EXHIBIT 10.4

 

Confidential treatment has been requested for portions of this exhibit pursuant
to Rule 24b-2 of the Securities Exchange Act of 1934, as amended. The copy filed
herewith omits the information subject to the confidentiality request. Omissions
are designated as [**]. A complete version of this exhibit has been filed
separately with the Securities and Exchange Commission.

 

 

TERM LOAN CREDIT AGREEMENT

 

dated as of

 

March 21, 2013

 

among

 

SUPERVALU INC.,
as Borrower,

 

THE GUARANTORS PARTY HERETO,

 

THE LENDERS PARTY HERETO

 

and

 

GOLDMAN SACHS BANK USA,
as Administrative Agent and Collateral Agent

 

GOLDMAN SACHS BANK USA, CREDIT SUISSE SECURITIES (USA) LLC, MORGAN STANLEY
SENIOR FUNDING, INC., MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and
BARCLAYS BANK PLC,
as Joint Lead Bookrunners and Joint Lead Arrangers

 

CREDIT SUISSE SECURITIES (USA) LLC

 

and

 

MORGAN STANLEY SENIOR FUNDING, INC.,
as Syndication Agents

 

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

 

and

 

BARCLAYS BANK PLC,
as Documentation Agents

 

 

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Table of Contents

 

 

 

Page

ARTICLE I Definitions

 

1

 

 

 

SECTION 1.01. Defined Terms

 

1

SECTION 1.02. Terms Generally

 

59

SECTION 1.03. Pro Forma Calculations

 

60

SECTION 1.04. Classification of Loans and Borrowings

 

60

 

 

 

ARTICLE II The Credits

 

60

 

 

 

SECTION 2.01. Commitments

 

60

SECTION 2.02. Loans

 

60

SECTION 2.03. Borrowing Procedure

 

61

SECTION 2.04. Evidence of Debt; Repayment of Loans

 

62

SECTION 2.05. Fees

 

63

SECTION 2.06. Interest on Loans

 

63

SECTION 2.07. Default Interest

 

63

SECTION 2.08. Alternate Rate of Interest

 

64

SECTION 2.09. Termination of Commitments

 

64

SECTION 2.10. Conversion and Continuation of Borrowings

 

64

SECTION 2.11. Repayment of Borrowings

 

66

SECTION 2.12. Voluntary Prepayments

 

67

SECTION 2.13. Mandatory Prepayments

 

68

SECTION 2.14. Reserve Requirements; Change in Circumstances

 

70

SECTION 2.15. Change in Legality

 

71

SECTION 2.16. Breakage

 

72

SECTION 2.17. Pro Rata Treatment

 

72

SECTION 2.18. Sharing of Setoffs

 

73

SECTION 2.19. Payments

 

73

SECTION 2.20. Taxes

 

74

SECTION 2.21. Assignment of Commitments Under Certain Circumstances; Duty to
Mitigate

 

75

SECTION 2.22. Incremental Loans

 

77

SECTION 2.23. Extension Amendments

 

79

 

 

 

ARTICLE III Representations and Warranties

 

81

 

 

 

SECTION 3.01. Existence, Qualification and Power

 

81

SECTION 3.02. Authorization; No Contravention

 

82

SECTION 3.03. Governmental Authorization; Other Consents

 

83

SECTION 3.04. Binding Effect

 

83

SECTION 3.05. Financial Statements; No Material Adverse Effect

 

83

SECTION 3.06. Litigation

 

85

SECTION 3.07. No Default

 

85

SECTION 3.08. Ownership of Properties; Liens

 

85

 

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SECTION 3.09. Environmental Compliance

 

86

SECTION 3.10. Insurance

 

87

SECTION 3.11. Taxes

 

88

SECTION 3.12. ERISA Compliance

 

88

SECTION 3.13. Subsidiaries; Equity Interests

 

89

SECTION 3.14. Margin Regulations; Investment Company Act

 

89

SECTION 3.15. Disclosure

 

89

SECTION 3.16. Compliance with Laws

 

90

SECTION 3.17. Intellectual Property; Licenses, Etc.

 

90

SECTION 3.18. Labor Matters

 

90

SECTION 3.19. Security Documents

 

91

SECTION 3.20. Solvency

 

92

SECTION 3.21. Deposit Accounts; Credit Card Arrangements

 

92

SECTION 3.22. Brokers

 

92

SECTION 3.23. Trade Relations

 

93

SECTION 3.24. Material Contracts

 

93

SECTION 3.25. Casualty

 

93

SECTION 3.26. Payable Practices

 

93

SECTION 3.27. Notices from Farm Products Sellers, Etc.

 

93

SECTION 3.28. HIPAA Compliance

 

93

SECTION 3.29. Compliance with Health Care Laws

 

94

SECTION 3.30. Transaction Documents

 

95

SECTION 3.31. Sanctioned Persons

 

95

SECTION 3.32. Anti-Terrorism; Foreign Corrupt Practices Act

 

95

 

 

 

ARTICLE IV Conditions of Lending

 

95

 

 

 

SECTION 4.01. Conditions to Borrowing

 

95

 

 

 

ARTICLE V Affirmative Covenants

 

99

 

 

 

SECTION 5.01. Financial Statements

 

99

SECTION 5.02. Certificates; Other Information

 

100

SECTION 5.03. Notices

 

102

SECTION 5.04. Payment of Obligations

 

104

SECTION 5.05. Preservation of Existence, Etc.

 

105

SECTION 5.06. Maintenance of Properties

 

105

SECTION 5.07. Maintenance of Insurance

 

105

SECTION 5.08. Compliance with Laws

 

107

SECTION 5.09. Books and Records; Accountants; Maintenance of Ratings

 

108

SECTION 5.10. Inspection Rights

 

108

SECTION 5.11. Use of Proceeds

 

108

SECTION 5.12. Additional Loan Parties

 

108

SECTION 5.13. Cash Management

 

109

SECTION 5.14. Information Regarding the Collateral

 

109

SECTION 5.15. [Reserved]

 

110

SECTION 5.16. Environmental Laws

 

110

 

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SECTION 5.17. Further Assurances

 

111

SECTION 5.18. Ground Leases

 

112

SECTION 5.19. [Reserved]

 

113

SECTION 5.20. ERISA

 

113

SECTION 5.21. Agricultural Products

 

113

SECTION 5.22. Term Loan Priority Account

 

114

SECTION 5.23. Designation of Subsidiaries

 

114

SECTION 5.24. Preparation of Environmental Reports

 

115

SECTION 5.25. Post-Closing Collateral

 

116

SECTION 5.26. Escrow Agreement and Indemnity

 

116

 

 

 

ARTICLE VI Negative Covenants

 

117

 

 

 

SECTION 6.01. Liens

 

117

SECTION 6.02. Investments, Loans and Advances

 

117

SECTION 6.03. Indebtedness

 

118

SECTION 6.04. Fundamental Changes

 

118

SECTION 6.05. Dispositions

 

118

SECTION 6.06. Restricted Payments

 

118

SECTION 6.07. Prepayments of Other Indebtedness

 

119

SECTION 6.08. Business of Borrower and Restricted Subsidiaries

 

120

SECTION 6.09. Transactions with Affiliates

 

120

SECTION 6.10. Burdensome Agreements

 

120

SECTION 6.11. Use of Proceeds

 

121

SECTION 6.12. Amendment of Material Documents

 

121

SECTION 6.13. Fiscal Year

 

121

SECTION 6.14. Disqualified Stock

 

121

 

 

 

ARTICLE VII Events of Default

 

121

 

 

 

SECTION 7.01. Events of Default

 

121

SECTION 7.02. Application of Funds

 

126

 

 

 

ARTICLE VIII The Administrative Agent and the Collateral Agent; Etc.

 

127

 

 

 

ARTICLE IX Miscellaneous

 

131

 

 

 

SECTION 9.01. Notices; Electronic Communications

 

131

SECTION 9.02. Survival of Agreement

 

134

SECTION 9.03. Binding Effect

 

134

SECTION 9.04. Successors and Assigns

 

135

SECTION 9.05. Expenses; Indemnity

 

140

SECTION 9.06. Right of Setoff

 

142

SECTION 9.07. Applicable Law

 

142

SECTION 9.08. Waivers; Amendment

 

143

SECTION 9.09. Interest Rate Limitation

 

144

SECTION 9.10. Entire Agreement

 

144

 

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SECTION 9.11. WAIVER OF JURY TRIAL

 

144

SECTION 9.12. Severability

 

145

SECTION 9.13. Counterparts

 

145

SECTION 9.14. Headings

 

145

SECTION 9.15. Jurisdiction; Consent to Service of Process

 

145

SECTION 9.16. Confidentiality

 

146

SECTION 9.17. Lender Action; Intercreditor Agreement

 

146

SECTION 9.18. USA PATRIOT Act Notice

 

147

SECTION 9.19. No Fiduciary Duty

 

147

SECTION 9.20. Collateral and Guarantee Matters

 

148

SECTION 9.21. Substitution, Release and Addition of Term Loan Priority
Collateral

 

149

 

iv

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SCHEDULES

 

 

 

 

 

Schedule 2.01

-

Lenders and Commitments

Schedule 3.01

-

Organizational Information of Loan Parties

Schedule 3.06

-

Litigation

Schedule 3.08(b)

-

Owned Real Estate

Schedule 3.08(c)

-

Leases Constituting Material Contracts

Schedule 3.09

-

Environmental Matters

Schedule 3.10

-

Insurance

Schedule 3.13

-

Subsidiaries and Equity Interests

Schedule 3.17

-

Intellectual Property Matters

Schedule 3.21(a)

-

Demand Deposit Accounts

Schedule 3.21(b)

-

Credit Card Arrangements

Schedule 5.02

-

Financial and Collateral Reports

Schedule 6.01

-

Existing Liens

Schedule 6.02

-

Existing Investments

Schedule 6.03

-

Existing Indebtedness

Schedule 6.09

-

Transactions with Affiliates

Schedule 9.01(a)

-

Borrower’s Website Address

Schedule 9.01(b)

-

Administrative Agent’s Notice and Account Information

 

 

 

EXHIBITS

 

 

 

 

 

Exhibit A

-

Form of Administrative Questionnaire

Exhibit B

-

Form of Assignment and Acceptance

Exhibit C

-

Form of Borrowing Request

Exhibit D

-

Form of Compliance Certificate

Exhibit E

-

Form of Perfection Certificate

Exhibit F

-

Form of Security Agreement

Exhibit G

-

Form of Facility Guaranty

Exhibit H

-

Form of Mortgage

Exhibit I

-

Form of Intercreditor Agreement

Exhibit J

-

Form of Promissory Note

Exhibit K

-

Form of Opinion of Dorsey & Whitney LLP

Exhibit L

-

Form of DDA Notification

Exhibit M

-

Form of Credit Card Notification

Exhibit N

-

Closing Date Collateral List

Exhibit O

-

Form of United States Tax Compliance Certificate

Exhibit P

-

Form of Related Real Estate Collateral Security Agreement

Exhibit Q

-

Modified Dutch Auction Procedures

Exhibit R

-

Form of Borrower Assignment and Acceptance

 

v

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TERM LOAN CREDIT AGREEMENT, dated as of March 21, 2013 (as amended, amended and
restated, supplemented or otherwise modified from time to time, this
“Agreement”), among SUPERVALU INC., a Delaware corporation (the “Borrower”), the
Guarantors (such term and each other capitalized term used but not defined in
this introductory statement having the meaning given it in Article I) party
hereto, the Lenders party hereto and GOLDMAN SACHS BANK USA (“Goldman Sachs”),
as administrative agent (in such capacity, including any successor thereto, the
“Administrative Agent”) and as collateral agent (in such capacity, including any
successor thereto, the “Collateral Agent”) for the Lenders.

 

WHEREAS, the Borrower has requested the Lenders to extend credit in the form of
Loans on the Closing Date, in an aggregate principal amount not in excess of
$1,500,000,000; and

 

WHEREAS, the Lenders are willing to extend such credit to the Borrower on the
terms and subject to the conditions set forth herein.

 

NOW THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties hereto agree as follows:

 

ARTICLE I

 

Definitions

 

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

 

“ABL Collateral Agent” shall mean Wells Fargo Bank, National Association, as
collateral agent under the ABL Facility for the benefit of the lenders
thereunder, and its successors and assigns including any replacement or
successor agent.

 

“ABL Credit Agreement” shall mean the amended and restated asset-based revolving
credit agreement, dated of even date herewith, by and among the Borrower, each
Subsidiary party thereto, the ABL Facility Agent and the various financial
institutions from time to time party thereto, as amended, restated, amended and
restated, supplemented or otherwise modified in accordance with the terms
thereof, hereof and the Intercreditor Agreement.

 

“ABL Debt” shall have the meaning assigned to such term in the Intercreditor
Agreement as of the date hereof.

 

“ABL Facility” shall mean the senior secured asset-based revolving credit
facility pursuant to the terms of the ABL Credit Agreement as it may be amended
or refinanced in accordance with the terms thereof, hereof and the Intercreditor
Agreement.

 

“ABL Facility Agent” shall mean Wells Fargo Bank, National Association, as
administrative agent under the ABL Facility for the benefit of the lenders
thereunder, including its successors and assigns including any replacement or
successor agent successors thereto.

