Exhibit 10.12

FINANCING AGREEMENT

Dated as of November 9, 2016

by and among

PATRIOT NATIONAL, INC. AND EACH OF ITS SUBSIDIARIES LISTED AS
A BORROWER ON THE SIGNATURE PAGES HERETO,
as Borrowers,

EACH SUBSIDIARY OF PATRIOT NATIONAL, INC.
LISTED AS A GUARANTOR ON THE SIGNATURE PAGES HERETO,
as Guarantors,

THE LENDERS FROM TIME TO TIME PARTY HERETO,
as Lenders

and

CERBERUS BUSINESS FINANCE, LLC,

as Collateral Agent and Administrative Agent

 

 

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

 

 

Page

 

 

ARTICLE I DEFINITIONS; CERTAIN TERMS

1

Section 1.01

Definitions

1

Section 1.02

Terms Generally

44

Section 1.03

Certain Matters of Construction

44

Section 1.04

Accounting and Other Terms

45

Section 1.05

Time References

46

 

 

ARTICLE II THE LOANS

46

Section 2.01

Commitments

46

Section 2.02

Making the Loans

47

Section 2.03

Repayment of Loans; Evidence of Debt

50

Section 2.04

Interest

51

Section 2.05

Reduction of Commitment; Prepayment of Loans

52

Section 2.06

Fees

55

Section 2.07

LIBOR Option

57

Section 2.08

Funding Losses

58

Section 2.09

Taxes

58

Section 2.10

Increased Costs and Reduced Return

61

Section 2.11

Changes in Law; Impracticability or Illegality

62

 

 

ARTICLE III [INTENTIONALLY OMITTED]

63

 

 

ARTICLE IV APPLICATION OF PAYMENTS; DEFAULTING LENDERS; JOINT AND SEVERAL
LIABILITY OF BORROWERS

63

Section 4.01

Payments; Computations and Statements

63

Section 4.02

Sharing of Payments

64

Section 4.03

Apportionment of Payments

64

Section 4.04

Defaulting Lenders

65

Section 4.05

Administrative Borrower; Joint and Several Liability of the Borrowers

67

 

 

ARTICLE V CONDITIONS TO LOANS

68

Section 5.01

Conditions Precedent to Effectiveness

68

Section 5.02

Conditions Precedent to All Loans

71

Section 5.03

Conditions Subsequent to Effectiveness

72

 

 

ARTICLE VI REPRESENTATIONS AND WARRANTIES

73

Section 6.01

Representations and Warranties

73

 

 

 

- i -

 

 

--------------------------------------------------------------------------------

 

ARTICLE VII COVENANTS OF THE LOAN PARTIES

81

Section 7.01

Affirmative Covenants

81

Section 7.02

Negative Covenants

90

Section 7.03

Financial Covenants

96

 

 

ARTICLE VIII CASH MANAGEMENT ARRANGEMENTS AND OTHER COLLATERAL MATTERS

97

Section 8.01

Cash Management Arrangements

97

 

 

ARTICLE IX EVENTS OF DEFAULT

98

Section 9.01

Events of Default

98

 

 

ARTICLE X AGENTS

102

Section 10.01

Appointment

102

Section 10.02

Nature of Duties; Delegation

103

Section 10.03

Rights, Exculpation, Etc

103

Section 10.04

Reliance

104

Section 10.05

Indemnification

104

Section 10.06

Agents Individually

105

Section 10.07

Successor Agent

105

Section 10.08

Collateral Matters

105

Section 10.09

Agency for Perfection

107

Section 10.10

No Reliance on any Agent’s Customer Identification Program.

108

Section 10.11

No Third Party Beneficiaries

108

Section 10.12

No Fiduciary Relationship

108

Section 10.13

Reports; Confidentiality; Disclaimers

108

Section 10.14

Collateral Custodian

109

Section 10.15

[Intentionally Omitted.]

109

Section 10.16

[Intentionally Omitted.]

109

Section 10.17

Collateral Agent May File Proofs of Claim

109

 

 

ARTICLE XI GUARANTY

110

Section 11.01

Guaranty

110

Section 11.02

Guaranty Absolute

111

Section 11.03

Waiver

112

Section 11.04

Continuing Guaranty; Assignments

112

Section 11.05

Subrogation

112

Section 11.06

Contribution

113

 

 

ARTICLE XII MISCELLANEOUS

114

Section 12.01

Notices, Etc

114

Section 12.02

Amendments, Etc

116

Section 12.03

No Waiver; Remedies, Etc

118

Section 12.04

Expenses; Taxes; Attorneys’ Fees

118

Section 12.05

Right of Set-off

119

Section 12.06

Severability

120

 

- ii -

 

 

--------------------------------------------------------------------------------

 

Section 12.07

Assignments and Participations

120

Section 12.08

Counterparts

123

Section 12.09

GOVERNING LAW

124

Section 12.10

CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE

125

Section 12.11

WAIVER OF JURY TRIAL, ETC

126

Section 12.12

Consent by the Agents and Lenders

126

Section 12.13

No Party Deemed Drafter

126

Section 12.14

Reinstatement; Certain Payments

126

Section 12.15

Indemnification; Limitation of Liability for Certain Damages

127

Section 12.16

Records

128

Section 12.17

Binding Effect

128

Section 12.18

Highest Lawful Rate

128

Section 12.19

Confidentiality

129

Section 12.20

Public Disclosure

130

Section 12.21

Integration

130

Section 12.22

USA PATRIOT Act

130

 

 

 

 

- iii -

 

 

--------------------------------------------------------------------------------

 

SCHEDULE AND EXHIBITS

 

Schedule 1.01(A)

Lenders and Lenders’ Commitments

Schedule 1.01(B)

Facilities

Schedule 1.01(C)

Restricted Insurance Carrier Accounts

Schedule 6.01(e)

Capitalization; Subsidiaries

Schedule 6.01(f)

Litigation

Schedule 6.01(i)

ERISA

Schedule 6.01(l)

Nature of Business

Schedule 6.01(q)

Environmental Matters

Schedule 6.01(r)

Insurance

Schedule 6.01(u)

Intellectual Property

Schedule 6.01(v)

Material Contracts

Schedule 7.02(a)

Existing Liens

Schedule 7.02(b)(i)

Existing Indebtedness

Schedule 7.02(b)(ii)

Existing Earn-Out Obligations

Schedule 7.02(e)

Existing Investments

Schedule 7.02(k)

Limitations on Dividends and Other Payment Restrictions

Schedule 8.01

Cash Management Accounts

 

Exhibit A

Form of Joinder Agreement

Exhibit B

Form of Assignment and Acceptance

Exhibit C

Form of Notice of Borrowing

Exhibit D

Form of LIBOR Notice

 

 

 

 

- v -

 

 

--------------------------------------------------------------------------------

 

FINANCING AGREEMENT

Financing Agreement, dated as of November 9, 2016, by and among Patriot
National, Inc., a Delaware corporation (“Patriot”), each subsidiary of Patriot
listed as a “Borrower” on the signature pages hereto (together with Patriot and
each other Person that executes a joinder agreement and becomes a “Borrower”
hereunder, each a “Borrower” and collectively, the “Borrowers”), each subsidiary
of Patriot listed as a “Guarantor” on the signature pages hereto (together with
each other Person that executes a joinder agreement and becomes a “Guarantor”
hereunder or otherwise guaranties all or any part of the Obligations (as
hereinafter defined), each a “Guarantor” and collectively, the “Guarantors”),
the lenders from time to time party hereto (each a “Lender” and collectively,
the ”Lenders”), Cerberus Business Finance, LLC, a Delaware limited liability
company (“Cerberus”), as collateral agent for the Lenders (in such capacity,
together with its successors and assigns in such capacity, the ”Collateral
Agent”), and Cerberus, as administrative agent for the Lenders (in such
capacity, together with its successors and assigns in such capacity,
the ”Administrative Agent” and together with the Collateral Agent, each an
“Agent” and collectively, the “Agents”).

RECITALS

The Borrowers have asked the Lenders to extend credit to the Borrowers
consisting of (a) a Term Loan (as hereinafter defined) in the aggregate
principal amount of $250,000,000 and (b) a revolving credit facility in an
aggregate principal amount not to exceed $30,000,000 at any time
outstanding.  The proceeds of the term loan and the loans made under the
revolving credit facility shall be used (i) to refinance existing indebtedness
of the Loan Parties (as hereinafter defined), (ii) to fund the Effective Date
Dividend (as hereinafter defined), (iii) to fund the Effective Date Stock
Buyback (as hereinafter defined), (iv) for general working capital requirements
and other general corporate purposes of the Loan Parties and (v) to pay fees and
expenses related to this Agreement.  The Lenders are severally, and not jointly,
willing to extend such credit to the Borrowers subject to the terms and
conditions hereinafter set forth.

In consideration of the premises and the covenants and agreements contained
herein, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS; CERTAIN TERMS

Section 1.01Definitions. As used in this Agreement, the following terms shall
have the respective meanings indicated below:

“Account Debtor” means, with respect to any Person, each debtor, customer or
obligor in any way obligated on or in connection with any Account of such Person

“Action” has the meaning specified therefor in Section 12.12.

 

 

 

 

--------------------------------------------------------------------------------

 

“Acquisition” means the acquisition (whether by means of a merger, consolidation
or otherwise) of at least 90% of the Equity Interests of any Person or all or
substantially all of the assets of (or any division or business line of) any
Person.

“Additional Amount” has the meaning specified therefor in Section 2.09(a).

“Administrative Agent” has the meaning specified therefor in the preamble
hereto.

“Administrative Agent’s Account” means an account at a bank designated by the
Administrative Agent from time to time as the account into which the Loan
Parties shall make all payments to the Administrative Agent for the benefit of
the Agents and the Lenders under this Agreement and the other Loan Documents.

“Administrative Borrower” has the meaning specified therefor in Section 4.05.

“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with, such Person.  For purposes of this definition,
“control” of a Person means the power, directly or indirectly, either to (a)
vote 15% or more of the Equity Interests having ordinary voting power for the
election of members of the Board of Directors of such Person or (b) direct or
cause the direction of the management and policies of such Person whether by
contract or otherwise.  Notwithstanding anything herein to the contrary, in no
event shall any Agent or any Lender be considered an “Affiliate” of any Loan
Party.

“Agent” has the meaning specified therefor in the preamble hereto.

“Agreement” means this Financing Agreement, including all amendments,
modifications and supplements and any exhibits or schedules to any of the
foregoing, and shall refer to the Agreement as the same may be in effect at the
time such reference becomes operative.

“Anti-Corruption Laws” has the meaning specified therefor in Section 6.01(cc).

“Anti-Money Laundering and Anti-Terrorism Laws” means any Requirement of Law
relating to terrorism, economic sanctions or money laundering, including,
without limitation, (a) the Money Laundering Control Act of 1986 (i.e., 18
U.S.C. §§ 1956 and 1957), (b) the Bank Secrecy Act of 1970 (31 U.S.C. §§
5311-5330 and 12 U.S.C. §§ 1818(s), 1820(b) and 1951-1959), and the implementing
regulations promulgated thereunder, (c) the USA PATRIOT Act and the implementing
regulations promulgated thereunder, (d) the laws, regulations and Executive
Orders administered by the United States Department of the Treasury’s Office of
Foreign Assets Control (“OFAC”), (e) any law prohibiting or directed against
terrorist activities or the financing or support of terrorist activities (e.g.,
18 U.S.C. §§ 2339A and 2339B), and (f) any similar laws enacted in the United
States or any other jurisdictions in which the parties to this Agreement
operate, as any of the foregoing laws have been, or shall hereafter be, amended,
renewed, extended, or replaced and all other present and future legal
requirements of any Governmental Authority governing, addressing, relating to,
or attempting to eliminate, terrorist acts and acts of war and any regulations
promulgated pursuant thereto.

 

- 2 -

 

 

--------------------------------------------------------------------------------

 

“Applicable Margin” means, as of any date of determination, with respect to the
interest rate of any Revolving Loan or the Term Loan (or any portion thereof):

(a)From the Effective Date until November 9, 2017 (the “Initial Applicable
Margin Period”), the relevant Applicable Margin shall be set at Level I in the
table below.

(b)After the Initial Applicable Margin Period, the relevant Applicable Margin
shall be set at the respective level indicated below based upon the Leverage
Ratio set forth opposite thereto, which ratio shall be calculated as of the end
of the most recent fiscal quarter of Patriot and its Subsidiaries for which
quarterly financial statements and a certificate of an Authorized Officer of
Patriot are received by the Agents and the Lenders in accordance with Section
7.01(a)(ii) and Section 7.01(a)(iv):

 

Level

Leverage Ratio

Reference Rate Loans

LIBOR Rate Loans

Revolving Loans

Term Loan

Revolving Loans

Term Loan

I

Greater than 2.75 to 1:00

5.50%

5.50%

7.25%

7.25%

II

Less than  or equal to 2.75 to 1:00

5.25%

5.25%

7.00%

7.00%

 

(c)Subject to clause (d) below, the adjustment of the Applicable Margin (if any)
will occur 2 Business Days after the date the Administrative Agent receives the
quarterly financial statements and a certificate of an Authorized Officer of
Patriot in accordance with Section 7.01(a)(ii) and Section 7.01(a)(iv).

(d)Notwithstanding the foregoing:

(i)the Applicable Margin shall be set at Level I in the table above (x) upon the
occurrence and during the continuation of a Default or Event of Default, or (y)
if for any period, the Administrative Agent does not receive the financial
statements and certificates described in clause (c) above, for the period
commencing on the date such financial statements and certificate were required
to be delivered through the date on which such financial statements and
certificate are actually received by the Administrative Agent and the Lenders;
and

(ii)in the event that any financial statement or certificate described in clause
(c) above is inaccurate (regardless of whether this Agreement or any Commitments
are in effect when such inaccuracy is discovered), and such inaccuracy, if
corrected, would have led to the application of a higher Applicable Margin for
any fiscal period, then the Applicable Margin for such fiscal period shall be
adjusted retroactively (to the effective date of the determination of the
Applicable Margin that was based upon the delivery of such inaccurate financial
statement or certificate) to reflect the correct Applicable Margin, and the
Borrowers shall promptly make payments to the Agents and the Lenders to reflect
such adjustment.

 

- 3 -

 

 

--------------------------------------------------------------------------------

 

“Applicable Premium” means

(a)as of the date of the occurrence of an Applicable Premium Trigger Event
specified in clause (a), (b) or (c) of the definition thereof:

(i)during the period from and after the Effective Date up to and including the
date that is the first anniversary of the Effective Date (the “First Period”),
an amount equal to 3.00% times the sum of (A) the aggregate amount of all
Obligations (other than the Applicable Premium) outstanding on the date of such
Applicable Premium Trigger Event and (B) the aggregate amount of undrawn
Revolving Credit Commitments immediately prior to such Applicable Premium
Trigger Event;

(ii)during the period after the First Period up to and including the date that
is the second anniversary of the Effective Date (the “Second Period”), an amount
equal to 2.00% times the sum of (A) the aggregate amount of all Obligations
(other than the Applicable Premium) outstanding on the date of such Applicable
Premium Trigger Event and (B) the aggregate amount of undrawn Revolving Credit
Commitments immediately prior to such Applicable Premium Trigger Event;

(iii)during the period after the Second Period up to and including the date that
is the third anniversary of the Effective Date (the “Third Period”), an amount
equal to 1.00% times the sum of (A) the aggregate amount of all Obligations
(other than the Applicable Premium) outstanding on the date of such Applicable
Premium Trigger Event and (B) the aggregate amount of undrawn Revolving Credit
Commitments immediately prior to such Applicable Premium Trigger Event; and

(iv)thereafter, zero; and

(b)as of the date of the occurrence of an Applicable Premium Trigger Event
specified in clause (d) of the definition thereof:

(i)during the First Period, an amount equal to 1.50% times the sum of (A) the
aggregate amount of all Obligations (other than the Applicable Premium)
outstanding on the date of such Applicable Premium Trigger Event and (B) the
aggregate amount of undrawn Revolving Credit Commitments immediately prior to
such Applicable Premium Trigger Event;

(ii)during the Second Period, an amount equal to 1.00% times the sum of (A) the
aggregate amount of all Obligations (other than the Applicable Premium)
outstanding on the date of such Applicable Premium Trigger Event and (B) the
aggregate amount of undrawn Revolving Credit Commitments immediately prior to
such Applicable Premium Trigger Event;

(iii)during the Third Period, an amount equal to 0.50% times the sum of (A) the
aggregate amount of all Obligations (other than the Applicable Premium)
outstanding on the date of such Applicable Premium Trigger Event and (B) the
aggregate amount of undrawn Revolving Credit Commitments immediately prior to
such Applicable Premium Trigger Event; and

(iv)thereafter, zero;

 

- 4 -

 

 

--------------------------------------------------------------------------------

 

“Applicable Premium Trigger Event” means

(a)the payment by any Loan Party of all of the Obligations, in full, in
connection with any refinancing of the Loans; provided that no Applicable
Premium shall be due and owing to any Lender if such Lender or any of its
Affiliates is the lead lender under the credit facility effectuating the
refinancing of the Loans;

(b)the acceleration of the Obligations for any reason, including, without
limitation, acceleration in accordance with Section 9.01 (other than as a result
of the occurrence of a Change of Control), including as a result of the
commencement of an Insolvency Proceeding;

(c)the satisfaction, release, payment, restructuring, reorganization,
replacement, reinstatement, defeasance or compromise of any of the Obligations
in any Insolvency Proceeding, foreclosure (whether by power of judicial
proceeding or otherwise) or deed in lieu of foreclosure or the making of a
distribution of any kind in any Insolvency Proceeding to the Collateral Agent,
for the account of the Lenders in full or partial satisfaction of the
Obligations; or

(d)the termination of this Agreement as a result of the occurrence of a Change
of Control.

“Assignment and Acceptance” means an assignment and acceptance entered into by
an assigning Lender and an assignee, and accepted by the Collateral Agent (and
the Administrative Agent, if applicable), in accordance with Section 12.07
hereof and substantially in the form of Exhibit B hereto or such other form
acceptable to the Collateral Agent.

“Authorized Officer” means, with respect to any Person, the chief executive
officer, chief operating officer, chief financial officer, treasurer or other
financial officer performing similar functions, president or executive vice
president of such Person.

“Availability” means, at any time, the difference between (a) the Total
Revolving Credit Commitment and (b)  the aggregate outstanding principal amount
of all Revolving Loans.

“Available Amount” shall mean, during any Fiscal Year (the “Current Fiscal
Year”), an amount, not less than zero, in the aggregate, equal to:

(a)the Retained Excess Cash Flow Amount based on Excess Cash Flow from the
immediately preceding Fiscal Year, minus

(b)any amount of the Available Amount used to make Permitted Acquisitions
permitted under Section 7.02(e) during the Current Fiscal Year, minus

(c)any amount of the Available Amount used to make Restricted Payments permitted
under Section 7.02(h) during the Current Fiscal Year;

 

- 5 -

 

 

--------------------------------------------------------------------------------

 

provided, that in no event shall the Available Amount exceed (i) in the case of
Restricted Payments permitted under Section 7.02(h) during any Current Fiscal
Year, 25% of the Excess Cash Flow of Patriot and its Subsidiaries for the
immediately preceding Fiscal Year and (ii) in the case of Permitted Acquisitions
permitted under Section 7.02(e) during any Current Fiscal Year, 50% of the
Excess Cash Flow of Patriot and its Subsidiaries for the immediately preceding
Fiscal Year.

“Bankruptcy Code” means Title 11 of the United States Code, as amended from time
to time and any successor statute or any similar federal or state law for the
relief of debtors.

“Blocked Person” means any Person:

(a)that (i) is identified on the list of “Specially Designated Nationals and
Blocked Persons” published by OFAC; (ii) resides, is organized or chartered, or
has a place of business in a country or territory that is the subject of an OFAC
Sanctions Program; or (iii) a United States Person is prohibited from dealing or
engaging in a transaction with under any of the Anti-Money Laundering and
Anti-Terrorism Laws; and

(b)that is owned or controlled by, or that owns or controls, or that is acting
for or on behalf of, any Person described in clause (a) above.

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

“Board of Directors” means with respect to (a) any corporation, the board of
directors of the corporation or any committee thereof duly authorized to act on
behalf of such board, (b) a partnership, the board of directors of the general
partner of the partnership, (c) a limited liability company, the managing member
or members or any controlling committee or board of directors of such company or
the sole member or the managing member thereof, and (d) any other Person, the
board or committee of such Person serving a similar function.

“Borrower” has the meaning specified therefor in the preamble hereto.

“Business Day” means (a) for all purposes other than as described in clause (b)
below, any day other than a Saturday, Sunday or other day on which commercial
banks in New York City are authorized or required to close, and (b) with respect
to the borrowing, payment or continuation of, or determination of interest rate
on, LIBOR Rate Loans, any day that is a Business Day described in clause (a)
above and on which dealings in Dollars may be carried on in the interbank
eurodollar markets in New York City and London.

 

- 6 -

 

 

--------------------------------------------------------------------------------

 

“Capital Expenditures” means, with respect to any Person for any period, the sum
of (a) the aggregate of all expenditures by such Person and its Subsidiaries
during such period that in accordance with GAAP are or should be included in
“property, plant and equipment” or in a similar fixed asset account on its
balance sheet, whether such expenditures are paid in cash or financed, including
all Capitalized Lease Obligations, obligations under synthetic leases and
capitalized software costs that are paid or due and payable during such period
and (b) to the extent not covered by clause (a) above, the aggregate of all
expenditures by such Person and its Subsidiaries during such period to acquire
by purchase or otherwise the business or fixed assets of, or the Equity
Interests of, any other Person; provided, that the term “Capital Expenditures”
shall not include any such expenditures which constitute (i) expenditures
financed with the proceeds received from the sale or issuance of Equity
Interests, (ii) expenditures that are accounted for as capital expenditures of
such Person and that actually are paid for by a third party (excluding any Loan
Party) and for which no Loan Party has provided or is required to provide or
incur, directly or indirectly, any consideration or obligation to such third
party or any other person (whether before, during or after such period), (iii)
the purchase price of equipment that is purchased substantially
contemporaneously with the trade in of existing equipment to the extent that the
gross amount of such purchase price is reduced by the credit granted by the
seller of such equipment for the equipment being traded in at such time, (iv)
expenditures made in connection with the replacement, substitution or
restoration of assets to the extent financed (A) from insurance proceeds (or
similar recoveries) paid on account of the loss of or damage to the assets being
replaced or restored or (B) with awards of compensation arising from the taking
by eminent domain or condemnation of the assets being replaced or (v) a
Permitted Acquisition.

“Capitalized Lease” means, with respect to any Person, any lease of (or other
arrangement conveying the right to use) real or personal property by such Person
as lessee that is required under GAAP to be capitalized on the balance sheet of
such Person.

“Capitalized Lease Obligations” means, with respect to any Person, obligations
of such Person and its Subsidiaries under Capitalized Leases, and, for purposes
hereof, the amount of any such obligation shall be the capitalized amount
thereof determined in accordance with GAAP.

“Cash Equivalents” means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case, maturing within six months from the date of acquisition thereof;
(b) commercial paper, maturing not more than 365 days after the date of issue
rated P‑1 by Moody’s or A‑1 by Standard & Poor’s; (c) certificates of deposit
maturing not more than 365 days after the date of issue, issued by commercial
banking institutions and money market or demand deposit accounts maintained at
commercial banking institutions, each of which is a member of the Federal
Reserve System and has a combined capital and surplus and undivided profits of
not less than $500,000,000; (d) repurchase agreements having maturities of not
more than 90 days from the date of acquisition which are entered into with major
money center banks included in the commercial banking institutions described in
clause (c) above and which are secured by readily marketable direct obligations
of the United States Government or any agency thereof; (e) money market accounts
maintained with mutual funds having assets in excess of $2,500,000,000, which
assets are primarily comprised of Cash Equivalents described in another clause
of this definition; and (f) marketable tax exempt securities rated A or higher
by Moody’s or A+ or higher by Standard & Poor’s, in each case, maturing within
365 days from the date of acquisition thereof.

 

- 7 -

 

 

--------------------------------------------------------------------------------

 

“Cash Management Accounts” means the bank accounts of each Loan Party maintained
at one or more Cash Management Banks listed on Schedule 8.01.

“Cash Management Bank” has the meaning specified therefor in Section 8.01(a).

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule,
regulation, judicial ruling, judgment or treaty, (b) any change in any law,
rule, regulation or treaty or in the administration, interpretation,
implementation or application thereof by any Governmental Authority or (c) the
making or issuance of any request, rule, guideline or directive (whether or not
having the force of law) by any Governmental Authority; provided that
notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street
Reform and Consumer Protection Act and all requests, rules, guidelines or
directives thereunder or issued in connection therewith and (ii) all requests,
rules, guidelines or directives concerning capital adequacy 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 shall, in each case, be deemed to be a “Change in Law”,
regardless of the date enacted, adopted or issued.

“Change of Control” means each occurrence of any of the following:

(a)the acquisition, directly or indirectly, by any person or group (within the
meaning of Section 13(d)(3) of the Exchange Act) that owns 5% or less of the
Equity Interests of Patriot as of the Effective Date of beneficial ownership of
more than 33% on a fully diluted basis of the aggregate outstanding voting power
of the Equity Interests of Patriot;

(b)the acquisition, directly or indirectly, by any person or group (within the
meaning of Section 13(d)(3) of the Exchange Act) that owns more than 5% of the
Equity Interests of Patriot as of the Effective Date of beneficial ownership of
more than 50%, other than Steven M. Mariano, on a fully diluted basis of the
aggregate outstanding voting power of the Equity Interests of Patriot;

(c)during any period of 24 consecutive months, individuals who at the beginning
of such period constituted the Board of Directors of Patriot (together with any
new directors whose election by such Board of Directors or whose nomination for
election by the shareholders of Patriot was approved by, or subsequently
ratified by, a vote of at least a majority of the directors of Patriot then
still in office who were either directors at the beginning of such period, or
whose election or nomination for election was previously approved) cease for any
reason to constitute a majority of the Board of Directors of Patriot; or

(d)Patriot shall cease to have beneficial ownership (as defined in Rule 13d-3
under the Exchange Act) of (i) 100% of the aggregate voting or economic power of
the Equity Interests of each other Loan Party, other than Contego Services
Group, LLC and Decision UR, LLC, (ii) at least 97% of the aggregate voting or
economic power of Contego Services Group, LLC and (iii) at least 98.8% of the
aggregate voting or economic power of Decision UR, LLC, in each case (other than
in connection with any transaction permitted pursuant to Section 7.02(c)(i)),
free and clear of all Liens (other than Permitted Specified Liens).

 

- 8 -

 

 

--------------------------------------------------------------------------------

 

“Closing Fee” has the meaning specified therefor in Section 2.06(a).

“Collateral” has the meaning specified therefor in the Security Agreement.

“Collateral Agent” has the meaning specified therefor in the preamble hereto.

“Collateral Agent Advances” has the meaning specified therefor in Section
10.08(a).

“Collections” means all cash, checks, notes, instruments, and other items of
payment (including insurance proceeds, proceeds of cash sales, rental proceeds,
and tax refunds).

“Commitments” means, with respect to each Lender, such Lender’s Revolving Credit
Commitment and Term Loan Commitment.

“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.

“Compliance Certificate” has the meaning assigned to such term in Section
7.01(a)(iv).

“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 EBITDA” means, with respect to any Person for any period:

(a)the Consolidated Net Income of such Person for such period,

plus

(b)without duplication, the sum of the following amounts for such period to the
extent deducted in the calculation of Consolidated Net Income for such period:

(i)any provision for United States federal income taxes or other taxes measured
by net income,

(ii)Consolidated Net Interest Expense,

(iii)any loss from extraordinary items,

(iv)any depreciation and amortization expense,

(v)any aggregate net loss on the Disposition of property (other than accounts
and Inventory) outside the ordinary course of business,

 

- 9 -

 

 

--------------------------------------------------------------------------------

 

(vi)solely for purposes of calculating Consolidated EBITDA for the fiscal
quarter ending December 31, 2016, any synergies and cost savings in connection
with  acquisitions consummated prior to the Effective Date, provided that the
amount of such cost savings attributable to such fiscal quarter shall not exceed
$200,000,

(vii)any loss attributable to the decrease in value of any Equity Interests held
by a Loan Party in any Person that is not a Subsidiary of a Loan Party;

(viii)any other non-cash expenditure, charge or loss for such period (other than
any non-cash expenditure, charge or loss relating to write-offs, write-downs or
reserves with respect to accounts and Inventory),

(ix)realized losses on investments, loss on exchange of units and warrants,
increase in the fair value of common stock and warrant redemption liability,
non-cash stock compensation,

(x)any acquisition costs and expenses incurred during the fiscal quarter ending
December 31, 2016 in connection with acquisitions consummated prior to the
Effective Date in an aggregate amount not to exceed $500,000,

(xi)any severance costs or expenses actually incurred within 18 months of the
Effective Date in an aggregate amount not to exceed $1,000,000,

(xii)expenses related to evaluating potential business combinations, capital
raising, or other transactions for maximizing shareholder value in an aggregate
amount not to exceed $2,000,000, and

(xiii)Permitted Management Bonus,

minus

(c)without duplication, the sum of the following amounts for such period to the
extent included in the calculation of such Consolidated Net Income for such
period:

(i)any credit for United States federal income taxes or other taxes measured by
net income,

(ii)any gain from extraordinary items,

(iii)any aggregate net gain from the Disposition of property (other than
accounts and Inventory) outside the ordinary course of business,

(iv)any gain attributable to the increase in value of any Equity Interests held
by a Loan Party in any Person that is not a Subsidiary of a Loan Party,

(v)any other non-cash gain, including any reversal of a charge referred to in
clause (b)(viii) above by reason of a decrease in the value of any Equity
Interest, and

 

- 10 -

 

 

--------------------------------------------------------------------------------

 

(vi)realized gains on investments and decrease in the fair value of common stock
and warrant redemption liability;

in each case, determined on a consolidated basis in accordance with GAAP.

Notwithstanding the foregoing, for each of the periods set forth below,
Consolidated EBITDA shall be the amount set forth opposite such period:

APPLICABLE PERIOD

CONSOLIDATED EBITDA

For the fiscal quarter ending March 31, 2016

$18,343,000

For the fiscal quarter ending June 30, 2016

$11,613,000

For the fiscal quarter ending September 30, 2016

$15,746,000

 

“Consolidated Net Income” means, with respect to any Person, for any period, the
consolidated net income (or loss) of such Person and its Subsidiaries for such
period; provided, however, that the following shall be excluded:  (a) the net
income of any other Person in which such Person or one of its Subsidiaries has a
joint interest with a third-party (which interest does not cause the net income
of such other Person to be consolidated into the net income of such Person),
except to the extent of the amount of dividends or distributions paid to such
Person or Subsidiary, (b) the net income of any Subsidiary of such Person that
is, on the last day of such period, subject to any restriction or limitation on
the payment of dividends or the making of other distributions, to the extent of
such restriction or limitation, and (c) the net income of any other Person
arising prior to such other Person becoming a Subsidiary of such Person or
merging or consolidating into such Person or its Subsidiaries.

“Consolidated Net Interest Expense” means, with respect to any Person for any
period, (a) gross interest expense of such Person and its Subsidiaries for such
period determined on a consolidated basis and in accordance with GAAP
(including, without limitation, interest expense paid to Affiliates of such
Person), less (b) the sum of (i) interest income for such period, (ii) gains for
such period on Hedging Agreements (to the extent not included in interest income
above and to the extent not deducted in the calculation of gross interest
expense) and (iii) capitalized fees and expenses incurred in connection with
this Agreement, plus (c) the sum of (i) losses for such period on Hedging
Agreements (to the extent not included in gross interest expense) and (ii) the
upfront costs or fees for such period associated with Hedging Agreements (to the
extent not included in gross interest expense), in each case, determined on a
consolidated basis and in accordance with GAAP.

“Contingent Indemnity Obligations” means any Obligation constituting a
contingent, unliquidated indemnification obligation of any Loan Party, in each
case, to the extent (a) such obligation has not accrued and is not yet due and
payable and (b) no claim has been made or is reasonably anticipated to be made
with respect thereto.

 

- 11 -

 

 

--------------------------------------------------------------------------------

 

“Contingent Obligation” means, with respect to any Person, any obligation of
such Person guaranteeing or intending to guarantee any Indebtedness, leases,
dividends or other obligations (“primary obligations”) of any other Person
(the ”primary obligor”) in any manner, whether directly or indirectly,
including, without limitation, (a) the direct or indirect guaranty, endorsement
(other than for collection or deposit in the ordinary course of business),
co-making, discounting with recourse or sale with recourse by such Person of the
obligation of a primary obligor, (b) the obligation to make take-or-pay or
similar payments, if required, regardless of nonperformance by any other party
or parties to an agreement, (c) any obligation of such Person, whether or not
contingent, (i) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (ii) to advance or supply
funds (A) for the purchase or payment of any such primary obligation or (B) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to purchase
property, assets, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the holder of such primary obligation against loss in respect thereof;
provided, however, that the term “Contingent Obligation” shall not include any
product warranties extended in the ordinary course of business.  The amount of
any Contingent Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation with respect to which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms of the
instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability with respect thereto
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.

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

“Control Agreement” means, with respect to any deposit account, any securities
account, commodity account, securities entitlement or commodity contract, an
agreement, in form and substance satisfactory to the Collateral Agent, among the
Collateral Agent, the financial institution or other Person at which such
account is maintained or with which such entitlement or contract is carried and
the Loan Party maintaining such account, effective to grant “control” (as
defined under the applicable UCC) over such account to the Collateral Agent.

“Current Value” has the meaning specified therefor in Section 7.01(m).

“Debtor Relief Law” means the Bankruptcy Code and any other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief law of the United States or other applicable jurisdiction from
time to time in effect.

“Default” means an event which, with the giving of notice or the lapse of time
or both, would constitute an Event of Default.

 

- 12 -

 

 

--------------------------------------------------------------------------------

 

“Defaulting Lender” means any Lender that (a) has failed to (i) fund all or any
portion of its Loans within 2 Business Days of the date such Loans were required
to be funded hereunder unless such Lender notifies the Administrative Agent and
the Administrative Borrower in writing that such failure is the result of such
Lender’s determination that one or more conditions precedent to funding (each of
which conditions precedent, together with any applicable default, shall be
specifically identified in such writing) has not been satisfied, or (ii) pay to
the Administrative Agent or any other Lender any other amount required to be
paid by it hereunder within 2 Business Days of the date when due, (b) has
notified the Administrative Borrower, or the Administrative Agent in writing
that it does not intend to comply with its funding obligations hereunder, or has
made a public statement to that effect (unless such writing or public statement
relates to such Lender’s obligation to fund a Loan hereunder and states that
such position is based on such Lender’s determination that a condition precedent
to funding (which condition precedent, together with any applicable default,
shall be specifically identified in such writing or public statement) cannot be
satisfied), (c) has failed, within 3 Business Days after written request by the
Administrative Agent or the Administrative Borrower, to confirm in writing to
the Administrative Agent and the Administrative Borrower that it will comply
with its prospective funding obligations hereunder (provided that such Lender
shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt
of such written confirmation by the Administrative Agent and the Administrative
Borrower), or (d) has, or has a direct or indirect parent company that has, (i)
become the subject of a proceeding under any Debtor Relief Law, or (ii) had
appointed for it a receiver, custodian, conservator, trustee, administrator,
assignee for the benefit of creditors or similar Person charged with
reorganization or liquidation of its business or assets, including the Federal
Deposit Insurance Corporation or any other state or federal regulatory authority
acting in such a capacity.  Notwithstanding anything to the contrary herein, a
Lender shall not be a Defaulting Lender solely by virtue of the ownership or
acquisition of any Equity Interest in that Lender or any direct or indirect
parent company thereof by a Governmental Authority so long as such ownership
interest does not result in or provide such Lender with immunity from the
jurisdiction of courts within the United States or from the enforcement of
judgments or writs of attachment on its assets or permits such Lender (or such
Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts
or agreements made with such Lender.  Any determination by the Administrative
Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above
shall be conclusive and binding absent manifest error, and such Lender shall be
deemed to be a Defaulting Lender upon delivery of written notice of such
determination to the Administrative Borrower and each Lender.

“Disbursement Letter” means a disbursement letter, in form and substance
satisfactory to the Collateral Agent, by and among the Loan Parties, the Agents,
the Lenders and the other Persons party thereto, and the related funds flow
memorandum describing the sources and uses of all cash payments in connection
with the transactions contemplated to occur on the Effective Date.

 

- 13 -

 

 

--------------------------------------------------------------------------------

 

“Disposition” means any transaction, or series of related transactions, pursuant
to which any Person or any of its Subsidiaries sells, assigns, transfers,
leases, licenses (as licensor) or otherwise disposes of any property or assets
(whether now owned or hereafter acquired) to any other Person, in each case,
whether or not the consideration therefor consists of cash, securities or other
assets owned by the acquiring Person.  For purposes of clarification,
“Disposition” shall include (a) the sale or other disposition for value of any
contracts or (b) the early termination or modification of any contract resulting
in the receipt by any Loan Party of a cash payment or other consideration in
exchange for such event (other than payments in the ordinary course for accrued
and unpaid amounts due through the date of termination or modification).

“Disqualified Equity Interests” means any Equity Interest that, by its terms (or
by the terms of any security or other Equity Interest into which it is
convertible or for which it is exchangeable), or upon the happening of any event
or condition, (a) matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise (except as a result of a change of control or asset
sale so long as any rights of the holders thereof upon the occurrence of a
change of control or asset sale event shall be subject to the prior repayment in
full of the Loans and all other Obligations and the termination of the
Commitments), (b) is redeemable at the option of the holder thereof, in whole or
in part, (c) provides for the scheduled payments of dividends or distributions
in cash, or (d) is convertible into or exchangeable for (i) Indebtedness or (ii)
any other Equity Interests that would constitute Disqualified Equity Interests,
in each case of clauses (a) through (d), prior to the date that is 91 days after
the Final Maturity Date.

“Dividend/Acquisition Bucket” means, as of any date of determination, an amount
that may be used to make a Restricted Payment in reliance upon clause (g) of the
definition of “Permitted Restricted Payments” or to consummate a Permitted
Acquisition in reliance upon clause (j) of the definition of “Permitted
Acquisition”, which amount shall be equal to $100,000,000, plus the aggregate
amount of Net Cash Proceeds received by any Loan Party or its Subsidiaries in
connection with any Specified Disposition in excess of the applicable Specified
Disposition Threshold Amount, less the sum of (a) the Effective Date Dividend,
(b) the Effective Date Stock Buyback, (c) the aggregate amount of Restricted
Payments made prior to such date in reliance upon clause (g) of the definition
of “Permitted Restricted Payments”, (d) the aggregate amount of the purchase
prices for any Permitted Acquisitions that are consummated prior to such date in
reliance upon clause (j) of the definition of “Permitted Acquisition” and (e)
the Permitted Management Bonus; provided that the Dividend/Acquisition Bucket
shall be equal to zero on and after the 24 month anniversary of the Effective
Date.

“Dollar,” “Dollars” and the symbol “$” each means lawful money of the United
States of America.

“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.

“Effective Date” has the meaning specified therefor in Section 5.01.

 

- 14 -

 

 

--------------------------------------------------------------------------------

 

“Effective Date Dividend” means the dividend or distribution paid in cash by
Patriot to the owners of the shares of common stock of Patriot on or within 30
days of the Effective Date in an amount not to exceed $100,000,000.

“Effective Date Stock BuyBack” means payment by Patriot for the purchase or
acquisition of shares of common stock of Patriot on or within 24 months of the
Effective Date in an amount not to exceed $100,000,000, less, as of the date of
such payment, the sum of (a) the aggregate amount of the Effective Date
Dividend, (b) the aggregate amount of Restricted Payments made prior to such
date in reliance upon clause (g) of the definition of “Permitted Restricted
Payments” and (c) the aggregate amount of the purchase prices for any Permitted
Acquisitions that are consummated prior to such date in reliance upon clause (j)
of the definition of “Permitted Acquisition”.

“Employee Plan” means an employee benefit plan (other than a Multiemployer Plan)
covered by Title IV of ERISA and maintained (or that was maintained at any time
during the 6 calendar years preceding the date of any borrowing hereunder) for
employees of any Loan Party or any of its ERISA Affiliates.

“Environmental Actions” means any complaint, summons, citation, notice,
directive, order, claim, litigation, investigation, judicial or administrative
proceeding, judgment, letter or other communication from any Person or
Governmental Authority involving violations of Environmental Laws or Releases of
Hazardous Materials (a) from any assets, properties or businesses owned or
operated by any Loan Party or any of its Subsidiaries or any predecessor in
interest; (b) from adjoining properties or businesses; or (c) onto any
facilities which received Hazardous Materials generated by any Loan Party or any
of its Subsidiaries or any predecessor in interest.

“Environmental Laws” means the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. § 9601, et seq.), the Hazardous
Materials Transportation Act (49 U.S.C. § 1801, et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. § 6901, et seq.), the Federal Clean
Water Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et
seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.) and the
Occupational Safety and Health Act (29 U.S.C. § 651 et seq.), as such laws may
be amended or otherwise modified from time to time, and any other Requirement of
Law, permit, license or other binding determination of any Governmental
Authority imposing liability or establishing standards of conduct for protection
of the environment or other government restrictions relating to the protection
of the environment or the Release, deposit or migration of any Hazardous
Materials into the environment.

“Environmental Liabilities and Costs” means all liabilities, monetary
obligations, Remedial Actions, losses, damages, punitive damages, consequential
damages, treble damages, costs and expenses (including all reasonable fees,
disbursements and expenses of counsel, experts and consultants and costs of
investigations and feasibility studies), fines, penalties, sanctions and
interest incurred as a result of any claim or demand by any Governmental
Authority or any third party, and which relate to any environmental condition or
a Release of Hazardous Materials from or onto (a) any property presently or
formerly owned by any Loan Party or any of its Subsidiaries or (b) any facility
which received Hazardous Materials generated by any Loan Party or any of its
Subsidiaries.

 

- 15 -

 

 

--------------------------------------------------------------------------------

 

“Environmental Lien” means any Lien in favor of any Governmental Authority for
Environmental Liabilities and Costs.

“Equity Interests” means (a) all shares of capital stock (whether denominated as
common stock or preferred stock), equity interests, beneficial, partnership or
membership interests, joint venture interests, participations or other ownership
or profit interests in or equivalents (regardless of how designated) of or in a
Person (other than an individual), whether voting or non-voting and (b) all
securities convertible into or exchangeable for any of the foregoing and all
warrants, options or other rights to purchase, subscribe for or otherwise
acquire any of the foregoing, whether or not presently convertible, exchangeable
or exercisable.

“Equity Issuance” means either (a) the sale or issuance by any Loan Party or any
of its Subsidiaries of any shares of its Equity Interests or (b) the receipt by
Patriot of any cash capital contributions.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute of similar import, and regulations thereunder, in each
case, as in effect from time to time.  References to sections of ERISA shall be
construed also to refer to any successor sections.

“ERISA Affiliate” means, with respect to any Person, any trade or business
(whether or not incorporated) which is a member of a group of which such Person
is a member and which would be deemed to be a “controlled group” within the
meaning of Sections 414(b), (c), (m) and (o) of the Internal Revenue Code.

