Exhibit 10.63

 

Deutsche Bank    (Deutsche Bank_logo) [agree001.jpg]

 

For Bank Use Only For Committed Facility.

Insert Applicant Name:

SunPower Corporation

 

CONTINUING AGREEMENT FOR STANDBY LETTERS OF CREDIT AND DEMAND GUARANTEES

 

                                                   June 29, 2016

                                                    (Date)

 

Deutsche Bank AG New York Branch

and

Deutsche Bank Trust Company Americas

60 Wall Street

New York, New York 10005

Attention: ____________________

To induce each of you, during the Commitment Period (as defined below) and
subject to the terms and conditions set forth herein, to issue one or more
irrevocable letters of credit or demand guarantees at the request of Applicant
(as defined below), in substantially such form as Applicant shall request,
Applicant unconditionally and irrevocably agrees with you, including as to each
Credit (as defined below), as follows:

1.          Defined Terms. As used in this agreement (as amended, supplemented
or otherwise modified from time to time, including the application for the
Credit, this “Agreement”), the following terms have the respective meanings
specified below, unless the context requires otherwise:

“Adherence Agreement” means an agreement substantially in the form of Exhibit A
hereto, pursuant to which Applicant may designate any of its subsidiaries as a
Subsidiary Applicant in accordance with Section 4(g).

“Applicant” means the party signing below, and in the case of a request for
issuance of a demand guarantee under the URDG includes such party in its role as
the Instructing Party.

“Base Rate” means, for any day (or, if such day is not a Business Day, the
immediately preceding Business Day), a rate per annum equal to the greater of
(a) the Overnight Federal Funds Rate for such day plus 1/2 of 1% or (b) the
Prime Lending Rate for such day.

“Beneficiary” means, at any time, the beneficiary(ies) of the Credit, including
any second or substitute beneficiary(ies) or transferee(s) under a transferable
Credit and any successor of a beneficiary by operation of law.

“Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks are authorized or required to close in New York City or
at such other place where Issuer is obligated to honor a presentation or
otherwise act under the Credit, this Agreement or any other Loan Document.

“Change in Control” means (a) the Parent has ceased to own at least 50.1% of the
Voting Stock of the Applicant; and (b) in the case of a Subsidiary Applicant,
(i) a sale (whether of stock or other assets), merger or other transaction or
series of related transactions involving such Subsidiary Applicant, as a result
of which those Persons who held 100% of the Voting Stock of such Subsidiary
Applicant immediately prior to such transaction do not hold (either directly or
indirectly) more than 50% of the Voting Stock of such Subsidiary Applicant (or
the surviving or resulting entity thereof) after giving effect to such
transaction, or (ii) the sale of all or substantially all of the assets of a
Subsidiary Applicant in a transaction or series of related transactions.

“Change in Law” means (a) the adoption of any treaty, international agreement,
law, rule or regulation after the date of this Agreement, (b) any change in any
treaty, international agreement, law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
date of this Agreement or (c) compliance by Issuer with any request, guideline
or directive (whether or not having the force of law) of any Governmental
Authority made or issued after the date of this Agreement.

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

 

“Commitment Period” means the period from the Effective Date through and
including the Final Termination Date.

“counter-guarantee” has the meaning assigned thereto under the URDG.

“Credit” means each letter of credit or demand guarantee referred to in the
introductory paragraph hereof (including any bid bond, performance bond or
similar undertaking issued or undertaken by Issuer), and includes any amendment
or replacement thereof authorized by its terms or by consent of Applicant and,
at Issuer’s option, any pre-advice thereof.

“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.

“demand guarantee” has the meaning assigned thereto under the URDG, and unless
the context requires otherwise includes a counter-guarantee.

“Deposits” means any and all deposits (whether general or special, time or
demand, provisional or final) at any time held, and any other indebtedness at
any time owing, by Issuer or any of its affiliates to or for the credit or the
account of Applicant, excluding any deposit where the account title expressly
indicates that such deposit does not secure any Obligations or that Applicant is
not holding such deposit for itself.

“Dollars“ or “$” mean, at any time, the lawful currency of the United States of
America.

“Effective Date” means the date on which the conditions specified in Section
2(a) are satisfied (or waived in accordance with Section 23).

“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 Applicant, 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 existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by Applicant or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by Applicant or any ERISA Affiliate from the Pension Benefit
Guaranty Corporation 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 Applicant or any of its ERISA Affiliates of any
liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by Applicant or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from Applicant or any ERISA
Affiliate of any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.

“Event of Default” has the meaning provided in Section 17.

“Exchange Act” means the United States Securities Exchange Act of 1934.

“Financial Credit” means any Credit that is not a Performance Credit.

“Final Termination Date” has the meaning provided in Section 25(b).

“Governmental Authority” means the government of the United States of America,
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.

“Indemnified Party” means Issuer and each officer, director, affiliate, employee
and agent thereof.

“Instructing Party” has the meaning assigned to such term under the URDG.

“ISP” means the International Standby Practices 1998, International Chamber of
Commerce Publication No. 590.

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“Issuer” means Deutsche Bank AG New York Branch and Deutsche Bank Trust Company
Americas, including each as “guarantor” or “counter-guarantor,” as applicable,
within the meaning of the URDG, but with respect to any particular Credit, means
whichever one of them issued such Credit.

“Issuer’s Office” means Issuer’s address for notices under this Agreement.

“Letter of Credit Exposure” means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Credits issued by Issuer hereunder at such
time (including any pending drawings made prior to expiration and any scheduled
increases in accordance with the terms of any Credit) plus (b) the aggregate
amount of all payments made by Issuer pursuant to any such Credit issued
hereunder that have not yet been reimbursed by or on behalf of Applicant at such
time (including any and all acceptances and deferred payment undertakings
incurred under any Credit providing for acceptances or deferred payment
undertakings, as applicable).

“Loan Documents” means this Agreement, each request by Applicant for a Credit
and each other instrument or agreement made or entered into by Applicant with
Issuer in connection with the transactions contemplated hereby or thereby, and
any supplements or amendments to or waivers of any of the foregoing executed and
delivered from time to time.

“Material Adverse Effect” means a material adverse effect on (A) the business,
financial condition, operations or properties of the Applicant and its
subsidiaries, taken as a whole, (B) the ability of the Applicant to perform the
obligations, taken as a whole, under this Agreement or the other Loan Documents,
or (C) the validity or enforceability of this Agreement or any of the other Loan
Documents.

“Maximum Commitment Amount” means, at any time of determination, $50,000,000 or
if Applicant reduces the Maximum Commitment Amount in accordance with Section
25(a), such reduced amount.

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

“Notice of Termination” means a notice substantially in the form of Exhibit B
hereto, which Applicant may execute and deliver to Issuer in accordance with
Section 4(g).

“Obligations“ means all present and future obligations of Applicant under this
Agreement or in respect of the Credits, whether absolute or contingent, joint,
several or independent, including interest accruing at the rate provided in this
Agreement on or after the commencement of any bankruptcy or insolvency
proceeding, whether or not allowed or allowable.

“Overnight Federal Funds Rate“ means, at any time, the rate per annum at which
Issuer, in its sole discretion, can acquire Federal funds in the interbank
overnight federal funds market including through brokers of recognized standing.

“Performance Credit” means a Credit used directly or indirectly to cover a
default in the performance of any non-financial or commercial obligations of
Applicant or any Subsidiary Account Party under specific contracts, and any
Credit issued in favor of a bank or other surety who in connection therewith
issues a demand guarantee or similar undertaking, performance bond, surety bond
or other similar instrument that covers a default of any such performance
obligations, that is classified as a performance standby Credit by the Board or
by the Office of the Comptroller of the Currency of the United States.

“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, government (including
any subdivision, agency, court, central bank, or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government) 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 Applicant 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.

“Practices” has the meaning provided in Section 26(b).

“Prime Lending Rate“ means the rate of interest Issuer announces from time to
time as Issuer’s prime lending rate for unsecured commercial loans within the
United States of America (but is not intended to be the lowest rate of interest
Issuer charges in connection with extensions of credit to borrowers).

“Scheduled Termination Date” means the date two years from the Effective Date.

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

“Subsidiary Account Party” means any direct or indirect subsidiary of Applicant
(a) listed on Schedule I hereto and approved as a Subsidiary Account Party
hereunder by Issuer’s signing Schedule I in its sole discretion or (b) that
Applicant may from time to time list on a supplement to Schedule I with the
written approval of Issuer in its sole discretion.