 

1

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“ABL Facility Documents” shall mean the ABL Credit Agreement and each other
document specified as a “Loan Document” in the ABL Credit Agreement, in each
case, as amended, restated, amended and restated, supplemented or otherwise
modified in accordance with the terms thereof, hereof and the Intercreditor
Agreement.

 

“ABL Priority Collateral” shall have the meaning assigned to such term in the
Intercreditor Agreement.

 

“ABL Refinancing” shall mean the amendment and restatement of the Existing ABL
Facility with the ABL Facility.

 

“ABR”, when used in reference to any Loan or Borrowing, shall refer to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.

 

“Acquired Entity” shall have the meaning assigned to such term in
Section 6.02(b).

 

“Acquisition” shall mean, with respect to any Person (a) an Investment in, or a
purchase of a Controlling interest in, the Equity Interests of any other Person,
(b) a purchase or other acquisition of all or substantially all of the assets or
properties of another Person or of any business unit of another Person, (c) any
merger or consolidation of such Person with any other Person or other
transaction or series of transactions resulting in the acquisition of all or
substantially all of the assets, or a Controlling interest in the Equity
Interests, of any Person, or (d) any acquisition of any Store locations of any
Person, in each case in any transaction or group of transactions which are part
of a common plan.

 

“Acquisition Agreement” shall mean that certain Stock Purchase Agreement dated
as of January 10, 2013 among Buyer, the Borrower and NAI.

 

“Acquisition Agreement Representations” shall mean such of the representations
made by Buyer in the Acquisition Agreement as are material to the interests of
the Joint Lead Arrangers and the Initial Lenders, but only to the extent that
the Borrower has (or its applicable affiliate has) the right to terminate its
obligations under the Acquisition Agreement or to decline to consummate the NAI
Sale as a result of a breach of such representations and warranties in the
Acquisition Agreement.

 

“Additional Property” shall have the meaning assigned to such term in
Section 9.21.

 

“Adjusted LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum equal to the greater of
(a) 1.25% per annum and (b) the product of (i) the LIBO Rate in effect for such
Interest Period and (ii) Statutory Reserves.

 

“Administrative Agent” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

 

“Administrative Agent Fees” shall have the meaning assigned to such term in
Section 2.05.

 

2

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

 

“Administrative Questionnaire” shall mean an Administrative Questionnaire in the
form of Exhibit A, or such other form as may be supplied from time to time by
the Administrative Agent.

 

“Affiliate” shall mean, with respect to any Person, (a) another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified, (b) any
director, officer, managing member, partner, trustee or beneficiary of that
Person, but excluding such Persons as to any Lender (or in the case of a Lender
that is a Related Fund, the entity that administers or manages such Related
Fund), (c) any other Person directly or indirectly holding 10% or more of any
class of the Equity Interests of that Person, except in the case of a Lender (or
in the case of a Lender that is a Related Fund, the entity that administers or
manages such Related Fund), 35% or more of any class of the Equity Interests of
such Person and (d) any other Person 10% or more of any class of whose Equity
Interests is held directly or indirectly by that Person, except in the case of a
Lender (or in the case of a Lender that is a Related Fund, the entity that
administers or manages such Related Fund), 35% or more of any class of whose
Equity Interests is held directly or indirectly by such Person.

 

“Agent Payment Account” shall mean the account of the Administrative Agent set
forth on Schedule 9.01(b) or such other account of the Administrative Agent as
the Administrative Agent may from time to time designate to the Borrower as the
Agent Payment Account for purposes of this Agreement and the other Loan
Documents.

 

“Agents” shall have the meaning assigned to such term in Article VIII.

 

“ALTA” shall mean American Land Title Association, or any successor thereto.

 

“Alternate Base Rate” shall mean, for any day, a rate per annum equal to the
greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1.00%, (c) the Adjusted LIBO
Rate for a one-month Interest Period on such day (or if such day is not a
Business Day, the immediately preceding Business Day) plus 1.00% and (d) 2.25%;
provided that, for the avoidance of doubt, the Adjusted LIBO Rate for any day
shall be based on the rate determined on such day at approximately 11:00 a.m.
(London time) by reference to the British Bankers’ Association Interest
Settlement Rates for deposits in dollars (as set forth by any service selected
by the Administrative Agent that has been nominated by the British Bankers’
Association as an authorized vendor for the purpose of displaying such rates). 
If the Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Effective Rate for any reason, including the inability or failure of the
Administrative Agent to obtain sufficient quotations in accordance with the
terms of the definition thereof, the Alternate Base Rate shall be determined
without regard to clause (b) of the preceding sentence until the circumstances
giving rise to such inability no longer exist.  Any change in the Alternate Base
Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the
Adjusted LIBO Rate shall be effective on the effective date of such change in
the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, as
the case may be.

 

3

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“Applicable Collateral List” shall mean the Closing Date Collateral List or, if
any Restated Collateral List has been delivered to the Administrative Agent
pursuant to Section 9.21 (and subject to the satisfaction of the conditions
therein), the most recent Restated Collateral List so delivered.

 

“Applicable Margin” shall mean, for any day (a) with respect to any Eurodollar
Loan, 5.00% per annum and (b) with respect to any ABR Loan, 4.00% per annum.

 

“ASC” shall mean American Stores Company, LLC, a Delaware limited liability
company (formerly American Stores Company, a Delaware corporation).

 

“ASC Guarantee” shall mean that certain Guarantee by the Borrower of the ASC
Notes, originally made by Albertson’s Inc., a Delaware corporation, pursuant to
that Supplemental Indenture No. 2 dated as of July 6, 2005 between American
Stores Company, LLC, a Delaware limited liability company and J.P. Morgan Trust
Company, National Association, as successor trustee, to the ASC Indenture, as
assigned by Albertson’s LLC, a Delaware limited liability company (formerly
Albertson’s, Inc., a Delaware corporation) to the Borrower pursuant to that
Assignment and Assumption Agreement dated on or about July 21, 2008 between
Albertson’s LLC and the Borrower and that Supplemental Indenture No. 3 to the
ASC Indenture dated as of July 21, 2008 between American Stores Company, LLC and
Wells Fargo Bank, National Association, as successor trustee.

 

“ASC Indenture” shall mean the Indenture, dated as of May 1, 1995, between ASC
and Wells Fargo Bank, National Association (as successor to The First National
Bank of Chicago), as amended, supplemented or otherwise modified (including any
such modification contained in any notes, officer’s certificates or other
operative documents) as of the Closing Date or in accordance with the terms
hereof.

 

“ASC Notes” shall have the meaning assigned to such term in the definition of
NAI Sale.

 

“Assignment and Acceptance” shall mean an assignment and acceptance entered into
by a Lender and an Eligible Assignee, and accepted by the Administrative Agent,
in the form of Exhibit B or such other form as shall be approved by the
Administrative Agent.

 

“Attributable Indebtedness” shall mean, on any date, (a) in respect of any
Capital Lease Obligation of any Person, the capitalized amount thereof that
would appear on a balance sheet of such Person prepared as of such date in
accordance with GAAP and (b) in respect of any Synthetic Lease Obligation, the
capitalized amount of the remaining lease or similar payments under the relevant
lease or other applicable agreement or instrument that would appear on a balance
sheet of such Person prepared as of such date in accordance with GAAP if such
lease, agreement or instrument were accounted for as a capital lease.

 

“Auction” shall have the meaning assigned to such term in Section 9.04(k)(i).

 

“Auction Manager” means (a) the Administrative Agent or any of its Affiliates or
(b) any other financial institution or advisor agreed by Borrower and
Administrative Agent (whether or not an affiliate of the Administrative Agent)
to act as an arranger in connection with any repurchases pursuant to
Section 9.04(k).

 

4

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“Audited Financial Statements” shall mean the audited Consolidated balance sheet
of the Borrower and its Subsidiaries (prior to giving effect to the
Transactions) for the Fiscal Year ended February 25, 2012, and the related
Consolidated statements of income or operations, Shareholders’ Equity and cash
flows (in each case, prior to giving effect to the Transactions) for such Fiscal
Year of the Borrower and its Subsidiaries, including the notes thereto.

 

“Bank of America” shall mean Bank of America, N.A. and its successors and
assigns.

 

“Barclays” shall mean Barclays Bank PLC and its successors and assigns.

 

“Blocked Account” shall mean a deposit account of a Loan Party to which funds
from one or more DDAs are from time to time transferred.

 

“Blocked Account Agreement” shall mean, with respect to a deposit account
established by a Loan Party, an agreement, in form and substance satisfactory to
the Administrative Agent, establishing control (as defined in the UCC) of such
account by the Administrative Agent and whereby the bank maintaining such
account agrees to comply with instructions originated by the Administrative
Agent without the further consent of any Loan Party.

 

“Blocked Account Bank” shall mean each bank at which a Blocked Account is
located.

 

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

 

“Borrower” shall have the meaning assigned to such term in the introductory
statement to this Agreement.

 

“Borrower Assignment and Acceptance” shall mean an assignment and acceptance
entered into by a Lender and the Borrower, and accepted by the Administrative
Agent, in the form of Exhibit R or such other form as may be approved by the
Administrative Agent.

 

“Borrower Materials” shall have the meaning assigned to such term in
Section 9.01.

 

“Borrowing” shall mean Loans of the same Class and Type made, converted or
continued on the same date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect.

 

“Borrowing Request” shall mean a request by the Borrower in accordance with the
terms of Section 2.03 and substantially in the form of Exhibit C, or such other
form as shall be approved by the Administrative Agent.

 

“Breakage Event” shall have the meaning assigned to such term in Section 2.16.

 

“Business” shall mean retail food operations through traditional and
hard-discount retail food stores, wholesale distribution of products to
independent retailers and other businesses reasonably related thereto.

 

5

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“Business Day” shall mean any day other than a Saturday, Sunday or other day on
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state of New York and, if such day relates to any Eurodollar
Loan, shall mean any such day on which dealings in Dollar deposits are conducted
by and between banks in the London interbank market.

 

“Buyer” shall mean AB Acquisition LLC, a Delaware limited liability company.

 

“Capital Expenditures” shall mean, with respect to any Person for any period,
(a) all expenditures made (whether made in the form of cash or other property)
or costs incurred for the acquisition or improvement of fixed or capital assets
of such Person (excluding normal replacements and maintenance which are properly
charged to current operations), in each case that are (or should be) set forth
as capital expenditures in a Consolidated statement of cash flows of such Person
for such period, in each case prepared in accordance with GAAP, and (b) without
duplication, Capital Lease Obligations or Synthetic Lease Obligations incurred
by a Person during such period.

 

“Capital Leases” shall mean, with respect to any Person, any lease of (or any
agreement conveying the right to use) any property (whether real, personal or
mixed) by such Person as lessee which, in accordance with GAAP, is required to
be classified and accounted for as liabilities on the balance sheet of such
Person; provided, that, subject to any amendment entered into pursuant to
Section 1.02, the adoption or issuance of any accounting standards after the
Closing Date will not cause any lease that would not have been treated as a
Capital Lease prior to such adoption or issuance to be deemed a Capital Lease
regardless of whether such lease was entered into before or after such adoption
or issuance.

 

“Capital Lease Obligations” of any Person shall mean the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP; provided, that, subject to any amendment entered into pursuant to
Section 1.02, the adoption or issuance of any accounting standards after the
Closing Date will not cause any lease that would not have been treated as a
Capital Lease prior to such adoption or issuance to be deemed a Capital Lease
regardless of whether such lease was entered into before or after such adoption
or issuance.

 

“Cash Equivalents” shall mean Investments defined in clauses (a) through (e) of
the definition of Permitted Investments, or the equivalents thereof described in
the investment policy referred to in clause (f) of such definition.

 

“Casualty Event” shall mean any event that gives rise to the receipt by the
Borrower or any Restricted Subsidiary of any insurance proceeds or condemnation
awards in respect of any equipment, fixed assets or real property (including any
improvements thereon) to replace or repair such equipment, fixed assets or real
property.

 

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“Cash Pension Contribution” shall mean the actual cash pension funding payments
made by the Borrower and the Restricted Subsidiaries with respect to pension
funding obligations for the applicable period.

 

“Cerberus” shall mean Cerberus Capital Management, L.P.

 

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act, 42 U.S.C. § 9601 et seq.

 

“CERCLIS” shall mean the Comprehensive Environmental Response, Compensation, and
Liability Information System maintained by the United States Environmental
Protection Agency.

 

“Certified Medicaid Provider” shall mean any provider or supplier, including
without limitation a pharmacy, that has in effect an agreement with a
Governmental Authority of a State to participate in Medicaid.

 

“Certified Medicare Provider” shall mean a provider or supplier, including
without limitation a pharmacy, that has in effect an agreement with the Centers
for Medicare and Medicaid Services to participate in Medicare.

 

“Change in Law” shall mean the occurrence, after the date of this Agreement, of
any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.  For
purposes of this definition, the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all rules, regulations, orders, requests, guidelines or
directives thereunder or in connection therewith and all requests, rules,
guidelines or directives concerning capital adequacy known as “Basel III” and
promulgated either by the Bank for International Settlements, the Basel
Committee on Banking Supervision (or any successor or similar authority) or by
the United States or foreign regulatory authorities pursuant thereto, are deemed
to have been adopted and gone into effect after the date of this Agreement.

