of a Loan Party with and into another Loan Party; provided that if the Borrower
is a party thereto, the Borrower will be the surviving corporation, and (C) the
merger or consolidation of a Subsidiary that is not a Loan Party with and into
another Subsidiary that is not a Loan Party.

 

SECTION 6.05.Advances, Investments and Loans. The Loan Parties will not, nor
will they permit any Subsidiary to, make any Investment or contract to make any
Investment except for the following (the "Permitted Investments"):

 

(a)                cash and Cash Equivalents;

 

(b)                Investments existing as of the Effective Date as set forth on
Schedule 1.01(a) (which shall include new Restaurant development);

 

CREDIT AGREEMENT – Page 72 

 

 

(c)                receivables owing to the Loan Parties or any of their
Subsidiaries or any receivables and advances to suppliers, in each case if
created, acquired or made in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms;

 

(d)                Investments in and loans to any Loan Party;

 

(e)                loans and advances to officers, directors and employees in an
aggregate amount not to exceed $200,000 at any time outstanding; provided that
such loans and advances shall comply with all applicable Requirements of Law
(including Sarbanes-Oxley);

 

(f)                 Investments (including debt 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 arising in the ordinary course of business;

 

(g)                Permitted Acquisitions;

 

(h)                the construction or development of a new Restaurant;
provided, however, that in each such case, at the time such Loan Party enters
into a contract obligating a Loan Party or any of its Subsidiaries to commence
construction or develop a new Restaurant which obligates any Loan Party to pay
greater than $250,000 in the aggregate (i) no Default or Event of Default shall
have occurred and be continuing or would exist after giving effect to the
construction or development of the new Restaurant, and (ii) after giving effect
to the construction or development of such new Restaurant on a Pro Forma basis
(A) the Loan Parties are in compliance with each of the financial covenants set
forth in Section 5.10 and (B) the Adjusted Leverage Ratio shall be less than or
equal to 4.50 to 1.00 (each such construction or development of a new Restaurant
permitted pursuant to this clause (h) shall be referred to in this Agreement as
a "Permitted Construction Transaction");

 

(i)                 Banking Services to the extent permitted hereunder; and

 

(j)                 additional loan advances and/or Investments of a nature not
contemplated by the foregoing clauses hereof; provided that such loans, advances
and/or Investments made after the Effective Date pursuant to this clause shall
not exceed an aggregate amount of $2,500,000 at any one time outstanding.

 

SECTION 6.06.Transactions with Affiliates. The Loan Parties will not, nor will
they permit any Subsidiary to, enter into any transaction or series of
transactions, whether or not in the ordinary course of business, with any
officer, director, shareholder or Affiliate other than on terms and conditions
substantially as favorable as would be obtainable in a comparable arm’s-length
transaction with a Person other than an officer, director, shareholder or
Affiliate, other than (a)transactions solely between or among Loan Parties and
(b) any Restricted Payment permitted by Section 6.10.

 

SECTION 6.07.Ownership of Subsidiaries; Restrictions. The Loan Parties will not,
nor will they permit any Subsidiary to, create, form or acquire any
Subsidiaries, except for Domestic Subsidiaries that are joined as Additional
Loan Parties as required by the terms hereof. The Loan Parties will not sell,
transfer, pledge or otherwise dispose of any Equity Interests in any of their
Subsidiaries, nor will they permit any of their Subsidiaries to issue, sell,
transfer, pledge or otherwise dispose of any of their Equity Interests, except
in a transaction permitted by Section 6.04.

 

SECTION 6.08.Corporate Changes; Material Contracts. No Loan Party will, nor will
it permit any of its Subsidiaries to, (a) change its fiscal quarters or fiscal
year, (b) amend, modify or change its articles of incorporation, certificate of
designation (or corporate charter or other similar organizational document)
operating agreement or bylaws (or other similar document) in any respect
materially adverse to the interests of the Lenders without the prior written
consent of the Required Lenders. No Loan Party shall (a) (i) except as permitted
under Section 6.4, alter its legal existence or, in one transaction or a series
of transactions, merge into or consolidate with any other entity, or sell all or
substantially all of its assets, (ii) change its state of incorporation or
organization, without providing thirty (30) days prior written notice to the
Administrative Agent and without filing (or confirming that the Administrative
Agent has filed) such financing statements and amendments to any previously
filed financing statements as the Administrative Agent may require, or
(iii) change its registered legal name, without providing thirty (30) days prior
written notice to the Administrative Agent and without filing (or confirming
that the Administrative Agent has filed) such financing statements and
amendments to any previously filed financing statements as the Administrative
Agent may require, (b) amend, modify, cancel or terminate or fail to renew or
extend or permit the amendment, modification, cancellation or termination of any
of its Material Contracts in any respect materially adverse to the interests of
the Lenders without the prior written consent of the Required Lenders, (c) have
more than one state of incorporation, organization or formation, or (d) change
its accounting method (except in accordance with GAAP) in any manner adverse to
the interests of the Lenders without the prior written consent of the Required
Lenders.

 

CREDIT AGREEMENT – Page 73 

 

 

SECTION 6.09.Limitation on Restricted Actions. The Loan Parties will not, nor
will they permit any Subsidiary to, directly or indirectly, create or otherwise
cause or suffer to exist or become effective any encumbrance or restriction on
the ability of any such Person to (a) pay dividends or make any other
distributions to any Loan Party on its Equity Interests or with respect to any
other interest or participation in, or measured by, its profits, (b) pay any
Indebtedness or other obligation owed to any Loan Party, (c) make loans or
advances to any Loan Party, (d) sell, lease or transfer any of its properties or
assets to any Loan Party, or (e) act as a Guarantor and pledge its assets
pursuant to the Loan Documents or any renewals, refinancings, exchanges,
refundings or extension thereof or amend or otherwise modify the Loan Documents,
except (in respect of any of the matters referred to in clauses (a)-(d) above)
for such encumbrances or restrictions existing under or by reason of (i) this
Agreement and the other Loan Documents, (ii) applicable law, (iii) any document
or instrument governing Indebtedness incurred pursuant to Section 6.01(c);
provided that any such restriction contained therein relates only to the asset
or assets constructed or acquired in connection therewith, (iv) any Permitted
Lien or any document or instrument governing any Permitted Lien; provided that
any such restriction contained therein relates only to the asset or assets
subject to such Permitted Lien.

 

SECTION 6.10.Restricted Payments. The Loan Parties will not, nor will they
permit any Subsidiary to, directly or indirectly, declare, order, make or set
apart any sum for or pay any Restricted Payment, except (a) to make dividends
payable solely in the same class of Equity Interests of such Person, (b)to make
dividends or other distributions payable to the Loan Parties (directly or
indirectly through its Subsidiaries), (c) so long as (i) no Default or Event of
Default has occurred and is continuing or would result therefrom and (ii) the
Loan Parties are in compliance with each of the financial covenants set forth in
Section 5.10 after giving effect to such Restricted Payment on a Pro Forma
Basis, to repurchase Equity Interests of the Borrower (including rights, options
or warrants to acquire such Equity Interests) from employees of the Borrower or
any of its Subsidiaries or their authorized representatives upon the death,
disability or termination of employment of such employees, in an aggregate
amount not to exceed $1,000,000 in any fiscal year, (d) other Restricted
Payments not otherwise permitted by this Section 6.10 so long as (i) the Loan
Parties’ shall have Availability both before and after giving effect to such
Restricted Payment of not less than $40,000,000, (ii) no Default or Event of
Default shall have occurred and be continuing or shall have resulted therefrom
and (iii) the Loan Parties shall demonstrate to the reasonable satisfaction of
the Administrative Agent that, after giving effect to the Restricted Payment on
a Pro Forma Basis, (A) the Loan Parties are in compliance with each of the
financial covenants set forth in Section 5.10 and (B) the Adjusted Leverage
Ratio shall be less than 3.75 to 1.00.

 

CREDIT AGREEMENT – Page 74 

 

 

SECTION 6.11.Amendment of Subordinated Indebtedness. The Loan Parties will not,
nor will they permit any Subsidiary to, without the prior written consent of the
Required Lenders, amend, modify, waive or extend or permit the amendment,
modification, waiver or extension of any term of any document governing or
relating to any Subordinated Indebtedness in a manner that is adverse to the
interests of the Lenders.

 

SECTION 6.12.Sale Leasebacks. The Loan Parties will not, nor will they permit
any Subsidiary to, directly or indirectly, become or remain liable as lessee or
as guarantor or other surety with respect to any lease, whether an Operating
Lease or a Capital Lease, of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, (a) which any Loan Party or any
Subsidiary has sold or transferred or is to sell or transfer to a Person which
is not a Loan Party or a Subsidiary of a Loan Party or (b)which any Loan Party
or any Subsidiary of a Loan Party intends to use for substantially the same
purpose as any other property which has been sold or is to be sold or
transferred by a Loan Party or a Subsidiary of a Loan Party to another Person
which is not a Loan Party or a Subsidiary of a Loan Party in connection with
such lease (each a "Sale Leaseback"); provided, that the Loan Parties may enter
into Sale Leasebacks so long as the Loan Parties are in compliance with each of
the financial covenants set forth in Section 5.10 after giving effect to such
Sale Leaseback on a Pro Forma Basis.

 

SECTION 6.13.No Further Negative Pledges. The Loan Parties will not, nor will
they permit any Subsidiary to, enter into, assume or become subject to any
agreement prohibiting or otherwise restricting the creation or assumption of any
Lien upon any of their properties or assets, whether now owned or hereafter
acquired, or requiring the grant of any security for such obligation if security
is given for some other obligation, except (a) pursuant to this Agreement and
the other Loan Documents, (b) pursuant to any document or instrument governing
Indebtedness incurred pursuant to Section 6.01(c); provided that any such
restriction contained therein relates only to the asset or assets constructed or
acquired in connection therewith and (c) in connection with any Permitted Lien
or any document or instrument governing any Permitted Lien; provided that any
such restriction contained therein relates only to the asset or assets subject
to such Permitted Lien.