“Subsidiary Applicant” means (a) each direct or indirect subsidiary of Applicant
that has executed and delivered this Agreement as a “Subsidiary Applicant” in
the space provided below and (b) each other direct or indirect subsidiary of
Applicant from time to time approved in writing by Issuer as a Subsidiary
Applicant in accordance with Section 4(g), in each case other than any such
subsidiary that has ceased to be a “Subsidiary Applicant” pursuant to Section
4(g).

“Taxes” means all present and future taxes, levies, imposts, deductions,
charges, withholdings and related liabilities, excluding income and franchise
taxes imposed by the jurisdiction of Issuer’s head office or the office issuing
the Credit or any of its political subdivisions.

“UCC” means the Uniform Commercial Code, as in effect from time to time in the
applicable jurisdiction.

“UCP” means the Uniform Customs and Practice for Documentary Credits, 2007
Revision, International Chamber of Commerce Publication No. 600.

“URDG” means the Uniform Rules for Demand Guarantees, 2010 Revision,
International Chamber of Commerce Publication No. 758.

“Voting Stock” means shares of capital stock issued by a corporation (or
equivalent interests in any other 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 if the right so
to vote has 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.

2.          Conditions to Issuance; Interest on Deposited Amount; Issuance;
Reimbursement.

(a)          Effective Date. Issuer’s obligation to issue any Credit hereunder
shall not become effective until the date when each of the following conditions
is satisfied (or waived in accordance with Section 23):

(i)          Issuer shall have received from each party hereto a counterpart of
this Agreement signed on behalf of such party;

(ii)         [Reserved];

(iii)        [Reserved];

(iv)        Issuer shall have received a favorable written opinion (addressed to
Issuer and dated the Effective Date) from the counsel to Applicant, covering
good standing, power and authority, due authorization, execution and delivery,
enforceability, non-contravention, and perfection of security interests, such
opinions to be rendered under both (i) New York State and United States Federal
law and (ii) the jurisdiction of organization of the Applicant and covering such
other matters relating to Applicant, its organizational documents, the Loan
Documents, or the transactions contemplated hereby as Issuer shall reasonably
request;

(v)        Issuer shall have received all fees and other amounts due and payable
on or prior to the Effective Date, and, to the extent invoiced, reimbursement or
payment of all expenses required to be reimbursed or paid by Applicant hereunder
or under another agreement;

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(vi)        Issuer shall have received such documents and certificates as Issuer
or its counsel may reasonably request relating to the organization, existence
and good standing of Applicant, the authorization of the transactions
contemplated hereby, and any other matters relevant hereto, all in form and
substance reasonably satisfactory to Issuer;

(vii)       Applicant shall have received all consents and approvals (including,
without limitation, under any applicable credit facility or indenture) required
in connection with the execution and delivery by Applicant of the Loan Documents
or in connection with the consummation of the transactions contemplated hereby
and thereby, and Issuer, upon request, shall have received satisfactory evidence
of the same; and

(viii)       All other documents and legal matters in connection with the
transactions contemplated by this Agreement shall have been delivered, executed,
or recorded and shall be in form and substance satisfactory to Issuer.

(b)          Each Credit Event. Issuer’s obligation to issue, amend, renew or
extend any Credit hereunder is subject to the satisfaction of the following
conditions:

(i)          Issuer shall have received a signed and completed application for
such Credit substantially in the form attached hereto and otherwise in form and
substance reasonably satisfactory to it;

(ii)         [Reserved];

(iii)        Such Credit, or proposed amendment, shall be in form and substance
reasonably satisfactory to Issuer and, with respect to any issuance of a Credit,
such Credit may include a statement to the effect that it is being issued to
replace an existing letter of credit;

(iv)        Issuer shall have received payment of all fees contemplated hereby
in connection with any such issuance, amendment, renewal or extension;

(v)         At the time of and immediately after giving effect to the issuance,
amendment, renewal or extension of such Credit, the total Letter of Credit
Exposure will not exceed the Maximum Commitment Amount;

(vi)        No Default shall have occurred and be continuing immediately before
or after giving effect to the issuance, amendment, renewal or extension of such
Credit;

(vii)       The representations and warranties of Applicant contained in this
Agreement and the other Loan Documents shall be true and correct in all material
respects on and as of the date of issuance, amendment, renewal or extension of
such Credit, both before and immediately after giving effect to the issuance,
amendment, renewal or extension of such Credit, other than any such
representation or warranty that, by its terms, refers to a specific date other
than the date of such issuance, amendment, renewal or extension, in which case
as of such specific date;

(viii)      No Change in Law shall have occurred, no order, judgment or decree
of any Governmental Authority shall have been issued, and no litigation shall be
pending or threatened, which enjoins, prohibits or restrains (or with respect to
any litigation seeks to enjoin, prohibit or restrain), the reimbursement of
Issuer contemplated hereunder, the issuance of any Credit, or the consummation
of any of the other transactions contemplated hereby or the use of proceeds of
the Credit permitted hereunder;

(ix)        [Reserved];

(x)         Issuer, in its sole discretion, shall have determined that the
issuance of such Credit does not negatively impact the group sustainability
principles or reputation of the Issuer;

(xi)         Issuer, in its sole discretion, shall have determined that the
issuance of such Credit shall not cause any negative compliance implications or
resulting sanctions to be brought upon Issuer;

(xii)       Such Credit shall be issued during the Commitment Period; and

(xiii)      After giving effect to the issuance, amendment, renewal or extension
of such Credit, such Credit shall not have an expiration date occurring after
the earlier of (A) one year after the date of such issuance, amendment, renewal
or extension and (B) the Scheduled Termination Date, provided that any Credit
with a one-year tenor may provide for the extension thereof for additional
one-year periods (which shall in no event extend beyond the Scheduled
Termination Date),

(c)          [Reserved].

(d)          Notwithstanding anything herein to the contrary, the obligation to
issue Credits hereunder shall, subject to all terms and conditions herein, be
solely that of Deutsche Bank AG New York Branch; provided that Deutsche

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Bank Trust Company Americas may, with Applicant’s consent, also issue Credits
hereunder, and all terms and exculpations hereunder shall apply to Deutsche Bank
Trust Company Americas in respect of any such Credit. Applicant will reimburse
Issuer the amount of each payment Issuer makes under the Credit within five (5)
Business Days of the date Issuer notifies Applicant of such payment; provided
that if the Credit provides for acceptance of a time draft or incurrence of a
deferred payment obligation, and if Issuer notifies Applicant of such acceptance
or incurrence at least one Business Day in advance of its maturity,
reimbursement shall be due sufficiently in advance of its maturity to enable
Issuer to arrange for its cover in same day funds to reach the place where it is
payable no later than the date of its maturity. Each reimbursement shall be
without prejudice to Applicant’s rights under Section 8(b).

3.          Fees, Costs and Expenses.

Applicant will pay to Issuer (a) fees in respect of the Maximum Commitment
Amount and the Credit at such rates and times as Applicant and Issuer agree in
writing (including, if applicable, issuance fees, maintenance fees, amendment
fees, drawing fees, transfer fees, and assignment of proceeds fees), and (b) all
reasonable out-of-pocket costs and expenses (including reasonable and documented
attorney’s fees and disbursements) that Issuer incurs in connection with the
Credit, this Agreement or any other Loan Document, including (i) in enforcing
this Agreement or any other Loan Document, (ii) all reasonable costs and
expenses in complying with any governmental exchange, currency control or other
law, rule or regulation of any country now or hereafter applicable to the
purchase or sale of, or dealings in, foreign currency in connection with the
Credit, this Agreement or any other Loan Document, (iii) any stamp tax,
recording tax, or similar tax or fee payable in connection with the Credit, this
Agreement or any other Loan Document, and (iv) any adviser’s, confirmer’s, or
other nominated person’s fees and expenses with respect to the Credit that are
chargeable to Applicant or Issuer (if the application for the Credit requested
or authorized such advice, confirmation or other nomination, as applicable).

4.          Payments; Currency; Interest; Computations; Designation of
Subsidiary Applicants

(a)          All amounts due from Applicant under this Agreement shall be paid
to Issuer at Issuer’s Office without defense, setoff, or counterclaim, in
Dollars and in immediately available funds; provided that if the amount due is
based upon Issuer’s payment in a currency other than Dollars, Applicant will pay
the equivalent of such amount in Dollars computed at Issuer’s selling rate for
cable transfers to the place where and in the currency in which Issuer paid, or,
at Issuer’s option, Applicant will pay in such other currency, place, and manner
as Issuer reasonably specifies in writing. Applicant’s obligation to make
payments in any currency (the “Specified Currency”) shall not be discharged or
satisfied by any tender, or any recovery pursuant to any judgment or otherwise,
which is expressed in or converted into any currency other than the Specified
Currency, except to the extent that such tender or recovery results in the
actual receipt by Issuer at Issuer’s Office of the full amount of the Specified
Currency payable under this Agreement. Applicant shall indemnify Issuer for any
shortfall and Applicant’s obligation to make payments in the Specified Currency
shall be enforceable as an alternative or additional cause of action to the
extent that such actual receipt is less than the full amount of the Specified
Currency expressed to be payable hereunder, and shall not be affected by
judgment being obtained for other sums due hereunder.