 

“Change of Control” shall mean an event or series of events by which:

 

(a)  (i) any Person or two or more Persons (other than Cerberus) acting in
concert shall have acquired beneficial ownership (within the meaning of
Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly,
of Equity Interests of the Borrower (or other securities convertible into such
Equity Interests) representing 35% or more of the combined voting power of all
Equity Interests of the Borrower on a fully-diluted basis (and taking into
account all such Equity Interests that such “person” or “group” has the right to
acquire pursuant to any option right) or (ii) any Person or two or more Persons
(including Cerberus) acting in concert shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934),
directly or indirectly, of Equity Interests of the Borrower (or other securities
convertible into such Equity Interests) representing 50% or more of the combined
voting power of all Equity Interests of the Borrower on a fully-diluted basis
(and taking into account all such

 

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Equity Interests that such “person” or “group” has the right to acquire pursuant
to any option right); or

 

(b)  during any period of up to 24 consecutive months, commencing before or
after the date of this Agreement, individuals who at the beginning of such
24-month period were directors of the Borrower shall cease for any reason (other
than due to death or disability) to constitute a majority of the board of
directors of the Borrower (except to the extent that individuals who at the
beginning of such 24-month period were replaced by individuals (i) elected by at
least a majority of the remaining members of the board of directors of the
Borrower or (ii) nominated for election by a majority of the remaining members
of the board of directors of the Borrower and thereafter elected as directors by
the shareholders of the Borrower).

 

“Charges” shall have the meaning assigned to such term in Section 9.09.

 

“Class”, when used in reference to any Loan or Borrowing, shall refer to whether
such Loan, or the Loans comprising such Borrowing, are Loans, Other Loans or
Extended Loans and, when used in reference to any Commitment, refers to whether
such Commitment is a commitment to make Loans on the Closing Date or an
Incremental Loan Commitment.

 

“Closing Date” shall mean March 21, 2013.

 

“Closing Date Collateral List” shall mean the list of Real Estate sites of the
Loan Parties attached hereto as Exhibit N.

 

“Closing Date Material Adverse Effect”  shall mean an event or effect that is
materially adverse to the business, financial condition or results of operations
of the Borrower and its Subsidiaries, taken as a whole, but shall not include
events or effects relating to or resulting from (i) changes in general economic
or political conditions or the securities, credit or financial markets in
general, except to the extent such change has a disproportionate effect on the
Borrower and its Subsidiaries, taken as a whole, when compared to other
companies operating in the same industries and markets in which the Borrower and
its Subsidiaries operate, (ii) any decline in the market price or trading volume
of the Borrower’s securities (it being understood that the underlying cause of
such decline may be taken into account in determining whether a Closing Date
Material Adverse Effect has occurred to the extent it is not excluded by another
clause of this definition), (iii) general changes or developments in the
industries or markets in which the Borrower and its Subsidiaries operate,
including general changes in Law or regulation across such industries and
markets, except to the extent such change has a disproportionate effect on the
Borrower and its Subsidiaries, taken as a whole, when compared to other
companies operating in the same industries and markets in which the Borrower and
its Subsidiaries operate, (iv) the execution and delivery of agreements with
respect to, or the public announcement or pendency of, the Transactions and the
tender offer pursuant to the Tender Offer Agreement, including the impact
thereof on the relationships, contractual or otherwise, of the Borrower or any
of its Subsidiaries with employees, customers, suppliers or partners, (v) the
identity of Cerberus or any of its affiliates or co-investors and the parties
involved in the tender offer pursuant to the Tender Offer Agreement, (vi) the
taking of any action required by the Tender Offer Agreement, (vii) any acts of
terrorism or war, except to the extent such act has a

 

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disproportionate effect on the Borrower and its Subsidiaries, taken as a whole,
when compared to other companies operating in the same industries and markets in
which the Borrower and its Subsidiaries operate, (viii) any hurricane, tornado,
flood, earthquake, natural disasters, acts of God or other comparable events,
except to the extent such event has a disproportionate effect on the Borrower
and its Subsidiaries, taken as a whole, when compared to other companies
operating in the same industries and markets in which the Borrower and its
Subsidiaries operate, (ix) changes in applicable law, regulation or generally
accepted accounting principles or the interpretation thereof after January 10,
2013, (x) any failure to meet internal or published projections, forecasts or
revenue or earning predictions for any period (it being understood that the
underlying cause of such failure may be taken into account in determining
whether a Closing Date Material Adverse Effect has occurred to the extent it is
not excluded by another clause of this definition); or (xi) any matter disclosed
in Section 3.15 of the disclosure letter delivered by the Borrower to Symphony
immediately prior to the execution of the Tender Offer Agreement, a correct and
complete copy of which disclosure letter was provided to the Arrangers on or
prior to the date of the Tender Offer Agreement.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated and rulings issued thereunder (unless
otherwise provided herein).

 

“Collateral” shall mean any and all “Collateral” as defined in any applicable
Security Document and all other property that is or is intended under the terms
of the Security Documents to be subject to Liens in favor of the Administrative
Agent or the Collateral Agent and shall also include the Real Estate Collateral
Properties and the Related Real Estate Collateral.

 

“Collateral Access Agreement and Lien Waiver” means an agreement reasonably
satisfactory in form and substance to the Administrative Agent executed by (a) a
bailee or other Person in possession of Collateral, or (b) any landlord with
respect to a lease of property on which is located Collateral or other assets
that Administrative Agent may require access to, and use of, to realize on such
Collateral, and pursuant to which such bailee, other Person, or landlord waives
any lien that it may have in such Collateral.

 

“Collateral Agent” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

 

“Collateral Assignment Agreement” shall mean that certain Collateral Assignment
of Purchase Agreement and Escrow Agreement, dated of even date herewith, by and
among the Borrower, the Administrative Agent and the Collateral Agent.

 

“Commitment” shall mean, with respect to any Lender, the commitment of such
Lender to make Loans hereunder as set forth on Schedule 2.01, or in the
Assignment and Acceptance pursuant to which such Lender assumed its Commitment,
as applicable, as the same may be reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04.  The
aggregate commitments on the Closing Date shall be $1,500,000,000.  Unless the
context shall otherwise require, the “Commitments” shall include the Incremental
Loan Commitments.

 

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“Commitment Letter” shall mean the Commitment Letter, dated as of January 10,
2013, among the Borrower, Goldman Sachs, CS Securities, Credit Suisse, MSSF,
MLPFS, Bank of America and Barclays, as amended by the amendment thereto, dated
on or about February 13, 2013, among such parties.

 

“Communications” shall have the meaning assigned to such term in Section 9.01.

 

“Competitor” shall mean a Person, other than a Loan Party, who directly provides
products or services that are the same or substantially similar to the products
or services provided by, and that constitute a material part of the business of,
the Loan Parties taken as a whole, and any Controlled Affiliate of any such
Person, in each case who has been identified to the Administrative Agent in
writing from time to time and posted to both the “Public Lender” and “Non-Public
Lender” portions of the Platform subject to the confidentiality provisions
thereof in accordance with Section 9.01 or otherwise made available to all
Lenders and, in the case of Persons and Controlled Affiliates of any Person
identified to the Administrative Agent on or after the Closing Date, to the
extent reasonably acceptable to the Administrative Agent.  In no event shall the
designation of a Person as a Competitor apply retroactively to disqualify any
Lender as of the date of such designation.

 

“Compliance Certificate” shall mean a certificate substantially in the form of
Exhibit D.

 

“Consolidated” shall mean, when used to modify a financial term, test, statement
or report of a Person, the application or preparation of such term, test,
statement or report (as applicable) based upon the consolidation, in accordance
with GAAP, of the financial condition or operating results of such Person and
its Subsidiaries.

 

“Consolidated EBITDA” shall mean, for any period, Consolidated Net Income for
such period plus (a) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (i) Consolidated Interest
Expense for such period, (ii) Consolidated income tax expense for such period,
(iii) all amounts attributable to depreciation and amortization for such period,
(iv) any extraordinary, non-recurring or unusual charges for such period
(including such charges reflected in the financial statements provided to the
Lenders prior to the Closing Date), (v) the amount of any non-cash charges,
losses or expenses (and minus the amount of such cash gains) resulting from the
application of Statement of Financial Accounting Standards No. 123(R) and
(vi) Transaction Expenses incurred within one year after the Closing Date, minus
(b) without duplication (i) all cash payments made during such period on account
of reserves, restructuring charges and other non-cash charges added to
Consolidated Net Income pursuant to clauses (a)(iv) and (a)(v) above in a
previous period and (ii) to the extent included in determining such Consolidated
Net Income, any extraordinary, non-recurring or unusual gains for such period,
all determined on a Consolidated basis in accordance with GAAP; provided, that
for purposes of calculating the Total Leverage Ratio or the Total Secured
Leverage Ratio for any period, (A) the Consolidated EBITDA of any Acquired
Entity acquired or investment made by the Borrower or any Restricted Subsidiary
pursuant to a Permitted Acquisition during such period shall be included on a
pro forma basis for such period (assuming the consummation of such acquisition
and the incurrence or assumption of any Indebtedness in connection therewith
occurred as of the first day of such period) and (B) the Consolidated EBITDA of
any Person or line of business sold or otherwise disposed of by the Borrower or
any Restricted Subsidiary

 

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during such period for shall be excluded for such period (assuming the
consummation of such sale or other disposition and the repayment of any
Indebtedness in connection therewith occurred as of the first day of such
period); provided, further, that Consolidated EBITDA for the Fiscal Quarter
ended September 8, 2012 shall be deemed to be $155,000,000 and for the Fiscal
Quarter ended December 1, 2012 shall be deemed to be $172,000,000; provided,
further, that for the Fiscal Quarter ending February 23, 2013 and the Fiscal
Quarter ending June 15, 2013, Consolidated EBITDA shall be calculated on the
basis used in preparing the Deal Basis Financial Statements (as more
particularly described in Section 3.05(f) and the Lender Presentation).

 

“Consolidated Interest Expense” shall mean, for any period (a) the interest
expense (including imputed interest expense in respect of Capital Lease
Obligations and Synthetic Lease Obligations) minus (b) the interest income, in
each case, of the Borrower and the Restricted Subsidiaries for such period,
determined on a Consolidated basis in accordance with GAAP.

 

“Consolidated Net Income” shall mean, for any period, the net income or loss of
the Borrower and the Restricted Subsidiaries for such period determined on a
Consolidated basis in accordance with GAAP; provided that there shall be
excluded (a) the income of any Restricted Subsidiary to the extent that the
declaration or payment of dividends or similar distributions by such Restricted
Subsidiary of such income is not at the time permitted by operation of the terms
of its charter or any agreement, instrument, judgment, decree, statute, rule or
governmental regulation applicable to such Restricted Subsidiary, (b) the income
of any Person (other than the Borrower and the Restricted Subsidiaries) in which
any other Person (other than the Borrower and the Restricted Subsidiaries or any
director holding qualifying shares in compliance with applicable law) owns an
Equity Interest, except to the extent of the amount of dividends or other
distributions actually paid to the Borrower and the Restricted Subsidiaries
during such period, (c) the income or loss of any Person accrued prior to the
date it becomes a Subsidiary of the Borrower or is merged into or consolidated
with the Borrower or any Restricted Subsidiary or the date that such Person’s
assets are acquired by the Borrower or any Restricted Subsidiary and (d) any
gains attributable to Dispositions.

 

“Contractual Obligation” shall mean, as to any Person, any provision 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” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise, and the
terms “Controlling” and “Controlled” shall have meanings correlative thereto.

 

“Credit Card Agreements” shall mean all agreements now or hereafter entered into
by the Borrower or for the benefit of the Borrower, in each case with any Credit
Card Issuer or any Credit Card Processor with respect to sales transactions
involving credit card or debit card purchases, including, but not limited to,
the agreements set forth on Schedule 3.21(b) hereto.

 

“Credit Card Notification” shall have the meaning assigned to such term in
Section 5.13(a).

 

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“Credit Card Issuer” shall mean any person (other than a Loan Party) who issues
or whose members issue credit cards, including, without limitation, MasterCard
or VISA bank credit or debit cards or other bank credit or debit cards issued
through World Financial Network National Bank, MasterCard International, Inc.,
Visa, U.S.A., Inc. or Visa International and American Express, Discover, Diners
Club, Carte Blanche and other non-bank credit or debit cards, including, without
limitation, credit or debit cards issued by or through American Express Travel
Related Services Company, Inc., Novus Services, Inc., PayPal and other issuers
approved by the Administrative Agent.

 

“Credit Card Processor” shall mean any servicing or processing agent or any
factor or financial intermediary who facilitates, services, processes or manages
the credit authorization, billing transfer and/or payment procedures with
respect to the Borrower’s sales transactions involving credit card or debit card
purchases by customers using credit cards or debit cards issued by any Credit
Card Issuer.

 

“Credit Card Receivables” shall mean each “Account” (as defined in the UCC)
together with all income, payments and proceeds thereof, owed by a Credit Card
Issuer or Credit Card Processor to a Loan Party resulting from charges by a
customer of a Loan Party on credit or debit cards issued by such Credit Card
Issuer or processed by such Credit Card Processor (including, without
limitation, electronic benefits transfers) in connection with the sale of goods
by a Loan Party, or services performed by a Loan Party, in each case in the
ordinary course of its business.

 

“Credit Suisse” shall mean Credit Suisse AG and its successors and assigns.

 

“CS Securities” shall mean Credit Suisse Securities (USA) LLC and its successors
and assigns.