“Event of Default” has the meaning specified therefor in Section 9.01.

“Excess Cash Flow” means, with respect to any Person for any period,
(a) Consolidated EBITDA of such Person and its Subsidiaries for such period,
less (b) the sum of, without duplication, (i) all cash principal payments
(excluding any principal payments made pursuant to Section 2.05(b) or  Section
2.05(c)) on the Loans made during such period (but, in the case of the Revolving
Loans, only to the extent that the Total Revolving Credit Commitment is
permanently reduced by the amount of such payments), and all cash principal
payments on Indebtedness (other than Indebtedness incurred under this Agreement)
of such Person or any of its Subsidiaries during such period to the extent such
other Indebtedness is permitted to be incurred, and such payments are permitted
to be made, under this Agreement (but, in the case of revolving loans, only to
the extent that the revolving credit commitment in respect thereof is
permanently reduced by the amount of such payments), (ii) all Consolidated Net
Interest Expense to the extent paid or payable in cash during such period,
(iii) the cash portion of Capital Expenditures (including any Capitalized Lease
Obligations) made by such Person and its Subsidiaries during such period to the
extent permitted to be made under this Agreement (excluding Capital Expenditures
to the extent financed through the incurrence of Indebtedness or through an
Equity Issuance), (iv) all scheduled loan servicing fees and other similar fees
in respect of Indebtedness of such Person or any of its Subsidiaries paid in
cash during such period, to the extent such Indebtedness is permitted to be
incurred, and such payments are permitted to be made, under this Agreement,
(v) income taxes paid in cash by such Person and its Subsidiaries for such
period, (vi) the excess, if any, of Working Capital at the end of such period

 

- 16 -

 

 

--------------------------------------------------------------------------------

 

over Working Capital at the beginning of such period (or minus the excess, if
any, of Working Capital at the beginning of such period over Working Capital at
the end of such period), (vii) all payments in cash during such period in
respect of contingent earn-out obligations, to the extent such Indebtedness is
set forth on Schedule 7.02(b)(ii) and such payments are not prohibited to be
made under this Agreement and (viii) amounts added back to Consolidated EBITDA
for such period pursuant to clauses (x) through (xiii) of the definition of
“Consolidated EBITDA”.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Excluded Account” means (a) any deposit account specifically and exclusively
used for payroll, payroll taxes and other employee wage and benefit payments to
or for the benefit of any Loan Party’s employees, (b) any Petty Cash Accounts
and (c) any other deposit account used for funding insurance claim payouts or
trust accounts holding insurance premiums listed on Schedule 1.01(C).

“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 not to constitute
an “eligible contract participant” as defined in the Commodity Exchange Act at
the time the guarantee of such Guarantor becomes effective with respect to such
related Swap Obligation.

“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 or Commitment pursuant
to a law in effect on the date on which (i) such Lender acquires such interest
in the Loan or Commitment (other than pursuant to an assignment request by the
Borrower under Section 2.12(b)) or (ii) such Lender changes its lending office,
except in each case to the extent that, pursuant to Section 2.09, amounts with
respect to such Taxes were payable either to such Lender’s assignor immediately
before such Lender became a party hereto or to such Lender immediately before it
changed its lending office, (c) Taxes attributable to such Recipient’s failure
to comply with Section 2.09(d) and (d) any U.S. federal withholding Taxes
imposed under FATCA.

“Executive Order No. 13224” means the Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001, as the same has been, or shall
hereafter be, renewed, extended, amended or replaced.

 

- 17 -

 

 

--------------------------------------------------------------------------------

 

“Existing Credit Facility” means the Credit Agreement, dated as of January 22,
2015, among Patriot, BMO Harris Bank N.A., as Administration Agent, Issuing
Lender and Swing Line Lender, and the various lenders who are party thereto, as
amended.

“Existing Lenders” means the lenders party to the Existing Credit Facility.

“Extraordinary Receipts” means any cash received by Patriot or any of its
Subsidiaries not in the ordinary course of business (and not consisting of
proceeds described in Section 2.05(c)(ii) or (iii) hereof), including, without
limitation, (a) foreign, United States, state or local tax refunds, (b) proceeds
of insurance (other than to the extent such insurance proceeds are (i)
immediately payable to a Person that is not Patriot or any of its Subsidiaries
in accordance with applicable Requirements of Law or with Contractual
Obligations entered into in the ordinary course of business or (ii) received by
Patriot or any of its Subsidiaries as reimbursement for any out-of-pocket costs
incurred or made by such Person prior to the receipt thereof directly related to
the event resulting from the payment of such proceeds) and (c) condemnation
awards (and payments in lieu thereof).

“Facility” means the real property identified on Schedule 1.01(B) and any New
Facility hereafter acquired by Patriot or any of its Subsidiaries, including,
without limitation, the land on which each such facility is located, all
buildings and other improvements thereon, and all fixtures located thereat or
used in connection therewith.

“FASB ASC” means the Accounting Standards Codification of the Financial
Accounting Standards Board.

“FATCA” means Sections 1471 through 1474 of the Internal Revenue 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) and any
current or future regulations or official interpretations thereof and any
agreements entered into pursuant to Section 1471(b)(1) of the Internal Revenue
Code.

“FCPA” has the meaning specified therefor in Section 6.01(cc).

“Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal to, for each day during such period, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

“Final Maturity Date” means November 9, 2021.

 

- 18 -

 

 

--------------------------------------------------------------------------------

 

“Financial Statements” means (a) the audited consolidated balance sheet of
Patriot and its Subsidiaries for the Fiscal Year ended December 31, 2015, and
the related consolidated statement of operations, shareholders’ equity and cash
flows for the Fiscal Year then ended, and (b) the unaudited consolidated balance
sheet of Patriot and its Subsidiaries for the 6 months ended June 30, 2016, and
the related consolidated statement of operations, shareholder’s equity and cash
flows for the 6 months then ended.

“Fiscal Year” means the fiscal year of Patriot and its Subsidiaries ending on
December 31st of each year.

“Fixed Charge Coverage Ratio” means, with respect to any Person for any period,
the ratio of (a) (i) Consolidated EBITDA of such Person and its Subsidiaries for
such period, minus (ii) unfinanced Capital Expenditures made by such Person and
its Subsidiaries during such period, to (b) the sum of (i) all principal of
Indebtedness of such Person and its Subsidiaries scheduled to be paid or prepaid
during such period to the extent there is an equivalent permanent reduction in
the commitments thereunder, plus (ii) Consolidated Net Interest Expense of such
Person and its Subsidiaries for such period, plus (iii) income taxes paid or
payable by such Person and its Subsidiaries during such period, plus (iv) cash
dividends or distributions paid, or the purchase, redemption or other
acquisition or retirement for value (including in connection with any merger or
consolidation), by such Person or any of its Subsidiaries, in respect of the
Equity Interests of such Person or any of its Subsidiaries (other than dividends
or distributions paid by a Loan Party to any other Loan Party) during such
period, plus (v) all management, consulting, monitoring, and advisory fees paid
by such Person or any of its Subsidiaries to any of its Affiliates during such
period.

Notwithstanding the foregoing, for each of the periods set forth below, the
amounts identified in clauses (b)(i), (b)(ii) and (b)(iii) of the definition of
“Fixed Charge Coverage Ratio” shall be the amount set forth opposite such
period:

APPLICABLE PERIOD

(bi)

(bii)

(biii)

For the fiscal quarter ending March 31, 2016

$1,250,000

$5,196,000

$991,000

For the fiscal quarter ending June 30, 2016

$1,250,000

$5,170,000

$79,200

For the fiscal quarter ending September 30, 2016

$1,250,000

$5,150,000

$685,000

 

“Foreign Official” has the meaning specified therefor in Section 6.01(cc).

“Foreign Subsidiary” means any Subsidiary of Patriot that is not a Domestic
Subsidiary.

“Funding Losses” has the meaning specified therefor in Section 2.08.

 

- 19 -

 

 

--------------------------------------------------------------------------------

 

“GAAP” means generally accepted accounting principles in effect from time to
time in the United States, applied on a consistent basis, provided that for the
purpose of Section 7.03 hereof and the definitions used therein, “GAAP” shall
mean generally accepted accounting principles in effect on the date hereof and
consistent with those used in the preparation of the Financial Statements,
provided, further, that if there occurs after the date of this Agreement any
change in GAAP that affects in any respect the calculation of any covenant
contained in Section 7.03 hereof, the Collateral Agent and the Administrative
Borrower shall negotiate in good faith amendments to the provisions of this
Agreement that relate to the calculation of such covenant with the intent of
having the respective positions of the Lenders and the Borrowers after such
change in GAAP conform as nearly as possible to their respective positions as of
the date of this Agreement and, until any such amendments have been agreed upon,
the covenants in Section 7.03 hereof shall be calculated as if no such change in
GAAP has occurred.

“Governing Documents” means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization, and the operating agreement; (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture, declaration or other applicable agreement or
documentation evidencing or otherwise relating to its formation or organization,
governance and capitalization; and (d) with respect to any of the entities
described above, any other agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization.

“Governmental Authority” means any nation or government, any foreign, Federal,
state, territory, provincial, city, town, municipality, county, local or other
political subdivision thereof or thereto and any department, commission, board,
bureau, instrumentality, agency 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).

“Guaranteed Obligations” has the meaning specified therefor in Section 11.01.

“Guarantor” means (a) each Subsidiary of Patriot listed as a “Guarantor” on the
signature pages hereto, and (b) each other Person which guarantees, pursuant to
Section 7.01(b) or otherwise, all or any part of the Obligations.

“Guaranty” means (a) the guaranty of each Guarantor party hereto contained in
Article XI hereof and (b) each other guaranty, in form and substance
satisfactory to the Collateral Agent, made by any other Guarantor in favor of
the Collateral Agent for the benefit of the Agents and the Lenders guaranteeing
all or part of the Obligations.

 

- 20 -

 

 

--------------------------------------------------------------------------------

 

“Hazardous Material” means (a) any element, compound or chemical that is
defined, listed or otherwise classified as a contaminant, pollutant, toxic
pollutant, toxic or hazardous substance, extremely hazardous substance or
chemical, hazardous waste, special waste, or solid waste under Environmental
Laws or that is likely to cause immediately, or at some future time, harm to or
have an adverse effect on, the environment or risk to human health or safety,
including, without limitation, any pollutant, contaminant, waste, hazardous
waste, toxic substance or dangerous good which is defined or identified in any
Environmental Law and which is present in the environment in such quantity or
state that it contravenes any Environmental Law; (b) petroleum and its refined
products; (c) polychlorinated biphenyls; (d) any substance exhibiting a
hazardous waste characteristic, including, without limitation, corrosivity,
ignitability, toxicity or reactivity as well as any radioactive or explosive
materials; and (e) any raw materials, building components (including, without
limitation, asbestos-containing materials) and manufactured products containing
hazardous substances listed or classified as such under Environmental Laws.

“Hedging Agreement” means any interest rate, foreign currency, commodity or
equity swap, collar, cap, floor or forward rate agreement, or other agreement or
arrangement designed to protect against fluctuations in interest rates or
currency, commodity or equity values (including, without limitation, any option
with respect to any of the foregoing and any combination of the foregoing
agreements or arrangements), and any confirmation executed in connection with
any such agreement or arrangement.

“Highest Lawful Rate” means, with respect to any Agent or any Lender, the
maximum non-usurious interest rate, if any, that at any time or from time to
time may be contracted for, taken, reserved, charged or received on the
Obligations under laws applicable to such Agent or such Lender which are
currently in effect or, to the extent allowed by law, under such applicable laws
which may hereafter be in effect and which allow a higher maximum non-usurious
interest rate than applicable laws now allow.

“Holdout Lender” has the meaning specified therefor in Section 12.02(b)

“Indebtedness” means, with respect to any Person, without duplication, (a) all
indebtedness of such Person for borrowed money; (b) all obligations of such
Person for the deferred purchase price of property or services (other than trade
payables or other accounts payable incurred in the ordinary course of such
Person’s business and not outstanding for more than 120 days after the date such
payable was created and any earn-out, purchase price adjustment or similar
obligation until such obligation appears in the liabilities section of the
balance sheet of such Person); (c) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments or upon which interest
payments are customarily made; (d) all reimbursement, payment or other
obligations and liabilities of such Person created or arising under any
conditional sales or other title retention agreement with respect to property
used and/or acquired by such Person, even though the rights and remedies of the
lessor, seller and/or lender thereunder may be limited to repossession or sale
of such property; (e) all Capitalized Lease Obligations of such Person; (f) all
obligations and liabilities, contingent or otherwise, of such Person, in respect
of letters of credit, acceptances and similar facilities; (g) all obligations
and liabilities, calculated on a basis satisfactory to the Collateral Agent and
in accordance with accepted practice, of such Person under Hedging Agreements;
(h) all monetary obligations under

 

- 21 -

 

 

--------------------------------------------------------------------------------

 

any receivables factoring, receivable sales or similar transactions and all
monetary obligations under any synthetic lease, tax ownership/operating lease,
off-balance sheet financing or similar financing; (i) all Contingent
Obligations; (j) all Disqualified Equity Interests; and (k) all obligations
referred to in clauses (a) through (j) of this definition of another Person
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) a Lien upon property owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness.  The Indebtedness of any Person shall include the
Indebtedness of any partnership of or joint venture in which such Person is a
general partner or a joint venturer.

“Indemnified Matters” has the meaning specified therefor in Section 12.15.

“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 any Loan
Party under any Loan Document and (b) to the extent not otherwise described in
clause (a), Other Taxes.

“Indemnitees” has the meaning specified therefor in Section 12.15.

“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of any Debtor Relief Law.

“Intellectual Property” has the meaning specified therefor in the Security
Agreement.

“Intercompany Subordination Agreement” means an Intercompany Subordination
Agreement made by Patriot and its Subsidiaries in favor of the Collateral Agent
for the benefit of the Agents and the Lenders, in form and substance reasonably
satisfactory to the Collateral Agent.

“Interest Period” means, with respect to each LIBOR Rate Loan, a period
commencing on the date of the making of such LIBOR Rate Loan (or the
continuation of a LIBOR Rate Loan or the conversion of a Reference Rate Loan to
a LIBOR Rate Loan) and ending 1, 2, or 3 months thereafter; provided, however,
that (a) if any Interest Period would end on a day that is not a Business Day,
such Interest Period shall be extended (subject to clauses (c)-(e) below) to the
next succeeding Business Day, (b) interest shall accrue at the applicable rate
based upon the LIBOR Rate from and including the first day of each Interest
Period to, but excluding, the day on which any Interest Period expires, (c) any
Interest Period that would end on a day that is not a Business Day shall be
extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the next
preceding Business Day, (d) with respect to an Interest Period that begins on
the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period), the Interest Period shall end on the last Business Day of the calendar
month that is 1, 2 or 3 months after the date on which the Interest Period
began, as applicable, and (e) the Borrowers may not elect an Interest Period
which will end after the Final Maturity Date.

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended (or
any successor statute thereto) and the regulations thereunder.

 

- 22 -

 

 

--------------------------------------------------------------------------------

 

“Inventory” means, with respect to any Person, all goods and merchandise of such
Person leased or held for sale or lease by such Person, including, without
limitation, all raw materials, work-in-process and finished goods, and all
packaging, supplies and materials of every nature used or usable in connection
with the shipping, storing, advertising or sale of such goods and merchandise,
whether now owned or hereafter acquired, and all such other property the sale or
other disposition of which would give rise to an Account or cash.

“Investment” means, with respect to any Person, (a) any investment by such
Person in any other Person (including Affiliates) in the form of loans,
guarantees, advances or other extensions of credit (excluding Accounts arising
in the ordinary course of business), capital contributions or acquisitions of
Indebtedness (including, any bonds, notes, debentures or other debt securities),
Equity Interests, or all or substantially all of the assets of such other Person
(or of any division or business line of such other Person), (b) the purchase or
ownership of any futures contract or liability for the purchase or sale of
currency or other commodities at a future date in the nature of a futures
contract, or (c) any investment in any other items that are or would be
classified as investments on a balance sheet of such Person prepared in
accordance with GAAP.

“Joinder Agreement” means a Joinder Agreement, substantially in the form of
Exhibit A, duly executed by a Subsidiary of a Loan Party made a party hereto
pursuant to Section 7.01(b).

“Lease” means any lease of real property to which any Loan Party or any of its
Subsidiaries is a party as lessor or lessee.

“Lender” has the meaning specified therefor in the preamble hereto.

“Leverage Ratio” means, with respect to any Person and its Subsidiaries for any
period, the ratio of (a) all Indebtedness described in clauses (a), (b), (c),
(d) and (e) in the definition thereof of such Person and its Subsidiaries as of
the end of such period to (b) Consolidated EBITDA of such Person and its
Subsidiaries for such period.

“LIBOR” means, with respect to each day during each Interest Period pertaining
to a LIBOR Rate Loan, the rate per annum rate appearing on Bloomberg L.P.’s (the
“Service”) Page LIBOR01 (or on any successor or substitute page of such Service,
or any successor to or substitute for such Service), at approximately 11:00
a.m., London time, two Business Days prior to the beginning of such Interest
Period, in an amount approximately equal to the principal amount of the LIBOR
Rate Loan to which such Interest Period is to apply and for a period of time
comparable to such Interest Period, which determination shall be conclusive
absent manifest error.  If such rate is not available at such time for any
reason, then “LIBOR” for such Interest Period shall be the rate per annum
determined by the Administrative Agent to be the rate per annum equal to the
offered quotation rate to first class banks in the London interbank market for
deposits (for delivery on the first day of the relevant period) in Dollars of
amounts in same day funds comparable to the principal amount of the applicable
LIBOR Rate Loan of 3 major London banks for which LIBOR is then being determined
with maturities comparable to such Interest Period as of approximately 11:00
a.m., London time, two Business Days prior to the commencement of such Interest
Period.  Notwithstanding anything herein to the contrary, if “LIBOR” shall be
less than zero, such rate shall be deemed to be zero for purposes of this
Agreement.

 

- 23 -

 

 

--------------------------------------------------------------------------------

 

“LIBOR Deadline” has the meaning specified therefor in Section 2.07(a).

“LIBOR Notice” means a written notice substantially in the form of Exhibit D.

“LIBOR Option” has the meaning specified therefor in Section 2.07(a).

“LIBOR Rate” means, for each Interest Period for each LIBOR Rate Loan, the
greater of (a) the rate per annum determined by the Administrative Agent
(rounded upwards if necessary, to the next 1/100%) by dividing (i) LIBOR for
such Interest Period by (ii) 100% minus the Reserve Percentage and (b)
1.00%.  The LIBOR Rate shall be adjusted on and as of the effective day of any
change in the Reserve Percentage.

“LIBOR Rate Loan” means each portion of a Loan that bears interest at a rate
determined by reference to the LIBOR Rate.

“Lien” means any mortgage, deed of trust, pledge, lien (statutory or otherwise),
security interest, charge or other encumbrance or security or preferential
arrangement of any nature, including, without limitation, any conditional sale
or title retention arrangement, any Capitalized Lease and any assignment,
deposit arrangement or financing lease intended as, or having the effect of,
security.

“Loan” means the Term Loan or any Revolving Loan made by an Agent or a Lender to
the Borrowers pursuant to Article II hereof.

“Loan Account” means an account maintained hereunder by the Administrative Agent
on its books of account at the Payment Office, and with respect to the
Borrowers, in which the Borrowers will be charged with all Loans made to, and
all other Obligations incurred by, the Borrowers.

“Loan Document” means this Agreement, any Control Agreement, the Disbursement
Letter, any Guaranty, the Intercompany Subordination Agreement, any Joinder
Agreement, any Mortgage, any Security Agreement, any UCC Filing Authorization
Letter, any landlord waiver, any collateral access agreement, any Perfection
Certificate and any other agreement, instrument, certificate, report and other
document executed and delivered pursuant hereto or thereto or otherwise
evidencing or securing any Loan  or any other Obligation.

“Loan Party” means any Borrower and any Guarantor.

“Loan Servicing Fee” has the meaning specified therefor in Section 2.06(d).

“Material Adverse Effect” means a material adverse effect on any of (a) the
operations, assets, liabilities or financial condition of the Loan Parties taken
as a whole, (b) the ability of the Loan Parties taken as a whole to perform any
of their obligations under any Loan Document, (c) the legality, validity or
enforceability of this Agreement or any other Loan Document, (d) the rights and
remedies of any Agent or any Lender under any Loan Document, or (e) the
validity, perfection or priority of a Lien in favor of the Collateral Agent for
the benefit of the Agents and the Lenders on Collateral having a fair market
value in excess of $3,000,000.

 

- 24 -

 

 

--------------------------------------------------------------------------------

 

“Material Contract” means, with respect to any Person, all contracts or
agreements 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.

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

“Mortgage” means a mortgage, deed of trust or deed to secure debt, in form and
substance satisfactory to the Collateral Agent, made by a Loan Party in favor of
the Collateral Agent for the benefit of the Agents and the Lenders, securing the
Obligations and delivered to the Collateral Agent.

“Multiemployer Plan” means a “multiemployer plan” as defined in Section
4001(a)(3) of ERISA to which any Loan Party or any of its ERISA Affiliates has
contributed, or has been obligated to contribute, to at any time during the
preceding 6 years.

“Net Cash Proceeds” means, with respect to, any issuance or incurrence of any
Indebtedness, any Equity Issuance, any Disposition or the receipt of any
Extraordinary Receipts by any Person or any of its Subsidiaries, the aggregate
amount of cash received (directly or indirectly) from time to time (whether as
initial consideration or through the payment or disposition of deferred
consideration) by or on behalf of such Person or such Subsidiary, in connection
therewith after deducting therefrom only (a) in the case of any Disposition or
the receipt of any Extraordinary Receipts consisting of insurance proceeds or
condemnation awards, the amount of any Indebtedness secured by any Permitted
Lien on any asset (other than Indebtedness assumed by the purchaser of such
asset) which is required to be, and is, repaid in connection therewith (other
than Indebtedness under this Agreement), (b) reasonable expenses related thereto
incurred by such Person or such Subsidiary in connection therewith (including
sales commissions and legal, accounting, advisory and investment banking fees),
(c) transfer taxes paid to any taxing authorities by such Person or such
Subsidiary in connection therewith, and (d) net income taxes to be paid in
connection therewith (after taking into account any tax credits or deductions
and any tax sharing arrangements), in each case, to the extent, but only to the
extent, that the amounts so deducted are (i) actually paid to a Person that,
except in the case of reasonable out-of-pocket expenses, is not an Affiliate of
such Person or any of its Subsidiaries and (ii) properly attributable to such
transaction or to the asset that is the subject thereof.

“New Facility” has the meaning specified therefor in Section 7.01(m).

“New Lending Office” has the meaning specified therefor in Section 2.09(d).

“Non-U.S. Lender” has the meaning specified therefor in Section 2.09(d).

“Notice of Borrowing” has the meaning specified therefor in Section 2.02(a).

 

- 25 -

 

 

--------------------------------------------------------------------------------

 

“Obligations” means all present and future indebtedness, obligations, and
liabilities of each Loan Party to the Agents and the Lenders arising under or in
connection with this Agreement or any other Loan Document, whether or not the
right of payment in respect of such claim is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, disputed, undisputed, legal,
equitable, secured, unsecured, and whether or not such claim is discharged,
stayed or otherwise affected by any proceeding referred to in Section
9.01.  Without limiting the generality of the foregoing, the Obligations of each
Loan Party under the Loan Documents include (a) the obligation (irrespective of
whether a claim therefor is allowed in an Insolvency Proceeding) to pay
principal, interest, charges, expenses, fees, premiums (including the Applicable
Premium), attorneys’ fees and disbursements, indemnities and other amounts
payable by such Person under the Loan Documents, and (b) the obligation of such
Person to reimburse any amount in respect of any of the foregoing that any Agent
or any Lender (in its sole discretion) may elect to pay or advance on behalf of
such Person.  Notwithstanding any of the foregoing, Obligations shall not
include any Excluded Swap Obligations.

“OFAC Sanctions Programs” means (a) the Requirements of Law and Executive Orders
administered by OFAC, including, without limitation, Executive Order No. 13224,
and (b) the list of Specially Designated Nationals and Blocked Persons
administered by OFAC, in each case, as renewed, extended, amended, or replaced.

“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 Tax (other than connections 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 or Loan Document).

“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.

“Participant Register” has the meaning specified therefor in Section 12.07(i).

“Patriot” has the meaning specified therefor in the preamble hereto.

Payment Office” means the Administrative Agent’s office located at Cerberus
Business Finance, LLC, 875 Third Avenue, New York, New York 10022, or at such
other office or offices of the Administrative Agent as may be designated in
writing from time to time by the Administrative Agent to the Collateral Agent
and the Borrower.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

“Perfection Certificate” means a certificate in form and substance satisfactory
to the Collateral Agent providing information with respect to the property of
each Loan Party.

 

- 26 -

 

 

--------------------------------------------------------------------------------

 

“Permitted Acquisition” means any Acquisition by a Loan Party to the extent that
each of the following conditions shall have been satisfied:

(a)no Default or Event of Default shall have occurred and be continuing or would
result from the consummation of the proposed Acquisition;

(b)the Borrower shall have furnished to the Agents at least 10 Business Days
prior to the consummation of such Acquisition (i) an executed term sheet and/or
commitment letter (setting forth in reasonable detail the terms and conditions
of such Acquisition) and, at the request of any Agent, such other information
and documents that any Agent may request, including, without limitation,
executed counterparts of the respective agreements, instruments or other
documents pursuant to which such Acquisition is to be consummated (including,
without limitation, any related management, non-compete, employment, option or
other material agreements), any schedules to such agreements, instruments or
other documents and all other material ancillary agreements, instruments or
other documents to be executed or delivered in connection therewith, (ii) pro
forma financial statements of the Patriot and its Subsidiaries after the
consummation of such Acquisition, (iii) a certificate of the chief financial
officer of Patriot, demonstrating (x) on a pro forma basis compliance, as at the
end of the most recently ended fiscal quarter for which internally prepared
financial statements are available, with all covenants set forth in Section 7.03
hereof after giving effect to the consummation of such Acquisition and (y) that
the Leverage Ratio of Patriot and its Subsidiaries would be less than 3.50:1.00
after giving effect to the consummation of such Acquisition (other than an
Acquisition the purchase price of which is funded solely with amounts permitted
under clause (j) below) and (iv) copies of such other agreements, instruments or
other documents as any Agent shall reasonably request;

(c)such Acquisition shall be effected in such a manner so that the acquired
assets or Equity Interests are owned by a Loan Party and, if effected by merger
or consolidation involving a Loan Party, a Loan Party shall be the continuing or
surviving Person;

(d)no Revolving Loans shall be outstanding immediately before or after the
consummation of such Acquisition;

(e)the assets being acquired or the Person whose Equity Interests are being
acquired did not have negative Consolidated EBITDA during the 12 consecutive
month period most recently concluded prior to the date of the proposed
Acquisition, provided that, in the case of an Acquisition which is funded solely
with amounts permitted under clause (j) below, the Consolidated EBITDA
attributable to such assets or Person shall not be less than -$1,000,000;

(f)the assets being acquired (other than a de minimis amount of assets in
relation to the Loan Parties’ and their Subsidiaries’ total assets), or the
Person whose Equity Interests are being acquired, are useful in or engaged in,
as applicable, the business of the Loan Parties and their Subsidiaries or a
business reasonably related thereto;

(g)the assets being acquired (other than a de minimis amount of assets in
relation to the assets being acquired) are located within the United States or
the Person whose Equity Interests are being acquired is organized in a
jurisdiction located within the United States;

 

- 27 -

 

 

--------------------------------------------------------------------------------

 

(h)any such Subsidiary (and its equityholders) shall execute and deliver the
agreements, instruments and other documents required by Section 7.01(b) within
five (5) Business Days after the date of the consummation of such Acquisition;

(i)the purchase price payable in respect of all Acquisitions in the aggregate
during any Fiscal Year shall not exceed the Available Amount of Patriot and its
Subsidiaries for such Fiscal Year plus any amount permitted under clause (j)
below; and

(j)in addition to the purchase price parameters set forth in clause (i) above,
Patriot and its Subsidiaries shall be permitted to fund the purchase price in
respect of Acquisitions in an aggregate amount not to exceed the
Dividend/Acquisition Bucket as of the date of the consummation of such
Acquisition.

“Permitted Disposition” means:

(a)sale of Inventory and Permitted Investments in the ordinary course of
business;

(b)licensing, on a non-exclusive basis, Intellectual Property rights in the
ordinary course of business;

(c)leasing or subleasing assets in the ordinary course of business;

(d)(i) the lapse of Registered Intellectual Property of Patriot and its
Subsidiaries to the extent not economically desirable in the conduct of their
business or (ii) the abandonment of Intellectual Property rights in the ordinary
course of business so long as (in each case under clauses (i) and (ii)), (A)
with respect to copyrights, such copyrights are not material revenue generating
copyrights, and (B) such lapse is not materially adverse to the interests of the
Secured Parties;

(e)any involuntary loss, damage or destruction of property;

(f)any involuntary condemnation, seizure or taking, by exercise of the power of
eminent domain or otherwise, or confiscation or requisition of use of property;

(g)so long as no Event of Default has occurred and is continuing or would result
therefrom, transfers of assets (i) from Patriot or any of its Subsidiaries  to a
Loan Party, and (ii) from any Subsidiary of Patriot that is not a Loan Party to
any other Subsidiary of Patriot;

(h)Disposition of obsolete or worn-out equipment in the ordinary course of
business;

(i)Disposition of property or assets not otherwise permitted in clauses (a)
through (h) above for cash in an aggregate amount not less than the fair market
value of such property or assets;

 

- 28 -

 

 

--------------------------------------------------------------------------------

 

(j)Specified Disposition so long as the aggregate amount of Net Cash Proceeds
from all such Specified Dispositions do not exceed the lesser of (1) 20% of
Patriot’s TTM Consolidated EBITDA on the Effective Date and (2) 25% of Patriot’s
TTM Consolidated EBITDA determined after giving pro forma effect to such
Specified Disposition based on Patriot’s financial statements most recently
delivered to the Agents pursuant to Section 7.01(a);

(k)Dispositions of accounts receivable and captive claims recoverable balances
in connection with the collection or compromise thereof in the ordinary course
of business;

(l) to the extent deemed a Disposition and without any duplication, the making
of a Permitted Investment;

(m)Dispositions permitted by Section 7.02(c)(i); and

(n)to the extent deemed a Disposition and without any duplication, the making of
a Permitted Investment;

provided that, if required pursuant to Section 2.05(c)(ii) or Section
2.05(c)(vi), the Net Cash Proceeds of such Dispositions (including the proposed
Disposition) (1) in the case of clauses (h) and (i) above, do not exceed
$500,000 in the aggregate in any Fiscal Year and (2) in all cases, are paid to
the Administrative Agent for the benefit of the Agents and the Lenders pursuant
to the terms of Section 2.05(c)(ii) or applied as provided in Section
2.05(c)(vi), if required to be so paid or applied pursuant to such Sections.

“Permitted Indebtedness” means:

(a)any Indebtedness owing to any Agent or any Lender under this Agreement and
the other Loan Documents;

(b)any Indebtedness listed on Schedule 7.02(b)(i), and any Permitted Refinancing
Indebtedness in respect of such Indebtedness;

(c)Permitted Purchase Money Indebtedness and any Permitted Refinancing
Indebtedness in respect of such Indebtedness;

(d)Permitted Intercompany Investments;

(e)Indebtedness incurred in the ordinary course of business under performance,
surety, statutory, and appeal bonds;

(f)Indebtedness owed to any Person providing property, casualty, liability, or
other insurance to the Loan Parties, so long as the amount of such Indebtedness
is not in excess of the amount of the unpaid cost of, and shall be incurred only
to defer the cost of, such insurance for the period in which such Indebtedness
is incurred and such Indebtedness is outstanding only during such period;

 

- 29 -

 

 

--------------------------------------------------------------------------------

 

(g)the incurrence by any Loan Party of Indebtedness under Hedging Agreements
that are incurred for the bona fide purpose of hedging the interest rate,
commodity, or foreign currency risks associated with such Loan Party’s
operations and not for speculative purposes;

(h)Indebtedness incurred in respect of credit cards, credit card processing
services, debit cards, stored value cards, purchase cards (including so-called
“procurement cards” or “P-cards”) or other similar cash management services, in
each case, incurred in the ordinary course of business;

(i)Indebtedness owed to any Person in respect of any contingent earn-out
obligations listed on Schedule 7.02(b)(ii);

(j)Subordinated Indebtedness or unsecured Indebtedness in an aggregate amount
not exceeding $2,500,000 at any time outstanding;

(k)contingent liabilities in respect of any indemnification obligation,
adjustment of purchase price, non-compete, or similar obligation of any Loan
Party incurred in connection with the consummation of one or more Permitted
Acquisitions;

(l)Contingent Obligations in respect of Indebtedness incurred in the ordinary
course of business and permitted to be incurred pursuant to this definition; and

(m)Indebtedness permitted under Section 7.02(e).

“Permitted Intercompany Investments” means Investments made by (a) a Loan Party
to or in another Loan Party, (b) a Subsidiary that is not a Loan Party to or in
another Subsidiary that is not a Loan Party, (c) a Subsidiary that is not a Loan
Party to or in a Loan Party, so long as, in the case of a loan or advance, the
parties thereto are party to the Intercompany Subordination Agreement, and (d) a
Loan Party to or in a Subsidiary that is not a Loan Party so long as (i) the
aggregate amount of all such Investments made by the Loan Parties to or in
Subsidiaries that are not Loan Parties after the Effective Date does not exceed
$1,500,000 at any time outstanding, (ii) no Default or Event of Default has
occurred and is continuing either immediately before or immediately after giving
effect to such Investment, and (iii) the Borrowers have Availability plus
Qualified Cash of not less than $7,500,000 after giving effect to such
Investment.

“Permitted Investments” means:

(a)Investments in cash and Cash Equivalents;

(b)Investments in negotiable instruments deposited or to be deposited for
collection in the ordinary course of business;

(c)advances made in connection with purchases of goods or services in the
ordinary course of business;

 

- 30 -

 

 

--------------------------------------------------------------------------------

 

(d)Investments received in settlement of amounts due to any Loan Party or any of
its Subsidiaries effected in the ordinary course of business or owing to any
Loan Party or any of its Subsidiaries as a result of Insolvency Proceedings
involving an Account Debtor or upon the foreclosure or enforcement of any Lien
in favor of a Loan Party or its Subsidiaries;

(e)Investments existing on the date hereof, as set forth on Schedule 7.02(e)
hereto, but not any increase in the amount thereof as set forth in such Schedule
or any other modification of the terms thereof;

(f)Permitted Intercompany Investments;

(g)Investments in Hedging Agreements in the ordinary course of business and for
non-speculative purposes;

(h)loans and advances to employees, officers and directors of any Loan Party in
the ordinary course of business (including for travel, entertainment and
relocation expenses) in an aggregate amount for all Loan Parties not to exceed
$200,000 at any one time outstanding;

(i)Equity Interests or other securities acquired in connection with the
satisfaction or enforcement of Indebtedness or claims due or owing to a Loan
Party or its Subsidiaries (in bankruptcy of customers or suppliers or otherwise
outside the ordinary course of business) or as security for any such
Indebtedness or claims;

(j)Indebtedness constituting an Investment to the extent permitted under Section
7.02(b);

(k)Permitted Acquisitions;

(l)Investments held by a Subsidiary acquired after the Effective Date or of a
Person merged or amalgamated with or into a Borrower or another Loan Party in
accordance with Section 7.02(c)(i) after the Effective Date to the extent that
such Investments were not made in contemplation of or in connection with such
acquisition, merger, amalgamation or consolidation and were in existence on the
date of such acquisition, merger, amalgamation or consolidation;

(m)creation of any additional Subsidiaries that become Loan Parties, provided,
that such Subsidiaries comply with the provisions of Section 7.01(b); and

(n)so long as no Default or Event of Default has occurred and is continuing or
would result therefrom, any other Investments in an aggregate amount not to
exceed $500,000 at any time outstanding.

“Permitted Liens” means:

(a)Liens securing the Obligations;

(b)Liens for taxes, assessments and governmental charges the payment of which is
not required under Section 7.01(c)(ii);

 

- 31 -

 

 

--------------------------------------------------------------------------------

 

(c)Liens imposed by law, such as carriers’, warehousemen’s, mechanics’,
materialmen’s and other similar Liens arising in the ordinary course of business
and securing obligations (other than Indebtedness for borrowed money) that are
not overdue by more than 45 days or are being contested in good faith and by
appropriate proceedings promptly initiated and diligently conducted, and a
reserve or other appropriate provision, if any, as shall be required by GAAP
shall have been made therefor;

(d)Liens described on Schedule 7.02(a), provided that any such Lien shall only
secure the Indebtedness that it secures on the Effective Date and any Permitted
Refinancing Indebtedness in respect thereof;

(e)purchase money Liens on equipment acquired or held by any Loan Party or any
of its Subsidiaries in the ordinary course of its business to secure Permitted
Purchase Money Indebtedness so long as such Lien only (i) attaches to such
property and (ii) secures the Indebtedness that was incurred to acquire such
property or any Permitted Refinancing Indebtedness in respect thereof;

(f)deposits and pledges of cash securing (i) obligations incurred in respect of
workers’ compensation, unemployment insurance or other forms of governmental
insurance or benefits, (ii) the performance of bids, tenders, leases, contracts
(other than for the payment of money) and statutory obligations or (iii)
obligations on surety or appeal bonds, but only to the extent such deposits or
pledges are made or otherwise arise in the ordinary course of business and
secure obligations not past due;

(g)with respect to any Facility, easements, zoning restrictions and similar
encumbrances on real property and minor irregularities in the title thereto that
do not (i) secure obligations for the payment of money or (ii) materially impair
the value of such property or its use by any Loan Party or any of its
Subsidiaries in the normal conduct of such Person’s business;

(h)Liens of landlords and mortgagees of landlords (i) arising by statute or
under any lease or related Contractual Obligation entered into in the ordinary
course of business, (ii) on fixtures and movable tangible property located on
the real property leased or subleased from such landlord, or (iii) for amounts
not yet due or that are being contested in good faith by appropriate proceedings
diligently conducted and for which adequate reserves or other appropriate
provisions are maintained on the books of such Person in accordance with GAAP;

(i)the title and interest of a lessor or sublessor in and to personal property
leased or subleased (other than through a Capitalized Lease), in each case
extending only to such personal property;

(j)non-exclusive licenses of Intellectual Property rights in the ordinary course
of business;

(k)judgment liens (other than for the payment of taxes, assessments or other
governmental charges) securing judgments and other proceedings not constituting
an Event of Default under Section 9.01(j);

 

- 32 -

 

 

--------------------------------------------------------------------------------

 

(l)rights of set-off or bankers’ liens upon deposits of cash in favor of banks
or other depository institutions, solely to the extent incurred in connection
with the maintenance of such deposit accounts in the ordinary course of
business;

(m)Liens granted in the ordinary course of business on the unearned portion of
insurance premiums securing the financing of insurance premiums to the extent
the financing is permitted under the definition of Permitted Indebtedness;

(o)Liens securing the Indebtedness pursuant to the WCE Capital Lease; provided,
that such Liens encumber only the property financed by such Indebtedness and the
proceeds and products thereof; and

(p)other Liens which do not secure Indebtedness for borrowed money or letters of
credit and as to which the aggregate amount of the obligations secured thereby
does not exceed $1,000,000.

“Permitted Management Bonus” means that certain one-time management incentive
bonus payable by Patriot to certain senior officers of Patriot within 3 months
of the Effective Date in an amount approved in writing by the Administrative
Agent.  

“Permitted Purchase Money Indebtedness” means, as of any date of determination,
Indebtedness (other than the Obligations, but including Capitalized Lease
Obligations) incurred to finance the acquisition of any fixed assets secured by
a Lien permitted under clause (e) of the definition of “Permitted Liens”;
provided that (a) such Indebtedness is incurred within 20 days after such
acquisition, (b) such Indebtedness when incurred shall not exceed the purchase
price of the asset financed and (c) the aggregate principal amount of all such
Indebtedness shall not exceed $2,000,000 at any time outstanding.

“Permitted Refinancing Indebtedness” means the extension of maturity,
refinancing or modification of the terms of Indebtedness so long as:

(a)after giving effect to such extension, refinancing or modification, the
amount of such Indebtedness is not greater than the amount of Indebtedness
outstanding immediately prior to such extension, refinancing or modification
(other than by the amount of premiums paid thereon and the fees and expenses
incurred in connection therewith and by the amount of unfunded commitments with
respect thereto);

(b)such extension, refinancing or modification does not result in a shortening
of the average weighted maturity (measured as of the extension, refinancing or
modification) of the Indebtedness so extended, refinanced or modified;

(c)such extension, refinancing or modification is pursuant to terms that are not
less favorable to the Loan Parties and the Lenders than the terms of the
Indebtedness (including, without limitation, terms relating to the collateral
(if any) and subordination (if any)) being extended, refinanced or modified; and

 

- 33 -

 

 

--------------------------------------------------------------------------------

 

(d)the Indebtedness that is extended, refinanced or modified is not recourse to
any Loan Party or any of its Subsidiaries that is liable on account of the
obligations other than those Persons which were obligated with respect to the
Indebtedness that was refinanced, renewed, or extended.