 

ARTICLE VII

Events of Default

 

If any of the following events ("Events of Default") shall occur:

 

(a)                Payment. (i) The Borrower shall fail to pay any principal on
any Revolving Loan or Revolving Loan Note when due (whether at maturity, by
reason of acceleration or otherwise) in accordance with the terms hereof or
thereof; or (ii) the Borrower shall fail to reimburse the Issuing Bank for any
LC Exposure when due (whether at maturity, by reason of acceleration or
otherwise) in accordance with the terms hereof; (iii) the Borrower shall fail to
provide cash collateral when required pursuant to Section 2.04(j); or (iv) the
Borrower shall fail to pay any interest on any Revolving Loan or any fee or
other amount payable hereunder when due (whether at maturity, by reason of
acceleration or otherwise) in accordance with the terms hereof and such failure
shall continue unremedied for five (5) days; or (v) or any Guarantor shall fail
to pay on the Loan Guaranty or the Obligation Guaranty in respect of any of the
foregoing or in respect of any other Guarantees hereunder (after giving effect
to the grace period in clause (iii)); or

 

(b)                Misrepresentation. Any representation or warranty made or
deemed made herein, in the Collateral Documents or in any of the other Loan
Documents or which is contained in any certificate, document or financial or
other statement furnished at any time under or in connection with this Agreement
shall prove to have been incorrect, false or misleading in any material respect
on or as of the date made or deemed made; or

 

CREDIT AGREEMENT – Page 75 

 

 

(c)                Covenant Default.

 

(i)                 Any Loan Party shall fail to perform, comply with or observe
any term, covenant or agreement applicable to it contained in Sections 5.01,
5.02(b), 5.04 (to the extent such covenant requires that the Loan Parties and
their Subsidiaries preserve, renew and keep in full force and effect their
corporate or other formative existence), 5.07, 5.08, 5.10, 5.14, 5.17 or Article
VI hereof; or

 

(ii)               Any Loan Party shall fail to comply with any other covenant
contained in this Agreement or the other Loan Documents or any other agreement,
document or instrument among any Loan Party, the Administrative Agent and the
Lenders or executed by any Loan Party in favor of the Administrative Agent or
the Lenders (other than as described in Sections 7.01(a) or 7.01(c)(i) above)
and, with respect to this clause (ii) only, such breach or failure to comply is
not cured within thirty (30) days of its occurrence; or

 

(d)                Indebtedness Cross-Default. (i) Any Loan Party or any of its
Subsidiaries shall default in any payment of principal of or interest on any
Indebtedness (other than the Loans, the reimbursement obligations of the
Borrower for the LC Exposure, the Loan Guaranty, ASC 840-40 lease financing
obligations and Swap Agreements entered into in the ordinary course of business
in order to manage existing or anticipated commodity price risks) in a principal
amount outstanding of at least $5,000,000 for the Loan Parties and any of their
Subsidiaries in the aggregate beyond any applicable grace period (not to exceed
thirty (30) days), if any, provided in the instrument or agreement under which
such Indebtedness was created; or (ii) any Loan Party or any of its Subsidiaries
shall default in the observance or performance of any other agreement or
condition relating to any Indebtedness (other than the Loans, the reimbursement
obligations of the Borrower for the LC Exposure, the Loan Guaranty, ASC 840-40
lease financing obligations and Swap Agreements entered into in the ordinary
course of business in order to manage existing or anticipated commodity price
risks) in a principal amount outstanding of at least $5,000,000 in the aggregate
for the Loan Parties and their Subsidiaries or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
or beneficiary or beneficiaries of such Indebtedness (or a trustee or agent on
behalf of such holder or holders or beneficiary or beneficiaries) to cause, with
the giving of notice if required, such Indebtedness to become due prior to its
stated maturity or to be repurchased, prepaid, deferred or redeemed
(automatically or otherwise); or (iii) any Loan Party or any of its Subsidiaries
shall breach or default any Swap Agreement that is a Swap Agreement Obligation;
or

 

(e)                Other Cross-Defaults. The Loan Parties or any of their
Subsidiaries shall default in (i) the payment when due under any Material
Contract or (ii) the performance or observance, of any obligation or condition
of any Material Contract and, in the case of this clause (ii) only, such failure
to perform or observe such other obligation or condition continues unremedied
for a period of thirty (30) days after notice of the occurrence of such default
unless, but only as long as, the existence of any such default is being
contested by the Loan Parties in good faith by appropriate proceedings and
adequate reserves in respect thereof have been established on the books of the
Loan Parties to the extent required by GAAP except where such default could not
be reasonably expected to have a Material adverse Effect; or

 

CREDIT AGREEMENT – Page 76 

 

 

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

 

(g)                Judgment Default. (i) One or more judgments or decrees shall
be entered against a Loan Party or any of its Subsidiaries involving in the
aggregate a liability (to the extent not covered by insurance) of $5,000,000 or
more and all such judgments or decrees shall not have been paid and satisfied,
vacated, discharged, stayed or bonded pending appeal within the earlier of (A)
thirty (30) days from the entry thereof or (B) the expiration of the period
during which an appeal of such judgment or decree is permitted or (ii) any
injunction, temporary restraining order or similar decree shall be issued
against a Loan Party or any of its Subsidiaries that, individually or in the
aggregate, could result in a Material Adverse Effect; or

 

(h)                ERISA Default. An ERISA Event shall have occurred that, in
the opinion of the Required Lenders, when taken together with all other ERISA
Events that have occurred, could reasonably be expected to result in a Material
Adverse Effect; or

 

(i)                 Change in Control. There shall occur a Change in Control; or

 

(j)                 Invalidity of Guaranty. At any time after the execution and
delivery thereof, the Loan Guaranty or any Obligation Guaranty, for any reason
other than the satisfaction in full of all Secured Obligations, shall cease to
be in full force and effect (other than in accordance with its terms) or shall
be declared to be null and void, or any Loan Party shall contest the validity,
enforceability, perfection or priority of the Loan Guaranty, any Loan Document,
or any Lien granted thereunder in writing or deny in writing that it has any
further liability, including with respect to future advances by the Lenders,
under any Loan Document to which it is a party; or

 

(k)                Invalidity of Loan Documents. Any Loan Document shall fail to
be in full force and effect or to give the Administrative Agent and/or the
Lenders the security interests, liens, rights, powers, priority and privileges
purported to be created thereby (except as such documents may be terminated or
no longer in force and effect in accordance with the terms thereof, other than
those indemnities and provisions which by their terms shall survive) or any Lien
shall fail to be a first priority, perfected Lien on a material portion of the
Collateral; or

 

(l)                 Subordinated Indebtedness. The subordination provisions
contained in any Subordinated Indebtedness shall cease to be in full force and
effect or shall cease to give the Lenders the rights, powers and privileges
purported to be created thereby; or

 

CREDIT AGREEMENT – Page 77 

 

 

(m)              Classification as Senior Debt. The Secured Obligations shall
cease to be classified as "Senior Indebtedness," "Designated Senior
Indebtedness" or any similar designation under any Subordinated Indebtedness
instrument; or

 

(n)                Uninsured Loss. Any uninsured damage to or loss, theft or
destruction of any assets of the Loan Parties or any of their Subsidiaries shall
occur that is in excess of $5,000,000 (excluding customary deductible thresholds
established in accordance with historical past practices);

 

then, and in every such event (other than an event with respect to the Borrower
described in clause (f) of this Article), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different times:  (i) terminate the
Commitments whereupon the Commitments shall terminate immediately, (ii) declare
the Loans then outstanding to be due and payable in whole (or in part, in which
case any principal not so declared to be due and payable may thereafter be
declared to be due and payable), whereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall become due
and payable immediately, in each case without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower, and
(iii) require cash collateral for the LC Exposure in accordance with Section
2.04(j) hereof; and in the case of any event with respect to the Borrower
described in clause (f) of this Article, the Commitments shall automatically
terminate and the principal of the Loans then outstanding, and cash collateral
for the LC Exposure, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued hereunder, shall automatically become
due and payable, in each case without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower. Upon the
occurrence and during the continuance of an Event of Default, the Administrative
Agent may, and at the request of the Required Lenders shall, increase the rate
of interest applicable to the Loans and other Obligations as set forth in this
Agreement and exercise any rights and remedies provided to the Administrative
Agent under the Loan Documents or at law or equity, including all remedies
provided under the UCC.

 

ARTICLE VIII

The Administrative Agent

 

SECTION 8.01.Appointment.Each of the Lenders , on behalf of itself and any of
its Affiliates that are Secured Parties and the Issuing Bank hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf, including execution of the other Loan
Documents, and to exercise such powers as are delegated to the Administrative
Agent by the terms of the Loan Documents, together with such actions and powers
as are reasonably incidental thereto. In addition, to the extent required under
the laws of any jurisdiction other than the U.S., each of the Lenders and the
Issuing Bank hereby grants to the Administrative Agent any required powers of
attorney to execute any Collateral Document governed by the laws of such
jurisdiction on such Lender’s or Issuing Bank’s behalf. The provisions of this
Article are solely for the benefit of the Administrative Agent and the Lenders
(including the Issuing Bank), and the Loan Parties shall not have rights as a
third party beneficiary of any of such provisions. It is understood and agreed
that the use of the term "agent" as used herein or in any other Loan Documents
(or any similar term) with reference to the Administrative Agent is not intended
to connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.

 

SECTION 8.02.Rights as a Lender.The bank serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent, and such bank and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of business with any Loan Party
or any Subsidiary or any Affiliate thereof as if it were not the Administrative
Agent hereunder.

 

CREDIT AGREEMENT – Page 78 

 

 

SECTION 8.03.Duties and Obligations.The Administrative Agent shall not have any
duties or obligations except those expressly set forth in the Loan Documents.
Without limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) the Administrative Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated by the Loan Documents that the Administrative Agent is required to
exercise as directed in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), and, (c) except as expressly set forth in the Loan
Documents, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to any
Loan Party or any Subsidiary that is communicated to or obtained by the bank
serving as Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02) or in the absence of its own gross negligence or
willful misconduct as determined by a final nonappealable judgment of a court of
competent jurisdiction. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with any
Loan Document, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection with any Loan Document, (iii) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth in any Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of any Loan Document or any other agreement,
instrument or document, (v) the creation, perfection or priority of Liens on the
Collateral or the existence of the Collateral, or (vi) the satisfaction of any
condition set forth in Article IV or elsewhere in any Loan Document, other than
to confirm receipt of items expressly required to be delivered to the
Administrative Agent.

 

SECTION 8.04.Reliance.The Administrative Agent shall be entitled to rely upon,
and shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Administrative Agent may consult
with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.