 

“Cumulative Credit Amount” shall mean, as of any date, an amount (which shall
not be less than zero), determined on a cumulative basis, equal to, without
duplication:  (a) the Retained Excess Cash Flow Amount, plus (b) the cumulative
amount of Net Cash Proceeds received by the Borrower after the Closing Date from
issuances of the Borrower’s Qualified Capital Stock (but excluding any such sale
or issuance by the Borrower of its Equity Interests upon exercise of any warrant
or option by directors, officers or employees of any Loan Party or any
Subsidiary), minus (c) the cumulative amount of Permitted Investments made in
reliance on clause (o) of the definition thereof, minus (d) the cumulative
amount of Restricted Payments made in reliance on Section 6.06(iv), minus
(e) the cumulative amount of any payments of Indebtedness made in reliance on
Section 6.07(a)(vii).

 

“Current Assets” shall mean, at any time, the consolidated current assets (other
than cash and Permitted Investments) of the Borrower and the Subsidiaries.

 

“Current Liabilities” shall mean, at any time, the consolidated current
liabilities of the Borrower and the Subsidiaries at such time, but excluding,
without duplication, (a) the current portion of any long-term Indebtedness and
(b) outstanding revolving loans and swingline loans under the ABL Credit
Agreement.

 

“Customer Support Transaction” shall mean any one of the following transactions
in the ordinary course of the business of the Loan Parties consistent with the
current practices as of the

 

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date hereof: (a) any sublease by a Loan Party to a customer of any Loan Party of
leased real property of such Loan Party that constitutes a Capital Lease,
(b) any lease by a Loan Party to a customer of any Loan Party of owned real
property of such Loan Party that constitutes a Capital Lease, (c) any assignment
of a lease of real property by a Loan Party that constitutes a Capital Lease to
a customer of any Loan Party in connection with which the assigning Loan Party
is not released from liability under such lease, (d) any Guarantee by a Loan
Party for the benefit of a third party of Indebtedness of a customer of any Loan
Party and (e) any loan of money or property (other than ABL Priority Collateral
or Term Loan Priority Collateral) by a Loan Party to a customer; provided, that
the foregoing shall not be construed to apply to the sale of inventory on credit
by a Loan Party to a customer in the ordinary course of business.

 

“Customer Support Transaction Report” shall a report demonstrating in reasonable
detail the aggregate exposure of all Loan Parties under Customer Support
Transactions.

 

“DDA” shall mean each checking, savings or other demand deposit account
maintained by any of the Loan Parties, other than (i) such accounts used for
trust, payroll, payroll taxes and other employee wage and benefit payments to or
for the benefit of any Loan Party’s employees or exclusively used for the
receipt of Medicare and Medicaid receivables or exclusively used to hold funds
for the benefit of a particular person in a manner permitted pursuant to the
Loan Documents and (ii) such accounts pledged to secure Indebtedness and subject
to, or containing proceeds of property subject to, a Permitted Encumbrance.  All
funds in each DDA shall be presumed to be Collateral and proceeds of Collateral
and the Administrative Agent and the Lenders shall have no duty to inquire as to
the source of the amounts on deposit in any DDA.

 

“DDA Notification” shall have the meaning assigned to such term in
Section 5.17(d).

 

“Deal Basis Financial Statements” shall have the meaning assigned to such term
in Section 3.05(f).

 

“Debtor Relief Laws” shall mean the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.

 

“Default” shall mean any event or condition that constitutes an Event of Default
or that, with the giving of any notice, the passage of time, or both, would
constitute an Event of Default.

 

“Defaulting Lender” shall mean, subject to the second proviso of this
definition, any Lender for which the Administrative Agent has received
notification that such Lender is, or has a direct or indirect parent company
that is (i) insolvent, or is generally unable to pay its debts as they become
due, or admits in writing its inability to pay its debts as they become due, or
makes a general assignment for the benefit of its creditors or (ii) the subject
of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding,
or a receiver, trustee, conservator, intervenor or sequestrator or the like has
been appointed for such Lender or its direct or indirect parent company, or such
Lender or its direct or indirect parent company has taken any action in
furtherance of or indicating its consent to or acquiescence in any such
proceeding or

 

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appointment; provided that a Lender shall not be a Defaulting Lender solely by
virtue of the ownership or acquisition of any Equity Interest in that Lender or
any direct or indirect parent company thereof by a Governmental 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 permit such
Lender (or such Governmental Authority or instrumentality) to reject, repudiate,
disavow or disaffirm any contracts or agreements made with such Lender; provided
that a Defaulting Lender that has adequately remedied all matters that caused
such Lender to be a Defaulting Lender shall cease to be a Defaulting Lender.

 

“Discharge of ABL Debt” shall have the meaning assigned to such term in the
Intercreditor Agreement.

 

“Discharge of Obligations” shall have the meaning assigned to such term in
Section 9.20(a).

 

“Disposition” or “Dispose” shall mean the sale, transfer, license, lease or
other disposition (including any sale and leaseback transaction and any sale,
transfer, license or other disposition (whether in one transaction or in a
series of transactions) of any property (including, without limitation, any
Equity Interests) by any Person (or the granting of any option or other right to
do any of the foregoing), including any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any
rights and claims associated therewith.

 

“Disqualified Stock” shall mean any Equity Interest that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable, in each case, at the option of the holder thereof) or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
Latest Maturity Date; provided, that (i) only the portion of such Equity
Interests which so matures or is mandatorily redeemable, is so convertible or
exchangeable or is so redeemable at the option of the holder thereof prior to
such date shall be deemed to be Disqualified Stock and (ii) with respect to any
Equity Interest issued to any employee or to any plan for the benefit of
employees of the Borrower or its Subsidiaries or by any such plan to such
employees, (x) such Equity Interest shall not constitute Disqualified Stock
solely because it may be required to be repurchased by the Borrower or one of
its Subsidiaries in order to satisfy obligations or as a result of such
employee’s termination, resignation, death or disability, (y) if any class of
such Equity Interest of such Person that by its terms authorizes such Person to
satisfy its obligations thereunder by delivery of an Equity Interest that is not
Disqualified Stock, such Equity Interests shall not be deemed to be Disqualified
Stock solely by reason thereof and (z) any such Equity Interest that would
constitute Disqualified Stock solely because the holders thereof have the right
to require a Loan Party to repurchase such Equity Interest upon the occurrence
of a change of control or an asset sale shall not constitute Disqualified
Stock.  The amount of Disqualified Stock deemed to be outstanding at any time
for purposes of this Agreement will be the maximum amount that the Borrower and
its Subsidiaries may become obligated to pay upon maturity of, or pursuant to
any mandatory redemption provisions of, such Disqualified Stock or portion
thereof, plus accrued dividends.

 

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“Documentation Agents” shall mean MLPFS and Barclays, in their capacities as
documentation agents.

 

“Dollars” or “$” shall mean lawful money of the United States of America.

 

“Domestic Subsidiary” shall mean any direct or indirect Subsidiary of a Loan
Party other than a Foreign Subsidiary.

 

“E&Y” shall mean Ernst & Young LLP.

 

“Eligible Assignee” shall mean any Person other than a natural Person that is
(i) a Lender, an Affiliate of any Lender or a Related Fund (any two or more
Related Funds being treated as a single Eligible Assignee for all purposes
hereof) or (ii) a commercial bank, insurance company, investment or mutual fund
or other entity that is an “accredited investor” (as defined in Regulation D)
and which extends credit or buys loans in the ordinary course; provided that
notwithstanding anything herein to the contrary, “Eligible Assignee” shall not
include any Person that is a Loan Party (other than the Borrower to the extent
provided in Section 9.04(k)), any of the Loan Parties’ Affiliates, any
Subsidiaries, Cerberus and any of its Affiliates, any Competitor or any Lender
that at the time of the proposed assignment is a Defaulting Lender.

 

“Environmental Laws” shall mean any and all Federal, state, and local statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits,
grants, franchises, licenses, agreements or governmental restrictions relating
to pollution and the protection of the environment or the Release of any
Hazardous Materials into the environment, including those related to hazardous
substances or wastes, air emissions and discharges to waste or public systems.

 

“Environmental Liability” shall mean any liability, obligation, damage, loss,
claim, action, suit, judgment, order, fine, penalty, fee, expense, or cost,
contingent or otherwise (including any liability for damages, costs of
environmental remediation, fines, penalties or indemnities), of the Borrower, or
any other Loan Party resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, labeling,
storage, treatment, disposal or recycling of, or presence of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the Release or
threatened Release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.

 

“Equipment” shall have the meaning assigned to such term in the UCC.

 

“Equity Interests” shall mean, with respect to any Person, the shares of capital
stock of (or other ownership or profit interests in) such Person, the warrants,
options or other rights for the purchase or acquisition from such Person of
shares of capital stock of (or other ownership or profit interests in) such
Person, the securities convertible into or exchangeable for shares of capital
stock of (or other ownership or profit interests in) such Person or warrants,
rights or options for the purchase or acquisition from such Person of such
shares (or such other interests), and any of the other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are outstanding on any date of determination.

 

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“ERISA” shall mean the Employee Retirement Income Security Act of 1974 and the
regulations promulgated thereunder, as amended and in effect.

 

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated)
under common control with the Borrower within the meaning of Sections 414(b) or
(c) of the Code (and Sections 4.14(m) and (o) of the Code for purposes of
provisions relating to Sections 412 or 430 of the Code).

 

“ERISA Event” shall mean (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate; or (g) the breach of any terms of the PBGC Agreement.

 

“Escrow Agreement” shall mean that certain escrow agreement, dated of even date
herewith, by and among the Borrower, ASC and JPMorgan Chase Bank, N.A., as
escrow agent.

 

“Eurodollar”, when used in reference to any Loan or Borrowing, shall refer to
whether such Loan, or the Loans comprising such Borrowing, are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.

 

“Events of Default” shall have the meaning assigned to such term in
Section 7.01.

 

“Excess Cash Flow” shall mean, for (A) the period from the Closing Date until
February 22, 2014, and (B) any subsequent Fiscal Year of the Borrower
(commencing with the Fiscal Year ending closest to February 28, 2015) (a) the
sum, without duplication, of (i) Consolidated EBITDA for such period,
(ii) reductions to noncash working capital of the Borrower and the Restricted
Subsidiaries for such period (i.e., the decrease, if any, in Current Assets
minus Current Liabilities from the beginning to the end of such period),
(iii) the amount by which the Pension Expense for such period exceeds the Cash
Pension Contribution for such period, if any, and (iv) the Net Cash Proceeds of
any Other Asset Sale (whether a single transaction or a series of related
transactions) received by the Borrower and the Restricted Subsidiaries during
such period in which such Net Cash Proceeds are greater than $50,000 but less
than $5,000,000, minus (b) the sum, without duplication, of (i) the amount of
any Taxes payable in cash by the Borrower and the Restricted Subsidiaries with
respect to such period, (ii) Consolidated Interest Expense for such period paid
in cash, (iii) Capital Expenditures made in cash during such period, except to
the extent financed with the proceeds of Indebtedness, equity issuances,
casualty proceeds, condemnation proceeds or other proceeds that would not be

 

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included in Consolidated EBITDA, (iv) scheduled repayments of Indebtedness
(other than Indebtedness in respect of the ABL Facility) made in cash by the
Borrower and the Restricted Subsidiaries during such period, but only to the
extent that the Indebtedness so repaid by its terms cannot be reborrowed or
redrawn and such repayments do not occur in connection with a refinancing of all
or any portion of such Indebtedness, (v) additions to noncash working capital
for such period (i.e., the increase, if any, in Current Assets minus Current
Liabilities from the beginning to the end of such period), (vi) the amount by
which the Cash Pension Contribution for such period exceeds the Pension Expense
for such period, if any, and (vii) the amount of Restricted Payments made in
cash during such period to the extent permitted under Section 6.06.

 

“Excluded DDAs” shall mean each checking, savings or other demand deposit
account maintained by any Loan Party and exclusively used (a) for payroll,
payroll taxes and other employee wage and benefit payments to or for the benefit
of any Loan Party’s employees, (b) for the receipt of Medicare and Medicaid
receivables of a Loan Party, (c) to hold proceeds of Term Loan Priority
Collateral, subject to the Intercreditor Agreement, unless and until the release
of the Lien thereon of the Agents, or (d) for the receipt and deposit of funds
of a specific Person other than a Loan Party, or which a Loan Party is holding
in trust or as a fiduciary for such Person, in each case in a manner permitted
under this Agreement or the other Loan Documents.

 

“Excluded Information” shall have the meaning assigned to such term in
Section 9.04(l).

 

“Excluded Subsidiaries” shall mean, at any date of determination, each
(a) Immaterial Subsidiary, (b) Foreign Subsidiary, (c) Unrestricted Subsidiary,
(d) Subsidiary that is not wholly owned, directly or indirectly, by the Borrower
or (e) Insurance Captive; provided that, notwithstanding the foregoing, Moran
Foods shall not be deemed to be an Excluded Subsidiary.

 

“Excluded Taxes” shall mean, with respect to the Administrative Agent or any
Lender or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the United States of America or any similar tax imposed by any other
jurisdiction described in clause (a) above, (c) in the case of a Foreign Lender
(other than an assignee pursuant to a request by the Borrower under
Section 2.21(a)), any U.S. federal withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender’s failure to comply with Section 2.20(e), in each case
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from the Borrower with respect to such withholding
tax pursuant to Section 2.20(a) and (d) any U.S. federal withholding taxes
imposed as a result of a Foreign Lender’s failure to comply with FATCA.