“Permitted Restricted Payments” means any of the following Restricted Payments
made by:

(a)any Subsidiary of any Borrower to such Borrower;

(b)Patriot to (i) pay the Effective Date Dividend, (ii) make the Effective Date
Stock Buyback and (iii) pay other dividends in the form of Qualified Equity
Interests;

(c)each Loan Party and its Subsidiaries may make distributions to former
employees, officers, or directors of the Loan Parties or their Subsidiaries (or
any spouses, ex-spouses, or estates of any of the foregoing) on account of
redemptions of Equity Interests of the Borrower held by such Persons so long as
(i) the Loan Parties shall have Availability plus Qualified Cash in an amount
equal to or greater than $7,500,000 and (ii) no Default or Event of Default
shall have occurred and be continuing; provided, however, that, the aggregate
amount of such redemptions made by the Loan Parties and their Subsidiaries
during the term of this Agreement does not exceed $1,000,000 in the aggregate
for all former employees, officers or directors of the Loan Parties or their
Subsidiaries (or any spouses, ex-spouses, or estates of any of the foregoing);

(d)each Loan Party and its Subsidiaries may make distributions to former
employees, officers, or directors of the Loan Parties or their Subsidiaries (or
any spouses, ex-spouses, or estates of any of the foregoing), solely in the form
of forgiveness of Indebtedness of such Persons owing to the Loan Parties or
their Subsidiaries on account of repurchases of the Equity Interests of the
Borrower held by such Persons so long as (i) such Indebtedness was incurred by
such Persons solely to acquire Equity Interests of the Borrower and (ii) (A) the
Loan Parties shall have Availability plus Qualified Cash in an amount equal to
or greater than $7,500,000 and (B) no Default or Event of Default shall have
occurred and be continuing;

(e)the Borrower may make Restricted Payments and repurchase Equity Interests
issued under stock option plans (or other incentive plans or compensation
arrangements) approved by its Board of Directors not to exceed $1,000,000 in the
aggregate in any Fiscal Year so long as (i) the Loan Parties shall have
Availability plus Qualified Cash in an amount equal to or greater than
$7,500,000 and (ii) no Default or Event of Default shall have occurred and be
continuing;

(f)Patriot may (i) make dividends or distributions to the owners of the shares
of common stock of Patriot (other than the Effective Date Dividend) and (ii)
make payments for the purchase or acquisition of shares of common stock of
Patriot (other than the Effective Date Stock BuyBack), in each case, so long as
(A) no Default or Event of Default has occurred and is continuing or would arise
as a result of such Restricted Payment, (B) the Loan Parties would be in
compliance with the covenants set forth in Section 7.03 calculated on a pro
forma basis to give effect to such Restricted Payment, recomputed for the most
recent fiscal quarter for which

 

- 34 -

 

 

--------------------------------------------------------------------------------

 

financial statements have been delivered, (C) the Leverage Ratio of Patriot and
its Subsidiaries would be less than 3.50:1.00 calculated on pro forma basis to
give effect to such Restricted Payment, recomputed for the most recent fiscal
quarter for which financial statements have been delivered, (D) no Revolving
Loans shall be outstanding immediately before and after such Restricted Payment
and (E) (i) such Restricted Payment is made after the payment by Patriot and its
Subsidiaries of any Excess Cash Flow mandatory payment required to be made
pursuant to Section 2.05(c)(i), commencing with the delivery to the Agents and
the Lenders of the financial statements for the Fiscal Year ended December 31,
2017 pursuant to Section 7.01(a)(iii) and (ii) the aggregate amount of such
Restricted Payments permitted to be made under this clause (f) during any Fiscal
Year shall not exceed the Available Amount for such Fiscal Year plus any amount
permitted under clause (g) below;

(g)Patriot may (i) make dividends or distributions to the owners of the shares
of common stock of Patriot (other than the Effective Date Dividend) and (ii)
make payments for the purchase or acquisition of shares of common stock of
Patriot (other than the Effective Date Stock BuyBack) in an amount that shall
not exceed the Dividend/Acquisition Bucket, in each case, so long as (A) no
Default or Event of Default has occurred and is continuing or would arise as a
result of such Restricted Payment, (B) the Loan Parties would be in compliance
with the covenants set forth in Section 7.03 calculated on a pro forma basis to
give effect to such Restricted Payment, recomputed for the most recent fiscal
quarter for which financial statements have been delivered and (D) no Revolving
Loans shall be outstanding immediately before and after such Restricted Payment;
and

(h)Patriot may pay the Permitted Management Bonus, so long as (A) no Default or
Event of Default has occurred and is continuing or would arise as a result of
such Restricted Payment and (B) Patriot promptly provides the Agents written
notice of the making of such payment, which notice shall specifically designate
such payment as the “Permitted Management Bonus” permitted to be paid pursuant
to clause (h) of the definition of “Permitted Restricted Payments”.

“Permitted Specified Liens” means Permitted Liens described in clauses (a), (b)
and (c) of the definition of Permitted Liens, and, solely in the case of Section
7.01(b)(i), including clauses (g), (h) and (i) of the definition of Permitted
Liens.

“Person” means an individual, corporation, limited liability company,
partnership, association, joint-stock company, trust, unincorporated
organization, joint venture or other enterprise or entity or Governmental
Authority.

“Petty Cash Accounts” means Cash Management Accounts with deposits at any time
in an aggregate amount not in excess of $25,000 for any one account and $100,000
in the aggregate for all such accounts.  

“Plan” means any Employee Plan or Multiemployer Plan.

 

- 35 -

 

 

--------------------------------------------------------------------------------

 

“Post-Default Rate” means a rate of interest per annum equal to the rate of
interest otherwise in effect from time to time pursuant to the terms of this
Agreement plus 2.00%, or, if a rate of interest is not otherwise in effect,
interest at the highest rate specified herein for any Loan then outstanding
prior to an Event of Default plus 2.00%.  

“Pro Rata Share” means, with respect to:

(a)a Lender’s obligation to make Revolving Loans and the right to receive
payments of interest, fees, and principal with respect thereto, the percentage
obtained by dividing (A) such Lender’s Revolving Credit Commitment, by (B) the
Total Revolving Credit Commitment, provided, that, if the Total Revolving Credit
Commitment has been reduced to zero, the numerator shall be the aggregate unpaid
principal amount of such Lender’s Revolving Loans (including Collateral Agent
Advances) and the denominator shall be the aggregate unpaid principal amount of
all Revolving Loans (including Collateral Agent Advances),

(b)with respect to a Lender’s obligation to make the Term Loan  and receive
payments of interest, fees, and principal with respect thereto, the percentage
obtained by dividing (i) such Lender’s Term Loan  Commitment, by (ii) the Total
Term Loan Commitment, provided that if the Total Term Loan Commitment has been
reduced to zero, the numerator shall be the aggregate unpaid principal amount of
such Lender’s portion of the Term Loan and the denominator shall be the
aggregate unpaid principal amount of the Term Loan, and

(c)with respect to all other matters (including, without limitation, the
indemnification obligations arising under Section 10.05), the percentage
obtained by dividing (i) the sum of such Lender’s Revolving Credit Commitment
and the unpaid principal amount of such Lender’s portion of the Term Loan, by
(ii) the sum of the Total Revolving Credit Commitment and the aggregate unpaid
principal amount of the Term Loan, provided, that, if such Lender’s Revolving
Credit Commitment shall have been reduced to zero, such Lender’s Revolving
Credit Commitment shall be deemed to be the aggregate unpaid principal amount of
such Lender’s Revolving Loans (including Collateral Agent Advances) and if the
Total Revolving Credit Commitment shall have been reduced to zero, the Total
Revolving Credit Commitment shall be deemed to be the aggregate unpaid principal
amount of all Revolving Loans (including Collateral Agent Advances).

“Projections” means financial projections of Patriot and its Subsidiaries
delivered pursuant to Section 6.01(g)(ii), as updated from time to time pursuant
to Section 7.01(a)(vii).

“Qualified Cash” means, as of any date of determination, the amount of
unrestricted cash and Cash Equivalents of the Loan Parties that is subject to a
Control Agreement.

“Qualified Equity Interests” means, with respect to any Person, all Equity
Interests of such Person that are not Disqualified Equity Interests.

 

- 36 -

 

 

--------------------------------------------------------------------------------

 

“Real Property Deliverables” means each of the following agreements, instruments
and other documents in respect of each Facility:

(a)a Mortgage duly executed by the applicable Loan Party,

(b)evidence of the recording of each Mortgage in such office or offices as may
be necessary or, in the opinion of the Collateral Agent, desirable to perfect
the Lien purported to be created thereby or to otherwise protect the rights of
the Collateral Agent and the Lenders thereunder;

(c)a Title Insurance Policy or bring-down of the existing Title Insurance Policy
with respect to each Mortgage, dated as of the Effective Date;

(d)a current ALTA survey and a surveyor’s certificate, in form and substance
satisfactory to the Collateral Agent, certified to the Collateral Agent and to
the issuer of the Title Insurance Policy with respect thereto by a professional
surveyor licensed in the state in which such Facility is located and
satisfactory to the Collateral Agent;

(e)a copy of each letter issued by the applicable Governmental Authority,
evidencing each Facility’s compliance with all applicable building codes, fire
codes, other health and safety rules and regulations, parking, density and
height requirements and other building and zoning laws together with a copy of
all certificates of occupancy issued with respect to each Facility;

(f)an opinion of counsel, satisfactory to the Collateral Agent, in the state
where such Facility is located with respect to the enforceability of the
Mortgage to be recorded and such other matters as the Collateral Agent may
reasonably request;

(g)a satisfactory ASTM 1527-00 Phase I Environmental Site Assessment (“Phase I
ESA”) provided by the Borrowers to the Collateral Agent (and, if requested by
the Collateral Agent based upon the results of such Phase I ESA an ASTM 1527-00
Phase II Environmental Site Assessment) of each Facility, in form and substance
and by an independent firm satisfactory to the Collateral Agent; and

(h)such other agreements, instruments and other documents (including guarantees
and opinions of counsel) as the Collateral Agent may reasonably require.  

“Recipient” means any Agent and any Lender, as applicable.

“Reference Rate” means, for any period, the greatest of (a) 3.00% per annum, (b)
the Federal Funds Rate plus 0.50% per annum, (c) the LIBOR Rate (which rate
shall be calculated based upon an Interest Period of 1 month and shall be
determined on a daily basis) plus 1.00% per annum, and (d) the rate last quoted
by The Wall Street Journal as the “Prime Rate” in the United States or, if The
Wall Street Journal ceases to quote such rate, the highest per annum interest
rate published by the Federal Reserve Board in Federal Reserve Statistical
Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or,
if such rate is no longer quoted therein, any similar rate quoted therein (as
determined by the Administrative Agent) or any similar release by the Federal
Reserve Board (as determined by the Administrative Agent).  Each change in the
Reference Rate shall be effective from and including the date such change is
publicly announced as being effective.

 

- 37 -

 

 

--------------------------------------------------------------------------------

 

“Reference Rate Loan” means each portion of a Loan that bears interest at a rate
determined by reference to the Reference Rate.  

“Register” has the meaning specified therefor in Section 12.07(f).

“Registered Intellectual Property” means Intellectual Property that is issued,
registered, renewed or the subject of a pending application.

“Registered Loans” has the meaning specified therefor in Section 12.07(f).

“Regulation T”, “Regulation U” and “Regulation X” mean, respectively,
Regulations T, U and X of the Board or any successor, as the same may be amended
or supplemented from time to time.

“Related Fund” means, with respect to any Person, an Affiliate of such Person,
or a fund or account managed by such Person or an Affiliate of such Person.

“Related Party Assignment” has the meaning specified therefor in Section
12.07(c)(ii).

“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, seeping, migrating, dumping or
disposing of any Hazardous Material (including the abandonment or discarding of
barrels, containers and other closed receptacles containing any Hazardous
Material) into the indoor or outdoor environment, including, without limitation,
the movement of Hazardous Materials through or in the ambient air, soil, surface
or ground water, or property.

“Remedial Action” means all actions taken to (a) clean up, remove, remediate,
contain, treat, monitor, assess, evaluate or in any other way address Hazardous
Materials in the indoor or outdoor environment; (b) prevent or minimize a
Release or threatened Release of Hazardous Materials so they do not migrate or
endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment; (c) perform pre-remedial studies and investigations and
post-remedial operation and maintenance activities; or (d) perform any other
actions authorized by 42 U.S.C. § 9601.

“Replacement Lender” has the meaning specified therefor in Section 12.02(b).

“Reportable Event” means an event described in Section 4043 of ERISA (other than
an event for which notice to the PBGC is waived under the regulations
promulgated under such Section).

“Required Lenders” means Lenders whose Pro Rata Shares (calculated in accordance
with clause (d) of the definition thereof) aggregate at least 50.1%.

 

- 38 -

 

 

--------------------------------------------------------------------------------

 

“Requirements of Law” means, with respect to any Person, collectively, the
common law and all federal, state, provincial, local, foreign, multinational or
international laws, statutes, codes, treaties, standards, rules and regulations,
guidelines, ordinances, orders, judgments, writs, injunctions, decrees
(including administrative or judicial precedents or authorities) and the
interpretation or administration thereof by, and other determinations,
directives, requirements or requests of, any Governmental Authority, in each
case that are applicable to or binding upon such Person or any of its property
or to which such Person or any of its property is subject.

“Reserve Percentage” means, on any day, for any Lender, the maximum percentage
prescribed by the Board (or any successor Governmental Authority) for
determining the reserve requirements (including any basic, supplemental,
marginal, or emergency reserves) that are in effect on such date with respect to
eurocurrency funding (currently referred to as “eurocurrency liabilities”) of
that Lender, but so long as such Lender is not required or directed under
applicable regulations to maintain such reserves, the Reserve Percentage shall
be zero.

“Restricted Payment” means (a) the declaration or payment of any dividend or
other distribution, direct or indirect, on account of any Equity Interests of
any Loan Party or any of its Subsidiaries, now or hereafter outstanding, (b) the
making of any repurchase, redemption, retirement, defeasance, sinking fund or
similar payment, purchase or other acquisition for value, direct or indirect, of
any Equity Interests of any Loan Party or any direct or indirect parent of any
Loan Party, now or hereafter outstanding, (c) the making of any payment to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights for the purchase or acquisition of shares of any class of Equity
Interests of any Loan Party, now or hereafter outstanding, (d) the return of any
Equity Interests to any shareholders or other equity holders of any Loan Party
or any of its Subsidiaries, or make any other distribution of property, assets,
shares of Equity Interests, warrants, rights, options, obligations or securities
thereto as such or (e) the payment of any management, consulting, monitoring or
advisory fees or any other fees or expenses (including the reimbursement thereof
by any Loan Party or any of its Subsidiaries) pursuant to any management,
consulting, monitoring, advisory or other services agreement to any of the
shareholders or other equityholders of any Loan Party or any of its Subsidiaries
or other Affiliates, or to any other Subsidiaries or Affiliates of any Loan
Party.

“Retained Excess Cash Flow Amount” means, as of any date of determination, an
amount (a) equal to the Excess Cash Flow for the most recently ended Fiscal
Year, commencing with the Fiscal Year ending December 31, 2017, that is not
required to be applied to prepay the Loans pursuant to Section 2.05(c)(i) and
(b) determined after the prepayment of the Loans required under Section
2.05(c)(i) for such Fiscal Year.

“Revolving Credit Commitment” means, with respect to each Lender, the commitment
of such Lender to make Revolving Loans to the Borrowers in the amount set forth
opposite such Lender’s name in Schedule 1.01(A) hereto or in the Assignment and
Acceptance pursuant to which such Lender became a Lender under this Agreement,
as such amount may be terminated or reduced from time to time in accordance with
the terms of this Agreement.

“Revolving Loan” means a loan made by a Lender to the Borrowers pursuant to
Section 2.01(a)(i).

 

- 39 -

 

 

--------------------------------------------------------------------------------

 

“Revolving Loan Lender” means a Lender with a Revolving Credit Commitment or a
Revolving Loan.

“Revolving Loan Obligations” means any Obligations with respect to the Revolving
Loans (including without limitation, the principal thereof, the interest
thereon, and the fees and expenses specifically related thereto).

“Sale and Leaseback Transaction” means, with respect to Patriot or any of its
Subsidiaries, any arrangement, directly or indirectly, with any Person whereby
Patriot or any of its Subsidiaries shall sell or transfer any property used or
useful in its business, whether now owned or hereafter acquired, and thereafter
rent or lease such property or other property that it intends to use for
substantially the same purpose or purposes as the property being sold or
transferred.

“SEC” means the Securities and Exchange Commission or any other similar or
successor agency of the Federal government administering the Securities Act.

“Secured Party” means any Agent and any Lender.

“Securities Act” means the Securities Act of 1933, as amended, or any similar
Federal statute, and the rules and regulations of the SEC thereunder, all as the
same shall be in effect from time to time.

“Securitization” has the meaning specified therefor in Section 12.07(l).

“Security Agreement” means a Pledge and Security Agreement, in form and
substance satisfactory to the Collateral Agent, made by a Loan Party in favor of
the Collateral Agent for the benefit of the Secured Parties securing the
Obligations.

“Settlement Period” has the meaning specified therefor in Section 2.02(d)(i)
hereof.

“Significant Subsidiary” means each Subsidiary of Patriot that

(a)is designated with an asterisk on Schedule 6.01(e);

(b)accounted for at least 2.5% of consolidated revenues of Patriot and its
Subsidiaries or 2.5% of consolidated earnings of Patriot and its Subsidiaries
before interest and taxes, in each case for the four fiscal quarters of Patriot
ending on the last day of the last fiscal quarter of Patriot immediately
preceding the date as of which any such determination is made; or

(c)has assets which represent at least 2.5% of the consolidated assets of
Patriot and its Subsidiaries as at the last day of the last fiscal quarter of
Patriot immediately preceding the date as of which any such determination is
made.

provided, that all Subsidiaries of the Patriot that are not Significant
Subsidiaries shall not in the aggregate account more than (i) 5% of consolidated
revenues of Patriot and its Subsidiaries for the four fiscal quarters of the
Patriot ending on the last day of the last fiscal quarter of Patriot

 

- 40 -

 

 

--------------------------------------------------------------------------------

 

immediately preceding the date as of which any such determination is made (after
elimination of the intercompany debt and revenues) or (ii) have assets which
represent more than 5% of the consolidated assets of Patriot and its
Subsidiaries as at the last day of the last fiscal quarter of Patriot
immediately preceding the date as of which any such determination is made (after
elimination of the intercompany debt and revenues).

“Solvent” means, with respect to any Person on a particular date, that on such
date (a) the fair value of the property of such Person is not less than the
total amount of the liabilities of such Person, (b) the present fair salable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its existing debts as
they become absolute and matured, (c) such Person is able to realize upon its
assets and pay its debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, (d) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities
mature, and (e) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person’s
property would constitute unreasonably small capital.

“Specified Asset” means the assets or Equity Interests that are the subject of a
Specified Disposition.

“Specified Disposition” means any Disposition of all or substantially all of the
assets of, or Equity Interests in, any Loan Party (other than Patriot) or any
Subsidiary of any Loan Party, or of any business unit, line of business or
division of any Loan Party or any Subsidiary of any Loan Party, provided that
the Net Cash Proceeds from such Disposition are not less than the Specified
Disposition Threshold Amount.

“Specified Disposition Threshold Amount” means, in the case of the consummation
of a Specified Disposition, an amount equal to six (6) times the TTM
Consolidated EBITDA of or allocable to the Specified Asset subject to such
Specified Disposition.  

“Standard & Poor’s” means Standard & Poor’s Ratings Services, a division of
The McGraw‑Hill Companies, Inc. and any successor thereto.

“Subordinated Indebtedness” means Indebtedness of any Loan Party the terms of
which (including, without limitation, payment terms, interest rates, covenants,
remedies, defaults and other material terms) are reasonably satisfactory to the
Collateral Agent and the Required Lenders and which has been expressly
subordinated in right of payment to all Indebtedness of such Loan Party under
the Loan Documents (a) by the execution and delivery of a subordination
agreement, in form and substance reasonably satisfactory to the Collateral Agent
and the Required Lenders, or (b) otherwise on terms and conditions reasonably
satisfactory to the Collateral Agent and the Required Lenders.

 

- 41 -

 

 

--------------------------------------------------------------------------------

 

“Subsidiary” means, with respect to any Person at any date, any corporation,
limited or general partnership, limited liability company, trust, estate,
association, joint venture or other business entity (a) the accounts of which
would be consolidated with those of such Person in such Person’s consolidated
financial statements if such financial statements were prepared in accordance
with GAAP or (b) of which more than 50% of (i) the outstanding Equity Interests
having (in the absence of contingencies) ordinary voting power to elect a
majority of the Board of Directors of such Person, (ii) in the case of a
partnership or limited liability company, the interest in the capital or profits
of such partnership or limited liability company or (iii) in the case of a
trust, estate, association, joint venture or other entity, the beneficial
interest in such trust, estate, association or other entity business is, at the
time of determination, owned or controlled directly or indirectly through one or
more intermediaries, by such Person.  References to a Subsidiary shall mean a
Subsidiary of Patriot unless the context expressly provides otherwise.

“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.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

“Termination Date” means the first date on which all of the Obligations are paid
in full in cash and the Commitments of the Lenders are terminated.

“Termination Event” means (a) a Reportable Event with respect to any Employee
Plan, (b) any event that causes any Loan Party or any of its ERISA Affiliates to
incur liability under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of the Internal Revenue
Code, which has a Material Adverse Effect (c) the filing of a notice of intent
to terminate an Employee Plan or the treatment of an Employee Plan amendment as
a termination under Section 4041 of ERISA, (d) the institution of proceedings by
the PBGC to terminate an Employee Plan, or (e) any other event or condition that
could reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Employee Plan.

“Term Loan” and “Term Loans” means collectively, the loans made by the Term Loan
Lenders to the Borrowers on the Effective Date pursuant to Section 2.01(a)(ii).

“Term Loan Commitment” means, with respect to each Lender, the commitment of
such Lender to make the Term Loan to the Borrowers in the amount set forth in
Schedule 1.01(A) hereto or in the Assignment and Acceptance pursuant to which
such Lender became a Lender under this Agreement, as the same may be terminated
or reduced from time to time in accordance with the terms of this Agreement.  

“Term Loan Lender” means a Lender with a Term Loan Commitment or a Term Loan.

 

- 42 -

 

 

--------------------------------------------------------------------------------

 

“Term Loan Obligations” means any Obligations with respect to the Term Loan
(including, without limitation, the principal thereof, the interest thereon, and
the fees and expenses specifically related thereto).

“Title Insurance Policy” means a mortgagee’s loan policy, in form and substance
reasonably satisfactory to the Collateral Agent, together with all endorsements
made from time to time thereto, issued to the Collateral Agent by or on behalf
of a title insurance company selected by or otherwise satisfactory to the
Collateral Agent, insuring the Lien created by a Mortgage in an amount and on
terms and with such endorsements satisfactory to the Collateral Agent, delivered
to the Collateral Agent.

“Total Commitment” means the sum of the Total Revolving Credit Commitment and
the Total Term Loan Commitment.

“Total Revolving Credit Commitment” means the sum of the amounts of the Lenders’
Revolving Credit Commitments.

“Total Term Loan Commitment” means the sum of the amounts of the Lenders’ Term
Loan Commitments.

“Transferee” has the meaning specified therefor in Section 2.09(a).

“TTM Consolidated EBITDA” means, with respect to (i) any Person for any period,
the Consolidated EBITDA of such Person and its Subsidiaries for the trailing
twelve-month period then ended or (ii) any business unit, line of business or
division of any Person, for any period, the Consolidated EBITDA attributable to
such business unit, line of business or division of any Person for the trailing
twelve-month period then ended.

“UCC Filing Authorization Letter” means a letter duly executed by each Loan
Party authorizing the Collateral Agent to file appropriate financing statements
on Form UCC-1 without the signature of such Loan Party in such office or offices
as may be necessary or, in the opinion of the Collateral Agent, desirable to
perfect the security interests purported to be created by each Security
Agreement and each Mortgage.

“Uniform Commercial Code” or “UCC” has the meaning specified therefor in Section
1.04.

“Unused Line Fee” has the meaning specified therefor in Section 2.06(c).

“USA PATRIOT Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism (PATRIOT) Act of
2001 (Title III of Pub. L. 107-56, Oct. 26, 2001)) as amended by the USA Patriot
Improvement and Reauthorization Act of 2005 (Pub. L. 109-177, March 9, 2006) and
as the same may have been or may be further renewed, extended, amended, or
replaced.

“U.S. Person” means any Person that is a “United States Person” as defined in
Section 7701(a)(30) of the Code.

 

- 43 -

 

 

--------------------------------------------------------------------------------

 

“WARN” has the meaning specified therefor in Section 6.01(p).

“WCE Capital Lease” means the Master Equipment Lease Agreement, dated as of
December 3, 2013, among Fifth Third Bank, Patriot Underwriters, Inc. (f/k/a CTS
Underwriters, Inc.) and Steven M. Mariano.

“Withholding Agent” means any Loan Party and the Administrative Agent.

“Working Capital” means, at any date of determination thereof, (a) the sum, for
any Person and its Subsidiaries, of (i) the unpaid face amount of all Accounts
of such Person and its Subsidiaries as at such date of determination, plus
(ii) the aggregate amount of prepaid expenses and other current assets of such
Person and its Subsidiaries as at such date of determination (other than cash,
Cash Equivalents and any Indebtedness owing to such Person or any of its
Subsidiaries by Affiliates of such Person), minus (b) the sum, for such Person
and its Subsidiaries, of (i) the unpaid amount of all accounts payable of such
Person and its Subsidiaries as at such date of determination, plus (ii) the
aggregate amount of all accrued expenses of such Person and its Subsidiaries as
at such date of determination (other than the current portion of long-term debt
and all accrued interest and taxes).

Section 1.02Terms 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 “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,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person’s successors and
assigns, (c) 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, (d) 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 and (e) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any right or interest in or to assets and properties of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.

Section 1.03Certain Matters of Construction. References in this Agreement to
“determination” by any Agent include good faith estimates by such Agent (in the
case of quantitative determinations) and good faith beliefs by such Agent (in
the case of qualitative determinations).  A Default or Event of Default shall be
deemed to exist at all times during the period commencing on the date that such
Default or Event of Default occurs to the date on which such Default or Event of
Default is waived in writing pursuant to this Agreement or, in the case of a
Default, is cured within any period of cure expressly provided for in this
Agreement; and an Event of Default shall “continue” or be “continuing” until
such Event of Default has been waived in writing by the Required Lenders.  Any
Lien referred to in this Agreement or any other Loan Document as having been
created in favor of any Agent, any agreement entered into by any

 

- 44 -

 

 

--------------------------------------------------------------------------------

 

Agent pursuant to this Agreement or any other Loan Document, any payment made by
or to or funds received by any Agent pursuant to or as contemplated by this
Agreement or any other Loan Document, or any act taken or omitted to be taken by
any Agent, shall, unless otherwise expressly provided, be created, entered into,
made or received, or taken or omitted, for the benefit or account of the Agents
and the Lenders. Wherever the phrase “to the knowledge of any Loan Party” or
words of similar import relating to the knowledge or the awareness of any Loan
Party are used in this Agreement or any other Loan Document, such phrase shall
mean and refer to (i) the actual knowledge of a senior officer of any Loan Party
or (ii) the knowledge that a senior officer would have obtained if such officer
had engaged in good faith and diligent performance of such officer’s duties,
including the making of such reasonably specific inquiries as may be necessary
of the employees or agents of such Loan Party and a good faith attempt to
ascertain the existence or accuracy of the matter to which such phrase
relates.  All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or otherwise within the
limitations of, another covenant shall not avoid the occurrence of a default if
such action is taken or condition exists.  In addition, all representations and
warranties hereunder shall be given independent effect so that if a particular
representation or warranty proves to be incorrect or is breached, the fact that
another representation or warranty concerning the same or similar subject matter
is correct or is not breached will not affect the incorrectness of a breach of a
representation or warranty hereunder.

Section 1.04Accounting and Other Terms. (a) Unless otherwise expressly provided
herein, each accounting term used herein shall have the meaning given it under
GAAP.  For purposes of determining compliance with any incurrence or expenditure
tests set forth in Section 7.01, Section 7.02 and Section 7.03, any amounts so
incurred or expended (to the extent incurred or expended in a currency other
than Dollars) shall be converted into Dollars on the basis of the exchange rates
(as shown on the Bloomberg currency page for such currency or, if the same does
not provide such exchange rate, by reference to such other publicly available
service for displaying exchange rates as may be reasonably selected by the
Agents or, in the event no such service is selected, on such other basis as is
reasonably satisfactory to the Agents) as in effect on the date of such
incurrence or expenditure under any provision of any such Section that has an
aggregate Dollar limitation provided for therein (and to the extent the
respective incurrence or expenditure test regulates the aggregate amount
outstanding at any time and it is expressed in terms of Dollars, all outstanding
amounts originally incurred or spent in currencies other than Dollars shall be
converted into Dollars on the basis of the exchange rates (as shown on the
Bloomberg currency page for such currency or, if the same does not provide such
exchange rate, by reference to such other publicly available service for
displaying exchange rates as may be reasonably selected by the Agents or, in the
event no such service is selected, on such other basis as is reasonably
satisfactory to the Agents) as in effect on the date of any new incurrence or
expenditures made under any provision of any such Section that regulates the
Dollar amount outstanding at any time).  Notwithstanding the foregoing, (i) with
respect to the accounting for leases as either operating leases or capital
leases and the impact of such accounting in accordance with FASB ASC 840 on the
definitions and covenants herein, GAAP as in effect on the Effective Date shall
be applied and (ii) for purposes of determining compliance with any covenant
(including the computation of any financial covenant) contained herein,
Indebtedness of Patriot and its Subsidiaries shall be deemed to be carried at
100% of the outstanding principal amount thereof, and the effects of FASB ASC
825 and FASB ASC 470-20 on financial liabilities shall be disregarded.

 

- 45 -

 

 

--------------------------------------------------------------------------------

 

(b)All terms used in this Agreement which are defined in Article 8 or Article 9
of the Uniform Commercial Code as in effect from time to time in the State of
New York (the “Uniform Commercial Code” or the “UCC”) and which are not
otherwise defined herein shall have the same meanings herein as set forth
therein, provided that terms used herein which are defined in the Uniform
Commercial Code as in effect in the State of New York on the date hereof shall
continue to have the same meaning notwithstanding any replacement or amendment
of such statute except as any Agent may otherwise determine.

Section 1.05Time References. Unless otherwise indicated herein, all references
to time of day refer to Eastern Standard Time or Eastern daylight saving time,
as in effect in New York City on such day.  For purposes of the computation of a
period of time from a specified date to a later specified date, the word “from”
means “from and including” and the words “to” and “until” each means “to but
excluding”; provided, however, that with respect to a computation of fees or
interest payable to any Secured Party, such period shall in any event consist of
at least one full day.

ARTICLE II

THE LOANS

Section 2.01Commitments. (a) Subject to the terms and conditions and relying
upon the representations and warranties herein set forth:

(i)each Revolving Loan Lender severally agrees to make Revolving Loans to the
Borrowers at any time and from time to time during the term of this Agreement,
in an aggregate principal amount of Revolving Loans at any time outstanding not
to exceed the amount of such Lender’s Revolving Credit Commitment; and

(ii)each Term Loan Lender severally agrees to make the Term Loan  to the
Borrowers on the Effective Date, in an aggregate principal amount not to exceed
the amount of such Lender’s Term Loan Commitment;

(b)Notwithstanding the foregoing:

(i)The aggregate principal amount of Revolving Loans outstanding at any time to
the Borrowers shall not exceed the Total Revolving Credit Commitment.  The
Revolving Credit Commitment of each Lender shall automatically and permanently
be reduced to zero on the Final Maturity Date.  Within the foregoing limits, the
Borrowers may borrow, repay and reborrow, the Revolving Loans on or after the
Effective Date and prior to the Final Maturity Date, subject to the terms,
provisions and limitations set forth herein.  The total amount of Revolving
Loans advanced on the Effective Date shall not exceed $5,000,000.

(ii)The aggregate principal amount of the Term Loan  made on the Effective Date
shall not exceed the Total Term Loan  Commitment.  Any principal amount of the
Term Loan  which is repaid or prepaid may not be reborrowed.

 

- 46 -

 

 

--------------------------------------------------------------------------------

 

Section 2.02Making the Loans. (a) The Administrative Borrower shall give the
Administrative Agent prior telephonic notice (immediately confirmed in writing,
in substantially the form of Exhibit C hereto (a “Notice of Borrowing”)), not
later than 12:00 noon (New York City time) on the date which is (i) 3 Business
Days prior to the date of the proposed LIBOR Rate Loan (or such shorter period
as the Administrative Agent is willing to accommodate from time to time, but in
no event later than 12:00 noon (New York City time) on the borrowing date of the
proposed LIBOR Rate Loan) or (ii) the date of the proposed Reference Rate
Loan.  Such Notice of Borrowing shall be irrevocable and shall specify (i) the
principal amount of the proposed Loan, (ii) in the case of Loans requested on
the Effective Date, whether such Loan is requested to be a Revolving Loan or the
Term Loan, (iii) whether the Loan is requested to be a Reference Rate Loan or a
LIBOR Rate Loan and, in the case of a LIBOR Rate Loan, the initial Interest
Period with respect thereto, (iv) the use of the proceeds of such proposed Loan,
and (v) the proposed borrowing date, which must be a Business Day, and, with
respect to the Term Loan, must be the Effective Date.  The Administrative Agent
and the Lenders may act without liability upon the basis of written, telecopied
or telephonic notice believed by the Administrative Agent in good faith to be
from the Administrative Borrower (or from any Authorized Officer thereof
designated in writing purportedly from the Administrative Borrower to the
Administrative Agent).  Each Borrower hereby waives the right to dispute the
Administrative Agent’s record of the terms of any such telephonic Notice of
Borrowing.  The Administrative Agent and each Lender shall be entitled to rely
conclusively on any Authorized Officer’s authority to request a Loan on behalf
of the Borrowers until the Administrative Agent receives written notice to the
contrary.  The Administrative Agent and the Lenders shall have no duty to verify
the authenticity of the signature appearing on any written Notice of Borrowing.

(a)Each Notice of Borrowing pursuant to this Section 2.02 shall be irrevocable
and the Borrowers shall be bound to make a borrowing in accordance
therewith.  Each Revolving Loan shall be made in a minimum amount of $500,000
and shall be in an integral multiple of $100,000.

(b)(i) Except as otherwise provided in this Section 2.02(c), all Loans under
this Agreement shall be made by the Lenders simultaneously and proportionately
to their Pro Rata Shares of the Total Revolving Credit Commitment or the Total
Term Loan Commitment, as the case may be, it being understood that no Lender
shall be responsible for any default by any other Lender in that other Lender’s
obligations to make a Loan requested hereunder, nor shall the Commitment of any
Lender be increased or decreased as a result of the default by any other Lender
in that other Lender’s obligation to make a Loan requested hereunder, and each
Lender shall be obligated to make the Loans required to be made by it by the
terms of this Agreement regardless of the failure by any other Lender.

(i)Notwithstanding any other provision of this Agreement, and in order to reduce
the number of fund transfers among the Borrowers, the Agents and the Lenders,
the Borrowers, the Agents and the Lenders agree that the Administrative Agent
may (but shall not be obligated to), and the Borrowers and the Lenders hereby
irrevocably authorize the Administrative Agent to, fund, on behalf of the
Revolving Loan Lenders, Revolving Loans pursuant to Section 2.01, subject to the
procedures for settlement set forth in Section 2.02(d); provided, however, that
(A) the Administrative Agent shall in no event fund any such Revolving Loans if
the Administrative Agent shall have received written notice from the Collateral
Agent

 

- 47 -

 

 

--------------------------------------------------------------------------------

 

or the Required Lenders on the Business Day prior to the date of the proposed
Revolving Loan that one or more of the conditions precedent contained in Section
5.02 will not be satisfied at the time of the proposed Revolving Loan, and
(B) the Administrative Agent shall not otherwise be required to determine that,
or take notice whether, the conditions precedent in Section 5.02 have been
satisfied.  If the Administrative Borrower gives a Notice of Borrowing
requesting a Revolving Loan and the Administrative Agent elects not to fund such
Revolving Loan on behalf of the Revolving Loan Lenders, then promptly after
receipt of the Notice of Borrowing requesting such Revolving Loan, the
Administrative Agent shall notify each Revolving Loan Lender of the specifics of
the requested Revolving Loan and that it will not fund the requested Revolving
Loan on behalf of the Revolving Loan Lenders.  If the Administrative Agent
notifies the Revolving Loan Lenders that it will not fund a requested Revolving
Loan on behalf of the Revolving Loan Lenders, each Revolving Loan Lender shall
make its Pro Rata Share of the Revolving Loan available to the Administrative
Agent, in immediately available funds, in the Administrative Agent’s Account no
later than 3:00 p.m. (New York City time) (provided that the Administrative
Agent requests payment from such Revolving Loan Lender not later than 1:00 p.m.
(New York City time)) on the date of the proposed Revolving Loan.  The
Administrative Agent will make the proceeds of such Revolving Loans available to
the Borrowers on the day of the proposed Revolving Loan by causing an amount, in
immediately available funds, equal to the proceeds of all such Revolving Loans
received by the Administrative Agent in the Administrative Agent’s Account or
the amount funded by the Administrative Agent on behalf of the Revolving Loan
Lenders to be deposited in an account designated by the Administrative Borrower.

(ii)If the Administrative Agent has notified the Revolving Loan Lenders that the
Administrative Agent, on behalf of the Revolving Loan Lenders, will not fund a
particular Revolving Loan pursuant to Section 2.02(c)(ii), the Administrative
Agent may assume that each such Revolving Loan Lender has made such amount
available to the Administrative Agent on such day and the Administrative Agent,
in its sole discretion, may, but shall not be obligated to, cause a
corresponding amount to be made available to the Borrowers on such day.  If the
Administrative Agent makes such corresponding amount available to the Borrowers
and such corresponding amount is not in fact made available to the
Administrative Agent by any such Revolving Loan Lender, the Administrative Agent
shall be entitled to recover such corresponding amount on demand from such
Revolving Loan Lender together with interest thereon, for each day from the date
such payment was due until the date such amount is paid to the Administrative
Agent, at the Federal Funds Rate for 3 Business Days and thereafter at the
Reference Rate.  During the period in which such Revolving Loan Lender has not
paid such corresponding amount to the Administrative Agent, notwithstanding
anything to the contrary contained in this Agreement or any other Loan Document,
the amount so advanced by the Administrative Agent to the Borrowers shall, for
all purposes hereof, be a Revolving Loan made by the Administrative Agent for
its own account.  Upon any such failure by a Revolving Loan Lender to pay the
Administrative Agent, the Administrative Agent shall promptly thereafter notify
the Administrative Borrower of such failure and the Borrowers shall immediately
pay such corresponding amount to the Administrative Agent for its own account.

 

- 48 -

 

 

--------------------------------------------------------------------------------

 

(iii)Nothing in this Section 2.02(c) shall be deemed to relieve any Revolving
Loan Lender from its obligations to fulfill its Revolving Credit Commitment
hereunder or to prejudice any rights that the Administrative Agent or the
Borrowers may have against any Revolving Loan Lender as a result of any default
by such Revolving Loan Lender hereunder.

(c)(i) With respect to all periods for which the Administrative Agent has funded
Revolving Loans pursuant to Section 2.02(c), on Friday of each week, or if the
applicable Friday is not a Business Day, then on the following Business Day, or
such shorter period as the Administrative Agent may from time to time select
(any such week or shorter period being herein called a “Settlement Period”), the
Administrative Agent shall notify each Revolving Loan Lender of the unpaid
principal amount of the Revolving Loans outstanding as of the last day of each
such Settlement Period.  In the event that such amount is greater than the
unpaid principal amount of the Revolving Loans outstanding on the last day of
the Settlement Period immediately preceding such Settlement Period (or, if there
has been no preceding Settlement Period, the amount of the Revolving Loans made
on the date of such Revolving Loan Lender’s initial funding), each Revolving
Loan Lender shall promptly (and in any event not later than 2:00 p.m. (New York
City time) if the Administrative Agent requests payment from such Lender not
later than 12:00 noon (New York City time) on such day) make available to the
Administrative Agent its Pro Rata Share of the difference in immediately
available funds.  In the event that such amount is less than such unpaid
principal amount, the Administrative Agent shall promptly pay over to each
Revolving Loan Lender its Pro Rata Share of the difference in immediately
available funds.  In addition, if the Administrative Agent shall so request at
any time when a Default or an Event of Default shall have occurred and be
continuing, or any other event shall have occurred as a result of which the
Administrative Agent shall determine that it is desirable to present claims
against the Borrowers for repayment, each Revolving Loan Lender shall promptly
remit to the Administrative Agent or, as the case may be, the Administrative
Agent shall promptly remit to each Revolving Loan Lender, sufficient funds to
adjust the interests of the Revolving Loan Lenders in the then outstanding
Revolving Loans to such an extent that, after giving effect to such adjustment,
each such Revolving Loan Lender’s interest in the then outstanding Revolving
Loans will be equal to its Pro Rata Share thereof.  The obligations of the
Administrative Agent and each Revolving Loan Lender under this Section 2.02(d)
shall be absolute and unconditional.  Each Revolving Loan Lender shall only be
entitled to receive interest on its Pro Rata Share of the Revolving Loans which
have been funded by such Revolving Loan Lender.

(i)In the event that any Revolving Loan Lender fails to make any payment
required to be made by it pursuant to Section 2.02(d)(i), the Administrative
Agent shall be entitled to recover such corresponding amount on demand from such
Revolving Loan Lender together with interest thereon, for each day from the date
such payment was due until the date such amount is paid to the Administrative
Agent, at the Federal Funds Rate for 3 Business Days and thereafter at the
Reference Rate.  During the period in which such Revolving Loan Lender has not
paid such corresponding amount to the Administrative Agent, notwithstanding
anything to the contrary contained in this Agreement or any other Loan Document,
the amount so advanced by the Administrative Agent to the Borrowers shall, for
all purposes hereof, be a Revolving Loan made by the Administrative Agent for
its own account.  Upon any such failure by a Revolving Loan Lender to pay the
Administrative Agent, the Administrative Agent shall

 

- 49 -

 

 

--------------------------------------------------------------------------------

 

promptly thereafter notify the Administrative Borrower of such failure and the
Borrowers shall immediately pay such corresponding amount to the Administrative
Agent for its own account.  Nothing in this Section 2.02(d)(ii) shall be deemed
to relieve any Revolving Loan Lender from its obligation to fulfill its
Revolving Credit Commitment hereunder or to prejudice any rights that the
Administrative Agent or the Borrowers may have against any Revolving Loan Lender
as a result of any default by such Revolving Loan Lender hereunder.

Section 2.03Repayment of Loans; Evidence of Debt. (a) The outstanding principal
of all Revolving Loans shall be due and payable on the Final Maturity Date or,
if earlier, on the date on which they are declared due and payable pursuant to
the terms of this Agreement.

(a)The Term Loan shall be repayable in consecutive quarterly installments, equal
to (i) during the period from and including December 31, 2016 until September
30, 2017, $1,250,000 per quarter, (ii) during the period from and including
December 31, 2017 until September 30, 2018, $2,000,000 per quarter and (iii)
thereafter, $2,500,000 per quarter, each such installment to be due and payable,
in arrears, on the first day of each quarter and applied to the Term Loan;
provided, however, that the last such installment shall be in the amount
necessary to repay in full the unpaid principal amount of the Term Loan.    The
outstanding unpaid principal amount of the Term Loan, and all accrued and unpaid
interest thereon, shall be due and payable on the earliest of (i) the
termination of the Total Revolving Credit Commitment, (ii) the date on which the
Term Loan is declared due and payable pursuant to the terms of this Agreement
and (iii) the Final Maturity Date.

(b)Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the Indebtedness of the Borrowers 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.  

(c)The Administrative Agent shall maintain accounts in which it shall record (i)
the amount of each Loan made hereunder, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrowers 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.

(d)The entries made in the accounts maintained pursuant to Section 2.03(c) or
Section 2.03(d) shall be prima facie evidence of the existence and amounts of
the obligations recorded therein; provided that (i) 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 Borrowers to repay the Loans in
accordance with the terms of this Agreement and (ii) in the event of any
conflict between the entries made in the accounts maintained pursuant to Section
2.03(c) and the accounts maintained pursuant to Section 2.03(d), the accounts
maintained pursuant to Section 2.03(d) shall govern and control.

 

- 50 -

 

 

--------------------------------------------------------------------------------

 

(e)Any Lender may request that Loans made by it be evidenced by a promissory
note.  In such event, the Borrowers shall execute and deliver to such Lender a
promissory note payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) in a form furnished by the
Collateral Agent and reasonably acceptable to the Administrative
Borrower.  Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section
12.07) be represented by one or more promissory notes in such form payable to
the order of the payee named therein (or, if such promissory note is a
registered note, to such payee and its registered assigns).