 

SECTION 8.05.Actions through Sub-Agents. The Administrative Agent may perform
any and all of its duties and exercise its rights and powers by or through any
one or more sub-agents appointed by the Administrative Agent. The Administrative
Agent and any such sub-agent may perform any and all of its duties and exercise
its rights and powers through their respective Related Parties. The exculpatory
provisions of the preceding paragraphs shall apply to any such sub-agent and to
the Related Parties of the Administrative Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as the
Administrative Agent.

 

SECTION 8.06.Resignation.Subject to the appointment and acceptance of a
successor Administrative Agent as provided in this paragraph, the Administrative
Agent may resign at any time by notifying the Lenders, the Issuing Bank and the
Borrower. Upon any such resignation, the Required Lenders shall have the right,
in consultation with the Borrower, to appoint a successor. If no successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent may, on
behalf of the Lenders and the Issuing Bank, appoint a successor Administrative
Agent which shall be a bank with an office in New York, New York, or an
Affiliate of any such bank. Upon the acceptance of its appointment as
Administrative Agent hereunder by its successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents. The fees payable by the Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor, unless otherwise agreed
by the Borrower and such successor. Notwithstanding the foregoing, in the event
no successor Administrative Agent shall have been so appointed and shall have
accepted such appointment within thirty (30) days after the retiring
Administrative Agent gives notice of its intent to resign, the retiring
Administrative Agent may give notice of the effectiveness of its resignation to
the Lenders, the Issuing Banks and the Borrower, whereupon, on the date of
effectiveness of such resignation stated in such notice, (a) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents, provided that, solely for purposes
of maintaining any security interest granted to the Administrative Agent under
any Collateral Document for the benefit of the Secured Parties, the retiring
Administrative Agent shall continue to be vested with such security interest as
collateral agent for the benefit of the Secured Parties and, in the case of any
Collateral in the possession of the Administrative Agent, shall continue to hold
such Collateral, in each case until such time as a successor Administrative
Agent is appointed and accepts such appointment in accordance with this
paragraph (it being understood and agreed that the retiring Administrative Agent
shall have no duty or obligation to take any further action under any Collateral
Document, including any action required to maintain the perfection of any such
security interest), and (b) the Required Lenders shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent, provided that (i) all payments required to be made
hereunder or under any other Loan Document to the Administrative Agent for the
account of any Person other than the Administrative Agent shall be made directly
to such Person and (ii) all notices and other communications required or
contemplated to be given or made to the Administrative Agent shall also directly
be given or made to each Lender and each Issuing Bank. Following the
effectiveness of the Administrative Agent’s resignation from its capacity as
such, the provisions of this Article, Section 2.15(d) and Section 9.03, as well
as any exculpatory, reimbursement and indemnification provisions set forth in
any other Loan Document, shall continue in effect for the benefit of such
retiring Administrative Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while it was acting as Administrative Agent and in respect of the matters
referred to in the proviso under clause (a) above.

 

CREDIT AGREEMENT – Page 79 

 

 

SECTION 8.07.Non-Reliance.

 

(a)                Each Lender acknowledges and agrees that the extensions of
credit made hereunder are commercial loans and letters of credit and not
investments in a business enterprise or securities. Each Lender further
represents that it is engaged in making, acquiring or holding commercial loans
in the ordinary course of its business and has, independently and without
reliance upon the Administrative Agent, any arranger of this credit facility or
any amendment thereto or any other Lender and their respective Related Parties
and based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement as a Lender,
and to make, acquire or hold Loans hereunder. Each Lender shall, independently
and without reliance upon the Administrative Agent, any arranger of this credit
facility or any amendment thereto or any other Lender and their respective
Related Parties and based on such documents and information (which may contain
material, non-public information within the meaning of the U.S. securities laws
concerning the Borrower and its Affiliates) as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document, any related
agreement or any document furnished hereunder or thereunder and in deciding
whether or to the extent to which it will continue as a Lender or assign or
otherwise transfer its rights, interests and obligations hereunder.

 

CREDIT AGREEMENT – Page 80 

 

 

(b)                Each Lender hereby agrees that (i) it has requested a copy of
each Report prepared by or on behalf of the Administrative Agent; (ii) the
Administrative Agent (A) makes no representation or warranty, express or
implied, as to the completeness or accuracy of any Report or any of the
information contained therein or any inaccuracy or omission contained in or
relating to a Report and (B) shall not be liable for any information contained
in any Report; (iii) the Reports are not comprehensive audits or examinations,
and that any Person performing any field examination will inspect only specific
information regarding the Loan Parties and will rely significantly upon the Loan
Parties’ books and records, as well as on representations of the Loan Parties’
personnel and that the Administrative Agent undertakes no obligation to update,
correct or supplement the Reports; (iv) it will keep all Reports confidential
and strictly for its internal use, not share the Report with any Loan Party or
any other Person except as otherwise permitted pursuant to this Agreement; and
(v) without limiting the generality of any other indemnification provision
contained in this Agreement, (A) it will hold the Administrative Agent and any
such other Person preparing a Report harmless from any action the indemnifying
Lender may take or conclusion the indemnifying Lender may reach or draw from any
Report in connection with any extension of credit that the indemnifying Lender
has made or may make to the Borrower, or the indemnifying Lender’s participation
in, or the indemnifying Lender’s purchase of, a Loan or Loans; and (B) it will
pay and protect, and indemnify, defend, and hold the Administrative Agent and
any such other Person preparing a Report harmless from and against, the claims,
actions, proceedings, damages, costs, expenses, and other amounts (including
reasonable attorneys’ fees) incurred by the Administrative Agent or any such
other Person as the direct or indirect result of any third parties who might
obtain all or part of any Report through the indemnifying Lender.

 

SECTION 8.08.Other Agency Titles. The Joint Lead Arrangers shall not have any
right, power, obligation, liability, responsibility or duty under this Agreement
other than those applicable to all Lenders as such. Without limiting the
foregoing, none of such Lenders shall have or be deemed to have a fiduciary
relationship with any Lender. Each Lender hereby makes the same acknowledgments
with respect to the relevant Lenders in their respective capacities as Joint
Lead Arrangers, as applicable, as it makes with respect to the Administrative
Agent in the preceding paragraph.

 

SECTION 8.09.Not Partners or Co-Venturers; Administrative Agent as
Representative of the Secured Parties. (a)The Lenders are not partners or
co-venturers, and no Lender shall be liable for the acts or omissions of, or
(except as otherwise set forth herein in case of the Administrative Agent)
authorized to act for, any other Lender. The Administrative Agent shall have the
exclusive right on behalf of the Lenders to enforce the payment of the principal
of and interest on any Loan after the date such principal or interest has become
due and payable pursuant to the terms of this Agreement.

 

(b)                In its capacity, the Administrative Agent is a
"representative" of the Secured Parties within the meaning of the term "secured
party" as defined in the UCC. Each Lender authorizes the Administrative Agent to
enter into each of the Collateral Documents to which it is a party and to take
all action contemplated by such documents. Each Lender agrees that no Secured
Party (other than the Administrative Agent) shall have the right individually to
seek to realize upon the security granted by any Collateral Document, it being
understood and agreed that such rights and remedies may be exercised solely by
the Administrative Agent for the benefit of the Secured Parties upon the terms
of the Collateral Documents. In the event that any Collateral is hereafter
pledged by any Person as collateral security for the Secured Obligations, the
Administrative Agent is hereby authorized, and hereby granted a power of
attorney, to execute and deliver on behalf of the Secured Parties any Loan
Documents necessary or appropriate to grant and perfect a Lien on such
Collateral in favor of the Administrative Agent on behalf of the Secured
Parties.

 

CREDIT AGREEMENT – Page 81 

 

 

SECTION 8.10.Credit Bidding. The Secured Parties hereby irrevocably authorize
the Administrative Agent, at the direction of the Required Lenders, to credit
bid all or any portion of the Obligations (including by accepting some or all of
the Collateral in satisfaction of some or all of the Obligations pursuant to a
deed in lieu of foreclosure or otherwise) and in such manner purchase (either
directly or through one or more acquisition vehicles) all or any portion of the
Collateral (a) at any sale thereof conducted under the provisions of the
Bankruptcy Code, including under Sections 363, 1123 or 1129 of the Bankruptcy
Code, or any similar laws in any other jurisdictions to which a Credit Party is
subject, or (b) at any other sale, foreclosure or acceptance of collateral in
lieu of debt conducted by (or with the consent or at the direction of) the
Administrative Agent (whether by judicial action or otherwise) in accordance
with any applicable law. In connection with any such credit bid and purchase,
the Obligations owed to the Secured Parties shall be entitled to be, and shall
be, credit bid by the Administrative Agent at the direction of the Required
Lenders on a ratable basis (with Obligations with respect to contingent or
unliquidated claims receiving contingent interests in the acquired assets on a
ratable basis that shall vest upon the liquidation of such claims in an amount
proportional to the liquidated portion of the contingent claim amount used in
allocating the contingent interests) for the asset or assets so purchased (or
for the equity interests or debt instruments of the acquisition vehicle or
vehicles that are issued in connection with such purchase). In connection with
any such bid (i) the Administrative Agent shall be authorized to form one or
more acquisition vehicles and to assign any successful credit bid to such
acquisition vehicle or vehicles (ii) each of the Secured Parties’ ratable
interests in the Obligations which were credit bid shall be deemed without any
further action under this Agreement to be assigned to such vehicle or vehicles
for the purpose of closing such sale, (iii) the Administrative Agent shall be
authorized to adopt documents providing for the governance of the acquisition
vehicle or vehicles (provided that any actions by the Administrative Agent with
respect to such acquisition vehicle or vehicles, including any disposition of
the assets or equity interests thereof, shall be governed, directly or
indirectly, by, and the governing documents shall provide for, control by the
vote of the Required Lenders or their permitted assignees under the terms of
this Agreement or the governing documents of the applicable acquisition vehicle
or vehicles, as the case may be, irrespective of the termination of this
Agreement and without giving effect to the limitations on actions by the
Required Lenders contained in Section 9.02 of this Agreement), (iv) the
Administrative Agent on behalf of such acquisition vehicle or vehicles shall be
authorized to issue to each of the Secured Parties, ratably on account of the
relevant Obligations which were credit bid, interests, whether as equity,
partnership, limited partnership interests or membership interests, in any such
acquisition vehicle and/or debt instruments issued by such acquisition vehicle,
all without the need for any Secured Party or acquisition vehicle to take any
further action, and (v) to the extent that Obligations that are assigned to an
acquisition vehicle are not used to acquire Collateral for any reason (as a
result of another bid being higher or better, because the amount of Obligations
assigned to the acquisition vehicle exceeds the amount of Obligations credit bid
by the acquisition vehicle or otherwise), such Obligations shall automatically
be reassigned to the Secured Parties pro rata and the equity interests and/or
debt instruments issued by any acquisition vehicle on account of such
Obligations shall automatically be cancelled, without the need for any Secured
Party or any acquisition vehicle to take any further action. Notwithstanding
that the ratable portion of the Obligations of each Secured Party are deemed
assigned to the acquisition vehicle or vehicles as set forth in clause (ii)
above, each Secured Party shall execute such documents and provide such
information regarding the Secured Party (and/or any designee of the Secured
Party which will receive interests in or debt instruments issued by such
acquisition vehicle) as the Administrative Agent may reasonably request in
connection with the formation of any acquisition vehicle, the formulation or
submission of any credit bid or the consummation of the transactions
contemplated by such credit bid.