 

“Existing ABL Credit Agreement” shall mean that certain asset-based revolving
credit agreement, dated as of August 30, 2012, by and among the Borrower, each
Subsidiary party thereto, the ABL Facility Agent and the various financial
institutions from time to time party thereto.

 

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“Existing ABL Facility” shall mean the Borrower’s existing senior secured
asset-based revolving credit facility, documented pursuant to the Existing ABL
Credit Agreement.

 

“Existing Debt Documents” shall mean, collectively, the SVU 2016 Notes, the SVU
Indenture (but solely in respect of the SVU 2016 Notes) and any other notes,
indentures, instruments or other agreements evidencing, governing or related to
any other Material Indebtedness or securitization arrangements of the Borrower
or any of its Subsidiaries incurred after the Closing Date with a maturity prior
to the date that is five years from the Closing Date.

 

“Existing Term Loan Credit Agreement” shall mean the Term Loan Credit Agreement,
dated as of August 30, 2012, among the Borrower, Credit Suisse, as
administrative agent, and the various lenders and agents party thereto from time
to time.

 

“Existing Term Loan Facility” shall mean the Borrower’s existing senior secured
term loan credit facility, documented pursuant to the Existing Term Loan Credit
Agreement.

 

“Extended Loan Yield Differential” shall have the meaning assigned to such term
in Section 2.23.

 

“Extended Loans” shall have the meaning assigned to such term in Section 2.23.

 

“Extending Lender” shall have the meaning assigned to such term in Section 2.23.

 

“Extension Amendment” shall have the meaning assigned to such term in
Section 2.23.

 

“Extension Election” shall have the meaning assigned to such term in
Section 2.23.

 

“Extension Fee” shall have the meaning assigned to such term in Section 2.23.

 

“Extension Request” shall have the meaning assigned to such term in
Section 2.23.

 

“Facility Guaranty” shall mean the Facility Guaranty, dated of even date
herewith, made by the Guarantors in favor of the Administrative Agent and the
other Secured Parties, substantially in the form of Exhibit G hereto.

 

“Farm Products” shall have the meaning defined in the Food Security Act and the
UCC.

 

“Farm Products Sellers” shall mean, collectively, sellers or suppliers to any
Loan Party of any Farm Products and including any milk or dairy products,
perishable agricultural commodity (as defined in the PACA) or livestock (as
defined in the PSA), meat, meat food products or livestock products derived
therefrom or any poultry or products derived therefrom; sometimes referred to
herein individually as a “Farm Products Seller”.

 

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

 

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“FCPA” shall have the meaning assigned to such term in Section 3.32.

 

“Federal Funds Effective Rate” shall mean, for any day, 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 that is a Business Day, the average of the
quotations for the day for such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

 

“Fee Letter” shall mean the Fee Letter, dated as of January 10, 2013, among the
Borrower, Goldman Sachs, CS Securities, Credit Suisse, MSSF, MLPFS, Bank of
America and Barclays.

 

“Fees” shall mean the Administrative Agent Fees and the Participation Fees.

 

“Fiscal Intermediary” shall mean any qualified insurance company or other Person
that has entered into an ongoing relationship with any Governmental Authority to
make payments to payees under Medicare, Medicaid or any other Federal, state or
local public health care or medical assistance program pursuant to any of the
Health Care Laws.

 

“Fiscal Period” shall mean any four-week or five-week fiscal period of any
Fiscal Year, in accordance with the fiscal accounting calendar of the Loan
Parties as in effect on the date hereof.

 

“Fiscal Quarter” shall mean the period consisting of the first four Fiscal
Periods of each Fiscal Year and the next three periods of three Fiscal Periods
each in such Fiscal Year.

 

“Fiscal Year” shall mean any period of 13 consecutive Fiscal Periods ending on
the last Saturday of February of any calendar year.

 

“Fixed Maturity Date” shall mean March 21, 2019.

 

“Flood Certificate” shall mean a “Standard Flood Hazard Determination Form” of
the Federal Emergency Management Agency and any successor Governmental Authority
performing a similar function.

 

“Flood Program” shall mean the National Flood Insurance Program created by the
U.S. Congress pursuant to the National Flood Insurance Act of 1968, the Flood
Disaster Protection Act of 1973, the National Flood Insurance Reform Act of 1994
and the Flood Insurance Reform Act of 2004, in each case as amended from time to
time, and any successor statutes.

 

“Flood Zone” shall mean areas having special flood hazards as described in the
National Flood Insurance Act of 1968, as amended from time to time, and any
successor statute.

 

“Food Security Act” shall mean the Food Security Act of 1984, 7 U.S.C. § 1631
et. seq., as the same now exists or may hereafter from time to time be amended,
modified, recodified or supplemented, together with all rules and regulations
thereunder.

 

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“Food Security Act Notices” shall have the meaning assigned to such term in
Section 3.27(a).

 

“Foreign Lender” shall mean any Lender that is not a “United States person”
within the meaning of Section 7701(a)(30) of the Code.

 

“Foreign Subsidiary” shall mean a direct or indirect Subsidiary of a Loan Party
organized or incorporated under the laws of a jurisdiction other than a State of
the United States, the United States or the District of Columbia.

 

“GAAP” shall mean United States generally accepted accounting principles in
effect from time to time.

 

“Goldman Sachs” shall have the meaning assigned to such term in the introductory
statement to this Agreement.

 

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

 

“Granting Lender” shall have the meaning assigned to such term in
Section 9.04(i).

 

“Ground Lease” shall mean, individually and collectively, as the context may
require, each ground lease described on the Applicable Collateral List.

 

“Guarantee” shall mean, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect,
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person (or any right, contingent or otherwise, of any
holder of such Indebtedness to obtain any such Lien).  The term “Guarantee” as a
verb shall have a meaning correlative thereto.

 

“Guarantor” shall mean (a) each Subsidiary of the Borrower that is not an
Excluded Subsidiary, together with its successors and assigns, and (b) each
other Subsidiary of the Borrower from time to time party to the Facility
Guaranty.

 

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“Hazardous Materials” shall mean all chemicals, materials, substances or wastes
of any nature that are listed, classified, regulated, characterized or otherwise
defined as “hazardous,” “toxic,” “radioactive,” a “pollutant,” a “contaminant,”
or terms of similar intent or meaning, by any Governmental Authority or that are
otherwise prohibited, limited or regulated pursuant to any Environmental Law,
including petroleum or petroleum distillates, friable asbestos or friable
asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious
or medical wastes.

 

“Health Care Laws” shall mean all Federal, state and local laws, rules,
regulations, interpretations, guidelines, ordinances and decrees primarily
relating to patient healthcare, any health care provider, medical assistance and
cost reimbursement program, as now or at any time hereafter in effect,
applicable any Loan Party, including, but not limited to, the Social Security
Act, the Social Security Amendments of 1972, the Medicare-Medicaid Anti-Fraud
and Abuse Amendments of 1977, the Medicare and Medicaid Patient and Program
Protection Act of 1987, HIPAA and the Patient Protection and Affordable Care Act
of 2010.

 

“HIPAA” shall mean the Health Insurance Portability and Accountability Act of
1996, as the same now exists or may hereafter from time to time be amended,
modified, recodified or supplemented, together with all rules and regulations
thereunder.

 

“HIPAA Compliance Date” shall have the meaning assigned to such term in
Section 3.28(b).

 

“HIPAA Compliance Plan” shall have the meaning assigned to such term in
Section 3.28(a).

 

“HIPAA Compliant” shall have the meaning assigned to such term in
Section 3.28(b).

 

“Immaterial Subsidiary” shall mean (a) until the Borrower has first provided
financial statements pursuant to Section 5.01(a), each Subsidiary identified as
an Immaterial Subsidiary on the Closing Date on Schedule 3.13, and
(b) thereafter, each Subsidiary of the Borrower identified as an “Immaterial
Subsidiary” pursuant to a certificate executed and delivered by a Responsible
Officer of the Borrower to the Administrative Agent within 60 days of the
delivery of annual financial statements pursuant to Section 5.01(a) (certifying
as to each of the items set forth in the following proviso); provided (i) no
Subsidiary shall be an Immaterial Subsidiary if the book value of its assets
(net of assets arising from intercompany transactions that would be eliminated
on a Consolidated balance sheet of the Borrower) exceed 1.00% of the Total
Assets of the Borrower and its Subsidiaries on a Consolidated basis and (ii) the
aggregate book value of the assets of all Immaterial Subsidiaries (net of assets
arising from intercompany transactions that would be eliminated on a
Consolidated balance sheet of the Borrower) shall not exceed 5.00% of the Total
Assets of the Borrower and its Subsidiaries on a Consolidated basis, in each
case as determined for the most recently completed Fiscal Quarter for which the
Borrower has provided financial statements pursuant to Section 5.01(b);
provided, further, that Moran Foods shall not constitute an Immaterial
Subsidiary.

 

“Incremental Lender” shall mean a Lender with an Incremental Loan Commitment or
an outstanding Incremental Loan.

 

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“Incremental Loan Amount” shall mean, at any time, the excess, if any, of
(a) $250,000,000 over (b) the aggregate amount of all Incremental Loan
Commitments established prior to such time pursuant to Section 2.22.

 

“Incremental Loan Assumption Agreement” shall mean an Incremental Loan
Assumption Agreement among, and in form and substance reasonably satisfactory
to, the Borrower, the Administrative Agent and one or more Incremental Lenders.

 

“Incremental Loan Commitment” shall mean the commitment of any Lender,
established pursuant to Section 2.22, to make Incremental Loans to the Borrower.

 

“Incremental Loan Maturity Date” shall mean the final maturity date of any
Incremental Loan, as set forth in the applicable Incremental Loan Assumption
Agreement.

 

“Incremental Loan Repayment Dates” shall mean the dates scheduled for the
repayment of principal of any Incremental Loan, as set forth in the applicable
Incremental Loan Assumption Agreement.

 

“Incremental Loans” shall mean Loans made by one or more Lenders to the Borrower
pursuant to Section 2.01(b).  Incremental Loans may be made in the form of
additional Loans or, to the extent permitted by Section 2.22 and provided for in
the relevant Incremental Loan Assumption Agreement, Other Loans.

 

“Indebtedness” shall mean, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:

 

(a)  all obligations of such Person for borrowed money and all obligations of
such Person evidenced by bonds, debentures, notes, loan agreements or other
similar instruments;

 

(b)  the maximum amount of all direct or contingent obligations of such Person
arising under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, and similar instruments (and including
reimbursement obligations in connection with surety bonds);

 

(c)  the Swap Termination Value under any Swap Contract;

 

(d)  all obligations of such Person to pay the deferred purchase price of
property or services which are due six months or more from the date after such
property is acquired or such services are completed, and including, without
limitation, customary indemnification, adjustment of purchase price or similar
obligations, earn-outs or other similar obligations (but excluding trade
accounts payable incurred in the ordinary course of business on normal trade
terms and not overdue by more than 90 days unless such trade payables or other
obligations are being contested or disputed by such Person in good faith), in
each case to the extent required to be recorded as liabilities in accordance
with GAAP;

 

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(e)  Indebtedness (excluding prepaid interest thereon) secured by a Lien on
property owned or being purchased by such Person (including indebtedness arising
under conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited in
recourse;

 

(f)  all Attributable Indebtedness of such Person;

 

(g)  all obligations of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any Equity Interests of such Person or
any other Person (including, without limitation, Disqualified Stock), or any
warrant, right or option to acquire such Equity Interests, valued, in the case
of a redeemable preferred interest, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends;

 

(h)  all obligations under, or the net investments outstanding pursuant to, any
receivables financing; and

 

(i)  all Guarantees of such Person in respect of any of the foregoing.

 

For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person.  The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date; provided, (i) as to Swap Contracts relating to fuel
entered into by the Borrower in the ordinary course of business consistent with
its current practices, the Swap Termination Value may be determined at the end
of the most recently ended Fiscal Period for purposes of this Agreement and
(ii) as to Swap Contracts other than such Swap Contracts with respect to fuel,
the Swap Termination Value may be determined at the end of the most recently
ended Fiscal Period for purposes of this Agreement until the Administrative
Agent may notify the Borrower otherwise.

 

“Indemnified Taxes” shall mean Taxes other than Excluded Taxes.

 

“Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).

 

“Information” shall have the meaning assigned to such term in Section 9.16.

 

“Initial Lenders” shall mean Goldman Sachs, Credit Suisse, MSSF, Bank of America
and Barclays in their capacities as such under the Commitment Letter.

 

“Insurance Captive” shall mean each of (a) Wetterau Insurance Co. Ltd., a
Bermuda corporation, (b) Market Company, Ltd., a Bermuda corporation and
(c) such other Subsidiaries of the Borrower that perform similar insurance
functions, in each case to the extent organized and maintained as a captive
insurance Subsidiary of the Borrower.

 

“Intercreditor Agreement” shall mean the Intercreditor Agreement, dated of even
date herewith, by and among the Administrative Agent, the Collateral Agent and
the ABL Facility

 

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Agent, as acknowledged and agreed to by the Borrower and the Guarantors,
providing for such parties’ relative rights and priorities with respect to the
assets and properties of the Loan Parties and related matters, substantially in
the form of Exhibit I hereto.