Section 2.04Interest.

(a)Revolving Loans.  Subject to the terms of this Agreement, at the option of
the Administrative Borrower, each Revolving Loan shall be either a Reference
Rate Loan or a LIBOR Rate Loan.  Each Revolving Loan that is a Reference Rate
Loan shall bear interest on the principal amount thereof from time to time
outstanding, from the date of such Loan until repaid, at a rate per annum equal
to the Reference Rate plus the Applicable Margin.  Each Revolving Loan that is a
LIBOR Rate Loan shall bear interest on the principal amount thereof from time to
time outstanding, from the date of such Loan until repaid, at a rate per annum
equal to the LIBOR Rate for the Interest Period in effect for such Loan plus the
Applicable Margin.

(b)Term Loan.  Subject to the terms of this Agreement, at the option of the
Administrative Borrower, each Term Loan or any portion thereof shall be either a
Reference Rate Loan or a LIBOR Rate Loan.  Each portion of a Term Loan that is a
Reference Rate Loan shall bear interest on the principal amount thereof from
time to time outstanding, from the date of the Term Loan until repaid, at a rate
per annum equal to the Reference Rate plus the Applicable Margin.  Each portion
of a Term Loan that is a LIBOR Rate Loan shall bear interest on the principal
amount thereof from time to time outstanding, from the date of such Term Loan
until repaid, at a rate per annum equal to the LIBOR Rate for the Interest
Period in effect for such Term Loan (or such portion thereof) plus the
Applicable Margin

(c)Default Interest.  To the extent permitted by law and notwithstanding
anything to the contrary in this Section, upon the occurrence and during the
continuance of an Event of Default, at the election of the Collateral Agent, the
principal of, and all accrued and unpaid interest on, all Loans, fees,
indemnities or any other Obligations of the Loan Parties under this Agreement
and the other Loan Documents, shall bear interest, from the date such Event of
Default occurred until the date such Event of Default is cured or waived in
writing in accordance herewith, at a rate per annum equal at all times to the
Post-Default Rate.  

(d)Interest Payment.  Interest on each Loan shall be payable (i) monthly, in
arrears, on the first day of each month, commencing on the first day of the
month following the month in which such Loan is made and (ii) at maturity
(whether upon demand, by acceleration or otherwise.  Interest at the
Post-Default Rate shall be payable on demand.  Each Borrower hereby authorizes
the Administrative Agent to, and the Administrative Agent may, from time to
time, charge the Loan Account pursuant to Section 4.01 with the amount of any
interest payment due hereunder.  

 

- 51 -

 

 

--------------------------------------------------------------------------------

 

(e)General.  All interest and fees shall be computed on the basis of a year of
360 days (except that interest on Reference Rate shall be computed on the basis
of a year of 365 days (or 366 days in a leap year)) for the actual number of
days, including the first day but excluding the last day, elapsed.

Section 2.05Reduction of Commitment; Prepayment of Loans.

(a)Reduction of Commitments.  

(i)Revolving Credit Commitments. The Total Revolving Credit Commitment shall
terminate on the Final Maturity Date.  The Borrowers may reduce the Total
Revolving Credit Commitment to an amount (which may be zero) not less than the
sum of (A) the aggregate unpaid principal amount of all Revolving Loans then
outstanding and (B) the aggregate principal amount of all Revolving Loans not
yet made as to which a Notice of Borrowing has been given by the Administrative
Borrower under Section 2.02.  Each such reduction shall be (1) in an amount
which is an integral multiple of $1,000,000 (or by the full amount of the Total
Revolving Credit Commitment in effect immediately prior to such reduction if
such amount at that time is less than $1,000,000), (2) made by providing not
less than 5 Business Days’ prior written notice to the Administrative Agent, (3)
irrevocable and (4) accompanied by the payment of the Applicable Premium, if
any, payable in connection with such reduction of the Total Revolving Credit
Commitment.  Once reduced, the Total Revolving Credit Commitment may not be
increased.  Each such reduction of the Total Revolving Credit Commitment shall
reduce the Revolving Credit Commitment of each Lender proportionately in
accordance with its Pro Rata Share thereof.

(ii)Term Loan. The Total Term Loan Commitment shall terminate at 5:00 p.m. (New
York City time) on the Effective Date.

(b)Optional Prepayment.

(i)Revolving Loans.  The Borrowers may, at any time and from time to time,
prepay the principal of any Revolving Loan, in whole or in part.  Each
prepayment made pursuant to this Section 2.05(b)(i) in connection with a
reduction of the Total Revolving Credit Commitment pursuant to Section
2.05(a)(i) above shall be accompanied by the payment of the Applicable Premium,
if any, payable in connection with such reduction of the Total Revolving Credit
Commitment.

(ii)Term Loan.  The Borrowers may, at any time and from time to time, upon at
least 5 Business Days’ prior written notice to the Agents, prepay the principal
of the Term Loan, in whole or in part.  Each prepayment made pursuant to this
clause (b)(ii) shall be accompanied by the payment of (A) accrued interest to
the date of such payment on the amount prepaid and (B) the Applicable Premium,
if any, payable in connection with such prepayment of the Term Loan.  Each such
prepayment shall be applied against the remaining installments of principal due
on the Term Loan in the inverse order of maturity.

 

- 52 -

 

 

--------------------------------------------------------------------------------

 

(iii)Termination of Agreement.  The Borrowers may, upon at least 30 days prior
written notice to the Administrative Agent, terminate this Agreement by paying
to the Administrative Agent, in cash, the Obligations, in full, plus the
Applicable Premium, if any, payable in connection with such termination of this
Agreement.  If the Administrative Borrower has sent a notice of termination
pursuant to this Section 2.05(b)(iii), then the Lenders’ obligations to extend
credit hereunder shall terminate and the Borrowers shall be obligated to repay
the Obligations, in full, plus the Applicable Premium, if any, payable in
connection with such termination of this Agreement on the date set forth as the
date of termination of this Agreement in such notice.  

(c)Mandatory Prepayment.

(i)Contemporaneously with the delivery to the Agents and the Lenders of audited
annual financial statements pursuant to Section 7.01(a)(iii), commencing with
the delivery to the Agents and the Lenders of the financial statements for the
Fiscal Year ended December 31, 2017 or, if such financial statements are not
delivered to the Agents and the Lenders on the date such statements are required
to be delivered pursuant to Section 7.01(a)(iii), on the date such statements
are required to be delivered to the Agents and the Lenders pursuant to Section
7.01(a)(iii), the Borrowers shall, if the Leverage Ratio of Patriot and its
Subsidiaries as of the end of such Fiscal Year is (A) greater than 2.75:1.00,
prepay the outstanding principal amount of the Loans in accordance with Section
2.05(d) in an amount equal to the result of (to the extent positive) (1) 50% of
the Excess Cash Flow of Patriot and its Subsidiaries for such Fiscal Year minus
(2) the aggregate principal amount of all payments made by the Borrowers
pursuant to Section 2.05(b) for such Fiscal Year (in the case of payments made
by the Borrowers pursuant to Section 2.05(b)(i), only to the extent that the
Total Revolving Credit Commitment is permanently reduced by the amount of such
payments), or (B) equal to or less than 2.75:1.00, prepay the outstanding
principal amount of the Loans in accordance with Section 2.05(d) in an amount
equal to the result of (to the extent positive) (1) 25% of the Excess Cash Flow
of Patriot and its Subsidiaries for such Fiscal Year minus (2) the aggregate
principal amount of all payments made by the Borrowers pursuant to Section
2.05(b) for such Fiscal Year (in the case of payments made by the Borrowers
pursuant to Section 2.05(b)(i), only to the extent that the Total Revolving
Credit Commitment is permanently reduced by the amount of such payments).

(ii)Immediately upon any Disposition (excluding Dispositions which qualify as
Permitted Dispositions under clauses (a), (b), (c), (d), (e), (f) or (g) of the
definition of Permitted Disposition) by any Loan Party or its Subsidiaries, the
Borrowers shall prepay the outstanding principal amount of the Loans in
accordance with Section 2.05(d) in an amount equal to 100% of the Net Cash
Proceeds received by such Person in connection with such Disposition to the
extent that the aggregate amount of Net Cash Proceeds received by all Loan
Parties and their Subsidiaries (and not paid to the Administrative Agent as a
prepayment of the Loans) shall exceed for all such Dispositions $250,000 in any
Fiscal Year.  Nothing contained in this Section 2.05(c)(ii) shall permit any
Loan Party or any of its Subsidiaries to make a Disposition of any property
other than in accordance with Section 7.02(c)(ii).  Notwithstanding the
foregoing, in the event of a Specified Disposition, the Net Cash Proceeds
received by any Loan Party or its Subsidiaries in connection with such Specified
Disposition in excess of the Specified Disposition Threshold Amount may be
retained by the Loan Parties and not paid to the Administrative Agent as a
prepayment of the Loans to the extent that such Net Cash Proceeds are applied in
accordance with Section 2.05(c)(vi).  

 

- 53 -

 

 

--------------------------------------------------------------------------------

 

(iii)Upon the issuance or incurrence by any Loan Party or any of its
Subsidiaries of any Indebtedness (other than Permitted Indebtedness), the
Borrowers shall prepay the outstanding amount of the Loans in accordance with
Section 2.05(d) in an amount equal to 100% of the Net Cash Proceeds received by
such Person in connection therewith.  The provisions of this Section
2.05(c)(iii) shall not be deemed to be implied consent to any such issuance,
incurrence or sale otherwise prohibited by the terms and conditions of this
Agreement.

(iv)Upon the receipt by any Loan Party or any of its Subsidiaries of any
Extraordinary Receipts, the Borrowers shall prepay the outstanding principal of
the Loans in accordance with Section 2.05(d) in an amount equal to 100% of the
Net Cash Proceeds received by such Person in connection therewith.

(v)[Intentionally Omitted.]

(vi)Notwithstanding the foregoing, with respect to Net Cash Proceeds received by
any Loan Party or any of its Subsidiaries in connection with a Disposition or
the receipt of Extraordinary Receipts consisting of insurance proceeds or
condemnation awards that are required to be used to prepay the Obligations
pursuant to Section 2.05(c)(ii) or Section 2.05(c)(iv), as the case may be, up
to $1,000,000 in the aggregate in any Fiscal Year of the Net Cash Proceeds from
all such Dispositions (excluding Specified Dispositions for which the foregoing
Fiscal Year limitation shall not apply) and Extraordinary Receipts (excluding
insurance proceeds arising from events directly related to the corporate
headquarters of Patriot for which the foregoing Fiscal Year limitation shall not
apply) shall not be required to be so used to prepay the Obligations to the
extent that such Net Cash Proceeds are used to replace, repair or restore
properties or assets (other than current assets) used in such Person’s business,
provided that, (A) no Default or Event of Default has occurred and is continuing
on the date such Person receives such Net Cash Proceeds, (B) the Administrative
Borrower delivers a certificate to the Administrative Agent within 5 Business
Days after such Disposition or loss, destruction or taking, as the case may be,
stating that such Net Cash Proceeds shall be used to replace, repair or restore
properties or assets used in such Person’s business within a period specified in
such certificate not to exceed 180 days after the date of receipt of such Net
Cash Proceeds (which certificate shall set forth estimates of the Net Cash
Proceeds to be so expended), (C) such Net Cash Proceeds are deposited in an
account subject to a Control Agreement, and (D) upon the earlier of (1) the
expiration of the period specified in the relevant certificate furnished to the
Administrative Agent pursuant to clause (B) above (provided that if, prior to
the expiration of such 180-day period, the Borrower, directly or through its
Subsidiaries, shall have entered into a binding agreement providing for such
investment on or prior to the expiration of an additional 90-day period, such
180-day period shall be extended to the date provided for such investment in
such binding agreement) or (2) the occurrence of a Default or an Event of
Default, such Net Cash Proceeds, if not theretofore so used, shall be used to
prepay the Obligations in accordance with Section 2.05(c)(ii) or Section
2.05(c)(iv) as applicable.

(vii)The Borrowers will immediately prepay the Revolving Loans at any time when
the aggregate principal amount of all Revolving Loans exceeds the Total
Revolving Loan Commitment, to the full extent of any such excess.  

 

- 54 -

 

 

--------------------------------------------------------------------------------

 

(d)Application of Payments.  Each prepayment pursuant to subsections (c)(i),
(c)(ii), (c)(iii) and (c)(iv) above shall be applied (i) first, ratably to the
Term Loan until paid in full and (ii) to the Revolving Loans (with a
corresponding permanent reduction in the Revolving Credit Commitments), until
paid in full.  Each such prepayment of the Term Loan shall be applied ratably
against the remaining installments of principal of the Term Loan, in the inverse
order of maturity.  Notwithstanding the foregoing, after the occurrence and
during the continuance of an Event of Default, if the Administrative Agent has
elected, or has been directed by the Collateral Agent or the Required Lenders,
to apply payments in respect of any Obligations in accordance with Section
4.03(b), prepayments required under Section 2.05(c) shall be applied in the
manner set forth in Section 4.03(b).

(e)Interest and Fees.  Any prepayment made pursuant to this Section 2.05 (other
than prepayments made pursuant to subsection (c)(vii) of this Section 2.05)
shall be accompanied by (i) accrued interest on the principal amount being
prepaid to the date of prepayment, (ii) any Funding Losses payable pursuant to
Section 2.08, (iii) the Applicable Premium, if any, payable in connection with
such prepayment of the Loans to the extent required under Section 2.06(e) and
(iv) if such prepayment would reduce the amount of the outstanding Loans to zero
at a time when the Total Revolving Credit Commitment has been terminated, such
prepayment shall be accompanied by the payment of all fees accrued to such date
pursuant to Section 2.06.

(f)Cumulative Prepayments.  Except as otherwise expressly provided in this
Section 2.05, payments with respect to any subsection of this Section 2.05 are
in addition to payments made or required to be made under any other subsection
of this Section 2.05.

Section 2.06Fees.

(a)Closing Fee.  On or prior to the Effective Date, the Borrowers shall pay to
the Administrative Agent for the account of the Lenders, in accordance with a
written agreement among the Agents and the Lenders, a non‑refundable closing fee
(the ”Closing Fee”) equal to $5,600,000, which shall be deemed fully earned when
paid.

(b)Unused Line Fee.  From and after the Effective Date and until the Termination
Date, the Borrowers shall pay to the Administrative Agent for the account of the
Revolving Loan Lenders, in accordance with their Pro Rata Shares, monthly in
arrears on the first day of each month commencing December 1, 2016, an unused
line fee (the ”Unused Line Fee”), which shall accrue at the rate per annum of
0.50% on the excess, if any, of the Total Revolving Credit Commitment over the
sum of the average principal amount of all Revolving Loans outstanding from time
to time during the preceding month.

(c)Loan Servicing Fee.  From and after the Effective Date and until the
Termination Date, the Borrowers shall pay to the Administrative Agent for the
account of the Agents ,in accordance with a written agreement between such
Agents, a non-refundable loan servicing fee (the ”Loan Servicing Fee”) equal to
an aggregate amount of $5,000 each month, which shall be deemed fully earned
when paid and which shall be payable on the Effective Date (payable ratably
based on the number of days remaining in the calendar month in which the
Effective Date occurs) and monthly in advance thereafter on the first day of
each calendar month commencing on December 1, 2016.

 

- 55 -

 

 

--------------------------------------------------------------------------------

 

(d)[Intentionally Omitted].

(e)Applicable Premium.

(i)Upon the occurrence of an Applicable Premium Trigger Event, the Borrower
shall pay to the Administrative Agent, for the account of the Lenders in
accordance with their Pro Rata Shares, the Applicable Premium.

(ii)Any Applicable Premium payable in accordance with this Section 2.06(e) shall
be presumed to be equal to the liquidated damages sustained by the Lenders as
the result of the occurrence of the Applicable Premium Trigger Event and the
Loan Parties agree that it is reasonable under the circumstances currently
existing.  THE LOAN PARTIES EXPRESSLY WAIVE THE PROVISIONS OF ANY PRESENT OR
FUTURE STATUTE OR LAW THAT PROHIBITS OR MAY PROHIBIT THE COLLECTION OF THE
FOREGOING APPLICABLE PREMIUM IN CONNECTION WITH ANY ACCELERATION.

(iii)The Loan Parties expressly agree that:  (A) the Applicable Premium is
reasonable and is the product of an arm’s length transaction between
sophisticated business people, ably represented by counsel; (B) the Applicable
Premium shall be payable notwithstanding the then prevailing market rates at the
time payment is made; (C) there has been a course of conduct between the Lenders
and the Loan Parties giving specific consideration in this transaction for such
agreement to pay the Applicable Premium; (D) the Loan Parties shall be estopped
hereafter from claiming differently than as agreed to in this paragraph; (E)
their agreement to pay the Applicable Premium is a material inducement to
Lenders to provide the Commitments and make the Loans, and (F) the Applicable
Premium represents a good faith, reasonable estimate and calculation of the lost
profits or damages of the Agents and the Lenders and that it would be
impractical and extremely difficult to ascertain the actual amount of damages to
the Agents and the Lenders or profits lost by the Agents and the Lenders as a
result of such Applicable Premium Trigger Event.

(iv)Nothing contained in this Section 2.06(e) shall permit any prepayment of the
Loans or reduction of the Commitments not otherwise permitted by the terms of
this Agreement or any other Loan Document.

(f)Audit and Collateral Monitoring Fees. The Borrowers acknowledge that pursuant
to Section 7.01(f), representatives of the Agents may visit any or all of the
Loan Parties and/or conduct inspections and environmental site assessments of
any or all of the Loan Parties at any time and from time to time upon reasonable
advance notice to the Borrowers (unless an Event of Default has occurred and is
continuing, in which case, no such notice shall be required).  The Borrowers
agree to pay (i) $1,500 per day per examiner plus the examiner’s out-of-pocket
costs and reasonable expenses incurred in connection with all such visits,
inspections, environmental site assessments and (ii) the costs and reasonable
expenses incurred in connection with all visits, inspections and environmental
site assessments conducted by a third party on behalf of the Agents; provided,
that so long as no Event of Default shall have occurred and be continuing, the
Borrowers shall not be obligated to reimburse the Agents for costs and expenses
in incurred in connection with more than one visit or inspection during any
calendar year.

 

- 56 -

 

 

--------------------------------------------------------------------------------

 

Section 2.07LIBOR Option.

(a)The Borrowers may, at any time and from time to time, so long as no Default
or Event of Default has occurred and is continuing, elect to have interest on
all or a portion of the Loans be charged at a rate of interest based upon the
LIBOR Rate (the “LIBOR Option”) by notifying the Administrative Agent prior to
11:00 a.m. (New York City time) at least 3 Business Days prior to (i) the
proposed borrowing date of a Loan (as provided in Section 2.02), (ii) in the
case of the conversion of a Reference Rate Loan to a LIBOR Rate Loan, the
commencement of the proposed Interest Period or (iii) in the case of the
continuation of a LIBOR Rate Loan as a LIBOR Rate Loan, the last day of the then
current Interest Period (the “LIBOR Deadline”).  Notice of the Borrowers’
election of the LIBOR Option for a permitted portion of the Loans and an
Interest Period pursuant to this Section 2.07(a) shall be made by delivery to
the Administrative Agent of (A) a Notice of Borrowing (in the case of the
initial making of a Loan) in accordance with Section 2.02 or (B) a LIBOR Notice
prior to the LIBOR Deadline (or by telephonic notice received by the
Administrative Agent before the LIBOR Deadline (to be confirmed by delivery to
the Administrative Agent of a LIBOR Notice received by the Administrative Agent
prior to 5:00 p.m. (New York City time) on the same day)).  Promptly upon its
receipt of each such LIBOR Notice, the Administrative Agent shall provide a copy
thereof to each of the Lenders.  Each LIBOR Notice shall be irrevocable and
binding on the Borrowers.

(b)Interest on LIBOR Rate Loans shall be payable in accordance with Section
2.04(d).  On the last day of each applicable Interest Period, unless the
Borrowers properly have exercised the LIBOR Option with respect thereto, the
interest rate applicable to such LIBOR Rate Loans automatically shall convert to
the rate of interest then applicable to Reference Rate Loans of the same type
hereunder.  At any time that a Default or an Event of Default has occurred and
is continuing, the Borrowers no longer shall have the option to request that any
portion of the Loans bear interest at the LIBOR Rate and the Administrative
Agent shall have the right to convert the interest rate on all outstanding LIBOR
Rate Loans to the rate of interest then applicable to Reference Rate Loans of
the same type hereunder prior to the last day of the then current Interest
Period.

(c)Notwithstanding anything to the contrary contained in this Agreement, the
Borrowers (i) shall have not more than 5 LIBOR Rate Loans in effect at any given
time, and (ii) only may exercise the LIBOR Option for LIBOR Rate Loans of at
least $500,000 and integral multiples of $100,000 in excess thereof.

(d)The Borrowers may prepay LIBOR Rate Loans at any time; provided, however,
that in the event that LIBOR Rate Loans are prepaid on any date that is not the
last day of the Interest Period applicable thereto, including as a result of any
mandatory prepayment pursuant to Section 2.05(c) or any application of payments
or proceeds of Collateral in accordance with Section 4.03 or Section 4.04 or for
any other reason, including early termination of the term of this Agreement or
acceleration of all or any portion of the Obligations pursuant to the terms
hereof, the Borrowers shall indemnify, defend, and hold the Agents and the
Lenders and their participants harmless against any and all Funding Losses in
accordance with Section 2.08.

 

- 57 -

 

 

--------------------------------------------------------------------------------

 

(e)Anything to the contrary contained herein notwithstanding, neither any Agent
nor any Lender, nor any of their participants, is required actually to acquire
eurodollar deposits to fund or otherwise match fund any Obligation as to which
interest accrues at the LIBOR Rate.  

Section 2.08Funding Losses. In connection with each LIBOR Rate Loan, the
Borrowers shall indemnify, defend, and hold the Agents and the Lenders harmless
against any loss, cost, or expense incurred by any Agent or any Lender as a
result of (a) the payment of any principal of any LIBOR Rate Loan other than on
the last day of an Interest Period applicable thereto (including as a result of
a Default or an Event of Default or any mandatory prepayment required pursuant
to Section 2.05(c)), (b) the conversion of any LIBOR Rate Loan other than on the
last day of the Interest Period applicable thereto (including as a result of a
Default or an Event of Default), or (c) the failure to borrow, convert, continue
or prepay any LIBOR Rate Loan on the date specified in any Notice of Borrowing
or LIBOR Notice delivered pursuant hereto (such losses, costs, and expenses,
collectively, “Funding Losses”).  Funding Losses shall, with respect to any
Agent or any Lender, be deemed to equal the amount reasonably determined by such
Agent or such Lender to be the excess, if any, of (i) the amount of interest
that would have accrued on the principal amount of such LIBOR Rate Loan had such
event not occurred, at the LIBOR Rate that would have been applicable thereto,
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 therefor),
minus (ii) the amount of interest that would accrue on such principal amount for
such period at the interest rate which such Agent or such Lender would be
offered were it to be offered, at the commencement of such period, Dollar
deposits of a comparable amount and period in the London interbank market.  A
certificate of an Agent or a Lender delivered to the Administrative Borrower
setting forth any amount or amounts that such Agent or such Lender is entitled
to receive pursuant to this Section 2.08 shall be conclusive absent manifest
error.

Section 2.09Taxes. (a)  Any and all payments by or on account of any Loan Party
hereunder or under any other Loan Document shall be made free and clear of and
without deduction for any and all Taxes, except as required by applicable
law.  If any Loan Party shall be required to deduct any Taxes from or in respect
of any sum payable hereunder to any Secured Party (or any transferee or assignee
thereof, including a participation holder (any such entity, a “Transferee”)),
(i) the applicable Withholding Agent shall make such deductions and (ii) the
applicable Withholding Agent shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law and (iii) if such Tax
is an Indemnified Tax, then the sum payable by the applicable Loan Party shall
be increased by the amount (an “Additional Amount”) necessary such that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 2.09) such Secured Party (or such Transferee)
receives the amount equal to the sum it would have received had no such
deductions been made.

(a)In addition, each Loan Party agrees to pay to the relevant Governmental
Authority in accordance with applicable law any Other Taxes.  Each Loan Party
shall deliver to each Secured Party official receipts in respect of any Taxes or
Other Taxes payable hereunder promptly after payment of such Taxes or Other
Taxes.

 

- 58 -

 

 

--------------------------------------------------------------------------------

 

(b)The Loan Parties hereby jointly and severally indemnify and agree to hold
each Secured Party harmless from and against Taxes and Other Taxes (including,
without limitation, Taxes and Other Taxes imposed on any amounts payable under
this Section 2.09) paid by such Person, whether or not such Taxes or Other Taxes
were correctly or legally asserted.  Such indemnification shall be paid within
10 days from the date on which any such Person makes written demand therefore
specifying in reasonable detail the nature and amount of such Taxes or Other
Taxes.

(c)Each Lender (or Transferee) that is not a U.S. Person (a “Non-U.S. Lender”)
agrees that it shall, no later than the Effective Date (or, in the case of a
Lender which becomes a party hereto pursuant to Section 12.07 hereof after the
Effective Date, promptly after the date upon which such Lender becomes a party
hereto) deliver to the Agents one properly completed and duly executed copy of
either U.S. Internal Revenue Service Form W-8BEN, W-8ECI or W-8IMY or any
subsequent versions thereof or successors thereto, in each case claiming
complete exemption from, or reduced rate of, U.S. Federal withholding tax on
payments of interest hereunder.  In addition, in the case of a Non-U.S. Lender
claiming exemption from U.S. Federal withholding tax under Section 871(h) or
881(c) of the Internal Revenue Code, such Non-U.S. Lender hereby represents to
the Agents and the Borrowers that such Non-U.S. Lender is not a bank for
purposes of Section 881(c) of the Internal Revenue Code, is not a 10-percent
shareholder (within the meaning of Section 871(h)(3)(B) of the Internal Revenue
Code) of Patriot and is not a controlled foreign corporation related to Patriot
(within the meaning of Section 864(d)(4) of the Internal Revenue Code), and such
Non-U.S. Lender agrees that it shall promptly notify the Agents in the event any
such representation is no longer accurate.  Such forms shall be delivered by
each Non-U.S. Lender on or before the date it becomes a party to this Agreement
(or, in the case of a Transferee that is a participation holder, on or before
the date such participation holder becomes a Transferee hereunder) and on or
before the date, if any, such Non-U.S. Lender changes its applicable lending
office by designating a different lending office (a “New Lending Office”).  In
addition, such Lender (or Transferee) or Agent shall deliver such forms within
20 days after receipt of a written request therefor from the Administrative
Borrower or any Agent, the assigning Lender or the Lender granting a
participation, as applicable.  Notwithstanding any other provision of this
Section 2.09, a Non-U.S. Lender shall not be required to deliver any form
pursuant to this Section 2.09(d) that such Non-U.S. Lender is not legally able
to deliver.

(d)Any Secured Party (or Transferee) claiming any indemnity payment or
additional payment amounts payable pursuant to this Section 2.09 or Section 2.10
or Section 2.11 below shall use reasonable efforts (consistent with legal and
regulatory restrictions) to file any certificate or document reasonably
requested in writing by the Administrative Borrower or to change the
jurisdiction of its applicable lending office if the making of such a filing or
change would avoid the need for or reduce the amount of any such indemnity
payment or additional amount that may thereafter accrue, would not require such
Secured Party (or Transferee) to disclose any information such Secured Party (or
Transferee) deems confidential and would not, in the sole determination of such
Secured Party (or Transferee), be otherwise disadvantageous to such Secured
Party (or Transferee).   If any Secured Party (or Transferee) declines or is
unable to change the jurisdiction of its applicable lending office as set forth
above, then the Administrative Borrower may, at its sole expense and effort,
upon notice to such Secured Party (or Transferee), require such Secured Party to
assign and delegate, without recourse (in accordance with and

 

- 59 -

 

 

--------------------------------------------------------------------------------

 

subject to the restrictions set forth in Section 12.07), all of its interests,
rights (other than its existing rights to payment pursuant to Section 2.9 or
Section 2.10) and obligations under this Agreement and the related Loan
Documents to an eligible assignee pursuant to Section 12.07 that shall assume
such obligations (which assignee may be another Secured Party, if a Secured
Party accepts such assignment); provided that:

(i)Administrative Borrower shall have paid the applicable assignment fee, if
any, specified in Section 12.07;

(ii)Such Secured Party shall have received payment of an amount equal to the
outstanding principal of its Loans and participations pursuant to this Agreement
and the related Loan Documents, accrued interest thereon, accrued fees and all
other amounts payable to it hereunder and under the other Loan Documents from
the assignee (to the extent of such outstanding principal and accrued interest
and fees) or the Administrative Borrower (in the case of all other amounts);

(iii)In the case of any such assignment resulting from a claim for compensation
under Section 2.10 or payments required to be made pursuant to Section 2.9, such
assignment will result in a reduction in such compensation or payment
thereafter;

(iv)In the case of any such assignment resulting a notice delivered by a Lender
under Section 2.11, such assignment ill eliminate such illegality; and

(v)Such assignment does not conflict with applicable law.

(e)If any Secured Party (or a Transferee) shall become aware that it is entitled
to claim a refund from a Governmental Authority in respect of Taxes or Other
Taxes with respect to which any Loan Party has made an indemnity payment or paid
additional amounts, pursuant to this Section 2.09, it shall promptly notify the
Administrative Borrower of the availability of such refund claim and shall,
within 30 days after receipt of a request by the Administrative Borrower, make a
claim to such Governmental Authority for such refund at the Loan Parties’
expense.  If any Secured Party (or a Transferee) receives a refund (including
pursuant to a claim for refund made pursuant to the preceding sentence) in
respect of any Taxes or Other Taxes with respect to which any Loan Party has
made an Indemnity payment or paid additional amounts pursuant to this Section
2.09, it shall within 30 days from the date of such receipt pay over such refund
to the Administrative Borrower, net of all out‑of‑pocket expenses of such
Secured Party (or Transferee).

(f)If a payment made to a Lender (or Transferee) or any Agent under any Loan
Document would be subject to U.S. Federal withholding tax imposed by FATCA if
such Lender (or Transferee) or Agent were to fail to comply with the applicable
reporting requirements of FATCA (including those contained in Section 1471(b) or
1472(b) of the Internal Revenue Code, as applicable), such Lender (or
Transferee) or Agent shall deliver to the Administrative Borrower and the Agents
at the time or times prescribed by law and at such time or times reasonably
requested by the Administrative Borrower or the Agents such documentation
prescribed by applicable law (including as prescribed by Section
1471(b)(3)(C)(i) of the Internal Revenue Code) and such additional documentation
reasonably requested by the Administrative

 

- 60 -

 

 

--------------------------------------------------------------------------------

 

Borrower or the Agents as may be necessary for the Administrative Borrower and
the Agents to comply with their obligations under FATCA and to determine that
such Lender (or Transferee) or Agent has complied with its obligations under
FATCA or to determine the amount to deduct and withhold from such
payment.  Solely for purposes of this clause (g), “FATCA” shall include any
amendments made to FATCA after the date of this Agreement.  Any forms,
certifications or other documentation under this clause (g) shall be delivered
by each Lender (or Transferee) and each Agent.

(g)The obligations of the Loan Parties under this Section 2.09 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.

Section 2.10Increased Costs and Reduced Return. (a) If any Secured Party shall
have determined that any Change in Law shall (i) subject such Secured Party, or
any Person controlling such Secured Party to any tax, duty or other charge with
respect to this Agreement or any Loan made by such Agent or such Lender, or
change the basis of taxation of payments to such Secured Party or any Person
controlling such Secured Party of any amounts payable hereunder (except for (w)
taxes on the overall net income of such Secured Party or any Person controlling
such Secured Party, (x) Indemnified Taxes, (y) Taxes described in clauses (b)
through (d) of the definition of Excluded Taxes, and (z) Connection Income
Taxes), (ii) impose, modify or deem applicable any reserve, special deposit or
similar requirement against any Loan or against assets of or held by, or
deposits with or for the account of, or credit extended by, such Secured Party
or any Person controlling such Secured Party or (iii) impose on such Secured
Party or any Person controlling such Secured Party any other condition regarding
this Agreement or any Loan, and the result of any event referred to in clauses
(i), (ii) or (iii) above shall be to increase the cost to such Secured Party of
making any Loan, or agreeing to make any Loan, or to reduce any amount received
or receivable by such Secured Party hereunder, then, upon demand by such Secured
Party, the Borrowers shall pay to such Secured Party such additional amounts as
will compensate such Secured Party for such increased costs or reductions in
amount.

(a)If any Secured Party shall have determined that any Change in Law affecting
the amount of capital required or expected to be maintained by such Secured
Party or any Person controlling such Secured Party has or would have the effect
of reducing the rate of return on such Secured Party’s or such other controlling
Person’s capital to a level below that which such Secured Party or such
controlling Person could have achieved but for such Change in Law as a
consequence of any Loans made or maintained, or any agreement to make Loans or
such Secured Party’s or such other controlling Person’s other obligations
hereunder (in each case, taking into consideration, such Secured Party’s or such
other controlling Person’s policies with respect to capital adequacy), then from
time to time the Borrower’s shall pay to such Secured Party such additional
amounts as will compensate such Secured Party for such reduction in the rate of
return on such Secured Party’s or such other controlling Person’s capital.

 

- 61 -

 

 

--------------------------------------------------------------------------------

 

(b)A certificate of such Secured Party claiming compensation under this Section
2.10, specifying the event herein above described and the nature of such event
shall be submitted by such Secured Party to the Administrative Borrower, setting
forth the additional amount due and an explanation of the calculation thereof,
and such Secured Party’s reasons for invoking the provisions of this Section
2.10, and shall be final and conclusive absent manifest error.  The
Administrative Borrower shall pay such Secured Party the amount shown as due on
any such certificate within 10 days after receipt thereof.

(c)Failure or delay on the part of any Lender to demand compensation pursuant to
the foregoing provisions of this Section 2.10 shall not constitute a waiver of
such Lender’s right to demand such compensation; provided that the Borrowers
shall not be required to compensate a Lender pursuant to the foregoing
provisions of this Section 2.10 for any increased costs incurred or reductions
suffered more than nine months prior to the date that such Lender notifies the
Administrative Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender’s intention to claim compensation therefor
(except that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the nine-month period referred to above shall be
extended to include the period of retroactive effect thereof).

(d)The obligations of the Loan Parties under this Section 2.10 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.

Section 2.11Changes in Law; Impracticability or Illegality.  

(a)[Intentionally Omitted].

(b)In the event that any change in market conditions or any law, regulation,
treaty, or directive, or any change therein or in the interpretation of
application thereof, shall at any time after the date hereof, in the reasonable
opinion of any Lender, make it unlawful or impractical for such Lender to fund
or maintain LIBOR Rate Loans or to continue such funding or maintaining, or to
determine or charge interest rates at the LIBOR Rate, such Lender shall give
notice of such changed circumstances to the Administrative Borrower and the
Administrative Agent, and the Administrative Agent promptly shall transmit the
notice to each other Lender and (i) in the case of any LIBOR Rate Loans of such
Lender that are outstanding, the date specified in such Lender’s notice shall be
deemed to be the last day of the Interest Period of such LIBOR Rate Loans, and
interest upon the LIBOR Rate Loans of such Lender thereafter shall accrue
interest at the rate then applicable to Reference Rate Loans of the same type
hereunder, and (ii) the Borrowers shall not be entitled to elect the LIBOR
Option (including in any borrowing, conversion or continuation then being
requested) until such Lender determines that it would no longer be unlawful or
impractical to do so.

(c)The obligations of the Loan Parties under this Section 2.11 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.

 

- 62 -

 

 

--------------------------------------------------------------------------------

 

ARTICLE III

[INTENTIONALLY OMITTED]

ARTICLE IV

APPLICATION OF PAYMENTS; DEFAULTING LENDERS;
JOINT AND SEVERAL LIABILITY OF BORROWERS

Section 4.01Payments; Computations and Statements. (a)  The Borrowers will make
each payment under this Agreement not later than 12:00 noon (New York City time)
on the day when due, in lawful money of the United States of America and in
immediately available funds, to the Administrative Agent’s Account.  All
payments received by the Administrative Agent after 12:00 noon (New York City
time) on any Business Day will be credited to the Loan Account on the next
succeeding Business Day.  All payments shall be made by the Borrowers without
set-off, counterclaim, recoupment, deduction or other defense to the Agents and
the Lenders.  Except as provided in Section 2.02, after receipt, the
Administrative Agent will promptly thereafter cause to be distributed like funds
relating to the payment of principal ratably to the Lenders in accordance with
their Pro Rata Shares and like funds relating to the payment of any other amount
payable to any Lender to such Lender, in each case to be applied in accordance
with the terms of this Agreement.  The Lenders and the Borrowers hereby
authorize the Administrative Agent to, and the Administrative Agent may, from
time to time, charge the Loan Account of the Borrowers with any amount due and
payable by the Borrowers under any Loan Document.  Each of the Lenders and the
Borrowers agrees that the Administrative Agent shall have the right to make such
charges whether or not any Default or Event of Default shall have occurred and
be continuing or whether any of the conditions precedent in Section 5.02 have
been satisfied.  Any amount charged to the Loan Account of the Borrowers shall
be deemed a Revolving Loan hereunder made by the Revolving Loan Lenders to the
Borrowers, funded by the Administrative Agent on behalf of the Revolving Loan
Lenders and subject to Section 2.02 of this Agreement.  The Lenders and the
Borrowers confirm that any charges which the Administrative Agent may so make to
the Loan Account of the Borrowers as herein provided will be made as an
accommodation to the Borrowers and solely at the Administrative Agent’s
discretion, provided that the Administrative Agent shall from time to time upon
the request of the Collateral Agent, charge the Loan Account of the Borrowers
with any amount due and payable under any Loan Document.  Whenever any payment
to be made under any such Loan Document shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business
Day and such extension of time shall in such case be included in the computation
of interest or fees, as the case may be.  All computations of fees shall be made
by the Administrative Agent on the basis of a year of 360 days for the actual
number of days.  Each determination by the Administrative Agent of an interest
rate or fees hereunder shall be conclusive and binding for all purposes in the
absence of manifest error.

 

- 63 -

 

 

--------------------------------------------------------------------------------

 

(a)The Administrative Agent shall provide the Administrative Borrower, promptly
after the end of each calendar month, a summary statement (in the form from time
to time used by the Administrative Agent) of the opening and closing daily
balances in the Loan Account of the Borrowers during such month, the amounts and
dates of all Loans made to the Borrowers during such month, the amounts and
dates of all payments on account of the Loans to the Borrowers during such month
and the Loans to which such payments were applied, the amount of interest
accrued on the Loans to the Borrowers during such month, and the amount and
nature of any charges to the Loan Account made during such month on account of
fees, commissions, expenses and other Obligations.  All entries on any such
statement shall be presumed to be correct and, 30 days after the same is sent,
shall be final and conclusive absent manifest error.

Section 4.02Sharing of Payments. Except as provided in Section 2.02 hereof, if
any Lender shall obtain any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise) on account of any Obligation in
excess of its ratable share of payments on account of similar obligations
obtained by all the Lenders, such Lender shall forthwith purchase from the other
Lenders such participations in such similar obligations held by them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that (a) if all or any portion of such
excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and each Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender’s ratable share (according to the proportion
of (i) the amount of such Lender’s required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid by
the purchasing Lender in respect of the total amount so recovered and (b) the
provisions of this Section shall not be construed to apply to (i) any payment
made by the Borrowers pursuant to and in accordance with the express terms of
this Agreement (including the application of funds arising from the existence of
a Defaulting Lender), or (ii) any payment obtained by a Lender as consideration
for the assignment of or sale of a participation in any of its Loans, other than
to any Loan Party or any Subsidiary thereof (as to which the provisions of this
Section shall apply).  The Borrowers agree that any Lender so purchasing a
participation from another Lender pursuant to this Section may, to the fullest
extent permitted by law, exercise all of its rights (including the Lender’s
right of set-off) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrowers in the amount of such participation.

Section 4.03Apportionment of Payments. Subject to Section 2.02 hereof and to any
written agreement among the Agents and/or the Lenders:

(a)All payments of principal and interest in respect of outstanding Loans, all
payments of fees (other than the fees set forth in Section 2.06 hereof) and all
other payments in respect of any other Obligations, shall be allocated by the
Administrative Agent among such of the Lenders as are entitled thereto, in
proportion to their respective Pro Rata Shares or otherwise as provided herein
or, in respect of payments not made on account of Loans, as designated by the
Person making payment when the payment is made.

 

- 64 -

 

 

--------------------------------------------------------------------------------

 

(b)After the occurrence and during the continuance of an Event of Default, the
Administrative Agent may, and upon the direction of the Collateral Agent or the
Required Lenders shall, apply all proceeds of the Collateral, subject to the
provisions of this Agreement  (i) first, ratably to pay the Obligations in
respect of any fees, expense reimbursements, indemnities and other amounts then
due and payable to the Agents until paid in full; (ii) second, ratably to pay
interest then due and payable in respect of the Collateral Agent Advances until
paid in full; (iii) third, ratably to pay principal of the Collateral Agent
Advances until paid in full; (iv) fourth, ratably to pay the Revolving Loan
Obligations and Term Loan Obligations in respect of any fees (other than any
Applicable Premium), expense reimbursements, indemnities and other amounts then
due and payable to the Revolving Loan Lenders and Term Loan Lenders until paid
in full; (v) fifth, ratably to pay interest then due and payable in respect of
the Revolving Loans and the Term Loan until paid in full; (vi) sixth, ratably to
pay principal of the Revolving Loans and the Term Loan until paid in full; (vii)
seventh, ratably to pay the Obligations in respect of any Applicable Premium
then due and payable to the Lenders until paid in full; and (viii) eighth, to
the ratable payment of all other Obligations then due and payable.

(c)For purposes of Section 4.03(b) (other than clause (xi) thereof), “paid in
full” means payment in cash of all amounts owing under the Loan Documents
according to the terms thereof, including loan fees, service fees, professional
fees, interest (and specifically including interest accrued after the
commencement of any Insolvency Proceeding), default interest, interest on
interest, and expense reimbursements, whether or not same would be or is allowed
or disallowed in whole or in part in any Insolvency Proceeding, except to the
extent that default or overdue interest (but not any other interest) and loan
fees, each arising from or related to a default, are disallowed in any
Insolvency Proceeding; provided, however, that for the purposes of clause (xi),
“paid in full” means payment in cash of all amounts owing under the Loan
Documents according to the terms thereof, including loan fees, service fees,
professional fees, interest (and specifically including interest accrued after
the commencement of any Insolvency Proceeding), default interest, interest on
interest, and expense reimbursements, whether or not the same would be or is
allowed or disallowed in whole or in part in any Insolvency Proceeding.

(d)In the event of a direct conflict between the priority provisions of this
Section 4.03 and other provisions contained in any other Loan Document, it is
the intention of the parties hereto that both such priority provisions in such
documents shall be read together and construed, to the fullest extent possible,
to be in concert with each other.  In the event of any actual, irreconcilable
conflict that cannot be resolved as aforesaid, the terms and provisions of this
Section 4.03 shall control and govern.