 

CREDIT AGREEMENT – Page 82 

 

 

ARTICLE IX

Miscellaneous

 

SECTION 9.01.Notices.

 

(a)            Except in the case of notices and other communications expressly
permitted to be given by telephone or Electronic Systems (and subject in each
case to paragraph (b) below), all notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by fax, as follows:

 

(i)             if to any Loan Party, to it in care of the Borrower at:

 

Fiesta Restaurant Group, Inc.
14800 Landmark Boulevard, Suite 500
Dallas, Texas 75254
Attention: Chief Financial Officer
Telephone: (972) 702-9300
Fax: (972) 702-9305
Email: lschweinfurth@frgi.com

 

(ii)            if to the Administrative Agent or Chase in its capacity as an
Issuing Bank, to JPMorgan Chase Bank, N.A. at:

 

JPMorgan Chase Bank, N.A.
Middle Market Servicing
10 South Dearborn, Floor L2
Suite IL1-0480
Chicago, IL, 60603-2300
Attention: Stacy Slaton
jpm.agency.cri@jpmorgan.com

With a copy to:
stacy.l.slaton@jpmorgan.com

 

With a copy to:

JPMorgan Chase Bank, N.A.
2200 Ross Avenue, 8th Floor
Dallas, Texas 75201
Attention: Heather E. Aguilar
Fax No: 214-965-2946

 

(iii)             if to any other Lender or Issuing Bank, to it at its address
or fax number set forth in its Administrative Questionnaire.

 

All such notices and other communications (i) sent by hand or overnight courier
service, or mailed by certified or registered mail shall be deemed to have been
given when received, (ii) sent by fax shall be deemed to have been given when
sent, provided that if not given during normal business hours for the recipient,
such notice or communication shall be deemed to have been given at the opening
of business on the next Business Day of the recipient, or (iii) delivered
through Electronic Systems to the extent provided in paragraph (b) below shall
be effective as provided in such paragraph.

 

CREDIT AGREEMENT – Page 83 

 

 

(b)                Notices and other communications to the Lenders hereunder may
be delivered or furnished by Electronic Systems pursuant to procedures approved
by the Administrative Agent; provided that the foregoing shall not apply to
notices pursuant to Article II or to compliance and no Default certificates
delivered pursuant to Sections 5.01 and 5.02 unless otherwise agreed by the
Administrative Agent and the applicable Lender. Each of the Administrative Agent
and the Borrower (on behalf of the Loan Parties) may, in its discretion, agree
to accept notices and other communications to it hereunder by Electronic Systems
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications. Unless the
Administrative Agent otherwise proscribes, all such notices and other
communications (i) sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the "return receipt requested" function, as available, return e-mail or other
written acknowledgement), provided that if not given during the normal business
hours of the recipient, such notice or communication shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient, and (ii) posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient, at its e-mail
address as described in the foregoing clause (i), of notification that such
notice or communication is available and identifying the website address
therefor; provided that, for both clauses (i) and (ii) above, if such notice,
e-mail or other communication is not sent during the normal business hours of
the recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next Business Day of the recipient.

 

(c)                Any party hereto may change its address, facsimile number or
e-mail address for notices and other communications hereunder by notice to the
other parties hereto.

 

(d)                Electronic Systems.

 

(i)                 Each Loan Party agrees that the Administrative Agent may,
but shall not be obligated to, make Communications (as defined below) available
to the Issuing Bank and the other Lenders by posting the Communications on Debt
Domain, Intralinks, Syndtrak, ClearPar or a substantially similar Electronic
System.

 

(ii)               Any Electronic System used by the Administrative Agent is
provided "as is" and "as available." The Agent Parties (as defined below) do not
warrant the adequacy of such Electronic Systems and expressly disclaim liability
for errors or omissions in the Communications. No warranty of any kind, express,
implied or statutory, including any warranty of merchantability, fitness for a
particular purpose, non-infringement of third-party rights or freedom from
viruses or other code defects, is made by any Agent Party in connection with the
Communications or any Electronic System. In no event shall the Administrative
Agent or any of its Related Parties (collectively, the "Agent Parties") have any
liability to the Borrower or the other Loan Parties, any Lender, the Issuing
Bank or any other Person or entity for damages of any kind, including direct or
indirect, special, incidental or consequential damages, losses or expenses
(whether in tort, contract or otherwise) arising out of the Borrower’s, any Loan
Party’s or the Administrative Agent’s transmission of communications through an
Electronic System. "Communications" means, collectively, any notice, demand,
communication, information, document or other material provided by or on behalf
of any Loan Party pursuant to any Loan Document or the transactions contemplated
therein which is distributed by the Administrative Agent, any Lender or the
Issuing Bank by means of electronic communications pursuant to this Section,
including through an Electronic System.

 

CREDIT AGREEMENT – Page 84 

 

 

SECTION 9.02.Waivers; Amendments.

 

(a)                No failure or delay by the Administrative Agent, the Issuing
Bank or any Lender in exercising any right or power hereunder or under any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Administrative Agent, the Issuing Bank and the Lenders hereunder and under
any other Loan Document are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of any Loan
Document or consent to any departure by any Loan Party therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of this
Section, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. Without limiting the generality of
the foregoing, the making of a Loan or issuance of a Letter of Credit shall not
be construed as a waiver of any Default, regardless of whether the
Administrative Agent, any Lender or the Issuing Bank may have had notice or
knowledge of such Default at the time.

 

(b)                Subject to Section 2.12(c), neither this Agreement nor any
other Loan Document nor any provision hereof or thereof may be waived, amended
or modified except (i) in the case of this Agreement, pursuant to an agreement
or agreements in writing entered into by the Borrower and the Required Lenders
or (ii) in the case of any other Loan Document, pursuant to an agreement or
agreements in writing entered into by the Administrative Agent and the Loan
Party or Loan Parties that are parties thereto, with the consent of the Required
Lenders; provided that no such agreement shall (A) increase the Commitment of
any Lender without the written consent of such Lender (including any such Lender
that is a Defaulting Lender), (B) reduce or forgive the principal amount of any
Loan or LC Disbursement or reduce the rate of interest thereon, or reduce or
forgive any interest or fees payable hereunder, without the written consent of
each Lender (including any such Lender that is a Defaulting Lender) directly
affected thereby (except that any amendment or modification of the financial
covenants in this Agreement (or defined terms used in the financial covenants in
this Agreement) shall not constitute a reduction in the rate of interest or fees
for purposes of this clause (B)), (C) postpone any scheduled date of payment of
the principal amount of any Loan or LC Disbursement, or any date for the payment
of any interest, fees or other Obligations payable hereunder, or reduce the
amount of, waive or excuse any such payment, or postpone the scheduled date of
expiration of any Commitment, without the written consent of each Lender
(including any such Lender that is a Defaulting Lender) directly affected
thereby, (D) change Section 2.16(b) or (d) in a manner that would alter the
manner in which payments are shared, without the written consent of each Lender
(other than any Defaulting Lender), (E) change any of the provisions of this
Section or the definition of "Required Lenders" or any other provision of any
Loan Document specifying the number or percentage of Lenders required to waive,
amend or modify any rights thereunder or make any determination or grant any
consent thereunder, without the written consent of each Lender (other than any
Defaulting Lender) directly affected thereby, (F) change Section 2.18, without
the consent of each Lender (other than any Defaulting Lender), (G) release the
Borrower or all or substantially all of the value of the Loan Guaranty, without
the written consent of all of the Lenders; provided that the Administrative
Agent may release any Guarantor permitted to be released pursuant to the terms
of this Agreement (except as otherwise permitted herein or in the other Loan
Documents), without the written consent of each Lender (other than any
Defaulting Lender), or (H) except as provided in clause (c) of this Section or
in any Collateral Document, release all or substantially all of the Collateral
without the written consent of each Lender (other than any Defaulting Lender);
provided further that no such agreement shall amend, modify or otherwise affect
the rights or duties of the Administrative Agent or the Issuing Bank hereunder
without the prior written consent of the Administrative Agent or the Issuing
Bank, as the case may be (it being understood that any amendment to Section 2.18
shall require the consent of the Administrative Agent and the Issuing Bank);
provided further that no such agreement shall amend or modify the provisions of
Section 2.05 or any letter of credit application and any bilateral agreement
between the Borrower and the Issuing Bank regarding the Issuing Bank’s Issuing
Bank Sublimit or the respective rights and obligations between the Borrower and
the Issuing Bank in connection with the issuance of Letters of Credit without
the prior written consent of the Administrative Agent and the Issuing Bank,
respectively; provided further that any fee letter, Swap Agreement or other
bilateral agreement between one or more Loan Parties and any Credit Party may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto. The Administrative Agent may also amend the Commitment
Schedule to reflect assignments entered into pursuant to Section 9.04.