(b)          If Applicant fails to fully reimburse Issuer on the date of any
payment under the Credit, then Applicant will pay interest to Issuer on such
unreimbursed amount at a variable interest rate equal to (i) until the date
reimbursement is due under Section 2(d), the Base Rate, and (ii) thereafter, the
rate provided in the following sentence. Without limiting Applicant’s obligation
to make all payments hereunder when due, Applicant will pay to Issuer, on
demand, interest on all overdue amounts hereunder from the due date through the
payment date at a variable interest rate equal to the sum of two percent (2%)
per annum plus the Base Rate from time to time. Any change in the interest rate
resulting from a change in the Base Rate shall take effect on the date of such
change in the Base Rate. If any payment shall be due on a day that is not a
Business Day, such payment shall be made on the next Business Day and interest
shall be paid for each additional day elapsed.

(c)          Each Credit shall be denominated in Dollars or another currency
that Issuer has determined is available to it in the place where payment is
supposed to be made and is readily exchangeable to and from Dollars.

(d)          All computations of interest under this Agreement shall be based on
a 365-day or, if applicable, 366-day year for the actual number of days elapsed.
All computations of fees under this Agreement shall be based on a 360-day year
for the actual number of days elapsed. All computations of fees based upon the
available or face amount of the Credit at any time shall be calculated by
reference to the greatest amount for which Issuer may be contingently liable
under any circumstances under the Credit at such time or thereafter, giving
effect to any scheduled increases in accordance with the terms of the Credit.

(e)          Issuer shall make the determination as to whether a Credit is a
Performance Credit or a Financial Credit, and each such determination by Issuer
shall be conclusive absent manifest error.

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(f)          Any application that Applicant may make for the issuance of a
Credit may be made by any Subsidiary Applicant for the account of such
Subsidiary Applicant, and thereafter such Subsidiary Applicant may also make any
application for the extension of the term or increase in the amount of such
Credit or any other amendment thereto or waiver of discrepancies thereunder.
Applicant and the applicable Subsidiary Applicant shall be jointly and severally
liable to Issuer for all the reimbursement, indemnification and other
obligations, representations, warranties and other agreements of Applicant under
this Agreement in respect of any Credit requested by such Subsidiary Applicant.
Applicant and the applicable Subsidiary Applicant represent and warrant that at
the time of issuance of any Credit for the account of such Subsidiary Applicant
(or of any increase or extension thereof), such Subsidiary Applicant is a direct
or indirect majority-owned subsidiary of Applicant.

(g)          Subject to Issuer’s written consent in its sole discretion,
Applicant from time to time may designate any direct or indirect majority-owned
subsidiary of Applicant as a Subsidiary Applicant by (i) delivering to Issuer an
Adherence Agreement executed by such proposed Subsidiary Applicant and
countersigned by Applicant and Issuer, (ii) taking such further actions as
Issuer may reasonably request, including executing and delivering other
instruments, documents, and agreements corresponding to those obtained in
respect of Applicant, all in form and substance reasonably satisfactory to
Issuer, and (iii) providing Issuer with a reasonable opportunity to perform any
due diligence concerning such proposed Subsidiary Applicant, including any new
customer intake procedures imposed by applicable law or regulation or by
internal policy of Issuer (such as OFAC and “know your customer” checks and
obtaining evidence of corporate organization and existence and due authorization
and incumbency of signatories). Upon such delivery and the taking of such
further actions, such subsidiary shall for all purposes of this Agreement be a
Subsidiary Applicant hereunder and a party to this Agreement, until Applicant
shall have executed and delivered to Issuer a Notice of Termination in respect
of such subsidiary, whereupon such subsidiary shall cease to be a Subsidiary
Applicant. Notwithstanding the preceding sentence, no such Notice of Termination
will become effective as to any Subsidiary Applicant at a time when any
Obligations of such Subsidiary Applicant shall be outstanding hereunder or any
Credit issued at the request of such Subsidiary Applicant shall be outstanding;
provided that such Notice of Termination shall be effective to terminate such
Subsidiary Applicant’s right to request the issuance of any new Credits
hereunder or any increase in the amount of any other Credit.

5.          Capital Adequacy; Additional Costs. If Issuer determines that a
Change in Law affects the amount of capital, insurance or reserves (including
special deposits, deposit insurance or similar requirements) to be maintained by
Issuer or any corporation controlling Issuer, or otherwise increases the costs
of, or reduces the amount received or receivable by, Issuer or any corporation
controlling Issuer, and Issuer determines that the amount of such capital,
insurance or reserve or other increased cost or reduction, as the case may be,
is increased or reduced by or based upon the existence of the Credit, this
Agreement or any other Loan Document, then Applicant shall pay to Issuer, within
15 Business Days after demand from time to time, such additional amounts as
Issuer may demand to compensate for the increase or reduction, as the case may
be; provided that such demand shall include a statement of the basis for such
demand and a calculation in reasonable detail of the amount demanded and Issuer
computes all amounts due under this paragraph on a reasonable basis.

6.          Taxes. All payments to Issuer hereunder shall be made free and clear
of and without deduction for any Taxes. If any Taxes shall be required to be
deducted from any sum payable under this Agreement, then: (a) the sum payable
under this Agreement shall be increased so that after making all required
deductions Issuer receives an amount equal to the sum Issuer would have received
had no such deductions been required; (b) Applicant shall be responsible for
payment of the amount to the relevant taxing authority; (c) Applicant shall
indemnify Issuer for any such Taxes imposed on or paid by Issuer and any
liability (including penalties, interest and expenses) arising from its payment
or in respect of such Taxes within thirty days from the date Issuer makes
written demand therefor; and (d) Upon request, Applicant shall provide to Issuer
within thirty days of any payment to a taxing authority the original or a
certified copy of the receipt evidencing each Tax payment.

7.          Indemnification. Applicant will indemnify and hold harmless each
Indemnified Party from and against any and all claims, liabilities, losses,
damages, costs and expenses (including reasonable attorney’s fees and
disbursements) that arise out of or in connection with: (a) the Credit, any
demand for payment, other presentation or request under the Credit, or the
transaction(s) supported by the Credit, (b) any payment or other action taken or
omitted to be taken in connection with the Credit, this Agreement or any other
Loan Document, (c) the enforcement of this Agreement or any other Loan Document
or any rights or remedies under or in connection with the Credit, (d) any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto government or Governmental Authority with respect to the Credit, this
Agreement or any other Loan Document or any other cause beyond Issuer’s control,
or (e) any indemnity or other undertaking that Applicant requests or authorizes
Issuer to issue to induce any other financial institution (including any branch
or affiliate of Issuer) to issue its own letter of credit, demand guarantee, or
other undertaking in connection with any Credit, except in each case to the
extent such liability, loss, damage, cost or expense is found in a final,
non-appealable

7

 

judgment by a court of competent jurisdiction to have resulted directly from
such Indemnified Party’s gross negligence or willful misconduct. Applicant will
pay within fifteen Business Days after demand from time to time all amounts
owing under this Section.

8.          Obligations Absolute; Claims Against Issuer; Exculpations;
Limitations of Liability.

(a)          Applicant’s Obligations shall be absolute, unconditional and
irrevocable and shall be performed strictly in accordance with the terms of this
Agreement, irrespective of: (i) if any other Person shall at any time have
guaranteed or otherwise agreed to be liable for any of the Obligations or
granted any security therefor, any change in the time, manner or place of
payment of or any other term of the obligations of such other Person, (ii) any
exchange, change, waiver or release of any collateral for, or any other Person’s
guarantee of or other liability for, any of the Obligations, (iii) the existence
of any claim, setoff, defense or other right that Applicant or any other Person
may at any time have against any Beneficiary, any assignee of proceeds of the
Credit, Issuer or any other Person, (iv) any presentation under the Credit being
forged or fraudulent or any statement therein being untrue or inaccurate, or (v)
any other circumstance that might, but for the provisions of this Section,
constitute a legal or equitable discharge of or defense to any or all of the
Obligations.