Section 4.04Defaulting Lenders.  Notwithstanding anything to the contrary
contained in this Agreement, if any Lender becomes a Defaulting Lender, then,
until such time as such Lender is no longer a Defaulting Lender, to the extent
permitted by applicable law:

(a)Such Defaulting Lender’s right to approve or disapprove any amendment, waiver
or consent with respect to this Agreement shall be restricted as set forth in
Section 12.02.

 

- 65 -

 

 

--------------------------------------------------------------------------------

 

(b)The Administrative Agent shall not be obligated to transfer to such
Defaulting Lender any payments made by any Borrower to the Administrative Agent
for such Defaulting Lender’s benefit, and, in the absence of such transfer to
such Defaulting Lender, the Administrative Agent shall transfer any such
payments to each other non-Defaulting Lender ratably in accordance with their
Pro Rata Shares (without giving effect to the Pro Rata Shares of such Defaulting
Lender) (but only to the extent that such Defaulting Lender’s Loans were funded
by the other Lenders) or, if so directed by the Administrative Borrower and if
no Default or Event of Default has occurred and is continuing (and to the extent
such Defaulting Lender’s Loans were not funded by the other Lenders), retain the
same to be re-advanced to the Borrowers as if such Defaulting Lender had made
such Loans to the Borrowers.  Subject to the foregoing, the Administrative Agent
may hold and, in its discretion, re-lend to the Borrowers for the account of
such Defaulting Lender the amount of all such payments received and retained by
the Administrative Agent for the account of such Defaulting Lender.

(c)Any such failure to fund by any Defaulting Lender shall constitute a material
breach by such Defaulting Lender of this Agreement and shall entitle the
Borrowers to replace the Defaulting Lender with one or more substitute Lenders,
and the Defaulting Lender shall have no right to refuse to be replaced
hereunder.  Such notice to replace the Defaulting Lender shall specify an
effective date for such replacement, which date shall not be later than 15
Business Days after the date such notice is given.  Prior to the effective date
of such replacement, the Defaulting Lender shall execute and deliver an
Assignment and Acceptance, subject only to the Defaulting Lender being repaid
its share of the outstanding Obligations without any premium or penalty of any
kind whatsoever.  If the Defaulting Lender shall refuse or fail to execute and
deliver any such Assignment and Acceptance prior to the effective date of such
replacement, the Defaulting Lender shall be deemed to have executed and
delivered such Assignment and Acceptance.  The replacement of any Defaulting
Lender shall be made in accordance with the terms of Section 12.07.

(d)The operation of this Section shall not be construed to increase or otherwise
affect the Commitments of any Lender, to relieve or excuse the performance by
such Defaulting Lender or any other Lender of its duties and obligations
hereunder, or to relieve or excuse the performance by any Borrower of its duties
and obligations hereunder to the Administrative Agent or to the Lenders other
than such Defaulting Lender.

(e)This Section shall remain effective with respect to such Lender until either
(i) the Obligations under this Agreement shall have been declared or shall have
become immediately due and payable or (ii) the non-Defaulting Lenders, the
Agents, and the Borrowers shall have waived such Defaulting Lender’s default in
writing, and the Defaulting Lender makes its Pro Rata Share of the applicable
defaulted Loans and pays to the Agents all amounts owing by such Defaulting
Lender in respect thereof; provided that no adjustments will be made
retroactively with respect to fees accrued or payments made by or on behalf of
the Borrowers while such Lender was a Defaulting Lender; provided, further, that
except to the extent otherwise expressly agreed by the affected parties, no
change hereunder from Defaulting Lender to Lender will constitute a waiver or
release of any claim of any party hereunder arising from such Lender’s having
been a Defaulting Lender.

 

- 66 -

 

 

--------------------------------------------------------------------------------

 

Section 4.05Administrative Borrower; Joint and Several Liability of the
Borrowers.

(a)Each Borrower hereby irrevocably appoints Patriot as the borrowing agent and
attorney-in-fact for the Borrowers (the “Administrative Borrower”) which
appointment shall remain in full force and effect unless and until the Agents
shall have received prior written notice signed by all of the Borrowers that
such appointment has been revoked and that another Borrower has been appointed
Administrative Borrower.  Each Borrower hereby irrevocably appoints and
authorizes the Administrative Borrower (i) to provide to the Agents and receive
from the Agents all notices with respect to Loans obtained for the benefit of
any Borrower and all other notices and instructions under this Agreement and
(ii) to take such action as the Administrative Borrower deems appropriate on its
behalf to obtain Loans and to exercise such other powers as are reasonably
incidental thereto to carry out the purposes of this Agreement.  It is
understood that the handling of the Loan Account and Collateral of the Borrowers
in a combined fashion, as more fully set forth herein, is done solely as an
accommodation to the Borrowers in order to utilize the collective borrowing
powers of the Borrowers in the most efficient and economical manner and at their
request, and that neither the Agents nor the Lenders shall incur liability to
the Borrowers as a result hereof.  Each Borrower expects to derive benefit,
directly or indirectly, from the handling of the Loan Account and the Collateral
in a combined fashion since the successful operation of each Borrower is
dependent on the continued successful performance of the integrated group.

(b)Each Borrower hereby accepts joint and several liability hereunder and under
the other Loan Documents in consideration of the financial accommodations to be
provided by the Agents and the Lenders under this Agreement and the other Loan
Documents, for the mutual benefit, directly and indirectly, of each of the
Borrowers and in consideration of the undertakings of the other Borrowers to
accept joint and several liability for the Obligations.  Each of the Borrowers,
jointly and severally, hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several liability with the
other Borrowers, with respect to the payment and performance of all of the
Obligations (including, without limitation, any Obligations arising under this
Section 4.05), it being the intention of the parties hereto that all of the
Obligations shall be the joint and several obligations of each of the Borrowers
without preferences or distinction among them.  If and to the extent that any of
the Borrowers shall fail to make any payment with respect to any of the
Obligations as and when due or to perform any of the Obligations in accordance
with the terms thereof, then in each such event, the other Borrowers will make
such payment with respect to, or perform, such Obligation.  Subject to the terms
and conditions hereof, the Obligations of each of the Borrowers under the
provisions of this Section 4.05 constitute the absolute and unconditional, full
recourse Obligations of each of the Borrowers, enforceable against each such
Person to the full extent of its properties and assets, irrespective of the
validity, regularity or enforceability of this Agreement, the other Loan
Documents or any other circumstances whatsoever.

 

- 67 -

 

 

--------------------------------------------------------------------------------

 

(c)The provisions of this Section 4.05 are made for the benefit of the Agents,
the Lenders and their successors and assigns, and may be enforced by them from
time to time against any or all of the Borrowers as often as occasion therefor
may arise and without requirement on the part of the Agents, the Lenders or such
successors or assigns first to marshal any of its or their claims or to exercise
any of its or their rights against any of the other Borrowers or to exhaust any
remedies available to it or them against any of the other Borrowers or to resort
to any other source or means of obtaining payment of any of the Obligations
hereunder or to elect any other remedy.  The provisions of this Section 4.05
shall remain in effect until all of the Obligations shall have been paid in full
or otherwise fully satisfied.

(d)Each of the Borrowers hereby agrees that it will not enforce any of its
rights of contribution or subrogation against the other Borrowers with respect
to any liability incurred by it hereunder or under any of the other Loan
Documents, any payments made by it to the Agents or the Lenders with respect to
any of the Obligations or any Collateral, until such time as all of the
Obligations have been paid in full in cash.  Any claim which any Borrower may
have against any other Borrower with respect to any payments to the Agents or
the Lenders hereunder or under any other Loan Documents are hereby expressly
made subordinate and junior in right of payment, without limitation as to any
increases in the Obligations arising hereunder or thereunder, to the prior
payment in full in cash of the Obligations.

ARTICLE V

CONDITIONS TO LOANS

Section 5.01Conditions Precedent to Effectiveness. This Agreement shall become
effective as of the Business Day (the ”Effective Date”) when each of the
following conditions precedent shall have been satisfied in a manner
satisfactory to the Agents:

(a)Payment of Fees, Etc.  The Borrowers shall have paid on or before the
Effective Date all fees, costs, expenses and taxes then payable pursuant to
Section 2.06 and Section 12.04.

(b)Representations and Warranties; No Event of Default.  The following
statements shall be true and correct:  (i) the representations and warranties
contained in Article VI and in each other Loan Document, certificate or other
writing delivered to any Secured Party pursuant hereto or thereto on or prior to
the Effective Date are true and correct in all material respects on and as of
the Effective Date as though made on and as of such date, except to the extent
that any such representation or warranty expressly relates solely to an earlier
date (in which case such representation or warranty shall be true and correct on
and as of such earlier date) and (ii) no Default or Event of Default shall have
occurred and be continuing on the Effective Date or would result from this
Agreement or the other Loan Documents becoming effective in accordance with its
or their respective terms.

(c)Legality.  The making of the initial Loans shall not contravene any law, rule
or regulation applicable to any Secured Party.

 

- 68 -

 

 

--------------------------------------------------------------------------------

 

(d)Delivery of Documents.  The Collateral Agent shall have received on or before
the Effective Date the following, each in form and substance satisfactory to the
Collateral Agent and, unless indicated otherwise, dated the Effective Date and,
if applicable, duly executed by the Persons party thereto:

(i)a Security Agreement, together with the original stock certificates
representing all of the Equity Interests and all promissory notes required to be
pledged thereunder, accompanied by undated stock powers executed in blank and
other proper instruments of transfer;

(ii)evidence satisfactory to the Collateral Agent of the filing of appropriate
financing statements on Form UCC‑1 in such office or offices as may be necessary
or, in the opinion of the Collateral Agent, desirable to perfect the security
interests purported to be created by each Security Agreement and each Mortgage;

(iii)the results of searches for any effective UCC financing statements, tax
Liens or judgment Liens filed against any Loan Party or its property, which
results shall not show any such Liens (other than Permitted Liens acceptable to
the Collateral Agent);

(iv)a Perfection Certificate;

(v)the Disbursement Letter;

(vi)the Intercompany Subordination Agreement;

(vii)a certificate of an Authorized Officer of each Loan Party, certifying (A)
as to copies of the Governing Documents of such Loan Party, together with all
amendments thereto (including, without limitation, a true and complete copy of
the charter, certificate of formation, certificate of limited partnership or
other publicly filed organizational document of each Loan Party certified as of
a recent date not more than 30 days prior to the Effective Date by an
appropriate official of the jurisdiction of organization of such Loan Party
which shall set forth the same complete name of such Loan Party as is set forth
herein and the organizational number of such Loan Party, if an organizational
number is issued in such jurisdiction), (B) as to a copy of the resolutions or
written consents of such Loan Party authorizing (1) the borrowings hereunder and
the transactions contemplated by the Loan Documents to which such Loan Party is
or will be a party, and (2) the execution, delivery and performance by such Loan
Party of each Loan Document to which such Loan Party is or will be a party and
the execution and delivery of the other documents to be delivered by such Person
in connection herewith and therewith, (C) the names and true signatures of the
representatives of such Loan Party authorized to sign each Loan Document (in the
case of a Borrower, including, without limitation, Notices of Borrowing, LIBOR
Notices and all other notices under this Agreement and the other Loan Documents)
to which such Loan Party is or will be a party and the other documents to be
executed and delivered by such Loan Party in connection herewith and therewith,
together with evidence of the incumbency of such authorized officers and (D) as
to the matters set forth in Section 5.01(b);

 

- 69 -

 

 

--------------------------------------------------------------------------------

 

(viii)a certificate of the chief financial officer of Patriot (A) setting forth
in reasonable detail the calculations required to establish compliance, on a pro
forma basis after giving effect to the Loans, with each of the financial
covenants contained in Section 7.03 (as if the covenants applicable to the
quarter ending March 31, 2017 applied on the Effective Date), (B) certifying
that all tax returns required to be filed by the Loan Parties have been filed
and all taxes upon the Loan Parties or their properties, assets, and income
(including real property taxes and payroll taxes) have been paid, except to the
extent contested in good faith by proper proceedings and with respect to which
adequate reserves have been set aside for the payment thereof on the Financial
Statements in accordance with GAAP, (C) attaching a copy of the Financial
Statements and the Projections described in Section 6.01(g)(ii) hereof and
certifying as to the compliance in all material respects with the
representations and warranties set forth in Section 6.01(g)(i) and Section
6.01(g)(ii) and (D) attaching a copy of the solvency analysis provided by Duff &
Phelps to the Board of Directors of Patriot;

(ix)a certificate of the chief financial officer of each Loan Party, certifying
as to the solvency of such Loan Party (after giving effect to the Loans made on
the Effective Date);

(x)a certificate of an Authorized Officer of the Administrative Borrower
certifying that (A) the attached copies of the Material Contracts as in effect
on the Effective Date are true, complete and correct copies thereof and (B) such
agreements remain in full force and effect and that none of the Loan Parties has
breached or defaulted in any of its obligations under such agreements;

(xi)a certificate of the appropriate official(s) of the jurisdiction of
organization and, except to the extent such failure to be so qualified could not
reasonably be expected to have a Material Adverse Effect, each jurisdiction of
foreign qualification of each Loan Party certifying as of a recent date not more
than 30 days prior to the Effective Date as to the subsistence in good standing
of, and the payment of taxes by, such Loan Party in such jurisdictions;

(xii)an opinion of BakerHostetler, counsel to the Loan Parties, as to such
matters as the Collateral Agent may reasonably request;

(xiii)evidence of the insurance coverage required by Section 7.01 and the terms
of each Security Agreement and each Mortgage and such other insurance coverage
with respect to the business and operations of the Loan Parties as the
Collateral Agent may reasonably request, in each case, where requested by the
Collateral Agent;

(xiv)a collateral access agreement, in form and substance reasonably
satisfactory to the Collateral Agent, executed by each Person who possesses
Inventory of any Loan Party, which Inventory has a fair market value in excess
of $250,000;

 

- 70 -

 

 

--------------------------------------------------------------------------------

 

(xv)evidence of the payment in full of all Indebtedness under the Existing
Credit Facility, together with (A) a termination and release agreement with
respect to the Existing Credit Facility and all related documents, duly executed
by the Loan Parties and the Existing Lenders, (B) a satisfaction of mortgage for
each mortgage filed by the Existing Lender on each Facility, (C) a termination
of security interest in Intellectual Property for each assignment for security
recorded by the Existing Lenders at the United States Patent and Trademark
Office or the United States Copyright Office and covering any intellectual
property of the Loan Parties, and (D) UCC‑3 termination statements for all UCC-1
financing statements filed by the Existing Lenders and covering any portion of
the Collateral; and

(xvi)such other agreements, instruments, approvals, opinions and other
documents, each satisfactory to the Agents in form and substance, as any Agent
may reasonably request.

(e)Material Adverse Effect.  The Collateral Agent shall have determined, in its
sole judgment, that no event or development shall have occurred since December
31, 2015 which could reasonably be expected to have a Material Adverse Effect.

(f)Approvals.  All consents, authorizations and approvals of, and filings and
registrations with, and all other actions in respect of, any Governmental
Authority or other Person required in connection with the making of the Loans
shall have been obtained and shall be in full force and effect.  

Section 5.02Conditions Precedent to All Loans.  The obligation of any Agent or
any Lender to make any Loan after the Effective Date is subject to the
fulfillment, in a manner satisfactory to the Administrative Agent, of each of
the following conditions precedent:

(a)Payment of Fees, Etc.  The Borrowers shall have paid all fees, costs,
expenses and taxes then payable by the Borrowers pursuant to this Agreement and
the other Loan Documents, including, without limitation, Section 2.06 and
Section 12.04 hereof.

(b)Representations and Warranties; No Event of Default.  The following
statements shall be true and correct, and the submission by the Administrative
Borrower to the Administrative Agent of a Notice of Borrowing with respect to
each such Loan, and the Borrowers’ acceptance of the proceeds of such Loan,
shall each be deemed to be a representation and warranty by each Loan Party on
the date of such Loan that:  (i) the representations and warranties contained in
Article VI and in each other Loan Document, certificate or other writing
delivered to any Secured Party pursuant hereto or thereto on or prior to the
date of such Loan are true and correct in all material respects (except that
such materiality qualifier shall not be applicable to any representations or
warranties that already are qualified or modified as to materiality or “Material
Adverse Effect” in the text thereof, which representations and warranties shall
be true and correct in all respects subject to such qualification) on and as of
such date as though made on and as of such date, except to the extent that any
such representation or warranty expressly relates solely to an earlier date (in
which case such representation or warranty shall be true and correct on and as
of such earlier date), (ii) at the time of and after giving effect to the making
of such Loan and the application of the proceeds thereof, no Default or Event of
Default has occurred and is continuing or would result from the making of the
Loan to be made, on such date and (iii) the conditions set forth in this Section
5.02 have been satisfied as of the date of such request.

 

- 71 -

 

 

--------------------------------------------------------------------------------

 

(c)Legality.  The making of such Loan shall not contravene any law, rule or
regulation applicable to any Secured Party.

(d)Notices.  The Administrative Agent shall have received a Notice of Borrowing
pursuant to Section 2.02 hereof.

(e)Proceedings; Receipt of Documents.  All proceedings in connection with the
making of such Loan and the other transactions contemplated by this Agreement
and the other Loan Documents, and all documents incidental hereto and thereto,
shall be satisfactory to the Agents and their counsel, and the Agents and such
counsel shall have received such other agreements, instruments, approvals,
opinions and other documents, each in form and substance reasonably satisfactory
to the Agents, as any Agent may reasonably request.

Section 5.03Conditions Subsequent to Effectiveness. As an accommodation to the
Loan Parties, the Agents and the Lenders have agreed to execute this Agreement
and to make the Loans on the Effective Date notwithstanding the failure by the
Loan Parties to satisfy the conditions set forth below on or before the
Effective Date.  In consideration of such accommodation, the Loan Parties agree
that, in addition to all other terms, conditions and provisions set forth in
this Agreement and the other Loan Documents, including, without limitation,
those conditions set forth in Section 5.01, the Loan Parties shall satisfy each
of the conditions subsequent set forth below on or before the date applicable
thereto (it being understood that (i) the failure by the Loan Parties to perform
or cause to be performed any such condition subsequent on or before the date
applicable thereto shall constitute an Event of Default and (ii) to the extent
that the existence of any such condition subsequent would otherwise cause any
representation, warranty or covenant in this Agreement or any other Loan
Document to be breached, the Required Lenders hereby waive such breach for the
period from the Effective Date until the date on which such condition subsequent
is required to be fulfilled pursuant to this Section 5.03):

(a)Within 3 days after the Effective Date (or such later date as may be
permitted by the Agents in their sole discretion), the Agents shall have
received evidence reasonably satisfactory to the Agents of the payment of all
stamp taxes that are required to be paid under the laws of the State of Florida
in connection with the Loans and any of the other transactions contemplated
herein.

(b)Pursuant to Section 8.01(a) hereof, within 45 days after the Effective Date
(or such later date as may be permitted by the Agents in their sole discretion),
the Agents shall have received Control Agreements, each reasonably satisfactory
to the Agents, with respect to each of the Cash Management Accounts.

(c)Within 30 days after the Effective Date (or such later date as may be
permitted by the Agents in their sole discretion), the Agents shall have
received endorsements as to the named insureds or lender loss payees under the
insurance policies set forth on Schedule 6.01(r) as required under Section
7.01(h) and providing that such policy may be terminated or canceled (by the
insurer or the insured thereunder) only upon 30 days’ prior written notice to
the Collateral Agent and each such named insured or lender loss payee, together
with evidence of the payment of all premiums due in respect thereof for such
period as the Collateral Agent may request.

 

- 72 -

 

 

--------------------------------------------------------------------------------

 

(d)On or before January 31, 2017 (or such later date as may be permitted by the
Agents in their sole discretion), the Agents shall have received evidence
reasonably satisfactory to the Agents that the Facility located at 715 Congaree
Road, Greenville, South Carolina 29607 (the “SC Property”) shall have been sold
by Patriot; provided that if Patriot or one of its Subsidiaries owns the SC
Property after January 31, 2017, then no later February 28, 2017 (or such later
date as may be permitted by the Agents in their sole discretion), the Agents
shall have received each of the Real Property Deliverables with respect to the
SC Property.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

Section 6.01Representations and Warranties. Each Loan Party hereby represents
and warrants to the Secured Parties as follows:

(a)Organization, Good Standing, Etc. Each Loan Party (i) is a corporation,
limited liability company or limited partnership duly organized, validly
existing and in good standing under the laws of the state or jurisdiction of its
organization, (ii) has all requisite power and authority to conduct its business
as now conducted and as presently contemplated and, in the case of the
Borrowers, to make the borrowings hereunder, and to execute and deliver each
Loan Document to which it is a party, and to consummate the transactions
contemplated thereby, and (iii) is duly qualified to do business and is in good
standing in each jurisdiction in which the character of the properties owned or
leased by it or in which the transaction of its business makes such
qualification necessary, except (solely for the purposes of this subclause
(iii)) where the failure to be so qualified and in good standing could
reasonably be expected to have a Material Adverse Effect.

(b)Authorization, Etc. The execution, delivery and performance by each Loan
Party of each Loan Document to which it is or will be a party, (i) have been
duly authorized by all necessary action, (ii) do not and will not contravene (A)
any of its Governing Documents, (B) any applicable Requirement of Law or (C) any
Contractual Obligation binding on or otherwise affecting it or any of its
properties, (iii) do not and will not result in or require the creation of any
Lien (other than pursuant to any Loan Document) upon or with respect to any of
its properties, and (iv) do not and will not result in any default,
noncompliance, suspension, revocation, impairment, forfeiture or nonrenewal of
any permit, license, authorization or approval applicable to its operations or
any of its properties, except, in the case of clauses (ii)(B), (ii)(C) and (iv),
to the extent where such contravention, default, noncompliance, suspension,
revocation, impairment, forfeiture or nonrenewal could not reasonably be
expected to have a Material Adverse Effect.

(c)Governmental Approvals. No authorization or approval or other action by, and
no notice to or filing with, any Governmental Authority is required in
connection with the due execution, delivery and performance by any Loan Party of
any Loan Document to which it is or will be a party other than filings and
recordings with respect to Collateral to be made, or otherwise delivered to the
Collateral Agent for filing or recordation, on the Effective Date.

 

- 73 -

 

 

--------------------------------------------------------------------------------

 

(d)Enforceability of Loan Documents. This Agreement is, and each other Loan
Document to which any Loan Party is or will be a party, when delivered
hereunder, will be, a legal, valid and binding obligation of such Person,
enforceable against such Person in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors’ rights generally and by general principles of equity.

(e)Capitalization. On the Effective Date, after giving effect to the
transactions contemplated hereby to occur on the Effective Date, the authorized
Equity Interests of Patriot and each of its Subsidiaries and the issued and
outstanding Equity Interests of Patriot and each of its Subsidiaries are as set
forth on Schedule 6.01(e).  All of the issued and outstanding shares of Equity
Interests of Patriot and each of its Subsidiaries have been validly issued and
are fully paid and nonassessable, and the holders thereof are not entitled to
any preemptive, first refusal or other similar rights.  All Equity Interests of
such Subsidiaries of Patriot are owned by Patriot free and clear of all Liens
(other than Permitted Specified Liens).  Except as described on Schedule
6.01(e), there are no outstanding debt or equity securities of Patriot or any of
its Subsidiaries and no outstanding obligations of Patriot or any of its
Subsidiaries convertible into or exchangeable for, or warrants, options or other
rights for the purchase or acquisition from Patriot or any of its Subsidiaries,
or other obligations of Patriot or any of its Subsidiaries to issue, directly or
indirectly, any shares of Equity Interests of Patriot or any of its
Subsidiaries.

(f)Litigation. Except as set forth in Schedule 6.01(f), there is no pending or,
to the best knowledge of any Loan Party, threatened action, suit or proceeding
affecting any Loan Party or any of its properties before any court or other
Governmental Authority or any arbitrator that (i) if adversely determined, could
reasonably be expected to have a Material Adverse Effect or (ii) relates to this
Agreement or any other Loan Document or any transaction contemplated hereby or
thereby.

(g)Financial Statements.

(i)The Financial Statements, copies of which have been delivered to each Agent
and each Lender, fairly present in all material respects the consolidated
financial condition of Patriot and its Subsidiaries as at the respective dates
thereof and the consolidated results of operations of Patriot and its
Subsidiaries for the fiscal periods ended on such respective dates, all in
accordance with GAAP, subject to the absence of footnotes and normal year-end
adjustments for Financial Statements that are not audited.  All material
indebtedness and other liabilities (including, without limitation, Indebtedness,
liabilities for taxes, long-term leases and other unusual forward or long-term
commitments), direct or contingent, of Patriot and its Subsidiaries are set
forth in the Financial Statements to the extent that such indebtedness and other
liabilities are required to be disclosed on such Financial Statements in
accordance with GAAP.  Since December 31, 2015, no event or development has
occurred that has had or could reasonably be expected to have a Material Adverse
Effect.

 

- 74 -

 

 

--------------------------------------------------------------------------------

 

(ii)Patriot has heretofore furnished to each Agent and each Lender (A) projected
quarterly balance sheets, income statements and statements of cash flows of
Patriot and its Subsidiaries for the period from October 1, 2016, through
December 31, 2021, and (B) projected annual balance sheets, income statements
and statements of cash flows of Patriot and its Subsidiaries for the Fiscal
Years ending in December 31, 2016 through December 31, 2021, which projected
financial statements shall be updated from time to time pursuant to Section
7.01(a)(vii).  

(h)Compliance with Law, Etc. No Loan Party or any of its Subsidiaries is in
violation of (i) any of its Governing Documents, (ii) any Requirement of Law,
except where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect, or (iii) any term of any Contractual Obligation
(including, without limitation, any Material Contract) binding on or otherwise
affecting it or any of its properties, except where the failure to so comply
could not reasonably be expected to have a Material Adverse Effect, and as of
the Effective Date, no default or event of default has occurred and is
continuing thereunder.

(i)ERISA. Except as set forth on Schedule 6.01(i), (i) each Employee Plan is in
substantial compliance with ERISA and the Internal Revenue Code, (ii) no
Termination Event has occurred nor is reasonably expected to occur with respect
to any Employee Plan, (iii) the most recent annual report (Form 5500 Series)
with respect to each Employee Plan, including any required Schedule B (Actuarial
Information) thereto, copies of which have been filed with the Internal Revenue
Service and delivered to the Agents, is complete and correct and fairly presents
the funding status of such Employee Plan, and since the date of such report
there has been no material adverse change in such funding status, (iv) copies of
each agreement entered into with the PBGC, the U.S. Department of Labor or the
Internal Revenue Service with respect to any Employee Plan have been delivered
to the Agents, (v) no Employee Plan had an accumulated or waived funding
deficiency or permitted decrease which would create a deficiency in its funding
standard account or has applied for an extension of any amortization period
within the meaning of Section 412 of the Internal Revenue Code at any time
during the previous 60 months, and (vi) no Lien imposed under the Internal
Revenue Code or ERISA exists or is likely to arise on account of any Employee
Plan within the meaning of Section 412 of the Internal Revenue Code.  Except as
set forth on Schedule 6.01(i), no Loan Party or any of its ERISA Affiliates has
incurred any withdrawal liability under ERISA with respect to any Multiemployer
Plan, or is aware of any facts indicating that it or any of its ERISA Affiliates
may in the future incur any such withdrawal liability.  No Loan Party or any of
its ERISA Affiliates nor any fiduciary of any Employee Plan has (i) engaged in a
nonexempt prohibited transaction described in Sections 406 of ERISA or 4975 of
the Internal Revenue Code, (ii) failed to pay any required installment or other
payment required under Section 412 of the Internal Revenue Code on or before the
due date for such required installment or payment, (iii) engaged in a
transaction within the meaning of Section 4069 of ERISA or (iv) incurred any
liability to the PBGC which remains outstanding other than the payment of
premiums, and there are no premium payments which have become due which are
unpaid.  There are no pending or, to the best knowledge of any Loan Party,
threatened claims, actions, proceedings or lawsuits (other than claims for
benefits in the normal course) asserted or instituted against (i) any Employee
Plan or its assets, (ii) any fiduciary with respect to any Employee Plan, or
(iii) any Loan Party or any of its ERISA Affiliates with respect to any Employee
Plan.  Except as required by Section 4980B of the Internal Revenue  Code, no
Loan Party or any of its ERISA Affiliates maintains an employee welfare benefit
plan (as

 

- 75 -

 

 

--------------------------------------------------------------------------------

 

defined in Section 3(1) of ERISA) which provides health or welfare benefits
(through the purchase of insurance or otherwise) for any retired or former
employee of any Loan Party or any of its ERISA Affiliates or coverage after a
participant’s termination of employment.

(j)Taxes, Etc. All foreign, Federal and material provincial, state and local tax
returns and other reports required by applicable Requirements of Law to be filed
by any Loan Party have been filed, or extensions have been obtained, and (ii)
all taxes, assessments and other governmental charges imposed upon any Loan
Party or any property of any Loan Party in an aggregate amount for all such
taxes, assessments and other governmental charges exceeding $500,000 and which
have become due and payable on or prior to the date hereof have been paid, with
respect to which adequate reserves have been set aside for the payment thereof
on the Financial Statements in accordance with GAAP.

(k)Regulations T, U and X. No Loan Party is or will be engaged in the business
of extending credit for the purpose of purchasing or carrying margin stock
(within the meaning of Regulation T, U or X), and no proceeds of any Loan will
be used to purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any margin stock or for any purpose that
violates, or is inconsistent with, the provisions of Regulation T, U and X.

(l)Nature of Business.

(i)No Loan Party is engaged in any business other than as set forth on Schedule
6.01(l).

(ii)Except as identified in the Financial Statements or as disclosed in publicly
available filings with the SEC, Patriot does not have any material liabilities
(other than liabilities arising under the Loan Documents), own any material
assets (other than the Equity Interests of its Subsidiaries) or engage in any
operations or business (other than the ownership of its Subsidiaries).

(m)Adverse Agreements, Etc. No Loan Party or any of its Subsidiaries is a party
to any Contractual Obligation or subject to any restriction or limitation in any
Governing Document or any judgment, order, regulation, ruling or other
requirement of a court or other Governmental Authority, which (either
individually or in the aggregate) has, or in the future could reasonably be
expected (either individually or in the aggregate) to have, a Material Adverse
Effect.

(n)Permits, Etc. Each Loan Party has, and is in compliance with, all permits,
licenses, authorizations, approvals, entitlements and accreditations required
for such Person lawfully to own, lease, manage or operate, or to acquire, each
business and Facility currently owned, leased, managed or operated, or to be
acquired, by such Person, except to the extent the failure to have or be in
compliance therewith could not reasonably be expected to have a Material Adverse
Effect.  

 

- 76 -

 

 

--------------------------------------------------------------------------------

 

(o)Properties. Each Loan Party has good and marketable title to, valid leasehold
interests in, or valid licenses to use, all property and assets material to its
business, free and clear of all Liens, except Permitted Liens.  All such
properties and assets are in good working order and condition, ordinary wear and
tear excepted.

(p)Employee and Labor Matters. Except as could not reasonably be expected to
have a Material Adverse Effect, there is (i) no unfair labor practice complaint
pending or, to the best knowledge of any Loan Party, threatened against any Loan
Party before any Governmental Authority and no grievance or arbitration
proceeding pending or threatened against any Loan Party which arises out of or
under any collective bargaining agreement, (ii) no strike, labor dispute,
slowdown, stoppage or similar action or grievance pending or threatened against
any Loan Party or (iii) to the best knowledge of each Loan Party, no union
representation question existing with respect to the employees of any Loan Party
and no union organizing activity taking place with respect to any of the
employees of any Loan Party.  Except as could not reasonably be expected to have
a Material Adverse Effect, no Loan Party or any of its ERISA Affiliates has
incurred any liability or obligation under the Worker Adjustment and Retraining
Notification Act (“WARN”) or similar state law, which remains unpaid or
unsatisfied.  The hours worked and payments made to employees of any Loan Party
have not been in violation of the Fair Labor Standards Act or any other
applicable legal requirements, except to the extent such violation could not
reasonably be expected to have a Material Adverse Effect.  All payments due from
any Loan Party on account of wages and employee health and welfare insurance and
other benefits have been paid or accrued as a liability on the books of such
Loan Party, except to the extent that the failure to pay or accrue such amount
could not reasonably be expected to result in a Material Adverse Effect.

(q)Environmental Matters. Except as set forth on Schedule 6.01(q), (i) the
operations of each Loan Party are in compliance with all Environmental Laws,
except to the extent that such non-compliance could not reasonably be expected
to result in a Material Adverse Effect; (ii) there has been no Release at any of
the properties owned or operated by any Loan Party or a predecessor in interest,
or at any disposal or treatment facility which received Hazardous Materials
generated by any Loan Party or any predecessor in interest which could
reasonably be expected to have a Material Adverse Effect; (iii) no Environmental
Action has been asserted against any Loan Party or any predecessor in interest
nor does any Loan Party have knowledge or notice of any threatened or pending
Environmental Action against any Loan Party or any predecessor in interest which
could reasonably be expected to have a Material Adverse Effect; (iv) no
Environmental Actions have been asserted against any facilities that may have
received Hazardous Materials generated by any Loan Party or any predecessor in
interest which could reasonably be expected to have a Material Adverse Effect;
(v) to the knowledge of the Borrower, no property now or formerly owned or
operated by a Loan Party has been used as a treatment or disposal site for any
Hazardous Material; (vi) no Loan Party has failed to report to the proper
Governmental Authority any Release which is required to be so reported by any
Environmental Laws which could reasonably be expected to have a Material Adverse
Effect; (vii) each Loan Party holds all licenses, permits and approvals required
under any Environmental Laws in connection with the operation of the business
carried on by it, except for such licenses, permits and approvals as to which a
Loan Party’s failure to maintain or comply with could not reasonably be expected
to have a Material Adverse Effect; and (viii) no Loan Party has received any
notification pursuant to any Environmental Laws that (A) any work, repairs,
construction or

 

- 77 -

 

 

--------------------------------------------------------------------------------

 

Capital Expenditures are required to be made in respect as a condition of
continued compliance with any Environmental Laws, or any license, permit or
approval issued pursuant thereto or (B) any license, permit or approval referred
to above is about to be reviewed, made, subject to limitations or conditions,
revoked, withdrawn or terminated, in each case, except as could not reasonably
be expected to have a Material Adverse Effect.

(r)Insurance. Each Loan Party maintains the insurance and required services and
financial assurance as required by law and as required by Section
7.01(h).  Schedule 6.01(r) sets forth a list of all insurance maintained by each
Loan Party on the Effective Date.

(s)Use of Proceeds. The proceeds of the Loans shall be used to (a) refinance
existing indebtedness of the Loan Parties, (b) fund the Effective Date Dividend,
(c) fund the Effective Date Stock Buyback, (d) for general working capital
requirements and other general corporate purposes of the Loan Parties and (e) to
pay fees and expenses in connection with the transactions contemplated by this
Agreement .  

(t)Solvency. After giving effect to the transactions contemplated by this
Agreement and before and after giving effect to each Loan, each Loan Party is,
and the Loan Parties on a consolidated basis are, Solvent.  No transfer of
property is being made by any Loan Party and no obligation is being incurred by
any Loan Party in connection with the transactions contemplated by this
Agreement or the other Loan Documents with the intent to hinder, delay, or
defraud either present or future creditors of such Loan Party.

(u)Intellectual Property. Except as set forth on Schedule 6.01(u), each Loan
Party owns or licenses or otherwise has the right to use all Intellectual
Property rights that are necessary for the operation of its business, without
infringement upon or conflict with the rights of any other Person with respect
thereto, except for such infringements and conflicts which, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect.  Set forth on Schedule 6.01(u) is a complete and accurate list as of the
Effective Date of (i) each item of Registered Intellectual Property owned by
each Loan Party and (ii) each material work of authorship owned by each Loan
party and which is not Registered Intellectual Property.  No trademark or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by any Loan Party infringes
upon or conflicts with any rights owned by any other Person, and no claim or
litigation regarding any of the foregoing is pending or, to the knowledge of the
Borrower threatened, except for such infringements and conflicts which could not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.  To the knowledge of each Loan Party, no patent, invention,
device, application, principle or any statute, law, rule, regulation, standard
or code pertaining to Intellectual Property is pending or proposed, which,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

 

- 78 -

 

 

--------------------------------------------------------------------------------

 

(v)Material Contracts. Set forth on Schedule 6.01(v) is a complete and accurate
list as of the Effective Date of all Material Contracts of each Loan Party,
showing the parties and subject matter thereof and amendments and modifications
thereto.  Each such Material Contract (i) is in full force and effect and is
binding upon and enforceable against each Loan Party that is a party thereto
and, to the best knowledge of such Loan Party, all other parties thereto in
accordance with its terms, (ii) has not been otherwise amended or modified, and
(iii) is not in default due to the action of any Loan Party or, to the best
knowledge of any Loan Party, any other party thereto.

(w)Investment Company Act. None of the Loan Parties is (i) an “investment
company” or an “affiliated person” or “promoter” of, or “principal underwriter”
of or for, an “investment company”, as such terms are defined in the Investment
Company Act of 1940, as amended, or (ii) subject to regulation under any
Requirement of Law that limits in any respect its ability to incur Indebtedness
or which may otherwise render all or a portion of the Obligations unenforceable.

(x)Material Customers. Except as could not reasonably be expected to result in a
Material Adverse Effect, there exists no actual or, to the Borrowers’ knowledge,
threatened termination, cancellation or limitation of, or modification to or
change in, the business relationship between any Loan Party, on the one hand,
and any customer or any group thereof, on the other hand, whose agreements with
any Loan Party are individually or in the aggregate material to the business or
operations of such Loan Party; and there exists no present state of facts or
circumstances that could give rise to or result in any such termination,
cancellation, limitation, modification or change.

(y)[Intentionally Omitted].

(z)[Intentionally Omitted].

(aa)[Intentionally Omitted].

(bb)Anti-Money Laundering and Anti-Terrorism Laws.

(i)None of the Loan Parties, nor any Affiliate of any of the Loan Parties, has
violated or is in violation of any of the Anti-Money Laundering and
Anti-Terrorism Laws or has engaged in or conspired to engage in any transaction
that evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the Anti-Money Laundering and Anti-Terrorism Laws.

(ii)None of the Loan Parties, nor any Affiliate of any of the Loan Parties, nor
any officer or director of any of the Loan Parties, nor any of the Loan Parties’
respective agents acting or benefiting in any capacity in connection with the
Loans or other transactions hereunder, is a Blocked Person.  

 

- 79 -

 

 

--------------------------------------------------------------------------------

 

(iii)None of the Loan Parties, nor any of their agents acting in any capacity in
connection with the Loans or other transactions hereunder, (A) conducts any
business with or for the benefit of any Blocked Person or engages in making or
receiving any contribution of funds, goods or services to, from or for the
benefit of any Blocked Person, or (B) deals in, or otherwise engages in any
transaction relating to, any property or interests in property blocked or
subject to blocking pursuant to any OFAC Sanctions Programs.

(cc)Anti-Bribery and Anti-Corruption Laws.

(i)The Loan Parties are in compliance with the U.S. Foreign Corrupt Practices
Act of 1977, as amended (the “FCPA”) and the anti-bribery and anti-corruption
laws of those jurisdictions in which they do business (collectively, the
“Anti-Corruption Laws”).

(ii)None of the Loan Parties has at any time:

(A)offered, promised, paid, given, or authorized the payment or giving of any
money, gift or other thing of value, directly or indirectly, to or for the
benefit of any employee, official, representative, or other person acting on
behalf of any foreign (i.e., non-U.S.) Governmental Authority thereof, or of any
public international organization, or any foreign political party or official
thereof, or candidate for foreign political office (collectively, “Foreign
Official”), for the purpose of: (1) influencing any act or decision of such
Foreign Official in his, her, or its official capacity; or (2) inducing such
Foreign Official to do, or omit to do, an act in violation of the lawful duty of
such Foreign Official, or (3) securing any improper advantage, in order to
obtain or retain business for, or with, or to direct business to, any Person; or

(B)acted or attempted to act in any manner which would subject any of the Loan
Parties to liability under any Anti-Corruption Law.

(iii)To the knowledge of the Loan Parties, as of the Effective Date, there are,
and have been, no allegations, investigations or inquiries with regard to a
potential violation of any Anti-Corruption Law by any of the Loan Parties or any
of their respective current directors, officers, employees, or other persons
acting or purporting to act on their behalf.  

(iv)The Loan Parties have adopted, implemented and maintain anti-bribery and
anti-corruption policies and procedures that are reasonably designed to ensure
compliance with the Anti-Corruption Laws.

(dd)Full Disclosure.

(i)Each Loan Party has disclosed to the Agents all agreements, instruments and
corporate or other restrictions to which it is subject, and all other matters
known to it, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect.  None of the reports, financial
statements, certificates or other information furnished by or on behalf of any
Loan Party to the Agents (other than forward-looking information and projections
and information of a general economic nature and general information about
Borrowers’ industry) in connection with the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished), when taken as a whole contains any material misstatement of fact or
omits to state any material fact necessary to make the statements therein, in
the light of the circumstances under which it was made, not misleading.  

 

- 80 -

 

 

--------------------------------------------------------------------------------

 

(ii)Projections, have been prepared on a reasonable basis and in good faith
based on assumptions, estimates, methods and tests that are believed by the Loan
Parties to be reasonable at the time such Projections were prepared and
information believed by the Loan Parties to have been accurate based upon the
information available to the Loan Parties at the time such Projections were
furnished to the Lenders, and Patriot is not be aware of any facts or
information that would lead it to believe that such Projections are incorrect or
misleading in any material respect; it being understood that (A) Projections are
by their nature subject to significant uncertainties and contingencies, many of
which are beyond the Loan Parties’ control, (B) actual results may differ
materially from the Projections and such variations may be material and (C) the
Projections are not a guarantee of performance.