 

CREDIT AGREEMENT – Page 85 

 

 

(c)                The Lenders and the Issuing Bank hereby irrevocably authorize
the Administrative Agent, at its option and in its sole discretion, to release
any Liens granted to the Administrative Agent by the Loan Parties on any
Collateral (i) upon the Payment in Full of all Secured Obligations, and the cash
collateralization of all Unliquidated Obligations in a manner satisfactory to
each affected Lender, (ii) constituting property being sold or disposed of if
the Loan Party disposing of such property certifies to the Administrative Agent
that the sale or disposition is made in compliance with the terms of this
Agreement (and the Administrative Agent may rely conclusively on any such
certificate, without further inquiry), and to the extent that the property being
sold or disposed of constitutes 100% of the Equity Interests of a Subsidiary,
the Administrative Agent is authorized to release any Loan Guaranty or
Obligation Guaranty provided by such Subsidiary, (iii) constituting property
leased to a Loan Party under a lease which has expired or been terminated in a
transaction permitted under this Agreement, or (iv) as required to effect any
sale or other disposition of such Collateral in connection with any exercise of
remedies of the Administrative Agent and the Lenders pursuant to Article VII.
Except as provided in the preceding sentence, the Administrative Agent will not
release any Liens on Collateral without the prior written authorization of the
Required Lenders. Any such release shall not in any manner discharge, affect, or
impair the Obligations or any Liens (other than those expressly being released)
upon (or obligations of the Loan Parties in respect of) all interests retained
by the Loan Parties, including the proceeds of any sale, all of which shall
continue to constitute part of the Collateral. Any execution and delivery by the
Administrative Agent of documents in connection with any such release shall be
without recourse to or warranty by the Administrative Agent.

 

(d)                If, in connection with any proposed amendment, waiver or
consent requiring the consent of "each Lender" or "each Lender affected
thereby," the consent of the Required Lenders is obtained, but the consent of
other necessary Lenders is not obtained (any such Lender whose consent is
necessary but has not been obtained being referred to herein as a
"Non-Consenting Lender"), then the Borrower may elect to replace a
Non-Consenting Lender as a Lender party to this Agreement, provided that,
concurrently with such replacement, (i) another bank or other entity which is
reasonably satisfactory to the Borrower, the Administrative Agent and the
Issuing Bank shall agree, as of such date, to purchase for cash the Loans and
other Obligations due to the Non-Consenting Lender pursuant to an Assignment and
Assumption and to become a Lender for all purposes under this Agreement and to
assume all obligations of the Non-Consenting Lender to be terminated as of such
date and to comply with the requirements of clause (b) of Section 9.04, and (ii)
the Borrower shall pay to such Non-Consenting Lender in same day funds on the
day of such replacement (1) all interest, fees and other amounts then accrued
but unpaid to such Non-Consenting Lender by the Borrower hereunder to and
including the date of termination, including without limitation payments due to
such Non-Consenting Lender under Sections 2.13 and 2.15, and (2) an amount, if
any, equal to the payment which would have been due to such Lender on the day of
such replacement under Section 2.14 had the Loans of such Non-Consenting Lender
been prepaid on such date rather than sold to the replacement Lender.

 

(e)                Notwithstanding anything to the contrary herein the
Administrative Agent may, with the consent of the Borrower only, amend, modify
or supplement this Agreement or any of the other Loan Documents to cure any
ambiguity, omission, mistake, defect or inconsistency.

 

CREDIT AGREEMENT – Page 86 

 

 

SECTION 9.03.Expenses; Indemnity; Damage Waiver.

 

(a)                The Loan Parties, jointly and severally, shall pay all (i)
reasonable out-of-pocket expenses incurred by the Administrative Agent and its
Affiliates, including the reasonable fees, charges and disbursements of Winstead
PC and other fees, charges and disbursements of any local or special counsel for
the Administrative Agent, to the extent applicable, in connection with the
syndication and distribution (including, without limitation, via the internet or
through an Electronic System) of the credit facilities provided for herein, the
preparation and administration of the Loan Documents and any amendments,
modifications or waivers of the provisions of the Loan Documents (whether or not
the transactions contemplated hereby or thereby shall be consummated), (ii)
reasonable out-of-pocket expenses incurred by the Issuing Bank in connection
with the issuance, amendment, renewal or extension of any Letter of Credit or
any demand for payment thereunder and (iii) out-of-pocket expenses incurred by
the Administrative Agent, the Issuing Bank or any Lender, including the fees,
charges and disbursements of any counsel for the Administrative Agent, the
Issuing Bank or any Lender, in connection with the enforcement, collection or
protection of its rights in connection with the Loan Documents, including its
rights under this Section, or in connection with the Loans made or Letters of
Credit issued hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of such Loans or
Letters of Credit. Expenses being reimbursed by the Loan Parties under this
Section include, without limiting the generality of the foregoing, fees, costs
and expenses incurred in connection with:

 

(A)              appraisals and insurance reviews;

 

(B)              field examinations and the preparation of Reports based on the
fees charged by a third party retained by the Administrative Agent or the
internally allocated fees for each Person employed by the Administrative Agent
with respect to each field examination;

 

(C)              background checks regarding senior management and/or key
investors, as deemed necessary or appropriate in the sole discretion of the
Administrative Agent;

 

(D)              Taxes, fees and other charges for (i) lien and title searches
and (ii) filing financing statements and continuations, and other actions to
perfect, protect, and continue the Administrative Agent’s Liens;

 

(E)               sums paid or incurred to take any action required of any Loan
Party under the Loan Documents that such Loan Party fails to pay or take; and

 

(F)               forwarding loan proceeds, collecting checks and other items of
payment, and establishing and maintaining the accounts and lock boxes, and costs
and expenses of preserving and protecting the Collateral.

 

All of the foregoing fees, costs and expenses may be charged to the Borrower as
Revolving Loans or to another deposit account, all as described in
Section 2.16(c).

 

CREDIT AGREEMENT – Page 87 

 

 

(b)                The Loan Parties, jointly and severally, shall indemnify the
Administrative Agent, the Issuing Bank and each Lender, and each Related Party
of any of the foregoing Persons (each such Person being called an "Indemnitee")
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, penalties, incremental taxes, liabilities and related expenses,
including the fees, charges and disbursements of any counsel for any Indemnitee,
incurred by or asserted against any Indemnitee arising out of, in connection
with, or as a result of (i) the execution or delivery of the Loan Documents or
any agreement or instrument contemplated thereby, the performance by the parties
hereto of their respective obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
the Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
Release of Hazardous Materials on or from any property owned or operated by a
Loan Party or a Subsidiary, or any Environmental Liability related in any way to
a Loan Party or a Subsidiary, (iv) the failure of a Loan Party to deliver to the
Administrative Agent the required receipts or other required documentary
evidence with respect to a payment made by such Loan Party for Taxes pursuant to
Section 2.15, or (v) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether or not such claim,
litigation, investigation or proceeding is brought by any Loan Party or their
respective equity holders, Affiliates, creditors or any other third Person and
whether based on contract, tort or any other theory and regardless of whether
any Indemnitee is a party thereto; provided that such indemnity shall not, as to
any Indemnitee, be available to the extent that such losses, claims, damages,
penalties, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee. This Section
9.03(b) shall not apply with respect to Taxes other than any Taxes that
represent losses or damages arising from any non-Tax claim.

 

(c)                To the extent that any Loan Party fails to pay any amount
required to be paid by it to the Administrative Agent (or any sub-agent
thereof), or the Issuing Bank (or any Related Party of any of the foregoing)
under paragraph (a) or (b) of this Section, each Lender severally agrees to pay
to the Administrative Agent, or the Issuing Bank (or any Related Party of any of
the foregoing), as the case may be, such Lender’s Applicable Percentage
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount (it being understood that any such
payment by the Lenders shall not relieve the Borrower of any default in the
payment thereof); provided that the unreimbursed expense or indemnified loss,
claim, damage, penalty, liability or related expense, as the case may be, was
incurred by or asserted against the Administrative Agent, or the Issuing Bank in
its capacity as such.

 

(d)                To the extent permitted by applicable law, no Loan Party
shall assert, and each Loan Party hereby waives, any claim against any
Indemnitee, (i) for any damages arising from the use by others of information or
other materials obtained through telecommunications, electronic or other
information transmission systems (including the Internet), or (ii) on any theory
of liability, for special, indirect, consequential or punitive damages (as
opposed to direct or actual damages) arising out of, in connection with, or as a
result of, this Agreement, any other Loan Document, or any agreement or
instrument contemplated hereby or thereby, the Transactions, any Loan or Letter
of Credit or the use of the proceeds thereof; provided that, nothing in this
paragraph (d) shall relieve any Loan Party of any obligation it may have to
indemnify an Indemnitee against special, indirect, consequential or punitive
damages asserted against such Indemnitee by a third party.

 

(e)                All amounts due under this Section shall be payable not later
than ten days after written demand therefor.

 

SECTION 9.04.Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (and any attempted assignment
or transfer by the Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

 

CREDIT AGREEMENT – Page 88 

 

 

(b)                (i)Subject to the conditions set forth in paragraph (b)(ii)
below, any Lender may assign to one or more Persons (other than an Ineligible
Institution) all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment, participations in Letters of
Credit and the Loans at the time owing to it) with the prior written consent
(such consent not to be unreasonably withheld) of:

 

(A)              the Borrower, provided that the Borrower shall be deemed to
have consented to any such assignment unless it shall object thereto by written
notice to the Administrative Agent within five (5) Business Days after having
received notice thereof, and provided further that no consent of the Borrower
shall be required for an assignment to a Lender, an Affiliate of a Lender, an
Approved Fund or, if an Event of Default has occurred and is continuing, any
other assignee;

 

(B)              the Administrative Agent; and

 

(C)              the Issuing Bank.

 

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

 

(A)              except in the case of an assignment to a Lender or an Affiliate
of a Lender or an Approved Fund or an assignment of the entire remaining amount
of the assigning Lender’s Commitment or Loans, the amount of the Commitment or
Loans of the assigning Lender subject to each such assignment (determined as of
the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $5,000,000 unless
each of the Borrower and the Administrative Agent otherwise consent, provided
that no such consent of the Borrower shall be required if an Event of Default
has occurred and is continuing;

 

(B)              each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement;

 

(C)              the parties to each assignment shall execute and deliver to the
Administrative Agent (x) an Assignment and Assumption or (y) to the extent
applicable, an agreement incorporating an Assignment and Assumption by reference
pursuant to a Platform as to which the Administrative Agent and the parties to
the Assignment and Assumption are participants, together with a processing and
recordation fee of $3,500; and

 

(D)              the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Borrower, the other
Loan Parties and their Related Parties or their respective securities) will be
made available and who may receive such information in accordance with the
assignee’s compliance procedures and applicable laws, including federal and
state securities laws.