 

“Intercreditor Provisions” shall have the meaning assigned to such term in
Section 7.01(p).

 

“Interest Payment Date” shall mean (a) with respect to any ABR Loan, the last
Business Day of each March, June, September and December, and (b) with respect
to any Eurodollar Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurodollar
Borrowing with an Interest Period of more than three months’ duration, each day
that would have been an Interest Payment Date had successive Interest Periods of
three months’ duration been applicable to such Borrowing.

 

“Interest Period” shall mean, with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day (or, if there is no numerically corresponding day, on the last
day) in the calendar month that is one, two, three or six months (or nine or 12
months if agreed to by all Lenders and, with respect to a Eurodollar Borrowing
on the Closing Date, the period commencing on the Closing Date and ending on
March 31, 2013) thereafter, as the Borrower may elect; provided, however, that
(a) if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day,
(b) any Interest Period that begins on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last Business Day of
the calendar month at the end of such Interest Period and (c) no Interest Period
for any Loan shall extend beyond the maturity date of such Loan.  Interest shall
accrue from and including the first day of an Interest Period to but excluding
the last day of such Interest Period.  For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

 

“Internal Control Event” shall mean a material weakness in, or fraud that
involves senior management or other employees who have a significant role in,
the Borrower’s and/or its Subsidiaries’ internal controls over financial
reporting, in each case as described in the Securities Laws.

 

“Internally Generated Cash” shall mean, with respect to any Person, funds of
such Person and its Restricted Subsidiaries not constituting (x) proceeds of the
issuance of (or contributions in respect of) Equity Interests of such Person,
(y) proceeds of the incurrence of Indebtedness (other than the incurrence of
loans under the ABL Facility or extensions of credit under any other revolving
credit or similar facility or other short-term Indebtedness) by such Person or
any of its Restricted Subsidiaries or (z) proceeds of Dispositions and Casualty
Events.

 

“Investment” shall mean, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of Equity Interests of another Person, (b) a loan, advance or
capital contribution to, Guarantee or

 

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assumption of Indebtedness of, or purchase or other acquisition of any other
debt or interest in, another Person, (c) any Acquisition or (d) any other
investment of money or capital in order to obtain a profitable return.  For
purposes of covenant compliance, the amount of any Investment shall be the
amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.

 

“IRS” shall mean the United States Internal Revenue Service.

 

“Joinder Agreement” shall mean an agreement, in form satisfactory to the
Administrative Agent, pursuant to which a Subsidiary becomes a party to, and
bound by the terms of, this Agreement, the Facility Guaranty or the Security
Agreement, as applicable.

 

“Joint Lead Arrangers” shall mean Goldman Sachs, CS Securities, MSSF, MLPFS and
Barclays, in their capacities as joint bookrunners and joint lead arrangers.

 

“Latest Maturity Date” shall mean, at any date of determination, the latest
maturity date applicable to any Class of Loans or Commitments with respect to
such Loans or Commitments at such date of determination, including, for the
avoidance of doubt, the latest maturity date of any Incremental
Loans, Incremental Loan Commitments, Other Loans or Extended Loans, in each
case, as extended from time to time in accordance with this Agreement.

 

“Laws” shall mean each international, foreign, Federal, state and local statute,
treaty, rule, guideline, regulation, ordinance, code and administrative or
judicial precedent or authority, including the interpretation or administration
thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and each applicable administrative
order, directed duty, request, license, authorization and permit of, and
agreement with, any Governmental Authority, in each case whether or not having
the force of law.

 

“Lender Presentation” shall mean the Lender Presentation, dated January 2013,
included in the Borrower’s current report on form 8-K filed January 28, 2013.

 

“Lenders” shall mean (a) the Persons listed on Schedule 2.01 (other than any
such Person that has ceased to be a party hereto pursuant to an Assignment and
Acceptance) and (b) any Person that has become a party hereto pursuant to an
Assignment and Acceptance.

 

“LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any
Interest Period, the rate per annum determined by the Administrative Agent at
approximately 11:00 a.m. (London time) on the date that is two Business Days
prior to the commencement of such Interest Period by reference to the British
Bankers’ Association Interest Settlement Rates for deposits in Dollars (as set
forth by any service selected by the Administrative Agent that has been
nominated by the British Bankers’ Association as an authorized information
vendor for the purpose of displaying such rates) for a period equal to such
Interest Period; provided that, to the extent that an interest rate is not
ascertainable pursuant to the foregoing provisions of this definition, the “LIBO
Rate” shall be the interest rate per annum determined by the Administrative
Agent to be the average of the rates per annum at which deposits in Dollars are
offered for such relevant Interest Period to major banks in the London interbank
market in London, England by the Administrative Agent at approximately
11:00 a.m. (London time) on the date that is two Business Days prior to the
beginning of such Interest Period.

 

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“Lien” shall mean (a) any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge,
or preference, priority or other security interest or preferential arrangement
in the nature of a security interest of any kind or nature whatsoever (including
any conditional sale, any lease or other agreement giving rise to a Capital
Lease Obligation, Synthetic Lease Obligation, or other title retention
agreement, any easement, right of way or other encumbrance on title to real
property, and any financing lease having substantially the same economic effect
as any of the foregoing) and (b) in the case of securities, any purchase option,
call or similar right of a third party with respect to such securities.

 

“Loan Documents” shall mean this Agreement, the Intercreditor Agreement, the
Security Documents, each Incremental Loan Assumption Agreement, the promissory
notes, if any, executed and delivered pursuant to Section 2.04(e) and any other
document executed in connection with any of the foregoing and together with all
schedules, exhibits, annexes and other attachments thereto.

 

“Loan Parties” shall mean, collectively, the Borrower and the Guarantors.

 

“Loans” shall mean term loans made by the Lenders to the Borrower pursuant to
Section 2.01.  Unless the context shall otherwise require, the term “Loans”
shall include any Incremental Loans and any Extended Loans.

 

“Master Agreement” shall have the meaning assigned to such term in the
definition of “Swap Contract.”

 

“Material Adverse Effect” shall mean (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties or condition
(financial or otherwise) of the Borrower and its Subsidiaries taken as a whole;
(b) a material impairment of the ability of the Loan Parties to perform their
obligations under the Loan Documents; or (c) a material impairment of the rights
and remedies of the Administrative Agent or the Lenders under the Loan Documents
or a material adverse effect upon the legality, validity, binding effect or
enforceability against the Loan Parties of the Loan Documents.  In determining
whether any individual event would result in a Material Adverse Effect,
notwithstanding that such event in and of itself does not have such effect, a
Material Adverse Effect shall be deemed to have occurred if the cumulative
effect of such event and all other then existing events described in the
applicable provision since the applicable date would result in a Material
Adverse Effect.

 

“Material Contract” shall mean with respect to any Loan Party, each contract or
agreement to which such Loan Party is a party that is deemed to be a material
contract or material definitive agreement under any Securities Laws applicable
to such Loan Party, including, without limitation, the types of contracts
specified in item 601(b)(10)(ii) of Regulation S-K, and in the event that at any
time hereafter the Borrower ceases to be required to comply with the Securities
Laws, then the same definitions shall continue to apply for purposes of this
Agreement and the other Loan Documents.

 

“Material Indebtedness” shall mean the Indebtedness evidenced by or arising
under the Existing Debt Documents and any other Indebtedness (other than the
Obligations) of the Loan

 

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Parties in an aggregate principal amount exceeding $50,000,000.  For purposes of
determining the amount of Material Indebtedness at any time, (a) the amount of
the obligations in respect of any Swap Contract at such time shall be calculated
at the Swap Termination Value thereof, (b) undrawn committed or available
amounts shall be included and (c) all amounts owing to all creditors under any
combined or syndicated credit arrangement shall be included.

 

“Material Real Estate Asset” means Real Estate (other than an operating
leasehold interest) having a Value in excess of $1,000,000, as determined in
good faith by the Borrower, the acquiring Loan Party, E&Y or another
independent, third-party expert reasonably satisfactory to the Administrative
Agent, as of the date of the acquisition thereof.

 

“Material Related Collateral Location” means any Real Estate, other than a Real
Estate Collateral Property, owned, leased or operated by the Borrower or any of
its Subsidiaries if the Value of the property, plant and equipment located at
such Real Estate on the Borrower’s or such Subsidiary’s financial statements
exceeds $150,000 as of the Closing Date or as of the acquisition thereof.

 

“Maturity Date” shall mean the earlier of (a) the Fixed Maturity Date and
(b) the Springing Maturity Date.

 

“Maximum Rate” shall have the meaning assigned to such term in Section 9.09.

 

“Medicaid” shall mean the health care financial assistance program jointly
financed and administered by the Federal and State governments under Title XIX
of the Social Security Act.

 

“Medicare” shall mean the health care financial assistance program under
Title XVIII of the Social Security Act.

 

“MLPFS” shall mean Merrill Lynch, Pierce, Fenner & Smith Incorporated and its
successors and assigns.

 

“MMMF” shall having the meaning assigned to such term in the Escrow Agreement.

 

“Moody’s” shall mean Moody’s Investors Service, Inc., or any successor thereto.

 

“Moran Foods” shall mean Moran Foods, LLC, a Missouri limited liability company.

 

“Moran Sale” shall mean a sale, transfer or other disposition (including by way
of merger, casualty, condemnation or otherwise) of all or substantially all of
the assets or property of Moran Foods and its Subsidiaries (whether in one
transaction or a series of related transactions) or of all of the outstanding
Equity Interests of Moran Foods; provided that (a) no Default or Event of
Default shall have occurred or be continuing or shall occur as a result of any
such transaction, (b) the Borrower shall have delivered to the Administrative
Agent opinions of counsel, in each case in form and substance reasonably
satisfactory to the Administrative Agent, opining that the occurrence of any
such transaction (i) will not conflict with the SVU Indenture, the SVU 2016
Notes or any other Material Indebtedness, (ii) will not result in any “change of
control” offer or similar offer being required to be made under the SVU
Indenture, the SVU 2016 Notes or any other any Material Indebtedness and
(iii) will not result in the application of

 

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any of the consolidation, merger, conveyance, transfer or lease of assets
(however so denominated) provisions of the SVU Indenture, the SVU 2016 Notes or
any other Material Indebtedness, (c) to the extent applicable, the Borrower
shall apply the Net Cash Proceeds thereof in accordance with Section 2.13,
(d) the consideration paid in connection therewith shall be paid
contemporaneously with consummation thereof (other than consideration received
in connection with customary earn-out arrangements (calculated as of the date of
such Moran Sale as the present value of expected future payments in respect
thereof) in an amount not to exceed 25% of the aggregate consideration therefor)
and shall be in an amount not less than the fair market value of the property
disposed of and (e) the consideration paid in connection therewith shall be at
least 75% in cash or Cash Equivalents.

 

“Mortgage” shall mean any mortgage, deed of trust or leasehold mortgage
delivered pursuant to clause (a) of the definition of “Term Loan Priority
Collateral Requirements” encumbering any Real Estate Collateral Property, given
by the Loan Party owning or leasing such Real Estate Collateral Property in
favor of the Collateral Agent, substantially in the form of Exhibit H hereto or
such other form reasonably satisfactory to the Administrative Agent, together
with such schedules and including such provisions as shall be necessary to
conform such document to applicable Laws or as shall be customary under
applicable Laws.

 

“MSSF” shall mean Morgan Stanley Senior Funding, Inc. and its successors and
assigns.

 

“Multiemployer Plan” shall mean any employee benefit plan of the type described
in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding six plan
years, has made or been obligated to make contributions.

 

“NAI” shall mean New Albertson’s, Inc., an Ohio corporation.

 

“NAI Indenture” shall mean the Indenture, dated as of May 1, 1992, between NAI
and U.S. Bank National Association, as trustee, as successor trustee to Morgan
Guaranty Trust Company of New York, as supplemented by Supplemental Indenture
No. 1 dated as of May 7, 2004, Supplemental Indenture No. 2 dated as of June 1,
2006, and Supplemental Indenture No. 3 dated as of December 29, 2008, and as
further amended, supplemented or otherwise modified (including any such
modification contained in any notes, officer’s certificates or other operative
documents) as of the Closing Date.

 

“NAI Notes” shall have the meaning assigned to such term in the definition of
“NAI Sale”.