ARTICLE VII

COVENANTS OF THE LOAN PARTIES

Section 7.01Affirmative Covenants. So long as any principal of or interest on
any Loan or any other Obligation (whether or not due) shall remain unpaid (other
than Contingent Indemnity Obligations) or any Lender shall have any Commitment
hereunder, each Loan Party will, unless the Required Lenders shall otherwise
consent in writing:

(a)Reporting Requirements.  Furnish to each Agent and each Lender:

(i)as soon as available, and in any event within 30 days after the end of each
fiscal month of Patriot and its Subsidiaries commencing with the first fiscal
month of Patriot and its Subsidiaries ending after the Effective Date,
internally prepared consolidated statements of operations as at the end of such
fiscal month, in reasonable detail and certified by an Authorized Officer of
Patriot as fairly presenting, in all material respects, the results of
operations of Patriot and its Subsidiaries for such fiscal month and for such
year-to-date period, in accordance with GAAP applied in a manner consistent with
that of the most recent audited financial statements furnished to the Agents and
the Lenders, subject to the absence of footnotes and normal year-end
adjustments;

(ii)as soon as available and in any event within 45 days after the end of each
fiscal quarter of Patriot and its Subsidiaries commencing with the first fiscal
quarter of Patriot and its Subsidiaries ending after the Effective Date,
consolidated and consolidating balance sheets, statements of operations and
retained earnings and statements of cash flows of Patriot and its Subsidiaries
as at the end of such quarter, and for the period commencing at the end of the
immediately preceding Fiscal Year and ending with the end of such quarter,
setting forth in each case in comparative form the figures for the corresponding
date or period set forth in (A) the financial statements for the immediately
preceding Fiscal Year and (B) the Projections, all in reasonable detail and
certified by an Authorized Officer of Patriot as fairly presenting, in all
material respects, the financial position of Patriot and its Subsidiaries as of
the end of such quarter and the results of operations and cash flows of Patriot
and its Subsidiaries for such quarter and for such year-to-date period, in
accordance with GAAP applied in a manner consistent with that of the most recent
audited financial statements of Patriot and its Subsidiaries furnished to the
Agents and the Lenders, subject to the absence of footnotes and normal year-end
adjustments;

 

- 81 -

 

 

--------------------------------------------------------------------------------

 

(iii)as soon as available, and in any event within 90 days after the end of each
Fiscal Year of Patriot and its Subsidiaries, consolidated and consolidating
balance sheets, statements of operations and retained earnings and statements of
cash flows of Patriot and its Subsidiaries as at the end of such Fiscal Year,
setting forth in each case in comparative form the figures for the corresponding
date or period set forth in (A) the financial statements for the immediately
preceding Fiscal Year, and (B) the Projections, all in reasonable detail and
prepared in accordance with GAAP, and accompanied by a report and an opinion,
prepared in accordance with generally accepted auditing standards, of
independent certified public accountants of recognized standing selected by
Patriot and satisfactory to the Agents (which opinion shall be without (1) a
“going concern” or like qualification or exception, (2) any qualification or
exception as to the scope of such audit, or (3) any qualification which relates
to the treatment or classification of any item and which, as a condition to the
removal of such qualification, would require an adjustment to such item, the
effect of which would be to cause any noncompliance with the provisions of
Section 7.03), together with a written statement of such accountants (x) to the
effect that, in making the examination necessary for their certification of such
financial statements, they have not obtained any knowledge of the existence of
an Event of Default or a Default under Section 7.03 and (y) if such accountants
shall have obtained any knowledge of the existence of an Event of Default or
such Default, describing the nature thereof;

(iv)simultaneously with the delivery of the financial statements of Patriot and
its Subsidiaries required by clauses (i), (ii) and (iii) of this Section
7.01(a), a certificate of an Authorized Officer of Patriot (a “Compliance
Certificate”):

(A)stating that such Authorized Officer has reviewed the provisions of this
Agreement and the other Loan Documents and has made or caused to be made under
his or her supervision a review of the condition and operations of Patriot and
its Subsidiaries during the period covered by such financial statements with a
view to determining whether Patriot and its Subsidiaries were in compliance with
all of the provisions of this Agreement and such Loan Documents at the times
such compliance is required hereby and thereby, and that such review has not
disclosed, and such Authorized Officer has no knowledge of, the occurrence and
continuance during such period of an Event of Default or Default or, if an Event
of Default or Default had occurred and continued or is continuing, describing
the nature and period of existence thereof and the action which Patriot and its
Subsidiaries propose to take or have taken with respect thereto,

(B)in the case of the delivery of the financial statements of Patriot and its
Subsidiaries required by clauses (ii) and (iii) of this Section 7.01(a), (1)
attaching a schedule showing the calculation of the financial covenants
specified in Section 7.03 and the calculation of the Leverage Ratio for the
applicable period for purposes of determining the Applicable Margin in
accordance with the terms of the definition thereof and (2) including a
discussion and analysis of the financial condition and results of operations of
Patriot and its Subsidiaries for the portion of the Fiscal Year then elapsed and
discussing the reasons for any significant variations from the Projections for
such period and the figures for the corresponding period in the previous Fiscal
Year, and

 

- 82 -

 

 

--------------------------------------------------------------------------------

 

(C)in the case of the delivery of the financial statements of Patriot and its
Subsidiaries required by clause (iii) of this Section 7.01(a), attaching (1) a
summary of all material insurance coverage maintained as of the date thereof by
any Loan Party and all material insurance coverage planned to be maintained by
any Loan Party, together with such other related documents and information as
the Administrative Agent may reasonably require, (2) the calculation of the
Excess Cash Flow in accordance with the terms of Section 2.05(c)(i) and (3)
confirmation that there have been no changes to the information contained in
each of the Perfection Certificates delivered on the Effective Date or the date
of the most recently updated Perfection Certificate delivered pursuant to this
clause (iv) and/or attaching an updated Perfection Certificate identifying any
such changes to the information contained  therein;

(v)simultaneously with the delivery of the financial statements of Patriot and
its Subsidiaries required by clause (ii) of this Section 7.01(a), reports in
form and detail reasonably satisfactory to the Agents and certified by an
Authorized Officer of the Administrative Borrower as being accurate and complete
in all material respects (A) listing all Accounts of the Loan Parties as of such
day, which shall include the amount and age of each such Account, showing
separately those which are more than 30, 60, 90 and 120 days old and a
description of all Liens, set-offs, defenses and counterclaims with respect
thereto, together with a reconciliation of such schedule with the schedule
delivered to the Agents pursuant to this clause (v)(A) for the immediately
preceding fiscal quarter, and such other information as any Agent may request
and (B) listing all accounts payable of the Loan Parties as of each such day
which shall include the amount and age of each such account payable, and such
other information as any Agent may reasonably request;

(vi)[Intentionally Omitted];  

(vii)as soon as available and in any event not later than 30 days after the end
of each Fiscal Year, a certificate of an Authorized Officer of Patriot (A)
attaching Projections for Patriot and its Subsidiaries, supplementing and
superseding the Projections previously required to be delivered pursuant to this
Agreement, prepared on a quarterly basis and otherwise in form and substance
satisfactory to the Agents, for the immediately succeeding Fiscal Year for
Patriot and its Subsidiaries and (B) certifying that the representations and
warranties set forth in Section 6.01(dd)(ii) are true and correct with respect
to the Projections;

(viii)promptly after submission to any Governmental Authority, all documents and
information furnished to such Governmental Authority in connection with any
investigation of any Loan Party other than routine inquiries by such
Governmental Authority;

(ix)as soon as possible, and in any event within 3 Business Days after a Loan
Party receives knowledge of the occurrence of an Event of Default or Default or
the occurrence of any event or development that could reasonably be expected to
have a Material Adverse Effect, the written statement of an Authorized Officer
of the Administrative Borrower setting forth the details of such Event of
Default or Default or other event or development having a Material Adverse
Effect and the action which the affected Loan Party proposes to take with
respect thereto;

 

- 83 -

 

 

--------------------------------------------------------------------------------

 

(x)(A) as soon as possible and in any event within 10 days after any Loan Party
or any ERISA Affiliate thereof knows or has reason to know that (1) any
Reportable Event with respect to any Employee Plan has occurred, (2) any other
Termination Event with respect to any Employee Plan has occurred, or (3) an
accumulated funding deficiency has been incurred or an application has been made
to the Secretary of the Treasury for a waiver or modification of the minimum
funding standard (including installment payments) or an extension of any
amortization period under Section 412 of the Internal Revenue Code with respect
to an Employee Plan, a statement of an Authorized Officer of the Administrative
Borrower setting forth the details of such occurrence and the action, if any,
which such Loan Party or such ERISA Affiliate proposes to take with respect
thereto, (B) promptly and in any event within 3 days after receipt thereof by
any Loan Party or any ERISA Affiliate thereof from the PBGC, copies of each
notice received by any Loan Party or any ERISA Affiliate thereof of the PBGC’s
intention to terminate any Plan or to have a trustee appointed to administer any
Plan, (C) promptly and in any event within 10 days after the filing thereof with
the Internal Revenue Service if requested by any Agent, copies of each Schedule
B (Actuarial Information) to the annual report (Form 5500 Series) with respect
to each Employee Plan and Multiemployer Plan, (D) promptly and in any event
within 10 days after any Loan Party or any ERISA Affiliate thereof knows or has
reason to know that a required installment within the meaning of Section 412 of
the Internal Revenue Code has not been made when due with respect to an Employee
Plan, (E) promptly and in any event within 3 days after receipt thereof by any
Loan Party or any ERISA Affiliate thereof from a sponsor of a Multiemployer Plan
or from the PBGC, a copy of each notice received by any Loan Party or any ERISA
Affiliate thereof concerning the imposition or amount of withdrawal liability
under Section 4202 of ERISA or indicating that such Multiemployer Plan may enter
reorganization status under Section 4241 of ERISA, and (F) promptly and in any
event within 10 days after any Loan Party or any ERISA Affiliate thereof sends
notice of a plant closing or mass layoff (as defined in WARN) to employees,
copies of each such notice sent by such Loan Party or such ERISA Affiliate
thereof;

(xi)promptly after the commencement thereof but in any event not later than 5
Business Days after service of process with respect thereto on, or the obtaining
of knowledge thereof by, any Loan Party, notice of each action, suit or
proceeding before any court or other Governmental Authority or other regulatory
body or any arbitrator which, if adversely determined, could reasonably be
expected to have a Material Adverse Effect;

(xii)as soon as possible and in any event within 5 Business Days after
execution, receipt or delivery thereof, copies of any material notices that any
Loan Party executes or receives in connection with any Material Contract;

(xiii)as soon as possible and in any event within 5 Business Days after
execution, receipt or delivery thereof, copies of any material notices that any
Loan Party executes or receives in connection with the sale or other Disposition
of the Equity Interests of, or all or substantially all of the assets of, any
Loan Party;

(xiv)as soon as possible and in any event within 5 Business Days after the
delivery thereof to Patriot’s or the Borrower’s Board of Directors, copies of
all reports or other information so delivered, except to the extent that the
delivery of such information could jeopardize a Loan Party’s attorney-client
privilege with respect to such information;

 

- 84 -

 

 

--------------------------------------------------------------------------------

 

(xv)promptly after (A) the sending or filing thereof, copies of all statements,
reports and other information any Loan Party sends to any holders of its
Indebtedness or its securities or files with the SEC or any national (domestic
or foreign) securities exchange, including, without limitation, Form 10-Q
quarterly reports, Form 10-K annual reports, and Form 8-K current reports;
provided, that such filings shall be deemed delivered to the Agents on the
earlier of the date such statements or reports are available at (i) www.sec.gov
and (ii) the Borrower’s website at www.patnat.com and notice of such
availability is sent to the Agents; and (B) the receipt thereof, a copy of any
material notice received from any holder of its Indebtedness having an aggregate
amount outstanding in excess of $3,000,000;

(xvi)promptly upon receipt thereof, copies of all financial reports (including,
without limitation, management letters), if any, submitted to any Loan Party by
its auditors in connection with any annual or interim audit of the books
thereof;

(xvii)promptly upon request, any certification or other evidence requested from
time to time by any Lender in its sole discretion, confirming the Borrowers’
compliance with Section 7.02(r);

(xviii)simultaneously with the delivery of the financial statements of Patriot
and its Subsidiaries required by clauses (i), (ii) and (iii) of this Section
7.01(a), if, as a result of any change in accounting principles and policies
from those used in the preparation of the Financial Statements that is permitted
by Section 7.02(q), the consolidated financial statements of Patriot and its
Subsidiaries delivered pursuant to clauses (i), (ii) and (iii) of this Section
7.01(a) will differ from the consolidated financial statements that would have
been delivered pursuant to such subdivisions had no such change in accounting
principles and policies been made, then, together with the first delivery of
such financial statements after such change, one or more statements of
reconciliation for all such prior financial statements in form and substance
reasonably satisfactory to the Agents; and

(xix)promptly upon request, such other information concerning the condition or
operations, financial or otherwise, of any Loan Party as any Agent may from time
to time may reasonably request.

(b)Additional Borrowers, Guarantors and Collateral Security. Cause:

(i)each Subsidiary of any Loan Party not in existence on the Effective Date to
execute and deliver to the Collateral Agent promptly and in any event within 10
Business Days after the formation, acquisition or change in status thereof, (A)
a Joinder Agreement, pursuant to which such Subsidiary shall be made a party to
this Agreement as a Borrower or a Guarantor, (B) a supplement to the Security
Agreement, together with (1) certificates evidencing all of the Equity Interests
of any Person owned by such Subsidiary required to be pledged under the terms of
the Security Agreement, (2) undated stock powers for such Equity Interests
executed in blank with signature guaranteed, and (3) such opinions of counsel as
the Collateral Agent may reasonably request, (C) to the extent required under
the terms of this Agreement, one or more Mortgages creating on the real property
of such Subsidiary a perfected, first priority Lien (in terms of priority,
subject only to Permitted Specified Liens) on such real property and such other
Real Property Deliverables as may be required by the

 

- 85 -

 

 

--------------------------------------------------------------------------------

 

Collateral Agent with respect to each such real property, and (D) such other
agreements, instruments, approvals or other documents reasonably requested by
the Collateral Agent in order to create, perfect, establish the first priority
of or otherwise protect any Lien purported to be covered by any such Security
Agreement or Mortgage or otherwise to effect the intent that such Subsidiary
shall become bound by all of the terms, covenants and agreements contained in
the Loan Documents and that all property and assets of such Subsidiary shall
become Collateral for the Obligations; and

(ii)each owner of the Equity Interests of any such Subsidiary to execute and
deliver promptly and in any event within 3 days after the formation or
acquisition of such Subsidiary a Pledge Amendment (as defined in the Security
Agreement), together with (A) certificates evidencing all of the Equity
Interests of such Subsidiary required to be pledged under the terms of the
Security Agreement, (B) undated stock powers or other appropriate instruments of
assignment for such Equity Interests executed in blank with signature
guaranteed, (C) such opinions of counsel as the Collateral Agent may reasonably
request and (D) such other agreements, instruments, approvals or other documents
requested by the Collateral Agent.

Notwithstanding the foregoing, no Foreign Subsidiary shall be required to become
a Guarantor hereunder (and, as such, shall not be required to deliver the
documents required by clause (i) above; provided, however, that if the Equity
Interests of a Foreign Subsidiary are owned by a Loan Party, such Loan Party
shall deliver all such documents, instruments, agreements (including, without
limitation, at the reasonable request of the Collateral Agent, a pledge
agreement governed by the laws of the jurisdiction of the organization of such
Foreign Subsidiary) and certificates described in clause (ii) above to the
Collateral Agent, and take all commercially reasonable actions reasonably
requested by the Collateral Agent or otherwise necessary to grant and to perfect
a first-priority Lien (subject to Permitted Specified Liens) in favor of the
Collateral Agent, for the benefit of the Agents and the Lenders, in 65% of the
voting Equity Interests of such Foreign Subsidiary and 100% of all other Equity
Interests of such Foreign Subsidiary owned by such Loan Party.

(c)Compliance with Laws; Payment of Taxes.

(i)Comply, and cause each of its Subsidiaries to comply with all Requirements of
Law (including, without limitation, all Environmental Laws), judgments and
awards (including any settlement of any claim that, if breached, could give rise
to any of the foregoing), except to the extent the failure to so comply could
not reasonably be expected to have a Material Adverse Effect.

(ii)Pay, and cause each of its Subsidiaries to pay, in full before delinquency
or before the expiration of any extension period, all taxes, assessments and
other governmental charges imposed upon any Loan Party or any of its
Subsidiaries or any property of any Loan Party or any of its Subsidiaries in an
aggregate amount for all such taxes, assessments and other governmental charges
exceeding $250,000, except to the extent contested in good faith by proper
proceedings which stay the imposition of, or obligation to pay, any penalty,
fine or Lien resulting from the non-payment thereof and with respect to which
adequate reserves have been set aside for the payment thereof in accordance with
GAAP.

 

- 86 -

 

 

--------------------------------------------------------------------------------

 

(d)Preservation of Existence, Etc.  Except as otherwise permitted under Section
7.02(c), maintain and preserve, and cause each of its Subsidiaries to maintain
and preserve, its existence, rights and privileges, and become or remain, and
cause each of its Subsidiaries to become or remain, duly qualified and in good
standing in each jurisdiction in which the character of the properties owned or
leased by it or in which the transaction of its business makes such
qualification necessary, except to the extent that the failure to be so
qualified could not reasonably be expected to have a Material Adverse Effect.

(e)Keeping of Records and Books of Account.  Keep, and cause each of its
Subsidiaries to keep, adequate records and books of account, with complete
entries made to permit the preparation of financial statements in accordance
with GAAP.

(f)Inspection Rights.  Subject to the limitations set forth in Section 2.06(f),
permit, and cause each of its Subsidiaries to permit, the agents and
representatives of any Agent at any time and from time to time during normal
business hours, at the expense of the Borrowers, to examine and make copies of
and abstracts from its records and books of account, to visit and inspect its
properties, to verify materials, leases, notes, accounts receivable, deposit
accounts and its other assets and to discuss its affairs, finances and accounts
with any of its directors, officers, managerial employees, independent
accountants or any of its other representatives.  In furtherance of the
foregoing, each Loan Party hereby authorizes its independent accountants, and
the independent accountants of each of its Subsidiaries, to discuss the affairs,
finances and accounts of such Person (independently or together with
representatives of such Person) with the agents and representatives of any Agent
in accordance with this Section 7.01(f).

(g)Maintenance of Properties, Etc.  Maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, all of its properties which are necessary
or useful in the proper conduct of its business in good working order and
condition, ordinary wear and tear and casualty excepted, and comply, and cause
each of its Subsidiaries to comply, at all times with the provisions of all
leases to which it is a party as lessee or under which it occupies property, so
as to prevent any loss or forfeiture thereof or thereunder, except to the extent
the failure to so maintain and preserve or so comply could not reasonably be
expected to have a Material Adverse Effect.

(h)Maintenance of Insurance.  Maintain, and cause each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance companies or
associations (including, without limitation, comprehensive general liability,
hazard, rent, worker’s compensation and business interruption insurance) with
respect to its properties (including all real properties leased or owned by it)
and business, in such amounts and covering such risks as is required by any
Governmental Authority having jurisdiction with respect thereto or as is carried
generally in accordance with sound business practice by companies in similar
businesses similarly situated and in any event in amount, adequacy and scope
reasonably satisfactory to the Collateral Agent.  All policies covering the
Collateral are to be made payable to the Collateral Agent for the benefit of the
Agents and the Lenders, as its interests may appear, in case of loss, under a
standard non‑contributory “lender” or “secured party” clause and are to contain
such other provisions as the Collateral Agent may require to fully protect the
Lenders’ interest in the Collateral and to any payments to be made under such
policies.  All certificates of insurance are to be delivered to the Collateral
Agent and the policies are to be premium prepaid, with the loss

 

- 87 -

 

 

--------------------------------------------------------------------------------

 

payable and additional insured endorsement in favor of the Collateral Agent and
such other Persons as the Collateral Agent may designate from time to time, and
shall provide for not less than 30 days’ (10 days’ in the case of non-payment)
prior written notice to the Collateral Agent of the exercise of any right of
cancellation.  If any Loan Party or any of its Subsidiaries fails to maintain
such insurance, the Collateral Agent may arrange for such insurance, but at the
Borrowers’ expense and without any responsibility on the Collateral Agent’s part
for obtaining the insurance, the solvency of the insurance companies, the
adequacy of the coverage, or the collection of claims.  Upon the occurrence and
during the continuance of an Event of Default, the Collateral Agent shall have
the sole right, in the name of the Lenders, any Loan Party and its Subsidiaries,
to file claims under any insurance policies, to receive, receipt and give
acquittance for any payments that may be payable thereunder, and to execute any
and all endorsements, receipts, releases, assignments, reassignments or other
documents that may be necessary to effect the collection, compromise or
settlement of any claims under any such insurance policies.

(i)Obtaining of Permits, Etc.  Obtain, maintain and preserve, and cause each of
its Subsidiaries to obtain, maintain and preserve, and take all necessary action
to timely renew, all permits, licenses, authorizations, approvals, entitlements
and accreditations that are necessary or useful in the proper conduct of its
business, in each case, except to the extent the failure to obtain, maintain,
preserve or take such action could not reasonably be expected to have a Material
Adverse Effect.

(j)Environmental.  (i) Comply, and cause each of its Subsidiaries to comply,
with all Environmental Laws and provide to the Collateral Agent any
documentation of such compliance which the Collateral Agent may reasonably
request, except where the failure to comply could not reasonably be expected to
result in a Material Adverse Effect; (ii) provide the Agents written notice
within 5 Business Days of any Release of a Hazardous Material in excess of any
reportable quantity from or onto property at any time owned or operated by it or
any of its Subsidiaries and take any Remedial Actions required to abate said
Release; and (iii) provide the Agents with written notice within 10 days of the
receipt of any of the following:  (A) notice that an Environmental Lien has been
filed against any property of any Loan Party or any of its Subsidiaries;
(B) commencement of any Environmental Action or notice that an Environmental
Action will be filed against any Loan Party or any of its Subsidiaries; and
(C) notice of a violation, citation or other administrative order which could
reasonably be expected to have a Material Adverse Effect.

(k)Fiscal Year.  Cause the Fiscal Year of Patriot and its Subsidiaries to end on
December 31st of each calendar year unless the Agents consent to a change in
such Fiscal Year (and appropriate related changes to this Agreement).

(l)Landlord Waivers; Collateral Access Agreements.  At any time any Collateral
with a book value in excess of $500,000 (when aggregated with all other
Collateral at the same location) is located on any real property of a Loan Party
(whether such real property is now existing or acquired after the Effective
Date) which is not owned by a Loan Party, or is stored on the premises of a
bailee, warehouseman, or similar party, use commercially reasonable efforts to
obtain written subordinations or waivers or collateral access agreements, as the
case may be, in form and substance satisfactory to the Collateral Agent.

 

- 88 -

 

 

--------------------------------------------------------------------------------

 

(m)After Acquired Real Property.  Upon the acquisition by it or any of its
Subsidiaries after the date hereof of any fee simple interest in any real
property (wherever located) (each such interest being a “New Facility”) with a
Current Value (as defined below) in excess of $500,000 immediately so notify the
Collateral Agent, setting forth with specificity a description of the interest
acquired, the location of the real property, any structures or improvements
thereon and either an appraisal or such Loan Party’s good-faith estimate of the
current value of such real property (for purposes of this Section, the ”Current
Value”).  The Collateral Agent shall notify such Loan Party whether it intends
to require a Mortgage (and any other Real Property Deliverables) with respect to
such New Facility.  Upon receipt of such notice requesting a Mortgage (and any
other Real Property Deliverables), the Person that has acquired such New
Facility shall promptly furnish the same to the Collateral Agent.  The Borrowers
shall pay all fees and expenses, including, without limitation, reasonable
attorneys’ fees and expenses, and all title insurance charges and premiums, in
connection with each Loan Party’s obligations under this Section 7.01(m).

(n)Anti-Bribery and Anti-Corruption Laws.  Maintain, and cause each of its
Subsidiaries to maintain, anti-bribery and anti-corruption policies and
procedures that are reasonably designed to ensure compliance with the
Anti-Corruption Laws.

(o)Lender Meetings.  Upon the request of any Agent or the Required Lenders
(which request, so long as no Event of Default shall have occurred and be
continuing, shall not be made more than once during each Fiscal Year),
participate in a meeting with the Agents and the Lenders at the Borrowers’
corporate offices (or at such other location as may be agreed to by the
Administrative Borrower and such Agent or the Required Lenders) at such time as
may be agreed to by the Administrative Borrower and such Agent or the Required
Lenders.

(p)Further Assurances.  Take such action and execute, acknowledge and deliver,
and cause each of its Subsidiaries to take such action and execute, acknowledge
and deliver, at its sole cost and expense, such agreements, instruments or other
documents as any Agent may require from time to time in order (i) to carry out
more effectively the purposes of this Agreement and the other Loan Documents,
(ii) to subject to valid and perfected first priority Liens any of the
Collateral or any other property of any Loan Party and its Subsidiaries,
(iii) to establish and maintain the validity and effectiveness of any of the
Loan Documents and the validity, perfection and priority of the Liens intended
to be created thereby, and (iv) to better assure, convey, grant, assign,
transfer and confirm unto each Secured Party the rights now or hereafter
intended to be granted to it under this Agreement or any other Loan
Document.  In furtherance of the foregoing, to the maximum extent permitted by
applicable law, each Loan Party (i) authorizes each Agent to execute any such
agreements, instruments or other documents in such Loan Party’s name and to file
such agreements, instruments or other documents in any appropriate filing
office, (ii) authorizes each Agent to file any financing statement required
hereunder or under any other Loan Document, and any continuation statement or
amendment with respect thereto, in any appropriate filing office without the
signature of such Loan Party, and (iii) ratifies the filing of any financing
statement, and any continuation statement or amendment with respect thereto,
filed without the signature of such Loan Party prior to the date hereof.

 

- 89 -

 

 

--------------------------------------------------------------------------------

 

Section 7.02Negative Covenants. So long as any principal of or interest on any
Loan or any other Obligation (whether or not due) shall remain unpaid (other
than Contingent Indemnity Obligations) or any Lender shall have any Commitment
hereunder, each Loan Party shall not, unless the Required Lenders shall
otherwise consent in writing:

(a)Liens, Etc.  Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries to create, incur, assume or suffer to exist, any Lien upon or with
respect to any of its properties, whether now owned or hereafter acquired; file
or suffer to exist under the Uniform Commercial Code or any Requirement of Law
of any jurisdiction, a financing statement (or the equivalent thereof) that
names it or any of its Subsidiaries as debtor; sign or suffer to exist any
security agreement authorizing any secured party thereunder to file such
financing statement (or the equivalent thereof) other than, as to all of the
above, Permitted Liens.

(b)Indebtedness.  Create, incur, assume, guarantee or suffer to exist, or
otherwise become or remain liable with respect to, or permit any of its
Subsidiaries to create, incur, assume, guarantee or suffer to exist or otherwise
become or remain liable with respect to, any Indebtedness other than Permitted
Indebtedness.

(c)Fundamental Changes; Dispositions.  

(i)Wind-up, liquidate or dissolve, or merge, consolidate or amalgamate with any
Person, or permit any of its Subsidiaries to do (or agree to do) any of the
foregoing; provided, however, that (A) any wholly-owned Subsidiary of any Loan
Party (other than a Borrower) may be merged into such Loan Party or another
wholly-owned Subsidiary of such Loan Party, or may consolidate or amalgamate
with another wholly-owned Subsidiary of such Loan Party, so long as (i) no other
provision of this Agreement would be violated thereby, (ii) such Loan Party
gives the Agents at least 30 days’ prior written notice of such merger,
consolidation or amalgamation accompanied by true, correct and complete copies
of all material agreements, documents and instruments relating to such merger,
consolidation or amalgamation, including, without limitation, the certificate or
certificates of merger or amalgamation to be filed with each appropriate
Secretary of State (with a copy as filed promptly after such filing), (iii) no
Default or Event of Default shall have occurred and be continuing either before
or after giving effect to such transaction, (iv) the Lenders’ rights in any
Collateral, including, without limitation, the existence, perfection and
priority of any Lien thereon, are not adversely affected by such merger,
consolidation or amalgamation and (v) the surviving Subsidiary, if any, if not
already a Loan Party, is joined as a Loan Party hereunder pursuant to a Joinder
Agreement and is a party to a Security Agreement and the Equity Interests of
such Subsidiary is the subject of a Security Agreement, in each case, which is
in full force and effect on the date of and immediately after giving effect to
such merger, consolidation or amalgamation and (B) any of Patriot’s Subsidiaries
that are not Loan Parties may wind-up, liquidate, or dissolve if (i) the
governing body of such Subsidiary shall determine that the preservation thereof
is no longer desirable in the conduct of the business of Patriot and its
Subsidiaries and (ii) the value of such Subsidiary is immaterial to Patriot, its
Subsidiaries, and the Lenders; and

 

- 90 -

 

 

--------------------------------------------------------------------------------

 

(ii)Make any Disposition, whether in one transaction or a series of related
transactions, of all or any part of its business, property or assets, whether
now owned or hereafter acquired (or agree to do any of the foregoing), or permit
any of its Subsidiaries to do any of the foregoing; provided, however, that any
Loan Party and its Subsidiaries may make Permitted Dispositions.

(d)Change in Nature of Business.

(i)Make, or permit any of its Subsidiaries to make, any change in the nature of
its business as described in Section 6.01(l).

(ii)Except as identified in the Financial Statements or as disclosed in in
publicly available filings with the SEC, permit Patriot to have any material
liabilities (other than liabilities arising under the Loan Documents), own any
material assets (other than the Equity Interests of its Subsidiaries) or engage
in any operations or business (other than the ownership of its Subsidiaries).

(e)Loans, Advances, Investments, Etc.  Make or commit or agree to make, or
permit any of its Subsidiaries make or commit or agree to make, any Investment
in any other Person except for Permitted Investments.

(f)Sale and Leaseback Transactions.  Enter into, or permit any of its
Subsidiaries to enter into, any Sale and Leaseback Transaction.

(g)[Intentionally Omitted].  

(h)Restricted Payments.  Make or permit any of its Subsidiaries to make any
Restricted Payment other than Permitted Restricted Payments.

(i)Federal Reserve Regulations.  Permit any Loan or the proceeds of any Loan
under this Agreement to be used for any purpose that would cause such Loan to be
a margin loan under the provisions of Regulation T, U or X of the Board.

(j)Transactions with Affiliates.  Enter into, renew, extend or be a party to, or
permit any of its Subsidiaries to enter into, renew, extend or be a party to,
any transaction or series of related transactions (including, without
limitation, the purchase, sale, lease, transfer or exchange of property or
assets of any kind or the rendering of services of any kind) with any Affiliate
(other than a transaction or series of related transactions between a Borrower
and another Loan Party, not involving other Affiliates), except (i) transactions
consummated in the ordinary course of business in a manner and to an extent
consistent with past practice and necessary or desirable for the prudent
operation of its business, for fair consideration and on terms no less favorable
to it or its Subsidiaries than would be obtainable in a comparable arm’s length
transaction with a Person that is not an Affiliate thereof, and that are fully
disclosed to the Agents prior to the consummation thereof, if they involve one
or more payments by Patriot or any of its Subsidiaries in excess of $500,000 for
any single transaction or series of related transactions, (ii) transactions with
another Loan Party, (iii) transactions permitted by Section 7.02(e) and Section
7.02(h), (iv) sales of Qualified Equity Interests of Patriot to Affiliates of
Patriot not otherwise prohibited by the Loan Documents and the granting of
registration and

 

- 91 -

 

 

--------------------------------------------------------------------------------

 

other customary rights in connection therewith, (v) reasonable and customary
director and officer compensation (including bonuses and stock option programs),
benefits and indemnification arrangements, in each case approved by the Board of
Directors (or a committee thereof) of such Loan Party or such Subsidiary, (vi)
the reimbursement of the reasonable out of pocket expenses of each of the
directors of Patriot and its Subsidiaries, (vii) transactions with Guarantee
Insurance Group so long as the terms and conditions thereof are commercially
reasonable, (viii) the WCE Capital Lease and (ix) any change permitted by
Section 7.02(c)(i).

(k)Limitations on Dividends and Other Payment Restrictions Affecting
Subsidiaries.  Create or otherwise cause, incur, assume, suffer or permit to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Subsidiary of any Loan Party (i) to pay dividends or to
make any other distribution on any shares of Equity Interests of such Subsidiary
owned by any Loan Party or any of its Subsidiaries, (ii) to pay or prepay or to
subordinate any Indebtedness owed to any Loan Party or any of its Subsidiaries,
(iii) to make loans or advances to any Loan Party or any of its Subsidiaries or
(iv) to transfer any of its property or assets to any Loan Party or any of its
Subsidiaries, or permit any of its Subsidiaries to do any of the foregoing;
provided, however, that nothing in any of clauses (i) through (iv) of this
Section 7.02(k) shall prohibit or restrict compliance with:

(A)this Agreement and the other Loan Documents;

(B)any agreement in effect on the date of this Agreement and described on
Schedule 7.02(k), or any extension, replacement or continuation of any such
agreement; provided, that, any such encumbrance or restriction contained in such
extended, replaced or continued agreement is no less favorable to the Agents and
the Lenders than the encumbrance or restriction under or pursuant to the
agreement so extended, replaced or continued;

(C)any applicable law, rule or regulation (including, without limitation,
applicable currency control laws and applicable state corporate statutes
restricting the payment of dividends in certain circumstances);

(D)in the case of clause (iv), (1) customary restrictions on the subletting,
assignment or transfer of any specified property or asset set forth in a lease,
license, asset sale agreement or similar contract for the conveyance of such
property or asset and (2) instrument or other document evidencing a Permitted
Lien (or the Indebtedness secured thereby) from restricting on customary terms
the transfer of any property or assets subject thereto;

(E)customary restrictions on dispositions of real property interests in
reciprocal easement agreements;

(F)customary restrictions in agreements for the sale of assets on the transfer
or encumbrance of such assets during an interim period prior to the closing of
the sale of such assets; or

(G)customary restrictions in contracts that prohibit the assignment of such
contract.

 

- 92 -

 

 

--------------------------------------------------------------------------------

 

(l)Limitations on Negative Pledges.  Enter into, incur or permit to exist, or
permit any Subsidiary to enter into, incur or permit to exist, directly or
indirectly, any agreement, instrument, deed, lease or other arrangement that
prohibits, restricts or imposes any condition upon the ability of any Loan Party
or any Subsidiary of any Loan Party to create, incur or permit to exist any Lien
upon any of its property or revenues, whether now owned or hereafter acquired,
or that requires the grant of any security for an obligation if security is
granted for another obligation, except the following:  (i) this Agreement and
the other Loan Documents, (ii) restrictions or conditions imposed by any
agreement relating to secured Indebtedness permitted by Section 7.02(b) of this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness, (iii) any customary restrictions and
conditions contained in agreements relating to the sale or other disposition of
assets or of a Subsidiary pending such sale or other disposition; provided that
such restrictions and conditions apply only to the assets or Subsidiary to be
sold or disposed of and such sale or disposition is permitted hereunder, and
(iv) customary provisions in leases restricting the assignment or sublet
thereof.

(m)Modifications of Indebtedness, Organizational Documents and Certain Other
Agreements; Etc.  

(i)Amend, modify or otherwise change (or permit the amendment, modification or
other change in any manner of) any of the provisions of any of its or its
Subsidiaries’ Indebtedness or of any instrument or agreement (including, without
limitation, any purchase agreement, indenture, loan agreement or security
agreement) relating to any such Indebtedness if such amendment, modification or
change would shorten the final maturity or average life to maturity of, or
require any payment to be made earlier than the date originally scheduled on,
such Indebtedness, would increase the interest rate applicable to such
Indebtedness, would add any covenant or event of default, would change the
subordination provision, if any, of such Indebtedness, or would otherwise be
adverse to the Lenders or the issuer of such Indebtedness in any respect;

(ii)except for the Obligations, (A) make any voluntary or optional payment
(including, without limitation, any payment of interest in cash that, at the
option of the issuer, may be paid in cash or in kind), prepayment, redemption,
defeasance, sinking fund payment or other acquisition for value of any of its or
its Subsidiaries’ Indebtedness (including, without limitation, by way of
depositing money or securities with the trustee therefor before the date
required for the purpose of paying any portion of such Indebtedness when due),
(B) refund, refinance, replace or exchange any other Indebtedness for any such
Indebtedness (other than with respect to Permitted Refinancing Indebtedness),
(C) make any payment, prepayment, redemption, defeasance, sinking fund payment
or repurchase of any Subordinated Indebtedness in violation of the subordination
provisions thereof or any subordination agreement with respect thereto, or (D)
make any payment, prepayment, redemption, defeasance, sinking fund payment or
repurchase of any Indebtedness as a result of any asset sale, change of control,
issuance and sale of debt or equity securities or similar event, or give any
notice with respect to any of the foregoing;

 

- 93 -

 

 

--------------------------------------------------------------------------------

 

(iii)amend, modify or otherwise change any of its Governing Documents
(including, without limitation, by the filing or modification of any certificate
of designation, or any agreement or arrangement entered into by it) with respect
to any of its Equity Interests (including any shareholders’ agreement), or enter
into any new agreement with respect to any of its Equity Interests, except any
such amendments, modifications or changes or any such new agreements or
arrangements pursuant to this clause (iii) that either individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect; or

(iv)agree to any amendment, modification or other change to or waiver of any of
its rights under any Material Contract if such amendment, modification, change
or waiver could reasonably be expected to result in a Material Adverse Effect.

(n)Investment Company Act of 1940. Engage in any business, enter into any
transaction, use any securities or take any other action or permit any of its
Subsidiaries to do any of the foregoing, that would cause it or any of its
Subsidiaries to become subject to the registration requirements of the
Investment Company Act of 1940, as amended, by virtue of being an “investment
company” or a company “controlled” by an “investment company” not entitled to an
exemption within the meaning of such Act.

(o)ERISA. (i) Engage, or permit any ERISA Affiliate to engage, in any
transaction described in Section 4069 of ERISA; (ii) engage, or permit any ERISA
Affiliate to engage, in any prohibited transaction described in Section 406 of
ERISA or 4975 of the Internal Revenue Code for which a statutory, regulatory or
class exemption is not available or a private exemption has not previously been
obtained from the U.S. Department of Labor; (iii) adopt or permit any ERISA
Affiliate to adopt any employee welfare benefit plan within the meaning of
Section 3(1) of ERISA which provides benefits to employees after termination of
employment other than as required by Section 601 of ERISA or applicable law;
(iv) fail to make any contribution or payment to any Multiemployer Plan which it
or any ERISA Affiliate may be required to make under any agreement relating to
such Multiemployer Plan, or any law pertaining thereto; or (v) fail, or permit
any ERISA Affiliate to fail, to pay any required installment or any other
payment required under Section 412 of the Internal Revenue Code on or before the
due date for such installment or other payment.

(p)Environmental.  Permit the use, handling, generation, storage, treatment,
Release or disposal of Hazardous Materials at any property owned or leased by it
or any of its Subsidiaries, except in compliance with Environmental Laws (other
than any noncompliance that could not reasonably be expected to have a Material
Adverse Effect).

(q)Accounting Methods.  Modify or change, or permit any of its Subsidiaries to
modify or change, its method of accounting or accounting principles from those
utilized in the preparation of the Financial Statements (other than as may be
required to conform to GAAP).

 

- 94 -

 

 

--------------------------------------------------------------------------------

 

(r)Anti-Money Laundering and Anti-Terrorism Laws.

(i)None of the Loan Parties, nor any of their Affiliates or agents, shall:

(A)conduct any business or engage in any transaction or dealing with or for the
benefit of any Blocked Person, including the making or receiving of any
contribution of funds, goods or services to, from or for the benefit of any
Blocked Person;

(B)deal in, or otherwise engage in any transaction relating to, any property or
interests in property blocked or subject to blocking pursuant to the OFAC
Sanctions Programs;

(C)use any of the proceeds of the transactions contemplated by this Agreement to
finance, promote or otherwise support in any manner any illegal activity,
including, without limitation, any violation of the Anti-Money Laundering and
Anti-Terrorism Laws or any specified unlawful activity as that term is defined
in the Money Laundering Control Act of 1986, 18 U.S.C. §§ 1956 and 1957; or    

(D)violate, attempt to violate, or engage in or conspire to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding,
any of the Anti-Money Laundering and Anti-Terrorism Laws.

(ii)None of the Loan Parties, nor any Affiliate of any of the Loan Parties, nor
any officer or director of any of the Loan Parties, nor any of the Loan Parties’
respective agents acting or benefiting in any capacity in connection with the
Loans or other transactions hereunder, shall be or shall become a Blocked
Person.

(s)Anti-Bribery and Anti-Corruption Laws.  None of the Loan Parties shall:

(i)offer, promise, pay, give, or authorize the payment or giving of any money,
gift or other thing of value, directly or indirectly, to or for the benefit of
any Foreign Official for the purpose of: (1) influencing any act or decision of
such Foreign Official in his, her, or its official capacity; or (2) inducing
such Foreign Official to do, or omit to do, an act in violation of the lawful
duty of such Foreign Official, or (3) securing any improper advantage, in order
to obtain or retain business for, or with, or to direct business to, any Person;
or

(ii)act or attempt to act in any manner which would subject any of the Loan
Parties to liability under any Anti-Corruption Law.

 

- 95 -

 

 

--------------------------------------------------------------------------------

 

Section 7.03Financial Covenants. So long as any principal of or interest on any
Loan or any other Obligation (whether or not due) shall remain unpaid (other
than Contingent Indemnity Obligations) or any Lender shall have any Commitment
hereunder, each Loan Party shall not, unless the Required Lenders shall
otherwise consent in writing:

(a)Leverage Ratio. Permit the Leverage Ratio of Patriot and its Subsidiaries for
any period of 4 consecutive fiscal quarters of Patriot and its Subsidiaries for
which the last fiscal quarter ends on a date set forth below to be greater than
the ratio set forth opposite such date:

 

Fiscal Quarter End

Leverage Ratio

March 31, 2017

5.25:100

June 30, 2017

5.25:1.00

September 30, 2017

5.25:100

December 31, 2017

5.20:100

March 31, 2018

5.00:1.00

June 30, 2018

4.50:1.00

September 30, 2018

4.40:1.00

December 31, 2018

4.20:1.00

March 31, 2019

4.15:1.00

June 30, 2019

3.85:1.00

September 30, 2019

3.85:1.00

December 31, 2019

3.80:1.00

March 31, 2020

3.75:1.00

June 30, 2020

3.50:1.00

September 30, 2020

3.50:1.00

December 31, 2020

3.25:1.00

March 31, 2021

3.25:1.00

June 30, 2021

3.00:1.00

September 30, 2021

3.00:1.00

December 31, 2021 and each Fiscal Quarter ended thereafter

3.00:1.00

 

 

- 96 -

 

 

--------------------------------------------------------------------------------

 

(b)Fixed Charge Coverage Ratio.  Permit the Fixed Charge Coverage Ratio of
Patriot and its Subsidiaries for any period of 4 consecutive fiscal quarters of
Patriot and its Subsidiaries for which the last fiscal quarter ends on a date
set forth below to be less than the ratio set forth opposite such date:

Fiscal Quarter End

Fixed Charge Coverage Ratio

March 31, 2017

1.25:1.00

June 30, 2017

1.25:1.00

September 30, 2017

1.25:1.00

December 31, 2017

1.25:1.00

March 31, 2018

1.25:1.00

June 30, 2018

1.25:1.00

September 30, 2018

1.25:1.00

December 31, 2018

1.25:1.00

March 31, 2019

1.25:1.00

June 30, 2019 and each Fiscal Quarter ended thereafter

1.30:1.00

 

ARTICLE VIII

CASH MANAGEMENT ARRANGEMENTS
AND OTHER COLLATERAL MATTERS

Section 8.01Cash Management Arrangements.  (a)  The Loan Parties shall
(i) establish and maintain cash management services of a type and on terms
reasonably satisfactory to the Agents at one or more of the banks set forth on
Schedule 8.01 (each a “Cash Management Bank”) and (ii) except as otherwise
provided under Section 8.01(b), deposit or cause to be deposited promptly, and
in any event no later than the next Business Day after the date of receipt
thereof, all proceeds in respect of any Collateral, all Collections (of a nature
susceptible to a deposit in a bank account) and all other amounts received by
any Loan Party (including payments made by Account Debtors directly to any Loan
Party) into a Cash Management Account.