(b)          The foregoing shall not excuse Issuer from liability to Applicant
in any independent action or proceeding that is brought by Applicant against
Issuer following reimbursement by Applicant to Issuer to the extent of any
direct damages suffered by Applicant that were caused by Issuer’s gross
negligence or willful misconduct; provided that (i) Issuer shall be deemed to
have acted with reasonable care if it acts in accordance with standard letter of
credit practice or standard demand guarantee practice, as applicable, of
commercial banks located in New York City; and (ii) Applicant’s aggregate
remedies against Issuer for wrongfully honoring a presentation or wrongfully
retaining honored documents shall not exceed the aggregate amount paid by
Applicant to Issuer with respect to the honored presentation, plus interest.

(c)          Without limiting any other provision of this Agreement, Issuer: (i)
may rely upon any oral, telephonic, facsimile, electronic, written or other
communication reasonably believed to have been authorized by Applicant, (ii)
shall not be responsible for errors, omissions, interruptions or delays in
transmission or delivery of any message, advice or document in connection with
the Credit, whether transmitted by courier, mail, telex, any other
telecommunication, or otherwise (whether or not they be encrypted), or for
errors in interpretation of technical terms or in translation (and Issuer may
transmit Credit terms without translating them), (iii) may honor any
presentation under the Credit that appears on its face to substantially comply
with the terms and conditions of the Credit, (iv) may honor a demand for payment
under a demand guarantee or counter-guarantee that is issued subject to the URDG
even where (A) in the case of a demand guarantee other than a counter-guarantee,
such demand for payment is not supported by a statement indicating in what
respect Applicant is in breach of its obligations under any underlying agreement
or transaction, unless the demand guarantee expressly requires presentation of
such supporting statement and regardless of whether such demand guarantee
expressly excludes any requirement for such a supporting statement or (B) in the
case of a counter-guarantee, such demand is not supported by a statement by the
party to whom such counter-guarantee was issued indicating that such party has
received a complying demand under the demand guarantee or counter-guarantee
issued by such party, unless the counter-guarantee expressly requires
presentation of such supporting statement and regardless of whether the related
counter-guarantee expressly excludes the requirement for such a supporting
statement, (v) in the case of a demand for payment under a demand guarantee that
is issued subject to the URDG, shall be deemed (A) to have timely paid if it
pays within one Business Day after determining that such demand is complying or
(B) to have timely refused to pay if it gives notice of rejection of such demand
not later than the close of the fifth Business Day following the day of
presentation of such demand, (vi) may replace a purportedly lost, stolen or
destroyed original Credit, waive a requirement for its presentation, or provide
a replacement copy to any Beneficiary, (vii) if no form of draft is attached as
an exhibit to the Credit, may accept as a draft any written or electronic demand
or request for payment under the Credit, and may disregard any requirement that
such draft bear any particular reference to the Credit, (viii) unless the Credit
specifies the means of payment, may make any payment under the Credit by any
means it chooses, including by wire transfer of immediately available funds,
(ix) may select any branch or affiliate of Issuer or any other bank to act as
advising, transferring, confirming and/or nominated bank under the law and
practice of the place where it is located (if the application for the Credit
requested or authorized advice, transfer, confirmation and/or nomination, as
applicable), (x) may amend the Credit to reflect any change of address or other
contact information of any Beneficiary, (xi) shall not be obligated to examine,
and may disregard for purposes of determining compliance of any presentation
with the terms and conditions of the Credit, (A) any presented document not
called for by the terms and conditions of the Credit and (B) that portion, if
any, of any presented document called for by the terms and conditions of the
Credit that contains data not called for by the terms and conditions of the
Credit regardless of whether such data conflicts with data in the Credit or any
other presented document, (xii) in the case of a demand guarantee that is issued
subject to the URDG, shall be deemed to have timely informed the Instructing
Party of any demand for payment thereunder and of any request, as an
alternative, to extend the expiry of such demand guarantee if it so informs the
Instructing Party within three Business Days following the Business Day upon
which Issuer receives such demand or request, and (xiii) shall not be
responsible for any other action or inaction taken or suffered by Issuer under
or in

8

 

connection with the Credit, if required or permitted under any applicable
domestic or foreign law or letter of credit or demand guarantee practice. None
of the circumstances described in this Section 8(c) shall impair Issuer’s rights
and remedies against Applicant or place Issuer under any liability to Applicant.

(d)          Applicant will notify Issuer in writing of any objection Applicant
may have to Issuer’s issuance or amendment of the Credit, Issuer’s honor or
dishonor of any presentation under the Credit, or any other action or inaction
taken by Issuer under or in connection with the Credit, this Agreement or any
other Loan Document. Applicant’s notice of objection must be delivered to Issuer
within 15 Business Days after Applicant receives notice of the action or
inaction it objects to. Applicant’s failure to give notice of objection within
such period shall automatically waive Applicant’s objection. Applicant’s
acceptance or retention beyond such period of any original documents presented
under the Credit, or of any property for which title is conveyed by such
documents, shall ratify Issuer’s honor of the applicable presentation(s).

(e)          Issuer shall not be liable in contract, tort, or otherwise for any
punitive, exemplary, consequential, indirect or special damages (including for
any consequences of forgery or fraud by any Beneficiary or any other Person).

9.          Applicant Responsibility, Etc. Applicant’s ultimate responsibility
for the final text of the Credit shall not be affected by any assistance Issuer
may provide such as drafting or recommending text. Issuer may, without incurring
any liability to Applicant or impairing its entitlement to payment under this
Agreement, honor the Credit despite notice from Applicant of, and without any
duty to inquire into, any purported defense to honor or any claim against any
Beneficiary or any other Person. Issuer shall have no duty to seek any waiver of
discrepancies from Applicant, nor any duty to grant any waiver of discrepancies
which Applicant approves or requests.

10.        Transfers. If the Credit is issued in transferable form, Issuer shall
have no duty to determine the identity of anyone appearing in any transfer
request, draft or other document as transferee, or the validity or correctness
of any transfer made pursuant to documents that appear on their face to be
substantially in accordance with the terms and conditions of the Credit.

11.        Extensions and Modifications; Waivers of Discrepancies. This
Agreement shall be binding upon Applicant with respect to any replacement,
extension or modification of the Credit or waiver of discrepancies authorized by
Applicant. Except as may be provided in the Credit or otherwise agreed to in
writing by Issuer in its sole discretion, Issuer shall have no duty to (a) issue
or refrain from issuing notice of (i) its election not to extend the Credit,
(ii) if the Credit by its terms permits it to do so, its election to terminate
the Credit prior to its stated expiration date, or (iii) if the Credit by its
terms permits it to do so, its election not to reinstate the amount of any
drawing under the Credit or (b) otherwise amend or modify the Credit.

12.        [Reserved].

13.        Additional Bond or Collateral.

If Applicant or any other Person seeks to restrain any presentation under or
honor of the Credit or takes any other action that has a similar effect or if
any court shall do any of the foregoing or extend the term of the Credit, then,
in each case, Applicant shall, at Issuer’s request, provide Issuer with a bond
or other collateral of a type and value reasonably satisfactory to Issuer as
security for the Obligations.

14.        [Reserved].

15.        Covenants of Applicant.

(a)          Affirmative Covenants. Applicant will (i) comply, and cause each of
its subsidiaries (to the extent such subsidiaries are deemed Subsidiary
Applicants hereunder) to comply, with all applicable laws, rules and regulations
now or hereafter applicable to Applicant, its properties, the Credit or
transactions related to the Credit, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect, (ii) deliver to
Issuer, upon request from time to time, reasonably satisfactory evidence of
compliance with this Agreement and the other Loan Documents and, unless
Applicant timely files (without giving effect to any extension), regular annual
and quarterly financial statements with the U.S. Securities and Exchange
Commission (or any successor thereto) pursuant to the Exchange Act, financial
statements and such other information concerning Applicant’s financial
condition, business and prospects as Issuer may reasonably request, (iii) keep,
and will cause each of its subsidiaries (to the extent such subsidiaries are
deemed Subsidiary Applicants hereunder) to keep, adequate books of record and
account; and will permit representatives of Issuer to visit and inspect (on one
Business Day’s notice) any of its properties, to examine and make abstracts from
any of its books and records and to discuss its affairs, finances and accounts
with its officers, employees and independent public accountants, all during
normal business hours and as often as reasonably requested, (iv) promptly upon
obtaining knowledge of the occurrence of any Default, notify Issuer thereof in
writing, specifying the nature thereof and