 

“NAI Sale” shall mean the purchase by Buyer of all of the issued and outstanding
shares of NAI from the Borrower (together with the subsequent transfer pursuant
to Section 1.5 of the Acquisition Agreement by the Borrower to NAI of (x) the
equity interests in US Satellite Corporation, Inc. and (y) the FCC-issued
licenses and permits set forth in Section 5.23 of the Seller Disclosure Letter
to the Acquisition Agreement as in effect on the date hereof, in each case as to
such equity interests and licenses and permits retained by the Borrower solely
for the purpose of obtaining necessary regulatory consents) in consideration of,
among other things, not less than $100,000,000 in cash and Cash Equivalents, as
adjusted in accordance with the

 

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Acquisition Agreement, Buyer shall acquire NAI subject to certain direct and
indirect liabilities, including those arising under the notes (including,
without limitation, NAI’s 7.25% Notes due 2013, 7.45% Debentures due 2029, 7.75%
Debentures due 2026, 8.70% Debentures due 2030, 8.00% Debentures due 2031 and
6.34-7.15% Medium Term Notes due 2013-2028) issued by NAI pursuant to the NAI
Indenture (the “NAI Notes”), and the notes (including, without limitation, ASC’s
7.90% Debentures due 2017, 8.00% Debentures due 2026, 7.50% Debentures due 2037
and 7.10% Medium Term Notes due 2028) issued by ASC under the ASC Indenture (the
“ASC Notes”), certain capital leases and all workers’ compensation claims (and
including any obligations to provide any form of security for the benefit of the
California Office of Self Insured Funds, the California Department of Industrial
Relations or the California Self-Insured Security Fund or similar entities)
relating to banners operated by NAI and its Subsidiaries (the “NAI Workers’
Compensation Liabilities”), and the Borrower and its Subsidiaries after giving
effect to the NAI Sale shall have their liability eliminated, limited or
indemnified in a manner reasonably satisfactory to the Joint Lead Arrangers in
connection with the NAI Workers’ Compensation Liabilities (and such obligations
to provide any form of security) and the ASC Notes. In connection with the NAI
Sale, the Buyer and the Borrower will enter into transition services agreements
and a cross-license agreement as contemplated by the Acquisition Agreement.

 

“NAI Workers’ Compensation Liabilities” shall have the meaning assigned to such
term in the definition of “NAI Sale”.

 

“Net Cash Proceeds” shall mean (a) with respect to any Term Loan Priority
Collateral Sale, Other Asset Sale or Moran Sale, the cash proceeds (including
cash proceeds subsequently received (as and when received) in respect of noncash
consideration initially received), net of (i) selling expenses (including
reasonable broker’s fees or commissions, legal fees, transfer and similar taxes
and the Borrower’s good faith estimate of income taxes paid or payable in
connection with such sale), (ii) amounts provided as a reserve, in accordance
with GAAP, against any liabilities under any indemnification obligations or
purchase price adjustment associated with such Term Loan Priority Collateral
Sale or Other Asset Sale (provided that, to the extent and at the time any such
amounts are released from such reserve, such amounts shall constitute Net Cash
Proceeds) and (iii) the principal amount, premium or penalty, if any, interest
and other amounts on any Indebtedness which is secured by the asset sold in such
Term Loan Priority Collateral Sale or Other Asset Sale by a Lien permitted
hereunder which, to the extent the Administrative Agent has a Lien on such
asset, is senior to the Administrative Agent’s Lien on such asset and which is
required to be repaid with such proceeds (excluding any such Indebtedness
assumed by the purchaser of such asset); and (b) with respect to any issuance or
incurrence of Indebtedness (other than Permitted Indebtedness) or Equity
Interests (other than Equity Interests issued to directors, officers or
employees of the Borrower or its Subsidiaries), the cash proceeds thereof, net
of all taxes and customary fees, commissions, costs and other expenses incurred
in connection therewith.

 

“New Valuation” shall mean any valuation of a Substitute Property, a Replaced
Property, a Released Property or an Additional Property conducted by E&Y or
another independent, third-party expert reasonably satisfactory to the
Administrative Agent provided in connection with the applicable Term Loan
Priority Collateral Substitution, Term Loan Priority Collateral Release or Term
Loan Priority Collateral Addition for which the New Valuation Conditions have
been met.

 

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“New Valuation Conditions” shall mean with respect to a Substitute Property, a
Replaced Property, a Released Property (other than in connection with a
Permitted Disposition) or an Additional Property consisting of Real Estate, such
property (i) has not been Valued during the year preceding the date of the
Restated Collateral List provided in connection with the applicable Term Loan
Priority Collateral Substitution, Term Loan Priority Collateral Release or Term
Loan Priority Addition and is Valued at more than $4,000,000 pursuant to the
most recent Valuation thereof or (ii) has not been Valued; provided that,
notwithstanding the foregoing, the New Valuation Conditions shall be deemed to
be satisfied at any time after the aggregate Value of all Substitute Properties
and Additional Properties that have been added to the Term Loan Priority
Collateral during the current Fiscal Year without being Valued at any time in
such Fiscal Year exceeds $10,000,000.

 

“Non-Extended Loans” shall have the meaning assigned to such term in
Section 2.23.

 

“NPL” shall mean the National Priorities List under CERCLA.

 

“Obligations” shall mean all obligations, liabilities and indebtedness of every
kind, nature and description owing by any Loan Party to any Secured Party,
including principal, interest, charges, fees, premiums, indemnities and
expenses, however evidenced, whether as principal, surety, endorser, guarantor
or otherwise, arising under any of the Loan Documents, whether now existing or
hereafter arising, whether arising before, during or after the initial or any
renewal term of the Loan Documents or after the commencement of any case with
respect to any Loan Party under the Bankruptcy Code or any other Debtor Relief
Law or any other insolvency proceeding (and including, without limitation, any
principal, interest, fees, costs, expenses and other amounts which would accrue
and become due but for the commencement of such case, whether or not such
amounts are allowed or allowable in whole or in part in such case or similar
proceeding), whether direct or indirect, absolute or contingent, joint or
several, due or not due, primary or secondary, liquidated or unliquidated,
secured or unsecured.

 

“Occurrence Update Schedule” shall mean each of Schedule 3.01 (Loan Parties
Organizational Information), 3.06 (Litigation), 3.09 (Environmental Matters),
3.10 (for primary casualty insurance policies that cover Collateral), 3.13
(Subsidiaries; Other Equity Investments), 3.17 (Intellectual Property Matters)
and 3.21(b) (Credit Card Agreements).

 

“OFAC” shall have the meaning assigned to such term in Section 3.31.

 

“Offer” shall have the meaning assigned to such term in the Tender Offer
Agreement.

 

“OID” shall have the meaning assigned to such term in Section 2.22(b).

 

“Organization Documents” shall mean, (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 operating agreement; (c) with respect to any
partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any 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

 

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organization and, if applicable, any certificate or articles of formation or
organization of such entity; and (d) in each case, all shareholder or other
equity holder agreements, voting trusts and similar arrangements to which such
Person is a party.

 

“Original Loans” shall have the meaning assigned to such term in Section 2.23.

 

“Other Asset Sale” shall mean a sale, transfer or other disposition (including
by way of merger, casualty, condemnation or otherwise) that is not a Permitted
Disposition pursuant to clauses (a) through (n) of the definition thereof or
clause (p) of the definition thereof, of any assets or property of the Borrower
and the Restricted Subsidiaries other than a Disposition consisting solely of
Term Loan Priority Collateral or Equity Interests of any Subsidiary to the
extent the assets of such Subsidiary consist solely of Term Loan Priority
Collateral.

 

“Other Loans” shall have the meaning assigned to such term in Section 2.22(a).

 

“Other Taxes” shall mean any and all present or future stamp or documentary
Taxes or any other excise or property Taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document.

 

“PACA” shall mean the Perishable Agricultural Commodities Act, 1930, as amended,
7 U.S.C. § 499a et. seq., as the same now exists or may hereafter from time to
time be amended, modified, recodified or supplemented, together with all
rules and regulations thereunder.

 

“Participation Fees” shall have the meaning assigned to such term in
Section 2.05.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.

 

“PBGC Agreement” shall mean that certain term sheet by and among AB Acquisition
LLC, the Borrower and the PBGC, dated January 9, 2013, and any subsequent
agreement entered into pursuant thereto.

 

“PCAOB” shall mean the Public Company Accounting Oversight Board.

 

“Pension Expense” shall mean the actual pension expense for the applicable
period of the Borrower and the Restricted Subsidiaries pursuant to the profit
and loss statement charge (or benefit) with respect to such pension funding
obligations for such period.

 

“Pension Plan” shall mean any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or
has an obligation to contribute, or in the case of a multiple employer or other
plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding six plan years.

 

“Perfection Certificate” shall mean the Perfection Certificate substantially in
the form of Exhibit E hereto.

 

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“Periodic Update Schedule” shall mean each of Schedule 3.13 (as to Immaterial
Subsidiaries and Unrestricted Subsidiaries), 3.08(b) (Owned Real Estate),
3.08(c) (Leased Real Estate), 3.10 (for policies other than primary casualty
policies that cover Collateral) and 3.21(a) (Demand Deposit Accounts).

 

“Permitted Acquisition” shall mean an Acquisition permitted pursuant to
Section 6.02(b).

 

“Permitted Disposition” shall mean any of the following:

 

(a)  Dispositions of Inventory in the ordinary course of business (which for
this purpose does not include any Disposition in connection with a Store closing
or sale of a Store location);

 

(b)  bulk sales of the Inventory of a Loan Party not in the ordinary course of
business in connection with Store closings or the conversions of a Store to a
licensee operated store or a joint venture, at arm’s length, provided that the
number of such Store closings and conversions and related sales of Inventory,
minus the number of new Store locations opened during the same period, shall not
exceed in any Fiscal Year of the Borrower and its Subsidiaries, seven and
one-half percent (7.5%) of the number of the Loan Parties’ Stores as of the
beginning of such Fiscal Year and shall not exceed, in the aggregate from and
after the Closing Date, fifteen percent (15.0%) of the number of the Loan
Parties’ Stores in existence as of the Closing Date);

 

(c)  non-exclusive licenses or sublicenses of Intellectual Property of a Loan
Party or any of its Subsidiaries in the ordinary course of business;

 

(d)  licenses for the conduct of licensed departments within the Loan Parties’
Stores in the ordinary course of business;

 

(e)  Dispositions in the ordinary course of business of Equipment that (i) is
substantially worn, damaged or obsolete and the Disposition of which does not
detract from the value of the Related Real Estate Collateral in any material
respect or (ii) is replaced with similar property having at least equivalent
value;

 

(f)  Dispositions among the Loan Parties or by any Restricted Subsidiary to a
Loan Party; provided, that with respect to any such Disposition of Real Estate
Collateral Property (a) the Borrower provides at least 15 Business Days prior
written notice thereof (or such shorter notice as the Administrative Agent may
approve) identifying such Real Estate Collateral Property, (b) such Real Estate
Collateral Property is Disposed of subject in all respects to the Mortgage
thereon and such Mortgage remains a valid first priority lien on such Real
Estate Collateral Property so Disposed of and (c) the Borrower shall have
delivered to the Administrative Agent such documents and other information
evidencing that such Real Estate Collateral Property was so Disposed of subject
to the Mortgage thereon as the Administrative Agent may reasonably request;

 

(g)  Dispositions by an Excluded Subsidiary to an Excluded Subsidiary or to a
Loan Party;

 

(h)  (i) Dispositions of interests in Real Estate that constitute or create
Permitted Encumbrances pursuant to clauses (f), (g) and (h) of the definition
thereof (but only to the extent

 

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thereof); (ii) Dispositions in the ordinary course of business of fixtures that
(A) are substantially worn, damaged or obsolete and the Disposition of which
does not detract from the value of the Real Estate Collateral Properties in any
material respect or (B) are replaced with similar property having at least
equivalent value; (iii) with respect to Real Estate that does not constitute
Term Loan Priority Collateral, sale and leaseback transactions pursuant to
leases on market terms, so long as, as of the date of such sale and after giving
effect thereto, (x) no Default or Event of Default shall exist or have occurred
and be continuing and (y) the consideration paid to such Loan Party in
connection therewith shall be paid contemporaneously with the transaction (other
than consideration received in connection with customary earn-out arrangements
in an amount (calculated as of the date of such Disposition as the present value
of expected future payments in respect thereof) not to exceed 25% of the
aggregate consideration therefor) and shall be in an amount not less than the
fair market value of the property disposed of and shall be at least 75% in cash
or Cash Equivalents; and (iv) assignments of leases, subleases, licenses, and
sublicenses, that do not constitute Term Loan Priority Collateral and that, in
the reasonable, good faith judgment of a Loan Party, are no longer useful or
necessary in its business or that of any Subsidiary;

 

(i)  Dispositions by any Loan Party constituting a Customer Support Transaction;
provided, that the aggregate exposure of the Loan Parties under or pursuant to
all of such Customer Support Transactions, when combined with the aggregate
exposure of the Loan Parties under or pursuant to Investments made pursuant to
clause (n) of the definition of “Permitted Investments” and Indebtedness
incurred pursuant to clause (j) of the definition of “Permitted Indebtedness”,
shall not exceed $250,000,000 at any time outstanding; provided, further, that,
as to any such Disposition, each of the following conditions is satisfied:

 

(i) as of the date of any such Disposition, and in each case after giving effect
thereto, no Default or Event of Default shall have occurred and be continuing;

 

(ii) the Person receiving the property subject to such Disposition shall be
engaged in a business related, ancillary or complementary to the business of the
Borrower permitted by this Agreement; and

 

(iii) the Administrative Agent shall have received a Customer Support
Transaction Report once each month;

 

(j)  Dispositions by any Loan Party of Intellectual Property; provided that,
(i) such Intellectual Property is no longer used or useful in the business of
any Loan Party or Restricted Subsidiary, (ii) such Intellectual Property is not
otherwise material to the business of any Loan Party or any of its Affiliates or
Subsidiaries, (iii) such Intellectual Property does not have material value and
(iv) no Default or Event of Default shall have occurred and be continuing as of
the date of such Disposition;

 

(k)  sales of Prescription Files in the ordinary course of business, other than
in connection with the sale of a Store location where such Prescription Files
are maintained or in connection with the sale of other assets (and in such case,
clause (o) of this definition shall be applicable), (i) in connection with the
sale of one or more Stores or (ii) in the ordinary course of business; provided,
that as to any such sale pursuant to this clause (ii), each of the following
conditions is