 

CREDIT AGREEMENT – Page 89 

 

 

For the purposes of this Section 9.04(b), the terms "Approved Fund" and
"Ineligible Institution" have the following meanings:

 

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

 

"Ineligible Institution" means a (a) natural person, (b) a Defaulting Lender or
its Parent, (c) holding company, investment vehicle or trust for, or owned and
operated for the primary benefit of, a natural person or relative(s) thereof;
provided that, such holding company, investment vehicle or trust shall not
constitute an Ineligible Institution if it (x) has not been established for the
primary purpose of acquiring any Loans or Commitments, (y) is managed by a
professional advisor, who is not such natural person or a relative thereof,
having significant experience in the business of making or purchasing commercial
loans, and (z) has assets greater than $25,000,000 and a significant part of its
activities consist of making or purchasing commercial loans and similar
extensions of credit in the ordinary course of its business; provided that upon
the occurrence and during the continuance of an Event of Default, any Person
(other than a Lender) shall be an Ineligible Institution if after giving effect
to any proposed assignment to such Person, such Person would hold more than 25%
of the then outstanding Aggregate Credit Exposure or Commitments, as the case
may be or (d) a Loan Party or a Subsidiary or other Affiliate of a Loan Party.

 

(iii)             Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date specified
in each Assignment and Assumption, the assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.13, 2.14, 2.15 and 9.03). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this Section 9.04 shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.

 

(iv)              The Administrative Agent, acting for this purpose as a
non-fiduciary agent of the Borrower, shall maintain at one of its offices a copy
of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent,
the Issuing Bank and the Lenders shall treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrower, the Issuing Bank and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.

 

CREDIT AGREEMENT – Page 90 

 

 

(v)                Upon its receipt of (x) a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee or (y) to the extent
applicable, an agreement incorporating an Assignment and Assumption by reference
pursuant to a Platform as to which the Administrative Agent and the parties to
the Assignment and Assumption are participants, the assignee’s completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Assumption and record the information contained therein in the Register;
provided that if either the assigning Lender or the assignee shall have failed
to make any payment required to be made by it pursuant to Section 2.04(d) or
(e), 2.05(b), 2.16(d) or 9.03(c), the Administrative Agent shall have no
obligation to accept such Assignment and Assumption and record the information
therein in the Register unless and until such payment shall have been made in
full, together with all accrued interest thereon. No assignment shall be
effective for purposes of this Agreement unless it has been recorded in the
Register as provided in this paragraph.

 

(c)                Any Lender may, without the consent of the Borrower, the
Administrative Agent or the Issuing Bank, sell participations to one or more
banks or other entities (a "Participant") other than an Ineligible Institution
in all or a portion of such Lender’s rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided that (i) such Lender’s obligations under this Agreement shall remain
unchanged; (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations; and (iii) the Borrower, the
Administrative Agent, the Issuing Bank and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
The Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.13, 2.14 and 2.15 (subject to the requirements and limitations
therein, including the requirements under Sections 2.15(f) and (g) (it being
understood that the documentation required under Section 2.15(f) shall be
delivered to the participating Lender and the information and documentation
required under Section 2.15(g) will be delivered to the Borrower and the
Administrative Agent)) to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section;
provided that such Participant (A) agrees to be subject to the provisions of
Sections 2.16 and 2.17 as if it were an assignee under paragraph (b) of this
Section; and (B) shall not be entitled to receive any greater payment under
Sections 2.14 or 2.15 with respect to any participation than its participating
Lender would have been entitled to receive, except to the extent such
entitlement to receive a greater payment results from a Change in Law that
occurs after the Participant acquired the applicable participation.

 

Each Lender that sells a participation agrees, at the Borrower’s request and
expense, to use reasonable efforts to cooperate with the Borrower to effectuate
the provisions of Section 2.17(b) with respect to any Participant. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.08 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.17(d) as though it were a Lender. Each Lender that sells a
participation shall, acting solely for this purpose as an agent of the Borrower,
maintain a register on which it enters the name and address of each Participant
and the principal amounts (and stated interest) of each Participant’s interest
in the Loans or other obligations under this Agreement or any other Loan
Document (the "Participant Register"); provided that no Lender shall have any
obligation to disclose all or any portion of the Participant Register (including
the identity of any Participant or any information relating to a Participant’s
interest in any Commitments, Loans, Letters of Credit or its other obligations
under this Agreement or any other Loan Document) to any Person except to the
extent that such disclosure is necessary to establish that such Commitment,
Loan, Letter of Credit or other obligation is in registered form under Section
5f.103-1(c) of the United States Treasury Regulations. The entries in the
Participant Register shall be conclusive absent manifest error, and such Lender
shall treat each Person whose name is recorded in the Participant Register as
the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary.For the avoidance of doubt, the
Administrative Agent (in its capacity as Administrative Agent) shall have no
responsibility for maintaining a Participant Register.

 

CREDIT AGREEMENT – Page 91 

 

 

(d)                Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section
shall not apply to any such pledge or assignment of a security interest;
provided that no such pledge or assignment of a security interest shall release
a Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.

 

SECTION 9.05.Survival. All covenants, agreements, representations and warranties
made by the Loan Parties in the Loan Documents and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement or any
other Loan Document shall be considered to have been relied upon by the other
parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that the Administrative Agent, the Issuing Bank or any
Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Sections 2.13, 2.14, 2.16 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any other Loan Document or any provision hereof or thereof.

 

SECTION 9.06.Counterparts; Integration; Effectiveness; Electronic Execution.
(a)  This Agreement and each other Loan Document may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Agreement, the other Loan Documents and any separate
letter agreements with respect to (i) fees payable to the Administrative Agent
and (ii) increases or reductions of the Issuing Bank Sublimit of the Issuing
Bank constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.

 

(b)                Delivery of an executed counterpart of a signature page of
this Agreement or any other Loan Document by telecopy, emailed pdf. or any other
electronic means that reproduces an image of the actual executed signature page
shall be effective as delivery of a manually executed counterpart of this
Agreement or such other Loan Document. The words "execution," "signed,"
"signature," "delivery," and words of like import in or relating to any document
to be signed in connection with this Agreement, the other Loan Documents and the
transactions contemplated hereby or thereby shall be deemed to include
Electronic Signatures, deliveries or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity or enforceability as a
manually executed signature, physical delivery thereof or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as
provided for in any applicable law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures
and Records Act, or any other similar state laws based on the Uniform Electronic
Transactions Act; provided that nothing herein shall require the Administrative
Agent to accept electronic signatures in any form or format without its prior
written consent.

 

CREDIT AGREEMENT – Page 92 

 

 

SECTION 9.07.Severability. Any provision of any Loan Document held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

SECTION 9.08.Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of any Loan Party
against any of and all the Secured Obligations held by such Lender, irrespective
of whether or not such Lender shall have made any demand under the Loan
Documents and although such obligations may be unmatured. The applicable Lender
shall notify the Borrower and the Administrative Agent of such set-off or
application, provided that any failure to give or any delay in giving such
notice shall not affect the validity of any such set-off or application under
this Section. The rights of each Lender under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Lender
may have.

 

SECTION 9.09.Governing Law; Jurisdiction; Consent to Service of Process.

 

(a)                The Loan Documents (other than those containing a contrary
express choice of law provision) shall be governed by and construed in
accordance with the internal laws of the State of New York, but giving effect to
federal laws applicable to national banks.

 

(b)                Each Loan Party hereby irrevocably and unconditionally
submits, for itself and its property, to the exclusive jurisdiction of any U.S.
federal or New York state court sitting in New York, New York in any action or
proceeding arising out of or relating to any Loan Documents, or for recognition
or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such state court or, to the
extent permitted by law, in such federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other Loan
Document shall affect any right that the Administrative Agent, the Issuing Bank
or any Lender may otherwise have to bring any action or proceeding relating to
this Agreement or any other Loan Document against any Loan Party or its
properties in the courts of any jurisdiction.

 

(c)                Each Loan Party hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any other
Loan Document in any court referred to in paragraph (b) of this Section. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

 

CREDIT AGREEMENT – Page 93 

 

 

(d)                Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 9.01. Nothing in this
Agreement or any other Loan Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.

 

SECTION 9.10.WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE OR OTHER AGENT (INCLUDING ANY
ATTORNEY) OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.

 

SECTION 9.11.Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

 

SECTION 9.12.Confidentiality. Each of the Administrative Agent, the Issuing Bank
and the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any Governmental Authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by any Requirement of Law or by any subpoena or similar
legal process, (d) to any other party to this Agreement, (e) in connection with
the exercise of any remedies hereunder or under any other Loan Document or any
suit, action or proceeding relating to this Agreement or any other Loan Document
or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section,
to (x) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or (y) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Loan Parties and their obligations, (g) with the
consent of the Borrower, (h) to any Person providing a Guarantee of all or any
portion of the Secured Obligations, or (i) to the extent such Information
(x) becomes publicly available other than as a result of a breach of this
Section or (y) becomes available to the Administrative Agent, the Issuing Bank
or any Lender on a non-confidential basis from a source other than the Borrower.
For the purposes of this Section, "Information" means all information received
from the Borrower relating to the Borrower, any Loan Party or its respective
business, other than any such information that is available to the
Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis
prior to disclosure by the Borrower and other than information pertaining to
this Agreement provided by arrangers to data service providers, including league
table providers, that serve the lending industry; provided that, in the case of
information received from the Borrower after the date hereof, such information
is clearly identified at the time of delivery as confidential. Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

 

CREDIT AGREEMENT – Page 94 

 

 

SECTION 9.13.Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder shall
not relieve any other Lender from any of its obligations hereunder. Each Lender
hereby represents that it is not relying on or looking to any margin stock (as
defined in Regulation U of the Board) for the repayment of the Borrowings
provided for herein. Anything contained in this Agreement to the contrary
notwithstanding, neither the Issuing Bank nor any Lender shall be obligated to
extend credit to the Borrower in violation of any Requirement of Law.

 

SECTION 9.14.PATRIOT Act. Each Lender that is subject to the requirements of the
PATRIOT Act hereby notifies each Loan Party that pursuant to the requirements of
the PATRIOT Act, it is required to obtain, verify and record information that
identifies such Loan Party, which information includes the name and address of
such Loan Party and other information that will allow such Lender to identify
such Loan Party in accordance with the PATRIOT Act.