9

 

the action Applicant proposes to take with respect thereto, (v) provide Issuer
not less than 30 days’ prior written notice of any change in Applicant’s legal
name, Federal tax identification number (if applicable), state or type of
organization or any organization number, (vi) pay and discharge, and cause each
of its subsidiaries to pay and discharge, before the same shall become
delinquent, all of its respective material obligations and liabilities,
including any obligation pursuant to any agreement by which it or any of its
properties is bound and any tax liabilities, except where (A) the validity or
amount thereof is being contested in good faith by appropriate proceedings
diligently pursued, (B) Applicant or such subsidiary (to the extent such
subsidiary is deemed a Subsidiary Applicant hereunder) has set aside on its
books adequate reserves with respect thereto in accordance with generally
accepted accounting principles, consistently applied, and (C) the failure to
make such payment pending such contest could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect, (vii)
keep and maintain, and cause each of its subsidiaries (to the extent such
subsidiaries are deemed Subsidiary Applicants hereunder) to keep and maintain,
all property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, (viii) maintain, and cause each of its subsidiaries
to maintain, with financially sound and reputable insurers, insurance in such
amounts and against such risks as are customarily maintained by similarly
situated companies under similar circumstances, (ix) engage only in business of
the type contemplated by its organizational documents as in effect on the
Effective Date, (x) do or cause to be done, and cause each of its subsidiaries
to do or cause to be done, all things necessary to preserve and keep in full
force and effect its legal existence and the rights, licenses, permits,
privileges, authorizations, qualifications and accreditations material to the
conduct of its business, in each case if the failure to do so, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect, (xi) use all proceeds, if any, of the Credits for working capital and
general purposes of Applicant, in accordance with Applicant’s organizational
documents and this Agreement; and (xii) maintain each Plan in compliance in all
material respects with the applicable provisions of ERISA, the Code and other
federal or state law.

(b)          Negative Covenants. Applicant will not enter into any material
agreement that would be violated or breached by the performance of any
Obligations where such violation or breach would result in a Material Adverse
Effect.

16.        Representations and Warranties; Subsidiary Account Parties.

(a)          Applicant represents and warrants as of the date of this Agreement
and also as of the date of issuance of each Credit (or of any increase or
extension thereof) that: (i) it is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization with the power and
authority to carry on its business; (ii) its execution, delivery and performance
of this Agreement, the other Loan Documents and any underlying agreement or
transaction, (A) are within its powers, (B) have been duly authorized, (C) do
not contravene any charter provision, by-law, resolution, contract or other
undertaking binding on it or any of its properties, which could reasonably be
expected to have a Material Adverse Effect, (D) do not violate any domestic or
foreign law, rule or regulation, or any order, writ, judgment, decree, award or
permit of any arbitration tribunal, court or other Governmental Authority
applicable to it or any of its properties, which, could reasonably be expected
to have a Material Adverse Effect, and (E) do not require any notice, filing or
other action to or by any Governmental Authority (other than those that have
been made or obtained and are in full force and effect); (iii) each of this
Agreement and the other Loan Documents is its legal, valid and binding
obligation, enforceable against it in accordance with its terms; (iv) the
consolidated balance sheet and statements of income, shareholders’ equity and
cash flows as of and for the fiscal year ended January 3, 2016 for the Applicant
present fairly, in all material respects, the financial condition and results of
operations and cash flows of the Applicant and its consolidated subsidiaries as
of such date and for such periods, in accordance with generally accepted
accounting principles, consistently applied; (v) except as disclosed in the
Applicant’s filings with the SEC, there is no pending or threatened action or
investigation which could reasonably be expected to have a Material Adverse
Effect or which purports to affect the validity or enforceability of this
Agreement, the other Loan Documents or any other agreement supporting or
securing the Credit, this Agreement, the other Loan Documents or any transaction
related to the Credit; (vi) neither its granting of any collateral security for
the Obligations, nor Issuer’s issuance of the Credit (or any increase or
extension thereof), nor the making of any payment thereunder or the use of any
proceeds thereof, constitutes or will constitute, or be part of, a fraudulent
transfer or conveyance by Applicant to anyone (including Issuer and any
Beneficiary) under any applicable law, or exceed (alone or together with any
other payments or credit support for any transaction(s) supported by the Credit)
the maximum amount that would be allowed for any claim against Applicant under
any applicable subsection of United States Bankruptcy Code Section 502(b) if
Applicant were the subject of any proceeding thereunder; (vii) it is not an
investment company within the meaning of the Investment Company Act of 1940 or,
directly or indirectly, controlled by or acting on behalf of any party which is
such an investment company; (viii) immediately after giving effect to the
issuance of the Credit (or any increase or extension thereof), no Default has
occurred and is continuing; (ix) [Reserved]; (x) [Reserved]; (xi) no other
information furnished by it to Issuer is or shall be materially false or
misleading when furnished, provided that, with respect to projected financial
information, Applicant represents only that such information was prepared in
good faith based upon

10

 

assumptions believed to be reasonable at the time and Issuer recognizes and
acknowledges that such projected financial information is not to be viewed as
facts and that actual results during the period or periods covered by such
projections may differ from the projected results and such differences may be
material; (xii) on the Effective Date and the date of the issuance, amendment,
renewal or extension of each Credit, after giving effect to the transactions
contemplated by the Loan Documents occurring on such date, Applicant will be
Solvent; (xiii) neither Applicant nor any subsidiary thereof is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any margin stock (within the
meaning of Regulation U of the Board), and neither the issuance, amendment,
renewal or extension of any Credit nor the use of the proceeds thereof will
violate or be inconsistent with the provisions of Regulations T, U or X of the
Board; (xiv); its execution, delivery and performance hereof constitute private
rather than public or government acts; and neither it nor any of its property
has any immunity from jurisdiction of any court or from set-off or any legal
process under the laws of the State of New York or the laws of its jurisdiction
of organization; and (xv) as of the date hereof, no ERISA Event has occurred.

(b)          Without limiting any Obligations of Applicant hereunder, Applicant
represents, warrants and agrees as to any Credit issued to support obligations
of a Subsidiary Account Party that: (i) Applicant is duly authorized to act for
and bind such Subsidiary Account Party with respect to such Credit and this
Agreement; (ii) such Subsidiary Account Party shall be jointly and severally
liable with Applicant for the reimbursement, indemnification and other
obligations, representations, warranties and agreements of Applicant hereunder
in respect of such Credit, but not for the reimbursement, indemnification or
other obligations, representations, warranties or agreements of Applicant
hereunder in respect of any Credit not issued to support obligations of such
Subsidiary Account Party; (iii) such Subsidiary Account Party has consented to
its being referred to as the “applicant”, “account party”, “client”, “customer”
or “instructing party” at whose request or on whose behalf or for whose account
such Credit is issued; (iv) such Subsidiary Account Party has consented to its
not having any rights under this Agreement (including any right to request that
Issuer issue or amend such Credit or that Issuer dispose of any documents
presented under such Credit (or any goods represented thereby) in any particular
manner) and to Issuer’s treating Applicant as the sole Person entitled to
exercise such rights with respect to such Credit; (v) such Subsidiary Account
Party is a direct or indirect majority-owned subsidiary of Applicant at the time
of issuance of such Credit (or of any increase or extension thereof); (vi) such
Subsidiary Account Party is bound by all the limitations of liability and
exculpations in Issuer’s favor contained herein and subject to all the rights
and remedies in Issuer’s favor referred to herein as if it were Applicant; and
(vii) Issuer shall not be required to send any notice hereunder to such
Subsidiary Account Party, but if Issuer in its sole discretion chooses to do so,
Issuer may send such notice as provided herein care of Applicant and such notice
shall be effective as if given to such Subsidiary Account Party.