(a)Within 45 days after the Effective Date, the Loan Parties shall, with respect
to each Cash Management Account (other than Excluded Accounts), deliver to the
Collateral Agent a Control Agreement with respect to such Cash Management
Account.  The Loan Parties shall not maintain, and shall not permit any of their
Subsidiaries to maintain, cash, Cash Equivalents or other amounts in any deposit
account or securities account, unless the Collateral Agent shall have received a
Control Agreement in respect of each such Cash Management Account (other than
Excluded Accounts).

 

- 97 -

 

 

--------------------------------------------------------------------------------

 

(b)Upon the terms and subject to the conditions set forth in a Control Agreement
with respect to a Cash Management Account, all amounts received in such Cash
Management Account shall at the Administrative Agent’s direction be wired each
Business Day into the Administrative Agent’s Account, except that, so long as no
Event of Default has occurred and is continuing, the Administrative Agent will
not direct the Cash Management Bank to transfer funds in such Cash Management
Account to the Administrative Agent’s Account.

(c)So long as no Default or Event of Default has occurred and is continuing, the
Borrowers may amend Schedule 8.01 to add or replace a Cash Management Bank or
Cash Management Account; provided, however, that (i) such prospective Cash
Management Bank shall be reasonably satisfactory to the Collateral Agent and the
Collateral Agent shall have consented in writing in advance to the opening of
such Cash Management Account with the prospective Cash Management Bank, and (ii)
prior to the time of the opening of such Cash Management Account, each Loan
Party and such prospective Cash Management Bank shall have executed and
delivered to the Collateral Agent a Control Agreement.  Each Loan Party shall
close any of its Cash Management Accounts (and establish replacement cash
management accounts in accordance with the foregoing sentence) promptly and in
any event within 30 days of notice from the Collateral Agent that the
creditworthiness of any Cash Management Bank is no longer acceptable in the
Collateral Agent’s reasonable judgment, or that the operating performance, funds
transfer, or availability procedures or performance of such Cash Management Bank
with respect to Cash Management Accounts or the Collateral Agent’s liability
under any Control Agreement with such Cash Management Bank is no longer
acceptable in the Collateral Agent’s reasonable judgment.

ARTICLE IX

EVENTS OF DEFAULT

Section 9.01Events of Default. Each of the following events shall constitute an
event of default (each, an “Event of Default”):

(a)any Borrower shall fail to pay, when due (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), (i) any interest on any
Loan, any Collateral Agent Advance or any fee, indemnity or other amount payable
under this Agreement (other than any portion thereof constituting principal of
the Loans) or any other Loan Document, and such failure continues for a period
of 3 Business Days or (ii) all or any portion of the principal of the Loans;

(b)any representation or warranty made or deemed made by or on behalf of any
Loan Party or by any officer of the foregoing under or in connection with any
Loan Document or under or in connection with any certificate or other writing
delivered to any Secured Party pursuant to any Loan Document shall have been
incorrect in any material respect (or in any respect if such representation or
warranty is qualified or modified as to materiality or “Material Adverse Effect”
in the text thereof) when made or deemed made;

 

- 98 -

 

 

--------------------------------------------------------------------------------

 

(c)any Loan Party shall fail to perform or comply with any covenant or agreement
contained in Section 7.01(a), Section 7.01(c), Section 7.01(d), Section 7.01(f),
Section 7.01(h), Section 7.01(k), Section 7.01(m), Section 7.01(o), Section 7.02
or Section 7.03 or Article VIII;

(d)any Loan Party shall fail to perform or comply with any other term, covenant
or agreement contained in any Loan Document to be performed or observed by it
and, except as set forth in subsections (a), (b) and (c) of this Section 9.01,
such failure, if capable of being remedied, shall remain unremedied for 30 days
after the earlier of the date a senior officer of any Loan Party has knowledge
of such failure and the date written notice of such default shall have been
given by any Agent to such Loan Party;

(e)any Loan Party or any of its Significant Subsidiaries shall fail to pay when
due (whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) any principal, interest or other amount payable in respect of
Indebtedness (excluding Indebtedness evidenced by this Agreement) having an
aggregate amount outstanding in excess of $3,000,000, and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Indebtedness, or any other default under any
agreement or instrument relating to any such Indebtedness, or any other event,
shall occur and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such default or
event is to accelerate, or to permit the acceleration of, the maturity of such
Indebtedness; or any such Indebtedness shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required
prepayment), redeemed, purchased or defeased or an offer to prepay, redeem,
purchase or defease such Indebtedness shall be required to be made, in each
case, prior to the stated maturity thereof;

(f)Patriot or any of its Significant Subsidiaries (i) shall institute any
proceeding or voluntary case seeking to adjudicate it a bankrupt or insolvent,
or seeking dissolution, liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency, reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for any such Person or for any
substantial part of its property, (ii) shall be generally not paying its debts
as such debts become due or shall admit in writing its inability to pay its
debts generally, (iii) shall make a general assignment for the benefit of
creditors, or (iv) shall take any action to authorize or effect any of the
actions set forth above in this subsection (f);

(g)any proceeding shall be instituted against Patriot or any of its Significant
Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief of debtors, or seeking the entry of an order for relief or
the appointment of a receiver, trustee, custodian or other similar official for
any such Person or for any substantial part of its property, and either such
proceeding shall remain undismissed or unstayed for a period of 60 days or any
of the actions sought in such proceeding (including, without limitation, the
entry of an order for relief against any such Person or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property) shall occur;

 

- 99 -

 

 

--------------------------------------------------------------------------------

 

(h)as a result of an action or omission of any Loan Party or its Subsidiary, any
material provision of any Loan Document shall at any time for any reason (other
than pursuant to the express terms thereof) cease to be valid and binding on or
enforceable against any Loan Party intended to be a party thereto, or the
validity or enforceability thereof shall be contested by any party thereto, or a
proceeding shall be commenced by any Loan Party or any Governmental Authority
having jurisdiction over any of them, seeking to establish the invalidity or
unenforceability thereof, or any Loan Party shall deny in writing that it has
any liability or obligation purported to be created under any Loan Document;

(i)any Security Agreement, any Mortgage or any other security document, after
delivery thereof pursuant hereto, shall for any reason fail or cease to create a
valid and perfected and, except to the extent permitted by the terms hereof or
thereof, first priority Lien in favor of the Collateral Agent for the benefit of
the Agents and the Lenders on any Collateral purported to be covered thereby;

(j)one or more judgments, orders or awards (or any settlement of any litigation
or other proceeding that, if breached, could result in a judgment, order or
award) for the payment of money exceeding $1,000,000 in the aggregate (except to
the extent fully covered (other than to the extent of customary deductibles) by
insurance pursuant to which the insurer has been notified and has not denied
coverage) shall be rendered against Patriot or any of its Significant
Subsidiaries and remain unsatisfied and (i) enforcement proceedings shall have
been commenced by any creditor upon any such judgment, order, award or
settlement or (ii) there shall be a period of 10 consecutive days after entry
thereof during which (A) a stay of enforcement thereof is not be in effect or
(B) the same is not vacated, discharged, stayed or bonded pending appeal;

(k)Patriot or any of its Significant Subsidiaries is enjoined, restrained or in
any way prevented by the order of any court or any Governmental Authority from
conducting, or otherwise ceases to conduct for any reason whatsoever, all or any
material part of its business for more than 15 days;

(l)any material damage to, or loss, theft or destruction of, any Collateral,
whether or not insured, or any strike, lockout, labor dispute, embargo,
condemnation, act of God or public enemy, or other casualty which causes, for
more than 30 consecutive days, the cessation or substantial curtailment of
revenue producing activities at any facility of any Loan Party, if any such
event or circumstance could reasonably be expected to have a Material Adverse
Effect;

(m)the loss, suspension or revocation of, or failure to renew, any license or
permit now held or hereafter acquired by Patriot or any of its Significant
Subsidiaries, if such loss, suspension, revocation or failure to renew could
reasonably be expected to have a Material Adverse Effect;

 

- 100 -

 

 

--------------------------------------------------------------------------------

 

(n)the indictment of Patriot or any of its Significant Subsidiaries or any
senior officer thereof under any criminal statute, or commencement of criminal
or civil proceedings against Patriot or any of its Significant Subsidiaries or
any senior officer thereof, pursuant to which statute or proceedings the
penalties or remedies sought or available include forfeiture to any Governmental
Authority of any material portion of the property of such Person (for purposes
of this Section 9.01(n), “senior officer” shall mean any officer of Patriot
deemed to be an “officer” pursuant to Section 16(a) of the Exchange Act);

(o)any Loan Party or any of its ERISA Affiliates shall have made a complete or
partial withdrawal from a Multiemployer Plan, and, as a result of such complete
or partial withdrawal, any Loan Party or any of its ERISA Affiliates incurs a
withdrawal liability in an annual amount exceeding $2,500,000; or a
Multiemployer Plan enters reorganization status under Section 4241 of ERISA,
and, as a result thereof any Loan Party’s or any of its ERISA Affiliates’ annual
contribution requirements with respect to such Multiemployer Plan increases in
an annual amount exceeding $2,500,000;

(p)any Termination Event with respect to any Employee Plan shall have occurred,
and, 30 days after notice thereof shall have been given to any Loan Party by any
Agent, (i) such Termination Event (if correctable) shall not have been
corrected, and (ii) the then current value of such Employee Plan’s vested
benefits exceeds the then current value of assets allocable to such benefits in
such Employee Plan by more than $2,500,000 (or, in the case of a Termination
Event involving liability under Section 409, 502(i), 502(l), 515, 4062, 4063,
4064, 4069, 4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of the Internal
Revenue Code, the liability is in excess of such amount); or

(q)a Change of Control shall have occurred;

then, and in any such event, the Collateral Agent may, and shall at the request
of the Required Lenders, by notice to the Administrative Borrower, (i) terminate
or reduce all Commitments, whereupon all Commitments shall immediately be so
terminated or reduced, (ii) declare all or any portion of the Loans then
outstanding to be accelerated and due and payable, whereupon all or such portion
of the aggregate principal of all Loans, all accrued and unpaid interest
thereon, all fees and all other amounts payable under this Agreement and the
other Loan Documents shall become due and payable immediately, together with the
payment of the Applicable Premium with respect to the Commitments so terminated
and the Loans so repaid, without presentment, demand, protest or further notice
of any kind, all of which are hereby expressly waived by each Loan Party and
(iii) exercise any and all of its other rights and remedies under applicable
law, hereunder and under the other Loan Documents; provided, however, that upon
the occurrence of any Event of Default described in subsection (f) or (g) of
this Section 9.01 with respect to any Loan Party, without any notice to any Loan
Party or any other Person or any act by any Agent or any Lender, all Commitments
shall automatically terminate and all Loans then outstanding, together with all
accrued and unpaid interest thereon, all fees and all other amounts due under
this Agreement and the other Loan Documents, including, without limitation, the
Applicable Premium, shall be accelerated and become due and payable
automatically and immediately, without presentment, demand, protest or notice of
any kind, all of which are expressly waived by each Loan Party. 

 

- 101 -

 

 

--------------------------------------------------------------------------------

 

ARTICLE X

AGENTS

Section 10.01Appointment. Each Lender (and each subsequent maker of any Loan by
its making thereof) hereby irrevocably appoints, authorizes and empowers the
Administrative Agent and the Collateral Agent to perform the duties of each such
Agent as set forth in this Agreement and the other Loan Documents, together with
such actions and powers as are reasonably incidental thereto, including:  (i) to
receive on behalf of each Lender any payment of principal of or interest on the
Loans outstanding hereunder and all other amounts accrued hereunder for the
account of the Lenders and paid to such Agent, and, subject to Section 2.02 of
this Agreement, to distribute promptly to each Lender its Pro Rata Share of all
payments so received; (ii) to distribute to each Lender copies of all material
notices and agreements received by such Agent and not required to be delivered
to each Lender pursuant to the terms of this Agreement, provided that the Agents
shall not have any liability to the Lenders for any Agent’s inadvertent failure
to distribute any such notices or agreements to the Lenders; (iii) to maintain,
in accordance with its customary business practices, ledgers and records
reflecting the status of the Obligations, the Loans, and related matters and to
maintain, in accordance with its customary business practices, ledgers and
records reflecting the status of the Collateral and related matters; (iv) to
execute or file any and all financing or similar statements or notices,
amendments, renewals, supplements, documents, instruments, proofs of claim,
notices and other written agreements with respect to this Agreement or any other
Loan Document; (v) to make the Loans and Collateral Agent Advances, for such
Agent or on behalf of the applicable Lenders as provided in this Agreement or
any other Loan Document; (vi) to perform, exercise, and enforce any and all
other rights and remedies of the Lenders with respect to the Loan Parties, the
Obligations, or otherwise related to any of same to the extent reasonably
incidental to the exercise by such Agent of the rights and remedies specifically
authorized to be exercised by such Agent by the terms of this Agreement or any
other Loan Document; (vii)  to incur and pay such fees necessary or appropriate
for the performance and fulfillment of its functions and powers pursuant to this
Agreement or any other Loan Document; (viii) subject to Section 10.03, to take
such action as such Agent deems appropriate on its behalf to administer the
Loans and the Loan Documents and to exercise such other powers delegated to such
Agent by the terms hereof or the other Loan Documents (including, without
limitation, the power to give or to refuse to give notices, waivers, consents,
approvals and instructions and the power to make or to refuse to make
determinations and calculations); and (ix) to act with respect to all Collateral
under the Loan Documents, including for purposes of acquiring, holding and
enforcing any and all Liens on Collateral granted by any of the Loan Parties to
secure any of the Obligations.  As to any matters not expressly provided for by
this Agreement and the other Loan Documents (including, without limitation,
enforcement or collection of the Loans), the Agents shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Required Lenders (or such other number
or percentage of the Lenders as shall be expressly provided for herein or in the
other Loan Documents), and such instructions of the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents) shall be binding upon all Lenders and all
makers of Loans; provided, however, the Agents shall not be required to take any
action which, in the reasonable opinion of any Agent, exposes such Agent to
liability or which is contrary to this Agreement or any other Loan Document or
applicable law.

 

- 102 -

 

 

--------------------------------------------------------------------------------

 

Section 10.02Nature of Duties; Delegation. (a) The Agents shall have no duties
or responsibilities except those expressly set forth in this Agreement or in the
other Loan Documents.  The duties of the Agents shall be mechanical and
administrative in nature.  The Agents shall not have by reason of this Agreement
or any other Loan Document a fiduciary relationship in respect of any
Lender.  Nothing in this Agreement or any other Loan Document, express or
implied, is intended to or shall be construed to impose upon the Agents any
obligations in respect of this Agreement or any other Loan Document except as
expressly set forth herein or therein.  Each Lender shall make its own
independent investigation of the financial condition and affairs of the Loan
Parties in connection with the making and the continuance of the Loans hereunder
and shall make its own appraisal of the creditworthiness of the Loan Parties and
the value of the Collateral, and the Agents shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto, whether coming into
their possession before the initial Loan hereunder or at any time or times
thereafter, provided that, upon the reasonable request of a Lender, each Agent
shall provide to such Lender any documents or reports delivered to such Agent by
the Loan Parties pursuant to the terms of this Agreement or any other Loan
Document.  If any Agent seeks the consent or approval of the Required Lenders
(or such other number or percentage of the Lenders as shall be expressly
provided for herein or in the other Loan Documents) to the taking or refraining
from taking any action hereunder, such Agent shall send notice thereof to each
Lender.  Each Agent shall promptly notify each Lender any time that the Required
Lenders (or such other number or percentage of the Lenders as shall be expressly
provided for herein or in the other Loan Documents) have instructed such Agent
to act or refrain from acting pursuant hereto.

(a)Each Agent may, upon any term or condition it specifies, delegate or exercise
any of its rights, powers and remedies under, and delegate or perform any of its
duties or any other action with respect to, any Loan Document by or through any
trustee, co-agent, employee, attorney-in-fact and any other Person (including
any Lender).  Any such Person shall benefit from this Article X to the extent
provided by the applicable Agent.

Section 10.03Rights, Exculpation, Etc. The Agents and their directors, officers,
agents or employees shall not be liable for any action taken or omitted to be
taken by them under or in connection with this Agreement or the other Loan
Documents, except for their own gross negligence or willful misconduct as
determined by a final non-appealable judgment of a court of competent
jurisdiction.  Without limiting the generality of the foregoing, the Agents
(i) may treat the payee of any Loan as the owner thereof until the Collateral
Agent receives written notice of the assignment or transfer thereof, pursuant to
Section 12.07 hereof, signed by such payee and in form satisfactory to the
Collateral Agent; (ii) may consult with legal counsel (including, without
limitation, counsel to any Agent or counsel to the Loan Parties), independent
public accountants, and other experts selected by any of them and shall not be
liable for any action taken or omitted to be taken in good faith by any of them
in accordance with the advice of such counsel or experts; (iii) make no warranty
or representation to any Lender and shall not be responsible to any Lender for
any statements, certificates, warranties or representations made in or in
connection with this Agreement or the other Loan Documents; (iv) shall not have
any duty to ascertain or to inquire as to the performance or observance of any
of the terms, covenants or conditions of this Agreement or the other Loan
Documents on the part of any Person, the existence or possible existence of any
Default or Event of Default, or to inspect the Collateral or

 

- 103 -

 

 

--------------------------------------------------------------------------------

 

other property (including, without limitation, the books and records) of any
Person; (v) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; and (vi) shall not be deemed to have made
any representation or warranty regarding the existence, value or collectibility
of the Collateral, the existence, priority or perfection of the Collateral
Agent’s Lien thereon, or any certificate prepared by any Loan Party in
connection therewith, nor shall the Agents be responsible or liable to the
Lenders for any failure to monitor or maintain any portion of the
Collateral.  The Agents shall not be liable for any apportionment or
distribution of payments made in good faith pursuant to Section 4.03, and if any
such apportionment or distribution is subsequently determined to have been made
in error, and the sole recourse of any Lender to whom payment was due but not
made shall be to recover from other Lenders any payment in excess of the amount
which they are determined to be entitled.  The Agents may at any time request
instructions from the Lenders with respect to any actions or approvals which by
the terms of this Agreement or of any of the other Loan Documents the Agents are
permitted or required to take or to grant, and if such instructions are promptly
requested, the Agents shall be absolutely entitled to refrain from taking any
action or to withhold any approval under any of the Loan Documents until they
shall have received such instructions from the Required Lenders.  Without
limiting the foregoing, no Lender shall have any right of action whatsoever
against any Agent as a result of such Agent acting or refraining from acting
under this Agreement or any of the other Loan Documents in accordance with the
instructions of the Required Lenders (or such other number or percentage of the
Lenders as shall be expressly provided for herein or in the other Loan
Documents).

Section 10.04Reliance. Each Agent shall be entitled to rely upon any written
notices, statements, certificates, orders or other documents or any telephone
message believed by it in good faith to be genuine and correct and to have been
signed, sent or made by the proper Person, and with respect to all matters
pertaining to this Agreement or any of the other Loan Documents and its duties
hereunder or thereunder, upon advice of counsel selected by it.

Section 10.05Indemnification. To the extent that any Agent is not reimbursed and
indemnified by any Loan Party, and whether or not such Agent has made demand on
any Loan Party for the same, the Lenders will, within five days of written
demand by such Agent, reimburse such Agent for and indemnify such Agent from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses (including, without limitation,
client charges and expenses of counsel or any other advisor to such Agent),
advances or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against such Agent in any way relating to or
arising out of this Agreement or any of the other Loan Documents or any action
taken or omitted by such Agent under this Agreement or any of the other Loan
Documents, in proportion to each Lender’s Pro Rata Share, including, without
limitation, advances and disbursements made pursuant to Section 10.08; provided,
however, that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses, advances or disbursements for which there has been a final
non-appealable judicial determination that such liability resulted from such
Agent’s gross negligence or willful misconduct.  The obligations of the Lenders
under this Section 10.05 shall survive the payment in full of the Loans and the
termination of this Agreement.  

 

- 104 -

 

 

--------------------------------------------------------------------------------

 

Section 10.06Agents Individually. With respect to its Pro Rata Share of the
Total Commitment hereunder and the Loans made by it, each Agent shall have and
may exercise the same rights and powers hereunder and is subject to the same
obligations and liabilities as and to the extent set forth herein for any other
Lender or maker of a Loan.  The terms “Lenders” or “Required Lenders” or any
similar terms shall, unless the context clearly otherwise indicates, include
each Agent in its individual capacity as a Lender or one of the Required
Lenders.  Each Agent and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of banking, trust or other business with any
Borrower as if it were not acting as an Agent pursuant hereto without any duty
to account to the other Lenders.

Section 10.07Successor Agent. (a)  Any Agent may at any time give at least 30
days prior written notice of its resignation to the Lenders and the
Administrative Borrower.  Upon receipt of any such notice of resignation, the
Required Lenders shall have the right to appoint a successor Agent.  If no such
successor Agent shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Agent gives
notice of its resignation (or such earlier day as shall be agreed by the
Required Lenders) (the “Resignation Effective Date”), then the retiring Agent
may (but shall not be obligated to), on behalf of the Lenders, appoint a
successor Agent.  Whether or not a successor Agent has been appointed, such
resignation shall become effective in accordance with such notice on the
Resignation Effective Date.

(a)With effect from the Resignation Effective Date, (i) the retiring Agent shall
be discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of any Collateral held by such Agent on
behalf of the Lenders under any of the Loan Documents, the retiring Agent shall
continue to hold such collateral security until such time as a successor Agent
is appointed) and (ii) all payments, communications and determinations provided
to be made by, to or through such retiring Agent shall instead be made by or to
each Lender directly, until such time, if any, as a successor Agent shall have
been appointed as provided for above.  Upon the acceptance of a successor’s
Agent’s appointment as Agent hereunder, such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from all of its
duties and obligations hereunder or under the other Loan Documents.  After the
retiring Agent’s resignation hereunder and under the other Loan Documents, the
provisions of this Article, Section 12.04 and Section 12.15 shall continue in
effect for the benefit of such retiring Agent in respect of any actions taken or
omitted to be taken by it while the retiring Agent was acting as Agent.

Section 10.08Collateral Matters.

(a)The Collateral Agent may from time to time make such disbursements and
advances (“Collateral Agent Advances”) which the Collateral Agent, in its sole
discretion, deems necessary or desirable to preserve, protect, prepare for sale
or lease or dispose of the Collateral or any portion thereof, to enhance the
likelihood or maximize the amount of repayment by the Borrowers of the Loans and
other Obligations or to pay any other amount chargeable to the Borrowers
pursuant to the terms of this Agreement, including, without limitation, costs,
fees and expenses as described in Section 12.04.  The Collateral Agent Advances
shall be repayable on demand and be secured by the Collateral and shall bear
interest at a rate per annum equal to the

 

- 105 -

 

 

--------------------------------------------------------------------------------

 

rate then applicable to Revolving Loans that are Reference Rate Loans.  The
Collateral Agent Advances shall constitute Obligations hereunder which may be
charged to the Loan Account in accordance with Section 4.01.  The Collateral
Agent shall notify each Lender and the Administrative Borrower in writing of
each such Collateral Agent Advance, which notice shall include a description of
the purpose of such Collateral Agent Advance.  Without limitation to its
obligations pursuant to Section 10.05, each Lender agrees that it shall make
available to the Collateral Agent, upon the Collateral Agent’s demand, in
Dollars in immediately available funds, the amount equal to such Lender’s Pro
Rata Share of each such Collateral Agent Advance.  If such funds are not made
available to the Collateral Agent by such Lender, the Collateral Agent shall be
entitled to recover such funds on demand from such Lender, together with
interest thereon for each day from the date such payment was due until the date
such amount is paid to the Collateral Agent, at the Federal Funds Rate for three
Business Days and thereafter at the Reference Rate.

(b)The Lenders hereby irrevocably authorize the Collateral Agent, at its option
and in its discretion, to release any Lien granted to or held by the Collateral
Agent upon any Collateral upon termination of the Total Commitment and payment
and satisfaction of all Loans and all other Obligations (other than Contingent
Indemnification Obligations) in accordance with the terms hereof; or
constituting property being sold or disposed of in the ordinary course of any
Loan Party’s business or otherwise in compliance with the terms of this
Agreement and the other Loan Documents; or constituting property in which the
Loan Parties owned no interest at the time the Lien was granted or at any time
thereafter; or if approved, authorized or ratified in writing by the Lenders in
accordance with Section 12.02.  Upon request by the Collateral Agent at any
time, the Lenders will confirm in writing the Collateral Agent’s authority to
release particular types or items of Collateral pursuant to this Section
10.08(b).

(c)Without in any manner limiting the Collateral Agent’s authority to act
without any specific or further authorization or consent by the Lenders (as set
forth in Section 10.08(b)), each Lender agrees to confirm in writing, upon
request by the Collateral Agent, the authority to release Collateral conferred
upon the Collateral Agent under Section 10.08(b).  Upon receipt by the
Collateral Agent of confirmation from the Lenders of its authority to release
any particular item or types of Collateral, and upon prior written request by
any Loan Party, the Collateral Agent shall (and is hereby irrevocably authorized
by the Lenders to) execute such documents as may be necessary to evidence the
release of the Liens granted to the Collateral Agent for the benefit of the
Agents and the Lenders upon such Collateral; provided, however, that (i) the
Collateral Agent shall not be required to execute any such document on terms
which, in the Collateral Agent’s opinion, would expose the Collateral Agent to
liability or create any obligations or entail any consequence other than the
release of such Liens without recourse or warranty, and (ii) such release shall
not in any manner discharge, affect or impair the Obligations or any Lien upon
(or obligations of any Loan Party in respect of) all interests in the Collateral
retained by any Loan Party.

(d)Anything contained in any of the Loan Documents to the contrary
notwithstanding, the Loan Parties, each Agent and each Lender hereby agree that
(i) no Lender shall have any right individually to realize upon any of the
Collateral under any Loan Document or to enforce any Guaranty, it being
understood and agreed that all powers, rights and remedies under the Loan
Documents may be exercised solely by the Collateral Agent for the benefit of the

 

- 106 -

 

 

--------------------------------------------------------------------------------

 

Lenders in accordance with the terms thereof, (ii) in the event of a foreclosure
by the Collateral Agent on any of the Collateral pursuant to a public or private
sale, the Administrative Agent, the Collateral Agent or any Lender may be the
purchaser of any or all of such Collateral at any such sale and (iii) the
Collateral Agent, as agent for and representative of the Agents and the Lenders
(but not any other Agent or any Lender or Lenders in its or their respective
individual capacities unless the Required Lenders shall otherwise agree in
writing) shall be entitled (either directly or through one or more acquisition
vehicles) for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral to be sold (A) at any
public or private sale, (B) at any sale conducted by the Collateral Agent under
the provisions of the Uniform Commercial Code (including pursuant to Sections
9-610 or 9-620 of the Uniform Commercial Code), (C) at any sale or foreclosure
conducted by the Collateral Agent (whether by judicial action or otherwise) in
accordance with applicable law or (D) any sale conducted pursuant to the
provisions of any Debtor Relief Law (including Section 363 of the Bankruptcy
Code), to use and apply all or any of the Obligations as a credit on account of
the purchase price for any Collateral payable by the Collateral Agent at such
sale.

(e)The Collateral Agent shall have no obligation whatsoever to any Lender to
assure that the Collateral exists or is owned by the Loan Parties or is cared
for, protected or insured or has been encumbered or that the Lien granted to the
Collateral Agent pursuant to this Agreement or any other Loan Document has been
properly or sufficiently or lawfully created, perfected, protected or enforced
or is entitled to any particular priority, or to exercise at all or in any
particular manner or under any duty of care, disclosure or fidelity, or to
continue exercising, any of the rights, authorities and powers granted or
available to the Collateral Agent in this Section 10.08 or in any other Loan
Document, it being understood and agreed that in respect of the Collateral, or
any act, omission or event related thereto, the Collateral Agent may act in any
manner it may deem appropriate, in its sole discretion, given the Collateral
Agent’s own interest in the Collateral as one of the Lenders and that the
Collateral Agent shall have no duty or liability whatsoever to any other Lender,
except as otherwise provided herein.

Section 10.09Agency for Perfection. Each Agent and each Lender hereby appoints
each other Agent and each other Lender as agent and bailee for the purpose of
perfecting the security interests in and liens upon the Collateral in assets
which, in accordance with Article 9 of the Uniform Commercial Code, can be
perfected only by possession or control (or where the security interest of a
secured party with possession or control has priority over the security interest
of another secured party) and each Agent and each Lender hereby acknowledges
that it holds possession of or otherwise controls any such Collateral for the
benefit of the Agents and the Lenders as secured party.  Should the
Administrative Agent or any Lender obtain possession or control of any such
Collateral, the Administrative Agent or such Lender shall notify the Collateral
Agent thereof, and, promptly upon the Collateral Agent’s request therefor shall
deliver such Collateral to the Collateral Agent or in accordance with the
Collateral Agent’s instructions.  In addition, the Collateral Agent shall also
have the power and authority hereunder to appoint such other sub-agents as may
be necessary or required under applicable state law or otherwise to perform its
duties and enforce its rights with respect to the Collateral and under the Loan
Documents.  Each Loan Party by its execution and delivery of this Agreement
hereby consents to the foregoing.

 

- 107 -

 

 

--------------------------------------------------------------------------------

 

Section 10.10No Reliance on any Agent’s Customer Identification Program. Each
Lender acknowledges and agrees that neither such Lender, nor any of its
Affiliates, participants or assignees, may rely on any Agent to carry out such
Lender’s, Affiliate’s, participant’s or assignee’s customer identification
program, or other requirements imposed by the USA PATRIOT Act or the regulations
issued thereunder, including the regulations set forth in 31 C.F.R. §§
1010.100(yy), (iii), 1020.100, and 1020.220 (formerly 31 C.F.R. § 103.121), as
hereafter amended or replaced (“CIP Regulations”), or any other Anti-Terrorism
Laws, including any programs involving any of the following items relating to or
in connection with any of the Loan Parties, their Affiliates or their agents,
the Loan Documents or the transactions hereunder or contemplated hereby:  (1)
any identity verification procedures, (2) any recordkeeping, (3) comparisons
with government lists, (4) customer notices or (5) other procedures required
under the CIP Regulations or other regulations issued under the USA PATRIOT
Act.  Each Lender, Affiliate, participant or assignee subject to Section 326 of
the USA PATRIOT Act will perform the measures necessary to satisfy its own
responsibilities under the CIP Regulations.

Section 10.11No Third Party Beneficiaries. The provisions of this Article are
solely for the benefit of the Secured Parties, and no Loan Party shall have
rights as a third-party beneficiary of any of such provisions.

Section 10.12No Fiduciary Relationship. It is understood and agreed that the use
of the term “agent” herein or in any other Loan Document (or any other similar
term) with reference to any 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
contracting parties.

Section 10.13Reports; Confidentiality; Disclaimers. By becoming a party to this
Agreement, each Lender:

(a)is deemed to have requested that each Agent furnish such Lender, promptly
after it becomes available, a copy of each field audit or examination report
with respect to Patriot or any of its Subsidiaries (each, a “Report”) prepared
by or at the request of such Agent, and each Agent shall so furnish each Lender
with each such Report,

(b)expressly agrees and acknowledges that the Agents (i) do not make any
representation or warranty as to the accuracy of any Reports, and (ii) shall not
be liable for any information contained in any Reports,

(c)expressly agrees and acknowledges that the Reports are not comprehensive
audits or examinations, that any Agent or other party performing any audit or
examination will inspect only specific information regarding Patriot and its
Subsidiaries and will rely significantly upon Patriot’s and its Subsidiaries’
books and records, as well as on representations of their personnel,

(d)agrees to keep all Reports and other material, non-public information
regarding Patriot and its Subsidiaries and their operations, assets, and
existing and contemplated business plans in a confidential manner in accordance
with Section 12.19, and

 

- 108 -

 

 

--------------------------------------------------------------------------------

 

(e)without limiting the generality of any other indemnification provision
contained in this Agreement, agrees:  (i) to hold any Agent and any other Lender
preparing a Report harmless from any action the indemnifying Lender may take or
fail to take or any conclusion the indemnifying Lender may reach or draw from
any Report in connection with any loans or other credit accommodations that the
indemnifying Lender has made or may make to the Borrowers, or the indemnifying
Lender’s participation in, or the indemnifying Lender’s purchase of, a loan or
loans of the Borrowers, and (ii) to pay and protect, and indemnify, defend and
hold any Agent and any other Lender preparing a Report harmless from and
against, the claims, actions, proceedings, damages, costs, expenses, and other
amounts (including, attorneys fees and costs) incurred by any such Agent and any
such other Lender preparing a Report as the direct or indirect result of any
third parties who might obtain all or part of any Report through the
indemnifying Lender.

Section 10.14Collateral Custodian.

(a)Upon the occurrence and during the continuance of any Default or Event of
Default, the Collateral Agent or its designee may at any time and from time to
time employ and maintain on the premises of any Loan Party a custodian selected
by the Collateral Agent or its designee who shall have full authority to do all
acts necessary to protect the Agents’ and the Lenders’ interests.  Each Loan
Party hereby agrees to, and to cause its Subsidiaries to, cooperate with any
such custodian and to do whatever the Collateral Agent or its designee may
reasonably request to preserve the Collateral.  All costs and expenses incurred
by the Collateral Agent or its designee by reason of the employment of the
custodian shall be the responsibility of the Borrowers and charged to the Loan
Account.

Section 10.15[Intentionally Omitted.]

Section 10.16[Intentionally Omitted.]

Section 10.17Collateral Agent May File Proofs of Claim. In case of the pendency
of any proceeding under any Debtor Relief Law or any other judicial proceeding
relative to any Loan Party, the Collateral Agent (irrespective of whether the
principal of any Loan shall then be due and payable as herein expressed or by
declaration or otherwise and irrespective of whether any Agent shall have made
any demand on the Borrowers) shall be entitled and empowered (but not obligated)
by intervention in such proceeding or otherwise:

(a)to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans and all other Obligations that are
owing and unpaid and to file such other documents as may be necessary or
advisable in order to have the claims of the Secured Parties (including any
claim for the compensation, expenses, disbursements and advances of the Secured
Parties and their respective agents and counsel and all other amounts due the
Secured Parties hereunder and under the other Loan Documents) allowed in such
judicial proceeding; and

 

- 109 -

 

 

--------------------------------------------------------------------------------

 

(b)to collect and receive any monies or other property payable or deliverable on
any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Secured Party to make such payments to the Collateral Agent and, in the
event that the Collateral Agent shall consent to the making of such payments
directly to the Secured Parties, to pay to the Collateral Agent any amount due
for the reasonable compensation, expenses, disbursements and advances of the
Collateral Agent and its agents and counsel, and any other amounts due the
Collateral Agent hereunder and under the other Loan Documents.

ARTICLE XI

GUARANTY

Section 11.01Guaranty. Each Guarantor hereby jointly and severally and
unconditionally and irrevocably guarantees the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all Obligations of
the Borrowers now or hereafter existing under any Loan Document, whether for
principal, interest (including, without limitation, all interest that accrues
after the commencement of any Insolvency Proceeding of any Borrower, whether or
not a claim for post-filing interest is allowed in such Insolvency Proceeding),
fees, commissions, expense reimbursements, indemnifications or otherwise (such
obligations, to the extent not paid by the Borrowers, being the ”Guaranteed
Obligations”), and agrees to pay any and all expenses (including reasonable
counsel fees and expenses) incurred by the Secured Parties in enforcing any
rights under the guaranty set forth in this Article XI.  Without limiting the
generality of the foregoing, each Guarantor’s liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
the Borrowers to the Secured Parties under any Loan Document but for the fact
that they are unenforceable or not allowable due to the existence of an
Insolvency Proceeding involving any Borrower.  Notwithstanding any of the
foregoing, Guaranteed Obligations shall not include any Excluded Swap
Obligations.  

 

- 110 -

 

 

--------------------------------------------------------------------------------

 

Section 11.02Guaranty Absolute. Each Guarantor jointly and severally guarantees
that the Guaranteed Obligations will be paid strictly in accordance with the
terms of the Loan Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of the Secured Parties with respect thereto.  Each Guarantor agrees that
this Article XI constitutes a guaranty of payment when due and not of collection
and waives any right to require that any resort be made by any Agent or any
Lender to any Collateral.  The obligations of each Guarantor under this Article
XI are independent of the Guaranteed Obligations, and a separate action or
actions may be brought and prosecuted against each Guarantor to enforce such
obligations, irrespective of whether any action is brought against any Loan
Party or whether any Loan Party is joined in any such action or actions.  The
liability of each Guarantor under this Article XI shall be irrevocable, absolute
and unconditional irrespective of, and each Guarantor hereby irrevocably waives
any defenses it may now or hereafter have in any way relating to, any or all of
the following:

(a)any lack of validity or enforceability of any Loan Document or any agreement
or instrument relating thereto;

(b)any change in the time, manner or place of payment of, or in any other term
of, all or any of the Guaranteed Obligations, or any other amendment or waiver
of or any consent to departure from any Loan Document, including, without
limitation, any increase in the Guaranteed Obligations resulting from the
extension of additional credit to any Loan Party or otherwise;

(c)any taking, exchange, release or non-perfection of any Collateral, or any
taking, release or amendment or waiver of or consent to departure from any other
guaranty, for all or any of the Guaranteed Obligations;

(d)the existence of any claim, set-off, defense or other right that any
Guarantor may have at any time against any Person, including, without
limitation, any Secured Party;

(e)any change, restructuring or termination of the corporate, limited liability
company or partnership structure or existence of any Loan Party; or

(f)any other circumstance (including, without limitation, any statute of
limitations) or any existence of or reliance on any representation by the
Secured Parties that might otherwise constitute a defense available to, or a
discharge of, any Loan Party or any other guarantor or surety.

This Article XI shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by Secured Parties or any other Person upon the
insolvency, bankruptcy or reorganization of any Borrower or otherwise, all as
though such payment had not been made.

 

- 111 -

 

 

--------------------------------------------------------------------------------

 

Section 11.03Waiver. Each Guarantor hereby waives (i) promptness and diligence,
(ii) notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Article XI and any requirement that the Secured
Parties exhaust any right or take any action against any Loan Party or any other
Person or any Collateral, (iii) any right to compel or direct any Secured Party
to seek payment or recovery of any amounts owed under this Article XI from any
one particular fund or source or to exhaust any right or take any action against
any other Loan Party, any other Person or any Collateral, (iv) any requirement
that any Secured Party protect, secure, perfect or insure any security interest
or Lien on any property subject thereto or exhaust any right to take any action
against any Loan Party, any other Person or any Collateral, and (v) any other
defense available to any Guarantor.  Each Guarantor agrees that the Secured
Parties shall have no obligation to marshal any assets in favor of any Guarantor
or against, or in payment of, any or all of the Obligations.  Each Guarantor
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated herein and that the waiver set forth in this
Section 11.03 is knowingly made in contemplation of such benefits.  Each
Guarantor hereby waives any right to revoke this Article XI, and acknowledges
that this Article XI is continuing in nature and applies to all Guaranteed
Obligations, whether existing now or in the future.

Section 11.04Continuing Guaranty; Assignments. This Article XI is a continuing
guaranty and shall (a) remain in full force and effect until the later of the
cash payment in full of the Guaranteed Obligations (other than Contingent
Indemnity Obligations) and all other amounts payable under this Article XI and
the Final Maturity Date, (b) be binding upon each Guarantor, its successors and
assigns and (c) inure to the benefit of and be enforceable by the Secured
Parties and their successors, pledgees, transferees and assigns.  Without
limiting the generality of the foregoing clause (c), any Lender may pledge,
assign or otherwise transfer all or any portion of its rights and obligations
under this Agreement (including, without limitation, all or any portion of its
Commitments, its Loans owing to it) to any other Person, and such other Person
shall thereupon become vested with all the benefits in respect thereof granted
such Lender herein or otherwise, in each case as provided in Section 12.07.

Section 11.05Subrogation. No Guarantor will exercise any rights that it may now
or hereafter acquire against any Loan Party or any other guarantor that arise
from the existence, payment, performance or enforcement of such Guarantor’s
obligations under this Article XI, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and any
right to participate in any claim or remedy of the Secured Parties against any
Loan Party or any other guarantor or any Collateral, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from any Loan Party
or any other guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security solely on account of such
claim, remedy or right, unless and until all of the Guaranteed Obligations
(other than Contingent Indemnity Obligations) and all other amounts payable
under this Article XI shall have been paid in full in cash and the Final
Maturity Date shall have occurred.  If any amount shall be paid to any Guarantor
in violation of the immediately preceding sentence at any time prior to the
later of the payment in full in cash of the Guaranteed Obligations (other than
Contingent Indemnity Obligations) and all other amounts payable under this
Article XI and the Final Maturity Date, such amount shall be held in trust for
the benefit of the Secured Parties and shall forthwith be paid to the Secured
Parties to be credited and applied

 

- 112 -

 

 

--------------------------------------------------------------------------------

 

to the Guaranteed Obligations and all other amounts payable under this Article
XI, whether matured or unmatured, in accordance with the terms of this
Agreement, or to be held as Collateral for any Guaranteed Obligations or other
amounts payable under this Article XI thereafter arising.  If (i) any Guarantor
shall make payment to the Secured Parties of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations and all other amounts
payable under this Article XI shall be paid in full in cash and (iii) the Final
Maturity Date shall have occurred, the Secured Parties will, at such Guarantor’s
request and expense, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Guaranteed Obligations resulting from such payment by such Guarantor.

Section 11.06Contribution. All Guarantors desire to allocate among themselves,
in a fair and equitable manner, their obligations arising under this Guaranty. 
Accordingly, in the event any payment or distribution is made on any date by a
Guarantor under this Guaranty such that its Aggregate Payments exceeds its Fair
Share as of such date, such Guarantor shall be entitled to a contribution from
each of the other Guarantors in an amount sufficient to cause each Guarantor’s
Aggregate Payments to equal its Fair Share as of such date.  “Fair Share” means,
with respect to any Guarantor as of any date of determination, an amount equal
to (a) the ratio of (i) the Fair Share Contribution Amount with respect to such
Guarantor, to (ii) the aggregate of the Fair Share Contribution Amounts with
respect to all Guarantors multiplied by, (b) the aggregate amount paid or
distributed on or before such date by all Guarantors under this Guaranty in
respect of the obligations Guaranteed.  “Fair Share Contribution Amount” means,
with respect to any Guarantor as of any date of determination, the maximum
aggregate amount of the obligations of such Guarantor under this Guaranty that
would not render its obligations hereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any comparable applicable provisions of state law; provided, solely for
purposes of calculating the “Fair Share Contribution Amount” with respect to any
Guarantor for purposes of this Section 11.06, any assets or liabilities of such
Guarantor arising by virtue of any rights to subrogation, reimbursement or
indemnification or any rights to or obligations of contribution hereunder shall
not be considered as assets or liabilities of such Guarantor.  “Aggregate
Payments” means, with respect to any Guarantor as of any date of determination,
an amount equal to (A) the aggregate amount of all payments and distributions
made on or before such date by such Guarantor in respect of this Guaranty
(including, without limitation, in respect of this Section 11.06), minus (B) the
aggregate amount of all payments received on or before such date by such
Guarantor from the other Guarantors as contributions under this Section
11.06.  The amounts payable as contributions hereunder shall be determined as of
the date on which the related payment or distribution is made by the applicable
Guarantor.  The allocation among Guarantors of their obligations as set forth in
this Section 11.06 shall not be construed in any way to limit the liability of
any Guarantor hereunder.  Each Guarantor is a third party beneficiary to the
contribution agreement set forth in this Section 11.06.