 

SECTION 9.15.Disclosure. Each Loan Party, each Lender and the Issuing Bank
hereby acknowledges and agrees that the Administrative Agent and/or its
Affiliates from time to time may hold investments in, make other loans to or
have other relationships with, any of the Loan Parties and their respective
Affiliates.

 

SECTION 9.16.Appointment for Perfection. Each Lender hereby appoints each other
Lender as its agent for the purpose of perfecting Liens, for the benefit of the
Administrative Agent and the Secured Parties, in assets which, in accordance
with Article 9 of the UCC or any other applicable law can be perfected only by
possession or control. Should any Lender (other than the Administrative Agent)
obtain possession or control of any such Collateral, such Lender shall notify
the Administrative Agent thereof, and, promptly upon the Administrative Agent’s
request therefor shall deliver such Collateral to the Administrative Agent or
otherwise deal with such Collateral in accordance with the Administrative
Agent’s instructions.

 

SECTION 9.17.Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the "Charges"), shall exceed the maximum
lawful rate (the "Maximum Rate") which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

 

SECTION 9.18.No Fiduciary Duty, etc. The Borrower acknowledges and agrees, and
acknowledges its subsidiaries’ understanding, that no Credit Party will have any
obligations except those obligations expressly set forth herein and in the other
Loan Documents and each Credit Party is acting solely in the capacity of an
arm’s length contractual counterparty to the Borrower with respect to the Loan
Documents and the transaction contemplated therein and not as a financial
advisor or a fiduciary to, or an agent of, the Borrower or any other person. The
Borrower agrees that it will not assert any claim against any Credit Party based
on an alleged breach of fiduciary duty by such Credit Party in connection with
this Agreement and the transactions contemplated hereby. Additionally, the
Borrower acknowledges and agrees that no Credit Party is advising the Borrower
as to any legal, tax, investment, accounting, regulatory or any other matters in
any jurisdiction. The Borrower shall consult with its own advisors concerning
such matters and shall be responsible for making its own independent
investigation and appraisal of the transactions contemplated hereby, and the
Credit Parties shall have no responsibility or liability to the Borrower with
respect thereto.

 

CREDIT AGREEMENT – Page 95 

 

 

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

 

In addition, the Borrower acknowledges and agrees, and acknowledges its
subsidiaries’ understanding, that each Credit Party and its affiliates may be
providing debt financing, equity capital or other services (including financial
advisory services) to other companies in respect of which the Borrower may have
conflicting interests regarding the transactions described herein and otherwise.
No Credit Party will use confidential information obtained from the Borrower by
virtue of the transactions contemplated by the Loan Documents or its other
relationships with the Borrower in connection with the performance by such
Credit Party of services for other companies, and no Credit Party will furnish
any such information to other companies. The Borrower also acknowledges that no
Credit Party has any obligation to use in connection with the transactions
contemplated by the Loan Documents, or to furnish to the Borrower, confidential
information obtained from other companies.

 

SECTION 9.19.Marketing Consent.The Borrower hereby authorizes Chase and its
affiliates, at their respective sole expense, but without any prior approval by
the Borrower, to publish such tombstones and give such other publicity to this
Agreement as each may from time to time determine in its sole discretion. The
foregoing authorization shall remain in effect unless the Borrower notifies
Chase in writing that such authorization is revoked

 

SECTION 9.20.Acknowledgement and Consent to Bail-In of EEA Financial
Institutions. Notwithstanding anything to the contrary in any Loan Document or
in any other agreement, arrangement or understanding among any such parties,
each party hereto acknowledges that any liability of any EEA Financial
Institution arising under any Loan Document may be subject to the write-down and
conversion powers of an EEA Resolution Authority and agrees and consents to, and
acknowledges and agrees to be bound by:

 

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

 

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

 

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

 

CREDIT AGREEMENT – Page 96 

 

 

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

 

(iii)             the variation of the terms of such liability in connection
with the exercise of the write-down and conversion powers of any EEA Resolution
Authority.

 

ARTICLE X

Loan Guaranty

 

SECTION 10.01.Guaranty. Each Loan Guarantor (other than those that have
delivered a separate Obligation Guaranty) hereby agrees that it is jointly and
severally liable for, and, as a primary obligor and not merely as surety,
absolutely, unconditionally and irrevocably guarantees to the Secured Parties,
the prompt payment when due, whether at stated maturity, upon acceleration or
otherwise, and at all times thereafter, of the Secured Obligations and all costs
and expenses including, without limitation, all court costs and reasonable
attorneys’ and paralegals’ fees (including allocated costs of in-house counsel
and paralegals) and expenses paid or incurred by the Administrative Agent, the
Issuing Bank and the Lenders in endeavoring to collect all or any part of the
Secured Obligations from, or in prosecuting any action against, the Borrower,
any Loan Guarantor or any other guarantor of all or any part of the Secured
Obligations (such costs and expenses, together with the Secured Obligations,
collectively the "Guaranteed Obligations"); provided, however, that the
definition of "Guaranteed Obligations" shall not create any guarantee by any
Loan Guarantor of (or grant of security interest by any Loan Guarantor to
support, as applicable) any Excluded Swap Obligations of such Loan Guarantor for
purposes of determining any obligations of any Loan Guarantor. Each Loan
Guarantor further agrees that the Guaranteed Obligations may be extended or
renewed in whole or in part without notice to or further assent from it, and
that it remains bound upon its guarantee notwithstanding any such extension or
renewal. All terms of this Loan Guaranty apply to and may be enforced by or on
behalf of any domestic or foreign branch or Affiliate of any Lender that
extended any portion of the Guaranteed Obligations.

 

SECTION 10.02.Guaranty of Payment. This Loan Guaranty is a guaranty of payment
and not of collection. Each Loan Guarantor waives any right to require the
Administrative Agent, the Issuing Bank or any Lender to sue the Borrower, any
Loan Guarantor, any other guarantor of, or any other Person obligated for all or
any part of the Guaranteed Obligations (each, an "Obligated Party"), or
otherwise to enforce its payment against any collateral securing all or any part
of the Guaranteed Obligations.

 

SECTION 10.03.No Discharge or Diminishment of Loan Guaranty.

 

(a)                Except as otherwise provided for herein, the obligations of
each Loan Guarantor hereunder are unconditional and absolute and not subject to
any reduction, limitation, impairment or termination for any reason (other than
the Payment in Full of the Guaranteed Obligations), including: (i) any claim of
waiver, release, extension, renewal, settlement, surrender, alteration, or
compromise of any of the Guaranteed Obligations, by operation of law or
otherwise; (ii) any change in the corporate existence, structure or ownership of
the Borrower or any other Obligated Party liable for any of the Guaranteed
Obligations; (iii) any insolvency, bankruptcy, reorganization or other similar
proceeding affecting any Obligated Party, or their assets or any resulting
release or discharge of any obligation of any Obligated Party; or (iv) the
existence of any claim, setoff or other rights which any Loan Guarantor may have
at any time against any Obligated Party, the Administrative Agent, the Issuing
Bank, any Lender, or any other Person, whether in connection herewith or in any
unrelated transactions.

 

CREDIT AGREEMENT – Page 97 

 

 

(b)                The obligations of each Loan Guarantor hereunder are not
subject to any defense or setoff, counterclaim, recoupment, or termination
whatsoever by reason of the invalidity, illegality, or unenforceability of any
of the Guaranteed Obligations or otherwise, or any provision of applicable law
or regulation purporting to prohibit payment by any Obligated Party, of the
Guaranteed Obligations or any part thereof.

 

(c)                Further, the obligations of any Loan Guarantor hereunder are
not discharged or impaired or otherwise affected by: (i) the failure of the
Administrative Agent, the Issuing Bank or any Lender to assert any claim or
demand or to enforce any remedy with respect to all or any part of the
Guaranteed Obligations; (ii) any waiver or modification of or supplement to any
provision of any agreement relating to the Guaranteed Obligations; (iii) any
release, non-perfection, or invalidity of any indirect or direct security for
the obligations of the Borrower for all or any part of the Guaranteed
Obligations or any obligations of any other Obligated Party liable for any of
the Guaranteed Obligations; (iv) any action or failure to act by the
Administrative Agent, the Issuing Bank or any Lender with respect to any
collateral securing any part of the Guaranteed Obligations; or (v) any default,
failure or delay, willful or otherwise, in the payment or performance of any of
the Guaranteed Obligations, or any other circumstance, act, omission or delay
that might in any manner or to any extent vary the risk of such Loan Guarantor
or that would otherwise operate as a discharge of any Loan Guarantor as a matter
of law or equity (other than the Payment in Full of the Guaranteed Obligations).

 

SECTION 10.04.Defenses Waived. To the fullest extent permitted by applicable
law, each Loan Guarantor hereby waives any defense based on or arising out of
any defense of the Borrower or any Loan Guarantor or the unenforceability of all
or any part of the Guaranteed Obligations from any cause, or the cessation from
any cause of the liability of the Borrower, any Loan Guarantor or any other
Obligated Party, other than the Payment in Full of the Guaranteed Obligations.
Without limiting the generality of the foregoing, each Loan Guarantor
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against any
Obligated Party, or any other Person. Each Loan Guarantor confirms that it is
not a surety under any state law and shall not raise any such law as a defense
to its obligations hereunder. The Administrative Agent may, at its election,
foreclose on any Collateral held by it by one or more judicial or nonjudicial
sales, accept an assignment of any such Collateral in lieu of foreclosure or
otherwise act or fail to act with respect to any collateral securing all or a
part of the Guaranteed Obligations, compromise or adjust any part of the
Guaranteed Obligations, make any other accommodation with any Obligated Party or
exercise any other right or remedy available to it against any Obligated Party,
without affecting or impairing in any way the liability of such Loan Guarantor
under this Loan Guaranty, except to the extent the Guaranteed Obligations have
been Paid in Full. To the fullest extent permitted by applicable law, each Loan
Guarantor waives any defense arising out of any such election even though that
election may operate, pursuant to applicable law, to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of any Loan
Guarantor against any Obligated Party or any security.