17.        Events of Default. Each of the following shall be an “Event of
Default” hereunder: (a) other than as a result of administrative or technical
error and so long as such error is corrected within three Business Days of
notification to Applicant of such error, Applicant’s failure to pay any
reimbursement Obligation in respect of any drawing under any Credit within five
Business Days after the same becomes due, (b) Applicant’s failure to pay any
other Obligation within 10 Business Days after the date when due, (c)
Applicant’s failure to perform or observe any term or covenant of this Agreement
or any other Loan Document (not otherwise an Event of Default) for more than 30
days after Issuer notifies Applicant in writing of such failure, except where
such default cannot be reasonably cured within 30 days but can be cured within
60 days, Applicant has (A) during such 30-day period commenced and is diligently
proceeding to cure the same and (B) such default is cured within 60 days after
the earlier of becoming aware of such failure and receipt of notice to Applicant
from Issuer specifying such failure, (d) Applicant’s breach in any material
respect of any representation or warranty made in this Agreement, any other Loan
Document or any document delivered by Applicant under or in connection with this
Agreement, and such inaccuracy is not remedied within 30 days after receipt of
notice to Applicant from Issuer specifying such inaccuracy, (e) (i) Applicant’s
failure to pay when due (whether at scheduled maturity, upon acceleration, or
otherwise) and beyond the applicable grace period, any payment in respect of any
indebtedness or other obligation (other than the Obligations) of Applicant to
Issuer or another having an aggregate principal amount greater than $50,000,000
(or the equivalent in any foreign currency), or (ii) the acceleration of the
final stated maturity of such indebtedness or other obligation, (f) Applicant’s
repudiation of, or assertion of the unenforceability of, this Agreement, any
other Loan Document or any separate security agreement or other agreement or
undertaking supporting this Agreement, or any court or other Governmental
Authority shall issue any order, ruling or determination that this Agreement,
any other Loan Document or such other agreement or undertaking is not in full
force and effect, (g) Applicant’s dissolution or termination, (h) Applicant’s
(i) merger or consolidation with any third party unless Applicant is the
survivor, (ii) sale, lease or other conveyance of all or substantially all of
its assets or business or (iii) agreement to do any of the foregoing, (i)
institution by Applicant of any proceeding under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors or seeking or consenting to
the appointment of a liquidator, conservator, custodian, receiver,
rehabilitator, trustee or other similar official for Applicant or for any
substantial part of its property, or consent by Applicant to the institution of,
or failure to contest in a timely and appropriate manner, any proceeding
described in Section 17(j), or filing by Applicant of an answer admitting the
material allegations of a petition filed against it in any proceeding described
in

11

 

Section 17(j), or Applicant shall take any action for the purpose of effecting
any of the foregoing, (j) institution against Applicant of any proceeding under
any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or seeking the appointment of a liquidator, conservator, custodian,
receiver, rehabilitator, trustee or other similar official for Applicant or for
any substantial part of its property, and any such proceeding or case shall be
unstayed and in effect for more than 90 days, or an order for relief shall be
entered therein, (k) Applicant’s making an assignment for the benefit of
creditors, (l) Applicant’s insolvency or inability generally to pay its debts as
they become due, (m) any actual seizure, vesting or intervention by or under
authority of a government by which Applicant’s management is displaced or its
authority or control of its business is curtailed, (n) entry of one or more
final judgments having an aggregate amount greater than $50,000,000 (or the
equivalent in any foreign currency) against Applicant which remains unstayed and
unsatisfied for more than 30 days, (o) [Reserved], (p) any Change in Control,
(q) an ERISA Event occurs which results in the imposition or granting of
security, or the incurring of a liability that individually or in the aggregate
has or would have a Material Adverse Effect; (r) any event, act or condition
occurs and is continuing on or after giving effect to the issuance, amendment,
renewal or extension of the Credit which has had or will have a Material Adverse
Effect, or (s) the occurrence of any of the above events with respect to any
Person (including any Subsidiary Account Party) other than Applicant that is
liable for or has guaranteed or provided any collateral security for any
Obligations.

18.        Remedies. If any Event of Default shall have occurred and be
continuing, Issuer may take any one or more of the following actions: (a)
declare the amount of the Credit and any other Obligations then outstanding or
accrued due and payable by Applicant immediately (provided that if the Event of
Default is described in Section 17(i), (j) or (k), then such amount of the
Credit and all other Obligations then outstanding or accrued shall become due
and payable immediately and automatically), in which case Applicant shall pay
such amount to Issuer to be applied to pay any matured Obligations and held as
cash collateral in a non-interest bearing account for any contingent
Obligations, (b) require Applicant to (and Applicant agrees that it shall) use
its best efforts to cause Issuer to be promptly released from all its
obligations under the Credit, (c) by notice to Applicant, declare the obligation
of Issuer to issue (or extend, increase or otherwise amend) Credits to be
terminated, whereupon the same shall forthwith terminate, and (d) exercise any
and all other rights and remedies available at law, in equity, or otherwise to
secure, collect, enforce or satisfy the Obligations.

19.        Set-off. To the fullest extent permitted by law, if any Event of
Default shall have occurred and be continuing, Issuer may set off and apply any
and all Deposits against any and all of the Obligations, irrespective of whether
such Deposits or Obligations may be unmatured or contingent or payable at
different places or in different currencies. Issuer shall promptly thereafter
notify Applicant of any such setoff and application; provided that the failure
to give such notice shall not affect the validity of such setoff or application.

20.        Waiver of Immunity. Applicant acknowledges that this Agreement is,
and the Credit will be, entered into for commercial purposes of Applicant. To
the extent that Applicant or any of its assets has or hereafter acquires any
right of sovereign or other immunity from or in respect of any legal proceedings
to enforce or collect upon any Obligation or any other agreement relating to the
transactions contemplated herein, Applicant hereby irrevocably waives any such
immunity and agrees not to assert any such right or claim in any such
proceeding.

21.        Notices; Multiple Applicants; Applicant Status; Interpretation;
Severability; Multiple Roles.

(a)          All notices and other communications under this Agreement shall be
sent, if to Applicant or a Subsidiary Applicant that is a party to this
Agreement on the date hereof, to its address or fax number indicated on its
signature page to this Agreement, if to any Subsidiary Applicant that after the
date hereof becomes a party to this Agreement, at its address specified in the
Adherence Agreement pursuant to which it became a Subsidiary Applicant, and, if
to Issuer, to its address shown above, Attention: Letter of Credit Department,
or by fax to (212) 797-0780, or as to any of the foregoing, to such other
address or fax number as it may notify to the other parties hereto in writing.
No such notice shall be effective until actually received by Issuer’s Letter of
Credit Department or by Applicant or Subsidiary Applicant, as applicable, unless
the intended recipient fails to maintain, or fails to notify, the other parties
of any relevant change of its name, address or number(s), in which case such
notice shall be effective when sent in accordance with this Agreement. Notices
and other communications hereunder, including a signed application for a Credit,
may also be delivered or furnished by other methods of electronic communications
such as email; provided that, unless otherwise agreed in writing by Applicant,
Subsidiary Applicants, if any, and Issuer, the recipient thereof shall have the
option in its sole discretion whether or not to treat it as received and
effective under this Agreement.

(b)          If this Agreement is signed by two or more Persons as “Applicants”,
(i) each shall be deemed an “Applicant” hereunder and be jointly and severally
liable for all the Obligations, (ii) the release, waiver, instruction or consent
of any Applicant shall be sufficient to bind each Applicant with respect to this
Agreement, the Credit or any claims arising under or in connection with this
Agreement or the Credit, (iii) any Event of Default, regardless of fault, shall
be deemed an Event of Default as to all Applicants, (iv) delivery by Issuer of
any document, notice or other communication to any Applicant shall be deemed
delivery to each Applicant, and (v) the liability of any Applicant hereunder may
from time

12

 

to time, in whole or in part, be extended, modified, released or reduced by
Issuer without affecting or releasing any liability of any other Applicant. Each
Applicant agrees that its obligations hereunder are primary, waives all
discharge defenses available to a secondary obligor, and forgoes negotiation of
a separate guaranty and security agreement providing for secondary liability to
Issuer.

(c)          Issuer may treat each Person that signs this Agreement and each
other Person authorized to act generally for Applicant or specifically in the
matter as actually authorized to act for Applicant in amending this Agreement,
in authorizing Issuer to issue or amend the Credit, waive any discrepancy, pay
or otherwise act under the Credit, in receiving any notice (including service of
process) in connection with this Agreement, and in agreeing to indemnify Issuer
for any action or inaction taken or proposed. Any change in the identity of
Persons authorized to act for Applicant shall be ineffective until notified in
writing to Issuer.

(d)          Each Person identified in this Agreement as an Applicant represents
and warrants that (i) it acts for itself in requesting issuance of the Credit
for its account, or it acts for a Subsidiary Account Party in requesting
issuance of the Credit for such Subsidiary Account Party, and (ii) it may be
identified in the Credit as an “applicant”, “account party”, “client”,
“customer” or “instructing party” at whose request and on whose behalf or for
whose account the Credit is issued.

(e)          In this Agreement: (i) headings are included only for convenience
and are not interpretative; (ii) the term “including” means “including without
limitation”; (iii) references to actions Issuer “may” take or omit to take mean
“may in its sole discretion”; (iv) unless the context requires otherwise,
references herein to Sections shall be construed to refer to Sections of this
Agreement; and (v) references to any laws or rules include any amendments
thereto or successor or replacement laws or rules.

(f)          If any provision of this Agreement is held illegal or
unenforceable, the validity of the remaining provisions shall not be affected.