 

- 113 -

 

 

--------------------------------------------------------------------------------

 

ARTICLE XII

MISCELLANEOUS

Section 12.01Notices, Etc.

(a)Notices Generally.  All notices and other communications provided for
hereunder shall be in writing and shall be delivered by hand, sent by registered
or certified mail (postage prepaid, return receipt requested), overnight
courier, or telecopier.  In the case of notices or other communications to any
Loan Party, Administrative Agent or the Collateral Agent, as the case may be,
they shall be sent to the respective address set forth below (or, as to each
party, at such other address as shall be designated by such party in a written
notice to the other parties complying as to delivery with the terms of this
Section 12.01):

PATRIOT NATIONAL, INC.

401 E. Las Olas Blvd, Suites 1650

Fort Lauderdale, FL 33301

Attention: Chief Financial Officer

Telephone:                                                    
Telecopier:                                                    

with a copy to:

PATRIOT NATIONAL, INC.

401 E. Las Olas Blvd, Suites 1650

Fort Lauderdale, FL 33301

Attention: General Counsel

Telephone:                                                    
Telecopier:                                                    

with a copy to:

BAKER HOSTETLER LLP

127 Public Square

Suite 2000

Cleveland, Ohio 44114

Attention: Melissa Leonard

Telephone: 216-861-7986

Telecopier:  216-696-0740

 

- 114 -

 

 

--------------------------------------------------------------------------------

 

if to the Collateral Agent or the Administrative Agent, to it at the following
address:

CERBERUS BUSINESS FINANCE, LLC
875 Third Avenue
New York, New York  10022
Attention:  Daniel Wolf
Telephone:  212.891.2121
Telecopier:  212.891.1541
E-mail:  dwolf@cerberuscapital.com

in each case, with a copy to:

Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York  10022
Attention:  Eliot L. Relles, Esq.
Telephone:  212-756-2000
Telecopier:  212-593-5955

All notices or other communications sent in accordance with this Section 12.01,
shall be deemed received on the earlier of the date of actual receipt or 3
Business Days after the deposit thereof in the mail; provided, that (i) notices
sent by overnight courier service shall be deemed to have been given when
received and (ii) notices by facsimile shall be deemed to have been given when
sent (except that, if not given during normal business hours for the recipient,
shall be deemed to have been given at the opening of business on the next
Business Day for the recipient), provided, further that notices to any Agent
pursuant to Articles II shall not be effective until received by such Agent.

(b)Electronic Communications.

(i)Each Agent and the Administrative Borrower may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of
such procedures may be limited to particular notices or communications.  Notices
and other communications to the Lenders hereunder may be delivered or furnished
by electronic communication (including e‑mail and Internet or intranet websites)
pursuant to procedures approved by the Agents, provided that the foregoing shall
not apply to notices to any Lender pursuant to Articles II if such Lender has
notified the Agents that it is incapable of receiving notices under such Article
by electronic communication.

 

- 115 -

 

 

--------------------------------------------------------------------------------

 

(ii)Unless the Administrative Agent otherwise prescribes, (A) notices and other
communications 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), and (B) notices or communications 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 (A), of notification that such notice or communication is available and
identifying the website address therefor; provided that, for both clauses (A)
and (B) above, if such notice, email 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
for the recipient.

Section 12.02Amendments, Etc. (a) No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
any Loan Party therefrom, shall in any event be effective unless the same shall
be in writing and signed (x) in the case of an amendment, consent or waiver to
cure any ambiguity, omission, defect or inconsistency or granting a new Lien for
the benefit of the Agents and the Lenders or extending an existing Lien over
additional property, by the Agents and the Borrowers (or by the Administrative
Borrower on behalf of the Borrowers), (y) in the case of any other waiver or
consent, by the Required Lenders (or by the Collateral Agent with the consent of
the Required Lenders) and (z) in the case of any other amendment, by the
Required Lenders (or by the Collateral Agent with the consent of the Required
Lenders) and the Borrowers (or by the Administrative Borrower on behalf of the
Borrowers), and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall:

(i)increase the Commitment of any Lender, reduce the principal of, or interest
on, the Loans payable to any Lender, reduce the amount of any fee payable for
the account of any Lender, or postpone or extend any scheduled date fixed for
any payment of principal of, or interest or fees on, the Loans payable to any
Lender, in each case, without the written consent of such Lender;

(ii)increase the Total Commitment without the written consent of each Lender;

(iii)change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans that is required for the Lenders or any of them to
take any action hereunder without the written consent of each Lender;

(iv)amend the definition of “Required Lenders” or “Pro Rata Share” without the
written consent of each Lender;

 

- 116 -

 

 

--------------------------------------------------------------------------------

 

(v)release all or a substantial portion of the Collateral (except as otherwise
provided in this Agreement and the other Loan Documents), subordinate any Lien
granted in favor of the Collateral Agent for the benefit of the Agents and the
Lenders, or release any Borrower or any Guarantor (except in connection with a
Disposition of the Equity Interests thereof permitted by Section 7.02(c)(ii)),
in each case, without the written consent of each Lender; or

(vi)amend, modify or waive Section 4.02, Section 4.03 or this Section 12.02 of
this Agreement without the written consent of each Lender.

Notwithstanding the foregoing, (A) no amendment, waiver or consent shall, unless
in writing and signed by an Agent, affect the rights or duties of such Agent
(but not in its capacity as a Lender) under this Agreement or the other Loan
Documents, (B) any amendment, waiver or consent to any provision of this
Agreement (including Sections 4.01 and 4.02) that permits any Loan Party, or any
of their respective Affiliates to purchase Loans on a non-pro rata basis, become
an eligible assignee pursuant to Section 12.07 and/or make offers to make
optional prepayments on a non-pro rata basis shall require the prior written
consent of the Required Lenders rather than the prior written consent of each
Lender directly affected thereby and (C) the consent of the Borrowers shall not
be required to change any order of priority set forth in Section 2.05(d) and
Section 4.03.  Notwithstanding anything to the contrary herein, no Defaulting
Lender or any of its respective Affiliates that is a Lender shall have any right
to approve or disapprove any amendment, waiver or consent under the Loan
Documents and any Loans held by such Person for purposes hereof shall be
automatically deemed to be voted pro rata according to the Loans of all other
Lenders in the aggregate (other than such Defaulting Lender, Loan Party or
Affiliate).

(b)If any action to be taken by the Lenders hereunder requires the consent,
authorization, or agreement of all of the Lenders or any Lender affected
thereby, and a Lender (the “Holdout Lender”) fails to give its consent,
authorization, or agreement, then the Collateral Agent, upon at least 5 Business
Days prior irrevocable notice to the Holdout Lender, may permanently replace the
Holdout Lender with one or more substitute lenders (each, a “Replacement
Lender”), and the Holdout Lender shall have no right to refuse to be replaced
hereunder.  Such notice to replace the Holdout Lender shall specify an effective
date for such replacement, which date shall not be later than 15 Business Days
after the date such notice is given.  Prior to the effective date of such
replacement, the Holdout Lender and each Replacement Lender shall execute and
deliver an Assignment and Acceptance, subject only to the Holdout Lender being
repaid its share of the outstanding Obligations without any premium or penalty
of any kind whatsoever.  If the Holdout Lender shall refuse or fail to execute
and deliver any such Assignment and Acceptance prior to the effective date of
such replacement, the Holdout Lender shall be deemed to have executed and
delivered such Assignment and Acceptance.  The replacement of any Holdout Lender
shall be made in accordance with the terms of Section 12.07.  Until such time as
the Replacement Lenders shall have acquired all of the Obligations, the
Commitments, and the other rights and obligations of the Holdout Lender
hereunder and under the other Loan Documents, the Holdout Lender shall remain
obligated to make its Pro Rata Share of Loans.

 

- 117 -

 

 

--------------------------------------------------------------------------------

 

Section 12.03No Waiver; Remedies, Etc. No failure on the part of any Agent or
any Lender to exercise, and no delay in exercising, any right hereunder or under
any other Loan Document shall operate as a waiver thereof; nor shall any single
or partial exercise of any right under any Loan Document preclude any other or
further exercise thereof or the exercise of any other right.  The rights and
remedies of the Agents and the Lenders provided herein and in the other Loan
Documents are cumulative and are in addition to, and not exclusive of, any
rights or remedies provided by law.  The rights of the Agents and the Lenders
under any Loan Document against any party thereto are not conditional or
contingent on any attempt by the Agents and the Lenders to exercise any of their
rights under any other Loan Document against such party or against any other
Person.

Section 12.04Expenses; Taxes; Attorneys’ Fees. The Borrowers will pay on demand,
all costs and expenses incurred by or on behalf of each Agent (and, in the case
of clauses (b) through (n) below, each Lender), regardless of whether the
transactions contemplated hereby are consummated, including, without limitation,
reasonable fees, costs, client charges and expenses of counsel for the Agent and
the Lenders), (but limited in each case of this Section 12.04, for the Agents
and the Lenders taken as a whole, to (x) one primary counsel for each Agent and
one primary counsel for the Lenders (taken as a whole), (y) one regulatory
counsel and (z) one local counsel in each relevant jurisdiction or a single
special counsel acting in multiple jurisdictions, in each case unless a conflict
arises, in which case the reasonable and documented fees and out-of-pocket
expenses of one conflicts counsel shall also be reimbursed by the Borrower, and
for the Agents and the Lenders taken as a whole, to all other types of
professionals or advisors other than counsel (such as financial advisors,
investment bankers, accountants, etc.) to one firm of each such type of advisors
to the Agents and the Lenders, taken as a whole, accounting, due diligence,
periodic field audits, physical counts, valuations, investigations, searches and
filings, monitoring of assets, appraisals of Collateral, the rating of the
Loans, title searches and reviewing environmental assessments, miscellaneous
disbursements, examination, travel, lodging and meals, arising from or relating
to:  (a) the negotiation, preparation, execution, delivery, performance and
administration of this Agreement and the other Loan Documents (including,
without limitation, the preparation of any additional Loan Documents pursuant to
Section 7.01(b) or the review of any of the agreements, instruments and
documents referred to in Section 7.01(f)), (b) any requested amendments, waivers
or consents to this Agreement or the other Loan Documents whether or not such
documents become effective or are given, (c) the preservation and protection of
the Agents’ or any of the Lenders’ rights under this Agreement or the other Loan
Documents, (d) the defense of any claim or action asserted or brought against
any Agent or any Lender by any Person that arises from or relates to this
Agreement, any other Loan Document, the Agents’ or the Lenders’ claims against
any Loan Party, or any and all matters in connection therewith, (e) the
commencement or defense of, or intervention in, any court proceeding arising
from or related to this Agreement or any other Loan Document, (f) the filing of
any petition, complaint, answer, motion or other pleading by any Agent or any
Lender, or the taking of any action in respect of the Collateral or other
security, in connection with this Agreement or any other Loan Document, (g) the
protection, collection, lease, sale, taking possession of or liquidation of, any
Collateral or other security in connection with this Agreement or any other Loan
Document, (h) any attempt to enforce any Lien or security interest in any
Collateral or other security in connection with this Agreement or any other Loan
Document, (i) following the occurrence and during the continuance of an Event of
Default, any attempt to collect from any Loan Party, (j) all liabilities and
costs arising from or in connection with the past, present or future operations
of any Loan Party involving any damage to

 

- 118 -

 

 

--------------------------------------------------------------------------------

 

real or personal property or natural resources or harm or injury alleged to have
resulted from any Release of Hazardous Materials on, upon or into such property,
(k) any Environmental Liabilities and Costs incurred in connection with the
investigation, removal, cleanup and/or remediation of any Hazardous Materials
present or arising out of the operations of any Facility of any Loan Party, (l)
any Environmental Liabilities and Costs incurred in connection with any
Environmental Lien, (m) the rating of the Loans by one or more rating agencies
in connection with any Lender’s Securitization, or (n) the receipt by any Agent
or any Lender of any advice from professionals with respect to any of the
foregoing.  Without limitation of the foregoing or any other provision of any
Loan Document:  (x) the Borrowers agree to pay all stamp, document, transfer,
recording or filing taxes or fees and similar impositions now or hereafter
determined by any Agent or any Lender to be payable in connection with this
Agreement or any other Loan Document, and the Borrowers agree to save each Agent
and each Lender harmless from and against any and all present or future claims,
liabilities or losses with respect to or resulting from any omission to pay or
delay in paying any such taxes, fees or impositions, (y) the Borrowers agree to
pay all broker fees that may become due in connection with the transactions
contemplated by this Agreement and the other Loan Documents, and (z) if the
Borrowers fail to perform any covenant or agreement contained herein or in any
other Loan Document, any Agent may itself perform or cause performance of such
covenant or agreement, and the expenses of such Agent incurred in connection
therewith shall be reimbursed on demand by the Borrowers; provided, however,
that the Borrowers shall not have any obligation pursuant to this Section 12.04
for any cost or expense that is caused by the gross negligence or willful
misconduct of an Agent or a Lender, as determined by a final non-appealable
judgment of a court of competent jurisdiction.  The obligations of the Borrowers
under this Section 12.04 shall survive the repayment of the Obligations and
discharge of any Liens granted under the Loan Documents.

Section 12.05Right of Set-off. Upon the occurrence and during the continuance of
any Event of Default, any Agent or any Lender may, and is hereby authorized to,
at any time and from time to time, without notice to any Loan Party (any such
notice being expressly waived by the Loan Parties) and to the fullest extent
permitted by law, set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other Indebtedness at
any time owing by such Agent or such Lender or any of their respective
Affiliates to or for the credit or the account of any Loan Party against any and
all obligations of the Loan Parties either now or hereafter existing under any
Loan Document, irrespective of whether or not such Agent or such Lender shall
have made any demand hereunder or thereunder and although such obligations may
be contingent or unmatured; provided that in the event that any Defaulting
Lender shall exercise any such right of set-off, (a) all amounts so set off
shall be paid over immediately to the Administrative Agent for further
application in accordance with the provisions of Section 4.04 and, pending such
payment, shall be segregated by such Defaulting Lender from its other funds and
deemed held in trust for the benefit of the Agents and the Lenders, and (b) the
Defaulting Lender shall provide promptly to the Administrative Agent a statement
describing in reasonable detail the Obligations owing to such Defaulting Lender
as to which it exercised such right of set-off.  Each Agent and each Lender
agrees to notify such Loan Party promptly after any such set-off and application
made by such Agent or such Lender or any of their respective Affiliates provided
that the failure to give such notice shall not affect the validity of such
set-off and application.  The rights of the Agents and the Lenders under this
Section 12.05 are in addition to the other rights and remedies (including other
rights of set-off) which the Agents and the Lenders may have under this
Agreement or any other Loan Documents of law or otherwise.

 

- 119 -

 

 

--------------------------------------------------------------------------------

 

Section 12.06Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.

Section 12.07Assignments and Participations.

(a)This Agreement and the other Loan Documents shall be binding upon and inure
to the benefit of each Loan Party and each Agent and each Lender and their
respective successors and assigns; provided, however, that none of the Loan
Parties may assign or transfer any of its rights hereunder or under the other
Loan Documents without the prior written consent of each Lender and any such
assignment without the Lenders’ prior written consent shall be null and void.

(b)Subject to the conditions set forth in clause (c) below, each Lender may
assign to one or more other lenders or other entities all or a portion of its
rights and obligations under this Agreement with respect to:

(i)all or a portion of its Term Loan Commitment and any Term Loan made by it
with the written consent of the Collateral Agent and Administrative Borrower
(which consent shall not be unreasonably withheld, conditioned or delayed nor
shall it be required during the existence of an Event of Default), and

(ii)all or a portion of its Revolving Credit Commitment and the Revolving Loans
made by it with the written consent of each Agent and Administrative Borrower
(which consent shall not be unreasonably withheld, conditioned or delayed nor
shall it be required during the existence of an Event of Default);

provided, however, that (i) no written consent of the Collateral Agent or the
Administrative Agent shall be required  if such assignment is in connection with
any merger, consolidation, sale, transfer, or other disposition of all or any
substantial portion of the business or loan portfolio of such Lender and (ii) no
written consent of the Administrative Borrower shall be required in connection
with any assignment by a Lender to another Lender, an Affiliate of such Lender
or a Related Fund of such Lender.

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

(i)Each such assignment shall be in an amount which is at least $5,000,000 or a
multiple of $1,000,000 in excess thereof (or the remainder of such Lender’s
Commitment) (except such minimum amount shall not apply to an assignment by a
Lender to (A) a Lender, an Affiliate of such Lender or a Related Fund of such
Lender or (B) a group of new Lenders, each of whom is an Affiliate or Related
Fund of each other to the extent the aggregate amount to be assigned to all such
new Lenders is at least $5,000,000 or a multiple of $1,000,000 in excess
thereof);

 

- 120 -

 

 

--------------------------------------------------------------------------------

 

(ii)The parties to each such assignment shall execute and deliver to the
Collateral Agent (and the Administrative Agent, if applicable), for its
acceptance, an Assignment and Acceptance, together with any promissory note
subject to such assignment and such parties shall deliver to the Collateral
Agent, for the benefit of the Collateral Agent, a processing and recordation fee
of $5,000 (except the payment of such fee shall not be required in connection
with an assignment by a Lender to a Lender, an Affiliate of such Lender or a
Related Fund of such Lender); and

(iii)No such assignment shall be made to (A) any Loan Party, any equity holder
of Patriot or any of their respective Affiliates or (B) any Defaulting Lender or
any of its Affiliates, or any Person who, upon becoming a Lender hereunder,
would constitute any of the foregoing Persons described in this clause (B).  

(d)Upon such execution, delivery and acceptance, from and after the effective
date specified in each Assignment and Acceptance and recordation on the
Register, which effective date shall be at least 3 Business Days after the
delivery thereof to the Collateral Agent (or such shorter period as shall be
agreed to by the Collateral Agent and the parties to such assignment), (A) the
assignee thereunder shall become a “Lender” hereunder and, in addition to the
rights and obligations hereunder held by it immediately prior to such effective
date, have the rights and obligations hereunder that have been assigned to it
pursuant to such Assignment and Acceptance and (B) the assigning Lender
thereunder shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement (and, in the case of
an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto).  

(e)By executing and delivering an Assignment and Acceptance, the assigning
Lender and the assignee thereunder confirm to and agree with each other and the
other parties hereto as follows:  (i) other than as provided in such Assignment
and Acceptance, the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or any other Loan
Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto; (ii) the assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any
Loan Party or any of its Subsidiaries or the performance or observance by any
Loan Party of any of its obligations under this Agreement or any other Loan
Document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement and the other Loan Documents, together with
such other documents and information it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance;
(iv) such assignee will, independently and without reliance upon the assigning
Lender, any Agent or any Lender and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Agreement and the other Loan
Documents; (v) such assignee appoints and authorizes the Agents to take such
action as agents on its behalf and to exercise such powers under this Agreement
and the other Loan Documents as are delegated to the Agents by the terms hereof
and thereof, together with such powers as are reasonably incidental hereto and
thereto; and (vi) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement and the
other Loan Documents are required to be performed by it as a Lender.

 

- 121 -

 

 

--------------------------------------------------------------------------------

 

(f)The Administrative Agent shall, acting solely for this purpose as a
non-fiduciary agent of the Borrowers, maintain, or cause to be maintained at the
Payment Office, a copy of each Assignment and Acceptance delivered to and
accepted by it and a register (the “Register”) for the recordation of the names
and addresses of the Lenders and the Commitments of, and the principal amount of
the Loans (and stated interest thereon) (the “Registered Loans”) owing to each
Lender from time to time.  The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrowers, the Agents
and the Lenders may treat each Person whose name is recorded in the Register as
a Lender hereunder for all purposes of this Agreement.  The Register shall be
available for inspection by the Administrative Borrower and any Lender at any
reasonable time and from time to time upon reasonable prior notice.  

(g)Upon receipt by the Administrative Agent of a completed Assignment and
Acceptance, and subject to any consent required from the Administrative Agent or
the Collateral Agent pursuant to Section 12.07(b) (which consent of the
applicable Agent must be evidenced by such Agent’s execution of an acceptance to
such Assignment and Acceptance), the Administrative Agent shall accept such
assignment, record the information contained therein in the Register (as
adjusted to reflect any principal payments on or amounts capitalized and added
to the principal balance of the Loans and/or Commitment reductions made
subsequent to the effective date of the applicable assignment, as confirmed in
writing by the corresponding assignor and assignee in conjunction with delivery
of the assignment to the Administrative Agent) and provide to the Collateral
Agent a copy of the fully executed Assignment and Acceptance.

(h)A Registered Loan (and the registered note, if any, evidencing the same) may
be assigned or sold in whole or in part only by registration of such assignment
or sale on the Register (and each registered note shall expressly so
provide).  Any assignment or sale of all or part of such Registered Loan (and
the registered note, if any, evidencing the same) may be effected only by
registration of such assignment or sale on the Register, together with the
surrender of the registered note, if any, evidencing the same duly endorsed by
(or accompanied by a written instrument of assignment or sale duly executed by)
the holder of such registered note, whereupon, at the request of the designated
assignee(s) or transferee(s), one or more new registered notes in the same
aggregate principal amount shall be issued to the designated assignee(s) or
transferee(s).  Prior to the registration of assignment or sale of any
Registered Loan (and the registered note, if any, evidencing the same), the
Agents shall treat the Person in whose name such Registered Loan (and the
registered note, if any, evidencing the same) is registered on the Register as
the owner thereof for the purpose of receiving all payments thereon,
notwithstanding notice to the contrary.

(i)In the event that any Lender sells participations in a Registered Loan, such
Lender shall, acting for this purpose as a non-fiduciary agent on behalf of the
Borrowers, maintain, or cause to be maintained, a register, on which it enters
the name of all participants in the Registered Loans held by it and the
principal amount (and stated interest thereon) of the portion of the Registered
Loan that is the subject of the participation (the “Participant Register”).  A
Registered Loan (and the registered note, if any, evidencing the same) may be
participated in whole or in part only by registration of such participation on
the Participant Register (and each registered note shall expressly so
provide).  Any participation of such Registered Loan (and the

 

- 122 -

 

 

--------------------------------------------------------------------------------

 

registered note, if any, evidencing the same) may be effected only by the
registration of such participation on the Participant Register.  The Participant
Register shall be available for inspection by the Administrative Borrower and
any Lender at any reasonable time and from time to time upon reasonable prior
notice.

(j)Any Non-U.S. Lender who purchases or is assigned or participates in any
portion of such Registered Loan shall comply with Section 2.09(d).

(k)Each Lender may sell participations to one or more banks or other entities in
or to all or a portion of its rights and obligations under this Agreement and
the other Loan Documents (including, without limitation, all or a portion of its
Commitments and the Loans made by it); provided, that (i) such Lender’s
obligations under this Agreement (including without limitation, its Commitments
hereunder) and the other Loan Documents shall remain unchanged; (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations, and the Borrowers, the Agents 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 and the other Loan
Documents; and (iii) a participant shall not be entitled to require such Lender
to take or omit to take any action hereunder except (A) action directly
effecting an extension of the maturity dates or decrease in the principal amount
of the Loans, (B) action directly effecting an extension of the due dates or a
decrease in the rate of interest payable on the Loans or the fees payable under
this Agreement, or (C) actions directly effecting a release of all or a
substantial portion of the Collateral or any Loan Party (except as set forth in
Section 10.08 of this Agreement or any other Loan Document).  The Loan Parties
agree that each participant shall be entitled to the benefits of Section 2.09
and Section 2.10 of this Agreement with respect to its participation in any
portion of the Commitments and the Loans as if it was a Lender.

(l)Any Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank or loans made to such Lender pursuant to securitization or similar credit
facility (a ”Securitization”); provided that no such pledge or assignment shall
release such Lender from any of its obligations hereunder or substitute any such
pledgee or assignee for such Lender as a party hereto.  The Loan Parties shall
cooperate with such Lender and its Affiliates to effect the Securitization
including, without limitation, by providing such information as may be
reasonably requested by such Lender in connection with the rating of its Loans
or the Securitization.

Section 12.08Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which shall be deemed to be an original, but all of which taken together shall
constitute one and the same agreement.  Delivery of an executed counterpart of
this Agreement by telecopier or electronic mail shall be equally as effective as
delivery of an original executed counterpart of this Agreement.  Any party
delivering an executed counterpart of this Agreement by telecopier or electronic
mail also shall deliver an original executed counterpart of this Agreement but
the failure to deliver an original executed counterpart shall not affect the
validity, enforceability, and binding effect of this Agreement.  The foregoing
shall apply to each other Loan Document mutatis mutandis.

 

- 123 -

 

 

--------------------------------------------------------------------------------

 

Section 12.09GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS
EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH
OTHER LOAN DOCUMENT) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN
THE STATE OF NEW YORK.

 

- 124 -

 

 

--------------------------------------------------------------------------------

 

Section 12.10CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE. ANY LEGAL
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK IN THE COUNTY OF NEW YORK
OR OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK,
AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY HEREBY
IRREVOCABLY ACCEPTS IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
THE JURISDICTION OF THE AFORESAID COURTS.  EACH LOAN PARTY HEREBY IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS AND
IN ANY SUCH ACTION OR PROCEEDING BY ANY MEANS PERMITTED BY APPLICABLE LAW,
INCLUDING, WITHOUT LIMITATION, BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO THE ADMINISTRATIVE BORROWER AT ITS ADDRESS
FOR NOTICES AS SET FORTH IN SECTION 12.01, SUCH SERVICE TO BECOME EFFECTIVE 10
DAYS AFTER SUCH MAILING.  THE LOAN PARTIES AGREE 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 HEREIN SHALL AFFECT THE RIGHT OF THE AGENTS AND THE LENDERS TO
SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY LOAN PARTY IN ANY OTHER
JURISDICTION.  EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.  TO THE EXTENT THAT ANY LOAN PARTY HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, EACH LOAN PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF
ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

 

- 125 -

 

 

--------------------------------------------------------------------------------

 

Section 12.11WAIVER OF JURY TRIAL, ETC. EACH LOAN PARTY, EACH AGENT AND EACH
LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR
OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION
THEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION
WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.  EACH LOAN
PARTY CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ANY AGENT
OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT ANY AGENT OR ANY
LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK
TO ENFORCE THE FOREGOING WAIVERS.  EACH LOAN PARTY HEREBY ACKNOWLEDGES THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENTS AND THE LENDERS ENTERING INTO
THIS AGREEMENT.

Section 12.12Consent by the Agents and Lenders.  Except as otherwise expressly
set forth herein to the contrary or in any other Loan Document, if the consent,
approval, satisfaction, determination, judgment, acceptance or similar action
(an “Action”) of any Agent or any Lender shall be permitted or required pursuant
to any provision hereof or any provision of any other agreement to which any
Loan Party is a party and to which any Agent or any Lender has succeeded
thereto, such Action shall be required to be in writing and may be withheld or
denied by such Agent or such Lender, in its sole discretion, with or without any
reason, and without being subject to question or challenge on the grounds that
such Action was not taken in good faith.

Section 12.13No Party Deemed Drafter. Each of the parties hereto agrees that no
party hereto shall be deemed to be the drafter of this Agreement.

Section 12.14Reinstatement; Certain Payments. If any claim is ever made upon any
Secured Party for repayment or recovery of any amount or amounts received by
such Secured Party in payment or on account of any of the Obligations, such
Secured Party shall give prompt notice of such claim to each other Agent and
Lender and the Administrative Borrower, and if such Secured Party repays all or
part of such amount by reason of (i) any judgment, decree or order of any court
or administrative body having jurisdiction over such Secured Party or any of its
property, or (ii) any good faith settlement or compromise of any such claim
effected by such Secured Party with any such claimant, then and in such event
each Loan Party agrees that (A) any such judgment, decree, order, settlement or
compromise shall be binding upon it notwithstanding the cancellation of any
Indebtedness hereunder or under the other Loan Documents or the termination of
this Agreement or the other Loan Documents, and (B) it shall be and remain
liable to such Secured Party hereunder for the amount so repaid or recovered to
the same extent as if such amount had never originally been received by such
Secured Party.

 

- 126 -

 

 

--------------------------------------------------------------------------------

 

Section 12.15Indemnification; Limitation of Liability for Certain Damages.

(a)In addition to each Loan Party’s other Obligations under this Agreement, each
Loan Party agrees to, jointly and severally, defend, protect, indemnify and hold
harmless each Secured Party and all of their respective Affiliates, officers,
directors, employees, attorneys, consultants and agents (collectively called
the ”Indemnitees”) from and against any and all losses, damages, liabilities,
obligations, penalties, fees, reasonable costs and expenses (including, without
limitation, reasonable attorneys’ fees, costs and expenses) directly incurred by
such Indemnitees, whether prior to or from and after the Effective Date as a
result of or arising from or relating to or in connection with any of the
following:  (i) the negotiation, preparation, execution or performance or
enforcement of this Agreement, any other Loan Document or of any other document
executed in connection with the transactions contemplated by this Agreement,
(ii) any Agent’s or any Lender’s furnishing of funds to the Borrowers under this
Agreement or the other Loan Documents, including, without limitation, the
management of any such Loans or the Borrowers’ use of the proceeds thereof,
(iii) the Agents and the Lenders relying on any instructions of the
Administrative Borrower or the handling of the Loan Account and Collateral of
the Borrowers as herein provided, (iv) any matter relating to the financing
transactions contemplated by this Agreement or the other Loan Documents or by
any document executed in connection with the transactions contemplated by this
Agreement or the other Loan Documents, or (v) any claim, litigation,
investigation or proceeding relating to any of the foregoing, whether or not any
Indemnitee is a party thereto (collectively, the ”Indemnified Matters”);
provided, however, that the Loan Parties shall not have any obligation to any
Indemnitee under this subsection (a) for any Indemnified Matter caused by the
gross negligence or willful misconduct of such Indemnitee, as determined by a
final non-appealable judgment of a court of competent jurisdiction.

(b)The indemnification for all of the foregoing losses, damages, fees, costs and
expenses of the Indemnitees set forth in this Section 12.15 are chargeable
against the Loan Account.  To the extent that the undertaking to indemnify, pay
and hold harmless set forth in this Section 12.15 may be unenforceable because
it is violative of any law or public policy, each Loan Party shall, jointly and
severally, contribute the maximum portion which it is permitted to pay and
satisfy under applicable law, to the payment and satisfaction of all Indemnified
Matters incurred by the Indemnitees.

(c)No Loan Party shall assert, and each Loan Party hereby waives, any claim
against the Indemnitees, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
(whether or not the claim therefor is based on contract, tort or duty imposed by
any applicable legal requirement) arising out of, in connection with, as a
result of, or in any way related to, this Agreement or any other Loan Document
or any agreement or instrument contemplated hereby or thereby or referred to
herein or therein, the transactions contemplated hereby or thereby, any Loan or
the use of the proceeds thereof or any act or omission or event occurring in
connection therewith, and each Loan Party hereby waives, releases and agrees not
to sue upon any such claim or seek any such damages, whether or not accrued and
whether or not known or suspected to exist in its favor.

 

- 127 -

 

 

--------------------------------------------------------------------------------

 

(d)The indemnities and waivers set forth in this Section 12.15 shall survive the
repayment of the Obligations and discharge of any Liens granted under the Loan
Documents.

Section 12.16Records. The unpaid principal of and interest on the Loans, the
interest rate or rates applicable to such unpaid principal and interest, the
duration of such applicability, the Commitments, and the accrued and unpaid fees
payable pursuant to Section 2.06 hereof, shall at all times be ascertained from
the records of the Agents, which shall be conclusive and binding absent manifest
error.

Section 12.17Binding Effect. This Agreement shall become effective when it shall
have been executed by each Loan Party, each Agent and each Lender and when the
conditions precedent set forth in Section 5.01 hereof have been satisfied or
waived in writing by the Agents, and thereafter shall be binding upon and inure
to the benefit of each Loan Party, each Agent and each Lender, and their
respective successors and assigns, except that the Loan Parties shall not have
the right to assign their rights hereunder or any interest herein without the
prior written consent of each Agent and each Lender, and any assignment by any
Lender shall be governed by Section 12.07 hereof.

Section 12.18Highest Lawful Rate. It is the intention of the parties hereto that
each Agent and each Lender shall conform strictly to usury laws applicable to
it.  Accordingly, if the transactions contemplated hereby or by any other Loan
Document would be usurious as to any Agent or any Lender under laws applicable
to it (including the laws of the United States of America and the State of New
York or any other jurisdiction whose laws may be mandatorily applicable to such
Agent or such Lender notwithstanding the other provisions of this Agreement),
then, in that event, notwithstanding anything to the contrary in this Agreement
or any other Loan Document or any agreement entered into in connection with or
as security for the Obligations, it is agreed as follows:  (i) the aggregate of
all consideration which constitutes interest under law applicable to any Agent
or any Lender that is contracted for, taken, reserved, charged or received by
such Agent or such Lender under this Agreement or any other Loan Document or
agreements or otherwise in connection with the Obligations shall under no
circumstances exceed the maximum amount allowed by such applicable law, any
excess shall be canceled automatically and if theretofore paid shall be credited
by such Agent or such Lender on the principal amount of the Obligations (or, to
the extent that the principal amount of the Obligations shall have been or would
thereby be paid in full, refunded by such Agent or such Lender, as applicable,
to the Borrowers); and (ii) in the event that the maturity of the Obligations is
accelerated by reason of any Event of Default under this Agreement or otherwise,
or in the event of any required or permitted prepayment, then such consideration
that constitutes interest under law applicable to any Agent or any Lender may
never include more than the maximum amount allowed by such applicable law, and
excess interest, if any, provided for in this Agreement or otherwise shall,
subject to the last sentence of this Section 12.18, be canceled automatically by
such Agent or such Lender, as applicable, as of the date of such acceleration or
prepayment and, if theretofore paid, shall be credited by such Agent or such
Lender, as applicable, on the principal amount of the Obligations (or, to the
extent that the principal amount of the Obligations shall have been or would
thereby be paid in full, refunded by such Agent or such Lender to the
Borrowers).  All sums paid or agreed to be paid to any Agent or any Lender for
the use, forbearance or detention of sums due hereunder shall, to the extent
permitted by law applicable to such Agent or such Lender, be amortized,
prorated, allocated and spread throughout

 

- 128 -

 

 

--------------------------------------------------------------------------------

 

the full term of the Loans until payment in full so that the rate or amount of
interest on account of any Loans hereunder does not exceed the maximum amount
allowed by such applicable law.  If at any time and from time to time (x) the
amount of interest payable to any Agent or any Lender on any date shall be
computed at the Highest Lawful Rate applicable to such Agent or such Lender
pursuant to this Section 12.18 and (y) in respect of any subsequent interest
computation period the amount of interest otherwise payable to such Agent or
such Lender would be less than the amount of interest payable to such Agent or
such Lender computed at the Highest Lawful Rate applicable to such Agent or such
Lender, then the amount of interest payable to such Agent or such Lender in
respect of such subsequent interest computation period shall continue to be
computed at the Highest Lawful Rate applicable to such Agent or such Lender
until the total amount of interest payable to such Agent or such Lender shall
equal the total amount of interest which would have been payable to such Agent
or such Lender if the total amount of interest had been computed without giving
effect to this Section 12.18.

For purposes of this Section 12.18, the term “applicable law” shall mean that
law in effect from time to time and applicable to the loan transaction between
the Borrowers, on the one hand, and the Agents and the Lenders, on the other,
that lawfully permits the charging and collection of the highest permissible,
lawful non-usurious rate of interest on such loan transaction and this
Agreement, including laws of the State of New York and, to the extent
controlling, laws of the United States of America.

The right to accelerate the maturity of the Obligations does not include the
right to accelerate any interest that has not accrued as of the date of
acceleration.

Section 12.19Confidentiality. Each Agent and each Lender agrees (on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature and in accordance with safe and sound practices of comparable
commercial finance companies, any non-public information supplied to it by the
Loan Parties pursuant to this Agreement or the other Loan Documents which is
identified in writing by the Loan Parties as being confidential at the time the
same is delivered to such Person (and which at the time is not, and does not
thereafter become, publicly available or available to such Person from another
source not known to be subject to a confidentiality obligation to such Person
not to disclose such information), provided that nothing herein shall limit the
disclosure by any Agent or any Lender of any such information (i) to its
Affiliates and to its and its Affiliates’ respective equityholders (including,
without limitation, partners), directors, officers, employees, agents, trustees,
counsel, advisors and representatives (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 in accordance
with this Section 12.19); (ii) to any other party hereto; (iii) to any assignee
or participant (or prospective assignee or participant) or any party to a
Securitization so long as such assignee or participant (or prospective assignee
or participant) or party to a Securitization first agrees, in writing, to be
bound by confidentiality provisions similar in substance to this Section 12.19;
(iv) to the extent required by any Requirement of Law or judicial process or as
otherwise requested by any Governmental Authority; (v) to the National
Association of Insurance Commissioners or any similar organization, any
examiner, auditor or accountant or any nationally recognized rating agency or
otherwise to the extent consisting of general portfolio information that does
not

 

- 129 -

 

 

--------------------------------------------------------------------------------

 

identify Loan Parties; (vi) in connection with any litigation to which any Agent
or any Lender is a party; (vii) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder; or (viii) with the consent of the Administrative
Borrower.

Section 12.20Public Disclosure. Each Loan Party agrees that neither it nor any
of its Affiliates will now or in the future issue any press release or other
public disclosure using the name of an Agent, any Lender or any of their
respective Affiliates or referring to this Agreement or any other Loan Document
without the prior written consent of such Agent or such Lender, except to the
extent that such Loan Party or such Affiliate is required or it is advisable in
the opinion of counsel to do so under applicable Requirements of Law (in which
event, such Loan Party or such Affiliate will consult with (in the case of the
initial announcement of this Agreement) or use commercially reasonable efforts
to provide advance notice thereof to (in the case of all other announcements)
such Agent or such Lender before issuing such press release or other public
disclosure).  Each Loan Party hereby authorizes each Agent and each Lender,
after consultation with the Borrower, to advertise the closing of the
transactions contemplated by this Agreement, and to make appropriate
announcements of the existence and amount of the Commitments and the Loans
entered into among the parties hereto, as such Agent or such Lender shall deem
appropriate, including, without limitation, on a home page or similar place for
dissemination of information on the Internet or worldwide web, or in
announcements commonly known as tombstones, in such trade publications, business
journals, newspapers of general circulation and to such selected parties as such
Agent or such Lender shall deem appropriate.

Section 12.21Integration. This Agreement, together with the other Loan
Documents, reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.

Section 12.22USA PATRIOT Act. Each Lender that is subject to the requirements of
the USA PATRIOT Act hereby notifies the Borrowers that pursuant to the
requirements of the USA PATRIOT Act, it is required to obtain, verify and record
information that identifies the entities composing the Borrowers, which
information includes the name and address of each such entity and other
information that will allow such Lender to identify the entities composing the
Borrowers in accordance with the USA PATRIOT Act.  Each Loan Party agrees to
take such action and execute, acknowledge and deliver at its sole cost and
expense, such instruments and documents as any Lender may reasonably require
from time to time in order to enable such Lender to comply with the USA PATRIOT
Act.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

 

- 130 -

 

 

--------------------------------------------------------------------------------

 

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

 

BORROWER:

 

 

PATRIOT NATIONAL, INC.

 

 

By:

/s/ Steven M. Mariano

Name:

Steven M. Mariano

Title:

President, CEO

 

 

GUARANTORS:

 

 

PATRIOT SERVICES, INC.

 

 

By:

/s/ Steven M. Mariano

Name:

Steven M. Mariano

Title:

President, CEO

 

 

COMPLINX INSURANCE AGENCY, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

CONTEGO INVESTIGATIVE SERVICES, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

CORPORATE CLAIMS MANAGEMENT, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

CWI BENEFITS, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

FORZA LIEN, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

GLOBAL HR RESEARCH, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

INSURELINX, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT AUDIT SERVICES, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT CAPTIVE MANAGEMENT, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT CARE MANAGEMENT, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT CARE, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

PATRIOT CLAIM SERVICES, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT RISK CONSULTANTS, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT RISK SERVICES, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT TECHNOLOGY SOLUTIONS, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

PATRIOT UNDERWRITERS, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

TRIGEN INSURANCE SOLUTIONS, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

TRIGEN HOSPITALITY GROUP, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

VIKARAN TECHNOLOGY SOLUTIONS, INC.

 

 

By:

/s/ Elvis Rivera

Name:

Elvis Rivera

Title:

Treasurer

 

 

CONTEGO SERVICES GROUP, LLC

 

 

By:

Patriot Services, Inc., its Manager

 

 

By:

/s/ Steven M. Mariano

Name:

Steven M. Mariano

Title:

President, CEO

 

 

DECISION UR, LLC

 

 

By:

Patriot Technology Solutions, Inc., its

Manager

 

 

 

By:

/s/ Elvis Rivera

 

Name:

Elvis Rivera

 

Title:

Treasurer

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

COLLATERAL AGENT AND ADMINISTRATIVE AGENT:

 

CERBERUS BUSINESS FINANCE, LLC

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Chief Executive Officer

 

 

 

 

 

--------------------------------------------------------------------------------

 

LENDERS:

 

 

CERBERUS LEVERED LOAN OPPORTUNITIES FUND III, L.P.

 

 

By:

Cerberus Levered Opportunities III GP, LLC

Its:

General Partner

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Senior Managing Director

 

 

CERBERUS NJ CREDIT OPPORTUNITIES FUND, L.P.

 

 

By:

Cerberus NJ Credit Opportunities GP, LLC

Its:

General Partner

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Senior Managing Director

 

 

CERBERUS ASRS HOLDINGS LLC

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Vice President

 

 

CERBERUS ICQ LEVERED LOAN OPPORTUNITIES FUND, L.P.

 

 

By:

Cerberus ICQ Levered Opportunities GP, LLC

Its:

General Partner

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Senior Managing Director

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

CERBERUS KRS LEVERED LOAN OPPORTUNITIES FUND, L.P.

 

 

By:

Cerberus KRS Levered Opportunities GP, LLC

Its:

General Partner

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Senior Managing Director

 

 

CERBERUS PSERS LEVERED LOAN OPPORTUNITIES FUND, L.P.

 

 

By:

Cerberus PSERS Levered Opportunities GP, LLC

Its:

General Partner

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Senior Managing Director

 

 

CERBERUS FSBA HOLDINGS LLC

 

 

By:

/s/ Dan Wolf

Name:

Dan Wolf

Title:

Vice President

 

 

TCW DIRECT LENDING, LLC

 

 

By:

TCW Asset Management Company, its Investment Advisor

 

 

By:

/s/ Suzanne Grosso

Name:

Suzanne Grosso

Title:

Managing Director

 

 

WEST VIRGINIA DIRECT LENDING LLC

 

By:

TCW Asset Management Company, its Advisor

 

 

By:

/s/ Suzanne Grosso

Name:

Suzanne Grosso

Title:

Managing Director

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

TCW SKYLINE LENDING, L.P.

 

 

By:

TCW Asset Management Company LLC, its Investment Advisor

 

 

By:

/s/ Suzanne Grosso

Name:

Suzanne Grosso

Title:

Managing Director