 

SECTION 10.05.Rights of Subrogation. No Loan Guarantor will assert any right,
claim or cause of action, including, without limitation, a claim of subrogation,
contribution or indemnification that it has against any Obligated Party, or any
collateral, until the Loan Parties and the Loan Guarantors have fully performed
all their obligations to the Administrative Agent, the Issuing Bank and the
Lenders.

 

SECTION 10.06.Reinstatement; Stay of Acceleration. If at any time any payment of
any portion of the Guaranteed Obligations (including a payment effected through
exercise of a right of setoff) is rescinded, or must otherwise be restored or
returned upon the insolvency, bankruptcy or reorganization of the Borrower or
otherwise (including pursuant to any settlement entered into by a Secured Party
in its discretion), each Loan Guarantor’s obligations under this Loan Guaranty
with respect to that payment shall be reinstated at such time as though the
payment had not been made and whether or not the Administrative Agent, the
Issuing Bank and the Lenders are in possession of this Loan Guaranty. If
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of the Borrower, all
such amounts otherwise subject to acceleration under the terms of any agreement
relating to the Guaranteed Obligations shall nonetheless be payable by the Loan
Guarantors forthwith on demand by the Administrative Agent.

 

CREDIT AGREEMENT – Page 98 

 

 

SECTION 10.07.Information. Each Loan Guarantor assumes all responsibility for
being and keeping itself informed of the Borrower’s financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each Loan Guarantor assumes and incurs under this Loan Guaranty, and agrees that
none of the Administrative Agent, the Issuing Bank or any Lender shall have any
duty to advise any Loan Guarantor of information known to it regarding those
circumstances or risks.

 

SECTION 10.08.Termination. Each of the Lenders and the Issuing Bank may continue
to make loans or extend credit to the Borrower based on this Loan Guaranty until
five (5) days after it receives written notice of termination from any Loan
Guarantor. Notwithstanding receipt of any such notice, each Loan Guarantor will
continue to be liable to the Lenders for any Guaranteed Obligations created,
assumed or committed to prior to the fifth day after receipt of the notice, and
all subsequent renewals, extensions, modifications and amendments with respect
to, or substitutions for, all or any part of such Guaranteed Obligations.
Nothing in this Section 10.08 shall be deemed to constitute a waiver of, or
eliminate, limit, reduce or otherwise impair any rights or remedies the
Administrative Agent or any Lender may have in respect of, any Default or Event
of Default that shall exist under Article VII hereof as a result of any such
notice of termination.

 

SECTION 10.09.Taxes. Each payment of the Guaranteed Obligations will be made by
each Loan Guarantor without withholding for any Taxes, unless such withholding
is required by law. If any Loan Guarantor determines, in its sole discretion
exercised in good faith, that it is so required to withhold Taxes, then such
Loan Guarantor may so withhold and shall timely pay the full amount of withheld
Taxes to the relevant Governmental Authority in accordance with applicable law.
If such Taxes are Indemnified Taxes, then the amount payable by such Loan
Guarantor shall be increased as necessary so that, net of such withholding
(including such withholding applicable to additional amounts payable under this
Section), the Administrative Agent, Lender or Issuing Bank (as the case may be)
receives the amount it would have received had no such withholding been made.

 

SECTION 10.10.Maximum Liability.Notwithstanding any other provision of this Loan
Guaranty, the amount guaranteed by each Loan Guarantor hereunder shall be
limited to the extent, if any, required so that its obligations hereunder shall
not be subject to avoidance under Section 548 of the Bankruptcy Code or under
any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent
Conveyance Act, Uniform Voidable Transaction Act or similar statute or common
law. In determining the limitations, if any, on the amount of any Loan
Guarantor’s obligations hereunder pursuant to the preceding sentence, it is the
intention of the parties hereto that any rights of subrogation, indemnification
or contribution which such Loan Guarantor may have under this Loan Guaranty, any
other agreement or applicable law shall be taken into account.

 

SECTION 10.11.Contribution.

 

(a)                To the extent that any Loan Guarantor shall make a payment
under this Loan Guaranty (a "Guarantor Payment") which, taking into account all
other Guarantor Payments then previously or concurrently made by any other Loan
Guarantor, exceeds the amount which otherwise would have been paid by or
attributable to such Loan Guarantor if each Loan Guarantor had paid the
aggregate Guaranteed Obligations satisfied by such Guarantor Payment in the same
proportion as such Loan Guarantor’s "Allocable Amount" (as defined below) (as
determined immediately prior to such Guarantor Payment) bore to the aggregate
Allocable Amounts of each of the Loan Guarantors as determined immediately prior
to the making of such Guarantor Payment, then, following indefeasible payment in
full in cash of the Guarantor Payment, the Payment in Full of the Guaranteed
Obligations and the termination of this Agreement, such Loan Guarantor shall be
entitled to receive contribution and indemnification payments from, and be
reimbursed by, each other Loan Guarantor for the amount of such excess, pro rata
based upon their respective Allocable Amounts in effect immediately prior to
such Guarantor Payment.

 

CREDIT AGREEMENT – Page 99 

 

 

(b)                As of any date of determination, the "Allocable Amount" of
any Loan Guarantor shall be equal to the excess of the fair saleable value of
the property of such Loan Guarantor over the total liabilities of such Loan
Guarantor (including the maximum amount reasonably expected to become due in
respect of contingent liabilities, calculated, without duplication, assuming
each other Loan Guarantor that is also liable for such contingent liability pays
its ratable share thereof), giving effect to all payments made by other Loan
Guarantors as of such date in a manner to maximize the amount of such
contributions.

 

(c)                This Section 10.11 is intended only to define the relative
rights of the Loan Guarantors, and nothing set forth in this Section 10.11 is
intended to or shall impair the obligations of the Loan Guarantors, jointly and
severally, to pay any amounts as and when the same shall become due and payable
in accordance with the terms of this Loan Guaranty.

 

(d)                The parties hereto acknowledge that the rights of
contribution and indemnification hereunder shall constitute assets of the Loan
Guarantor or Loan Guarantors to which such contribution and indemnification is
owing.

 

(e)                The rights of the indemnifying Loan Guarantors against other
Loan Guarantors under this Section 10.11 shall be exercisable upon the Payment
in Full of the Guaranteed Obligations and the termination of this Agreement.

 

SECTION 10.12.Liability Cumulative. The liability of each Loan Party as a Loan
Guarantor under this Article X is in addition to and shall be cumulative with
all liabilities of each Loan Party to the Administrative Agent, the Issuing Bank
and the Lenders under this Agreement and the other Loan Documents to which such
Loan Party is a party or in respect of any obligations or liabilities of the
other Loan Parties, without any limitation as to amount, unless the instrument
or agreement evidencing or creating such other liability specifically provides
to the contrary.

 

SECTION 10.13.Keepwell. Each Qualified ECP Guarantor hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by each other Loan
Party to honor all of its obligations under this Guarantee in respect of a Swap
Obligation (provided, however, that each Qualified ECP Guarantor shall only be
liable under this Section 10.13 for the maximum amount of such liability that
can be hereby incurred without rendering its obligations under this Section
10.13 or otherwise under this Loan Guaranty voidable under applicable law
relating to fraudulent conveyance or fraudulent transfer, and not for any
greater amount). Except as otherwise provided herein, the obligations of each
Qualified ECP Guarantor under this Section 10.13 shall remain in full force and
effect until the termination of all Swap Obligations. Each Qualified ECP
Guarantor intends that this Section 10.13 constitute, and this Section 10.13
shall be deemed to constitute, a "keepwell, support, or other agreement" for the
benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of
the Commodity Exchange Act.

 

CREDIT AGREEMENT – Page 100 

 

 

[Signature Page Follows]

 

 

 

CREDIT AGREEMENT – Page 101 

 

 

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

 

BORROWER:

FIESTA RESTAURANT GROUP, INC.,
a Delaware corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

GUARANTORS:

CABANA BEVERAGES, INC.,
a Texas corporation

By: /s/ Caleb Wood
Name: Caleb Wood
Title: Vice President, Associate Counsel & Secretary

 

 

 

CABANA BEVCO LLC,
a Texas limited liability company

By: /s/ Caleb Wood
Name: Caleb Wood
Title: Manager

 

 

 

CABANA GRILL, INC.,
a Delaware corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

POLLO TROPICAL MANAGEMENT, LLC,
a Texas limited liability company

By: /s/ Caleb Wood
Name: Caleb Wood
Title: Manager

 

 

 

CREDIT AGREEMENT – Signature Page

 

 

 

POLLO TROPICAL BEVERAGES, LLC,
a Texas limited liability company

By: /s/ Caleb Wood
Name: Caleb Wood
Title: Manager

 

 

 

POLLO FRANCHISE, INC.,
a Florida corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

POLLO OPERATIONS, INC.,
a Florida corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

TACO CABANA, INC.,
a Delaware corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

TP ACQUISITION CORP.,
a Texas corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

CREDIT AGREEMENT – Signature Page

 

 

 

TC BEVCO LLC,
a Texas limited liability company

By: /s/ Caleb Wood
Name: Caleb Wood
Title: Manager

 

 

 

T.C. MANAGEMENT, INC.,
a Delaware corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

TPAQ HOLDING CORPORATION,
a Delaware corporation

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief Financial Officer and Treasurer

 

  TEXAS TACO CABANA, L.P.,
a Texas limited partnership         By:   T.C. Management, Inc.,
its general partner          

By: /s/ Lynn Schweinfurth
Name: Lynn Schweinfurth
Title: Senior Vice President, Chief
Financial Officer and Treasurer 

 

CREDIT AGREEMENT – Signature Page

 

  JPMORGAN CHASE BANK, N.A., individually, and as Administrative Agent and
Issuing Bank       By: /s/ Heather E. Aguilar   Name:  Heather Aguilar  
Title:  Vice President

 

 

CREDIT AGREEMENT – Signature Page

 

 

 

  WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender       By: /s/ Maureen S.
Malphus   Name:  Maureen S. Malphus   Title:    Vice President

 

 

CREDIT AGREEMENT – Signature Page

 

 

  Cadence Bank NA       By: /s/ John M. Huss   Name:  John M. Huss  
Title:    Managing Director

 

 

CREDIT AGREEMENT – Signature Page

 

 

  Fifth Third Bank, as Lender       By: /s/ John A. Marian   Name:  John A.
Marian   Title:    Vice President

 

 

CREDIT AGREEMENT – Signature Page