(g)          Applicant acknowledges and agrees that (i) Issuer and its
affiliates offer a wide range of financial and related services, which may at
any time include back-office processing services on behalf of financial
institutions, letter of credit beneficiaries, and other customers; (ii) some of
these customers may be Applicant’s counter-parties or competitors; and (iii)
Issuer and its affiliates may perform more than one role in relation to the
Credit.

22.          Successors and Assigns; Etc. This Agreement shall be binding upon
Applicant and its successors and assigns, and shall inure to the benefit of and
be enforceable by Issuer and its successors and assigns. Applicant agrees that
delivery of a signed copy or signature page of this Agreement by any electronic
means that reproduce an image of the signed signature page shall be as effective
as delivery of a manually signed original of this Agreement. Applicant shall not
transfer or otherwise assign any of its rights or obligations under this
Agreement without Issuer’s prior written consent. Issuer may transfer or
otherwise assign its rights and obligations under this Agreement, in whole or in
part, with the prior written consent of Applicant (which shall not be
unreasonably withheld); provided that if an Event of Default has occurred and is
continuing, the consent of Applicant shall not be required. Issuer may grant
participations in its rights and obligations under this Agreement or the Credit,
in whole or in part, without the consent of Applicant, provided that (i)
Issuer’s obligations under this Agreement and the other Loan Documents shall
remain unchanged, (ii) Issuer shall remain solely responsible to Applicant for
the performance of such obligations and (iii) Applicant shall continue to deal
solely and directly with Issuer in connection with Issuer’s rights and
obligations under this Agreement and the other Loan Documents. Applicant
acknowledges that information pertaining to Applicant as it relates to the
Credit, this Agreement or any other Loan Document may be disclosed to actual or
prospective participants, transferees or assignees. This Agreement shall not be
construed to confer any right or benefit upon any Person other than Issuer, the
Indemnified Parties and Applicant and their respective successors and permitted
assigns, and no such Person shall be deemed a third-party beneficiary hereof,
except that Applicant’s obligations under Sections 5 and 19 may be enforced
directly against Applicant by a participant; provided that such enforcement
shall not increase the amount of the Obligations.

23.        Modification; No Waiver. None of the terms of this Agreement may be
waived, terminated or amended orally, by course of dealing, or otherwise, except
in a writing signed by the party against whose interest the term is waived,
terminated or amended; provided that the signature of the undersigned Applicant
shall also be binding upon each of its affiliates that at any time is bound by
any of the provisions of this Agreement. Forbearance, failure or delay by Issuer
in the exercise of a right or remedy shall not constitute a waiver, nor shall
any exercise or partial exercise of any right or remedy preclude any further
exercise of that or any other right or remedy. Any waiver or consent by Issuer
shall be effective only in the specific instance and for the specific purpose
for which it is given.

24.        Entire Agreement; Remedies Cumulative. This Agreement constitutes the
entire agreement between the parties hereto concerning the subject matter hereof
and supersedes all prior or simultaneous agreements, written or oral, with
respect to the subject matter hereof. All rights and remedies of Issuer and all
obligations of Applicant under or in

13

 

connection with this Agreement and any other documents delivered in connection
with this Agreement are cumulative and in addition to those provided or
available at equity or under any applicable law.

25.        Reduction of Maximum Commitment Amount; Continuing Agreement;
Termination.

(a)          Upon at least three Business Days’ prior written notice, Applicant
shall have the right, at any time or from time to time, without premium or
penalty, to terminate this Agreement or partially reduce the Maximum Commitment
Amount; provided that (i) any partial reduction pursuant to this Section 25(a)
shall be in an amount of at least $5,000,000 or, if greater, in integral
multiples of $1,000,000 and (ii) Applicant shall not terminate this Agreement or
reduce the Maximum Commitment Amount if, after giving effect thereto and any
concurrent payment of Obligations made by Applicant, the total Letter of Credit
Exposure would exceed the Maximum Commitment Amount.

(b)          This is a continuing agreement and shall remain in full effect
until the earliest (such earliest date, the “Final Termination Date”) of (i) the
Scheduled Termination Date, (ii) delivery by each Issuer to Applicant of a
written notice of termination specifically referring to this Agreement as a
result of the occurrence of an Event of Default in accordance with Section 18
and (iii) Applicant’s delivery to Issuer of a written notice of termination
specifically referring to this Agreement in accordance with Section 25(a).
Termination shall not release Applicant from any liability for Obligations
existing on such date, or resulting from or incidental to a Credit issued on or
before such date or issued pursuant to any Issuer commitment existing on such
date. Upon termination of this Agreement, (i) Applicant shall cease to request
the issuance of any further Credit hereunder or any increase or extension of any
outstanding Credit hereunder and (ii) Issuer shall have all the rights and
remedies provided in Section 18. Provisions of this Agreement relating to Taxes,
indemnities, payment of costs and expenses, exculpations and limitations on
liability, waivers of immunity, jurisdiction, and waiver of trial by jury shall
survive any termination of this Agreement, expiration of the Credit, and
irrevocable and final payment of all the Obligations.

26.        Governing Law; Practice; UCP; ISP; URDG.

(a)          This Agreement and the rights and obligations of the parties under
or in connection with this Agreement shall be governed by and subject to the
laws of the State of New York applicable to contracts made and to be performed
in such State (including New York General Obligations Law Section 5-1401) and
applicable federal laws of the United States of America. In the event that the
Credit expressly chooses a state or country law other than the State of New
York, Applicant shall be obligated to reimburse Issuer for payments made under
the Credit if such payment is justified under New York law or such other law.

(b)          Unless Applicant specifies otherwise in its application for the
Credit, Issuer at its option may issue the Credit subject to the UCP, the ISP or
the URDG, or such later supplement to or revision of any thereof as is in effect
at the time of issuance of the Credit (collectively, the “Practices”). Issuer’s
rights and remedies under the Practices shall be in addition to, and not in
limitation of, those expressly provided herein.

(c)          To the extent permitted by applicable law, (i) this Agreement shall
prevail in case of conflict with the Practices or the UCC and (ii) the Practices
shall prevail in case of conflict between the Practices and the UCC.

27.        Jurisdiction; Service of Process; Enforcement.

(a)          Applicant consents and submits to the non-exclusive jurisdiction of
any state or federal court sitting in New York County, in the State of New York,
for itself and in respect of any of its property, in any action or proceeding
arising under or in connection with the Credit, this Agreement or any other Loan
Document. If the law of any jurisdiction other than the State of New York has
been chosen to govern the Credit or governs in the absence of an express choice
of governing law, Applicant also consents and submits to the non-exclusive
jurisdiction of any court sitting in such jurisdiction, in any action or
proceeding arising under or in connection with this Agreement or the Credit.
Applicant agrees not to bring any action or proceeding against Issuer that
arises under or in connection with the Credit, this Agreement or any other Loan
Document in any court or other forum not described in the first sentence of this
paragraph. Applicant waives any objection to venue or any claim of forum non
conveniens with respect to any action or proceeding in any court described in
this paragraph.

(b)          Applicant agrees that any service of process may be served upon it
by Issuer by mail or hand delivery if sent to the address for notices to
Applicant under this Agreement or to the Person designated on the signature
page(s) of this Agreement as “Applicant’s Authorized Agent,“ which Person
Applicant now designates as its authorized agent for the service of process.

(c)          Nothing in this Agreement shall affect Issuer’s right to serve
process in any other manner permitted by law or to commence legal proceedings or
otherwise proceed against Applicant in any other

14

 

jurisdiction. Applicant agrees that final judgment against it in any action or
proceeding shall be enforceable in any other jurisdiction within or outside the
United States of America by suit on the judgment, a certified copy of which
shall be conclusive evidence of the judgment.

[SIGNATURE PAGE FOLLOWS]

15

 

 

28.          JURY TRIAL WAIVER. EACH OF APPLICANT AND ISSUER WAIVES ANY RIGHT IT
MAY HAVE TO A JURY TRIAL OF ANY CLAIM, COUNTERCLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF THE CREDIT, THIS AGREEMENT, ANY OTHER LOAN DOCUMENT, OR
ANY DEALINGS WITH ONE ANOTHER RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.

Very truly yours,

 

Applicant:   SunPower Corporation (Print Name of Applicant)     By: /s/ Ada Kwan
  (Signature of Authorized Signer)   Ada Kwan   (Print Name of Authorized
Signer)   Treasurer   (Title of Authorized Signer)

Address for notices, etc. to Applicant:   77 Rio Robles San Jose, CA 95134

Attention:  Ada Kwan

Telephone number:  408-240-5500

Fax number:  408-240-5400

 

Applicant’s jurisdiction of organization, organization type & organizational
number (if applicable):  Delaware; Corporation; State File No. 3808702  

 

Applicant’s Social Security or Federal tax identification number (if
applicable): ##-#######

 

Applicant’s Authorized Agent (for service of process per Section 27(b)):

 

Print Name:   The Corporation Trust Center

 

Complete Address:   Corporation Trust Center, 1209 Orange Street, Wilmington, DE
19801, United States (which must be in the State of New York)

 

Subsidiary Applicant:   SunPower Corporation, Systems (Print Name of Subsidiary
Applicant)     By:    /s/ Ada Kwan   (Signature of Authorized Signer)   Ada Kwan
  (Print Name of Authorized Signer)   Treasurer   (Title of Authorized Signer)

Address for notices, etc. to Subsidiary Applicant: 77 Rio Robles San Jose, CA
95134

Attention:   Ada Kwan

Telephone number:   408-240-5500

Fax number:   408-240-5400

ACCEPTED AND AGREED TO: ACCEPTED AND AGREED TO:     DEUTSCHE BANK AG DEUTSCHE
BANK NEW YORK BRANCH TRUST COMPANY AMERICAS         By: /s/ Prashant Mehra   By:
/s/ Prashant Mehra   Name: Prashant Mehra Name: Prashant Mehra Title: Director
Title: Director

 

By: /s/ Christopher J. Shaw   By: /s/ Christopher J. Shaw   Name:  Christopher
J. Shaw Name:  Christopher J. Shaw Title:  Vice President Title:  Vice President

 

 

 

EXHIBIT A to Continuing Agreement for Standby Letters of Credit and Demand
Guarantees dated June 29, 2016 made by SunPower Corporation (and, if applicable,
one or more other parties) in favor of Deutsche Bank AG New York Branch and
Deutsche Bank Trust Company Americas

 

ADHERENCE AGREEMENT FOR SUBSIDIARY APPLICANTS

 

Deutsche Bank AG New York Branch and Deutsche Bank Trust Company Americas
(insert date) 60 Wall Street   New York, New York 10005-2858  

Re:Continuing Agreement for Standby Letters of Credit and Demand Guarantees
dated June 29, 2016 among (insert Applicant’s name) SunPower Corporation (and,
if applicable, one or more other parties), Deutsche Bank AG New York Branch and
Deutsche Bank Trust Company Americas (as amended, supplemented or otherwise
modified from time to time, the “Agreement”)

Ladies and Gentlemen:

Capitalized terms used but not otherwise defined herein shall have the
respective meanings assigned thereto in the Agreement.

We hereby agree to be a Subsidiary Applicant upon the terms and subject to the
conditions set forth in the Agreement, including, without limitation, that
pursuant to Section 4(f) of the Agreement we shall be jointly and severally
liable with Applicant to Issuer for all the reimbursement, indemnification and
other obligations, representations, warranties and other agreements of Applicant
in respect of any Credit requested by us.

Except as expressly modified by this letter, all provisions of the Agreement
remain in full force and effect. This letter shall be governed by the laws of
the State of New York, without regard to principles of conflict of laws. This
letter shall become effective as of the date hereof.

 

  Address:     Attention:     Telephone:      Facsimile:    

Very truly yours,   (Name of Subsidiary Applicant)   By:    Name:
Title:

 

ACCEPTED AND AGREED:   (Name of Applicant)   By:   Name: Title:

 

DEUTSCHE BANK AG NEW YORK BRANCH   DEUTSCHE BANK TRUST COMPANY AMERICAS      
By:     By:   Name:
Title:   Name:
Title:       By:     By:   Name:
Title:   Name:
Title:

 

 

 

EXHIBIT B to Continuing Agreement for Standby Letters of Credit and Demand
Guarantees dated June 29, 2016 made by SunPower Corporation (and, if applicable,
one or more other parties) in favor of Deutsche Bank AG New York Branch and
Deutsche Bank Trust Company Americas

 

NOTICE OF TERMINATION

 

Reference is made to the Continuing Agreement for Standby Letters of Credit and
Demand Guarantees dated June 29, 2016 among (insert Applicant’s name) SunPower
Corporation (and, if applicable, one or more other parties), Deutsche Bank AG
New York Branch and Deutsche Bank Trust Company Americas (as amended,
supplemented or otherwise modified from time to time, the “Continuing
Agreement”; capitalized terms used but not otherwise defined herein shall have
the respective meanings assigned thereto in the Continuing Agreement).

 

Applicant hereby notifies Issuer that (insert applicable Subsidiary Applicant’s
name) _____________________ (the “Terminating Subsidiary Applicant”) shall cease
to be a “Subsidiary Applicant” under the Continuing Agreement.

 

Applicant acknowledges and agrees that notwithstanding the preceding sentence,
this Notice of Termination will not become effective until such time as all
Obligations of Terminating Subsidiary Applicant shall have been paid in full in
cash and all Credits issued at the request of Terminating Subsidiary Applicant
shall have expired without any pending drawing or terminated; provided that this
Notice of Termination shall be effective as of the date hereof to terminate
Terminating Subsidiary Applicant’s right to request the issuance of any new
Credits under the Continuing Agreement or any increase in the amount of any
other Credit.

 

Dated as of: _________, 20__             (Name of Applicant)           By:      
  Name:     Title:

 

 

 

Deutsche Bank (GRAPHICS) [agree002.jpg]

 
Letter of Credit or Demand Guarantee number: _________________

 

APPLICATION FOR IRREVOCABLE STANDBY LETTER OF CREDIT OR DEMAND GUARANTEE

UNDER CONTINUING AGREEMENT FOR STANDBY LETTERS OF CREDIT AND DEMAND GUARANTEES

 

Applicant (Full name and address):

 

 

 

Issuing Bank:

Deutsche Bank AG New York Branch or

Deutsche Bank Trust Company Americas

60 Wall Street

New York, New York 10005

  Date of Application:

Expiry Date:

Place of Expiry:

 

 

☐ Issue by (air) mail            ☐  with brief advice by
    teletransmission

 

☐ Issue by teletransmission 

☐ Issue by courier 

☐ Applicant to arrange pick-up 

☐ Issue by other (specify):

 

Beneficiary (Full name and address):

 

  Name and Jurisdiction of Organization of any Subsidiary Account Party for this
Credit (or specify “None”):  

Confirmation of the Credit:

☐ not requested           ☐ requested            ☐ authorized if requested by
Beneficiary

 

Currency and Amount in Figures and Words (Please use ISO Currency Codes):   ☐
   Credit to be issued with the terms and conditions set forth in the attached
specimen.    

Credit available against the document(s) detailed herein:

☐ Beneficiary’s sight draft(s) drawn on Issuing Bank

 

☐ Original Credit and any and all amendments to the Credit

 

☐ Beneficiary’s signed and dated statement, reading as follows:

 

☐ Other documents (specify issuer(s) and data content):

 

 

Credit to be issued subject to (check one):

☐  International Standby Practices 1998, International Chamber of Commerce
Publication No. 590 (ISP98), or such later revision thereof as may be in effect
when the Credit is issued.

☐  Uniform Customs and Practice for Documentary Credits, 2007 Revision,
International Chamber of Commerce Publication No. 600 (UCP 600), or such later
revision thereof as may be in effect when the Credit is issued.

☐  Uniform Rules for Demand Guarantees, 2010 Revision, International Chamber of
Commerce Publication No. 758.

  ☐ See attached for additional instructions   ☐  Check if only a single drawing
for all or a portion of the amount of the Credit is permitted  

The undersigned requests you to issue your irrevocable letter of credit, demand
guarantee or similar undertaking (herein called the “Credit”), substantially in
accordance with these instructions (marked (x) where appropriate). The
undersigned agrees to be bound in respect of the Credit by the terms and
conditions of the Continuing Agreement for Standby Letters of Credit and Demand
Guarantees dated ______________________, as amended, supplemented or otherwise
modified from time to time, made by the undersigned (and, if applicable, one or
more other parties) to Deutsche Bank AG New York Branch and Deutsche Bank Trust
Company Americas (which Agreement you may have received by fax transmission).
The undersigned represents and warrants to you that (i) no Event of Default (as
defined in such Agreement) or other event that with notice or lapse of time or
both would constitute such an Event of Default has occurred and is continuing or
would result from the issuance of the requested Credit and (ii) all
representations and warranties contained in such Agreement are true and correct
in all material respects as of the date hereof and shall be true and correct in
all material respects immediately after issuance of the requested Credit.

 

Applicant or Subsidiary Applicant’s Name:

 

By: ________________________________________

      Print Name:

      Title:

 

 

THIS IS AN IMPORTANT LEGAL DOCUMENT. CONSULT WITH YOUR LEGAL COUNSEL.