 

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satisfied: (A) the appraised value (as determined pursuant to the ABL Credit
Agreement) of all Prescription Files disposed of pursuant to this clause (ii) in
any one Fiscal Year shall not exceed $12,500,000 and (B) as of the date of any
such sale and after giving effect thereto, no Default or Event of Default shall
have occurred and be continuing;

 

(l)  the NAI Sale;

 

(m)  the issuance and sale by any Loan Party or Restricted Subsidiary of Equity
Interests of such Loan Party or Restricted Subsidiary after the date hereof;
provided that (i) such Loan Party or Restricted Subsidiary shall not be required
to pay any cash dividends or repurchase or redeem such Equity Interests or make
any other payments in respect thereof, except as otherwise permitted in
Section 6.06, (ii) as of the date of such issuance and sale and after giving
effect thereto, no Default or Event of Default shall have occurred and be
continuing and (iii) no wholly-owned Restricted Subsidiary that is a Loan Party
shall issue and sell Equity Interests to any Person other than another Loan
Party;

 

(n)  Dispositions pursuant to a Permitted Store Swap Transaction or consisting
of transfers described in clause (s) of the definition of Permitted
Encumbrances;

 

(o)  sales or other Dispositions (including, for the avoidance of doubt,
Dispositions of Intellectual Property, but excluding any Moran Sale) of assets
of Loan Parties not otherwise subject to the provisions set forth in this
definition, provided that, as to any such sale or other Disposition, each of the
following conditions is satisfied:

 

(i) the consideration paid in connection therewith shall be paid
contemporaneously with consummation of the transaction (other than consideration
received in connection with customary earn-out arrangements in an amount
(calculated as of the date of such Disposition as the present value of expected
future payments in respect thereof) not to exceed 25% of the aggregate
consideration therefor), shall be in an amount not less than the fair market
value of the property disposed of and shall be at least 75% in cash or Cash
Equivalents;

 

(ii) if such sale or Disposition is a sale and leaseback transaction, such
transaction is permitted under clause (h)(iii) above;

 

(iii) such sale or Disposition does not involve the sale or other disposition of
a minority Equity Interest in any Restricted Subsidiary or Accounts of any Loan
Party;

 

(iv) in the case of any (A) Term Loan Priority Collateral Sale or (B) Other
Asset Sale (whether a single transaction or a series of related transactions)
including Term Loan Priority Collateral for which the Net Cash Proceeds (before
deducting the Value of any Term Loan Priority Collateral included therein)
exceed $5,000,000, (x) the ratio of the aggregate Value of the Term Loan
Priority Collateral (giving pro forma effect to any permitted reinvestment of
proceeds) to the amount of outstanding Obligations on a pro forma basis after
giving effect to such Term Loan Priority Collateral Sale or Other Asset Sale and
any related prepayments of the Loans (using such Net Cash Proceeds that the
Borrower has elected not to exercise its right of reinvestment pursuant to
Section 2.13(a) or (b) with respect thereto) shall not be less than the ratio of
the aggregate Value of the

 

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Term Loan Priority Collateral to the amount of outstanding Obligations prior to
giving effect to such Term Loan Priority Collateral Sale or Other Asset Sale and
(y) in the case of a Term Loan Priority Collateral Sale or Other Asset Sale with
respect to which the Borrower has elected to exercise its right of reinvestment
pursuant to Section 2.13(a) or (b), (i) the Related Real Estate Collateral on a
pro forma basis after giving effect to such Term Loan Priority Collateral Sale
or Other Asset Sale and such reinvestment shall not constitute more than 45% of
the aggregate Value of the Real Estate Collateral Properties and the Related
Real Estate Collateral and (ii) the owned Real Estate Collateral Properties on a
pro forma basis after giving effect to such Term Loan Priority Collateral Sale
or Other Asset Sale and such reinvestment shall constitute at least 50% of the
aggregate Value of the Real Estate Collateral Properties and the Related Real
Estate Collateral; and

 

(v) as of the date of any such sale or Disposition, and in each case after
giving effect thereto, no Default or Event of Default shall have occurred and be
continuing; and

 

(p)  any Moran Sale.

 

“Permitted Encumbrances” shall mean:

 

(a)  Liens imposed by law for Taxes that are not yet delinquent (or remain
payable without penalty) or are being contested in compliance with Section 5.04;
provided that adequate reserves with respect thereto are maintained on the books
of the relevant Loan Party, to the extent required by GAAP;

 

(b)  carriers’, warehousemen’s, mechanics’, materialmen’s, landlords’,
repairmen’s and other like Liens imposed by applicable Law, arising in the
ordinary course of business and securing obligations that are not delinquent (or
remain payable without penalty) or are being contested in compliance with
Section 5.04 (other than clause (iv) thereof);

 

(c)  pledges and deposits of cash made in the ordinary course of business in
compliance with workers’ compensation, unemployment insurance and other social
security laws or regulations, other than any Lien imposed by ERISA;

 

(d)  deposits of cash to secure the performance of bids, trade contracts,
government contracts, leases (other than Indebtedness), statutory obligations,
surety and appeal bonds, performance bonds and to secure liability to insurance
carriers, and other obligations of a like nature incurred in the ordinary course
of business;

 

(e)  Liens in respect of judgments that would not constitute an Event of Default
hereunder;

 

(f)  (i) easements, covenants, conditions, restrictions, building code laws,
zoning restrictions, rights-of-way and similar encumbrances on real property
imposed by law or arising in the ordinary course of business and such other
minor title defects or survey matters that are disclosed by current surveys (or
would have been disclosed by current surveys if the same were not obtained);
provided, that in each case, the same does not (A) secure any monetary
obligation that is not Permitted Indebtedness, (B) materially detract from the
value of the affected Real

 

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Estate Collateral Property, (C) materially detract from the value of the
affected property as a going concern in connection with such Loan Party’s
business or (D) materially interfere with the ordinary conduct of business of
any Loan Party; and (ii) Liens and encumbrances against or upon any property as
shown on or pursuant to the express terms of a document shown on (A) Schedule
B-I or B-II of the Title Insurance Policies insuring the Mortgages, or
(B) surveys of the Real Estate Collateral Properties to the extent such surveys
were provided to the Collateral Agent pursuant to the Term Loan Priority
Collateral Requirements;

 

(g)  interests or title of lessors, sublessors, licensors or sublicensors under
any lease or license otherwise permitted pursuant to this Agreement;

 

(h)  Leases, subleases, licenses, sublicenses and similar encumbrances on Real
Estate, Intellectual Property and other property, or interests therein, arising
in the ordinary course of business (or in connection with a Store closure
permitted under this Agreement) for fair market value; provided that, in each
case, if such Real Estate, Intellectual Property or other property is owned by a
Loan Party, such lease, sublease, license, sublicense, or similar encumbrance
does not secure any monetary obligation that is not Permitted Indebtedness, and
does not materially detract from the value of the affected property operated by
a Loan Party as a going concern in connection with such Loan Party’s business or
materially interfere with the ordinary conduct of business of any Loan Party or
any Store closures otherwise permitted under this Agreement; provided, further,
that to the extent affected Real Estate constitutes Real Estate Collateral
Property, such leases, subleases, licenses, sublicenses, and similar
encumbrances do not also materially detract from the value of such Real Estate
Collateral Property;

 

(i)  Liens existing on the date hereof and listed on Schedule 6.01 and any
renewals or extensions thereof; provided that (i) the property covered thereby
is not changed, (ii) the amount secured or benefited thereby is not increased,
(iii) the direct or any contingent obligor with respect thereto is not changed
and (iv) any renewal or extension of the obligations secured or benefited
thereby is otherwise permitted hereunder;

 

(j)  Liens on fixed or capital assets acquired or constructed by any Loan Party
which secure Indebtedness permitted under clauses (c) or (f) of the definition
of “Permitted Indebtedness” so long as (i) such Liens and the Indebtedness
secured thereby are incurred prior to or within 180 days after such acquisition,
improvement or construction, (ii) the principal amount of the Indebtedness
secured thereby does not exceed the cost of acquisition and construction of such
fixed or capital assets (including any shipping and installation costs) and
(iii) such Liens shall not extend to any other property or assets of the Loan
Parties other than proceeds of such secured property or assets;

 

(k)  Liens in favor of the Administrative Agent;

 

(l)  Liens of landlords if the leases are not in default in respect of rent,
except where a Collateral Access Agreement and Landlord Waiver is required by
Section 5.17;

 

(m)  possessory Liens in favor of brokers and dealers arising in connection with
the acquisition or disposition of Permitted Investments; provided that such
Liens (i) attach only to such Permitted Investments and (ii) secure only
obligations incurred in the ordinary course and

 

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arising in connection with the acquisition or disposition of such Permitted
Investments and not any obligation in connection with margin financing;

 

(n)  banker’s Liens, Liens in favor of securities intermediaries, rights of
setoff or similar rights and remedies as to deposit accounts or securities
accounts or other funds maintained with depository institutions or securities
intermediaries in the ordinary course of business of the maintenance and
operation of such accounts;

 

(o)  Liens arising from precautionary UCC filings regarding “true” operating
leases or, to the extent permitted under the Loan Documents, the consignment of
goods to a Loan Party;

 

(p)  Liens on property (other than ABL Priority Collateral) in existence at the
time such property is acquired pursuant to a Permitted Acquisition or on such
property of a Subsidiary of a Loan Party in existence at the time such
Subsidiary is acquired pursuant to a Permitted Acquisition; provided that such
Liens are not incurred in connection with or in anticipation of such Permitted
Acquisition and do not attach to any other assets of any Loan Party or any
Subsidiary;

 

(q)  Liens or rights of setoff against credit balances of the Borrower with
Credit Card Issuers or Credit Card Processors or amounts owing by such Credit
Card Issuers or Credit Card Processors to the Borrower in the ordinary course of
business, but not Liens on or rights of setoff against any other property or
assets of the Borrower pursuant to the Credit Card Agreements to secure the
obligations of the Borrower to such Credit Card Issuers or Credit Card
Processors as a result of fees and chargebacks;

 

(r)  Liens on inventory in favor of customs and revenues authorities imposed by
applicable Law arising in the ordinary course of business in connection with the
importation of goods and securing obligations not secured by deposits permitted
pursuant to clause (d) of this definition, (i) that are being contested in good
faith by appropriate proceedings, (ii) as to which the applicable Loan Party or
Subsidiary has set aside on its books adequate reserves with respect thereto in
accordance with GAAP and (iii) which contest effectively suspends collection of
the contested obligation and enforcement of any Lien securing such obligation;

 

(s)  transfers of any receivables not included in the Borrowing Base (as defined
in the ABL Credit Agreement) to secure any receivables financing that
constitutes Permitted Indebtedness under clause (k) of the definition thereof;

 

(t)  Liens in favor of the ABL Facility Agent in and on the ABL Priority
Collateral to secure the ABL Facility and in and on the Term Loan Priority
Collateral to secure the ABL Debt; provided that such Liens are at all times
subject to the terms of the Intercreditor Agreement;

 

(u)  Leases and licenses constituting Permitted Dispositions; and

 

(v)  other Liens on assets (other than Term Loan Priority Collateral) to secure
obligations permitted hereunder that do not exceed $30,000,000 at any time
outstanding.

 

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“Permitted Indebtedness” shall mean each of the following, so long as no Default
or Event of Default exists or would arise from the incurrence thereof:

 

(a)  Indebtedness outstanding on the date hereof and listed on Schedule 6.03
hereto and any Permitted Refinancing Indebtedness with respect thereto;

 

(b)  (i) unsecured Indebtedness of any Loan Party to any other Loan Party or
(ii) unsecured Indebtedness of any Loan Party or a Restricted Subsidiary to any
Restricted Subsidiary that is not a Loan Party arising in the ordinary course of
their respective businesses or conducted on the date hereof pursuant to the cash
concentration and disbursement practices of the Lead Borrower and its
Subsidiaries, provided, that, as to such Indebtedness or other obligations of a
Loan Party to a Restricted Subsidiary that it not a Loan Party, (A) will be
subordinated in right of payment to the payment in full of the Obligations on
terms and conditions reasonably satisfactory to Administrative Agent pursuant to
a subordination agreement to be delivered to Administrative Agent within 30 days
after the Closing Date (or such longer period of time as the Administrative
Agent may agree), (B) repayments of such Indebtedness or other obligations shall
be permitted in the ordinary course of their businesses consistent with and
pursuant to the cash concentration and disbursement practices of the Borrower
and its Subsidiaries as conducted on the date hereof, so long as no Specified
Event of Default exists or has occurred and (C) Borrower shall cause any
Restricted Subsidiary that is not a Loan Party not to exercise any legal
remedies to enforce any of the Indebtedness or other obligations owed to it;

 

(c)  without duplication of Indebtedness described in clause (f) of this
definition, purchase money Indebtedness of any Loan Party incurred after the
Closing Date to finance the acquisition of any fixed or capital assets,
including Capital Lease Obligations and Synthetic Lease Obligations, and any
Indebtedness assumed in connection with the acquisition of any such assets or
secured by a Lien on any such assets prior to the acquisition thereof, any
earn-out obligations that constitute Indebtedness incurred in a transaction
permitted hereunder and any Permitted Refinancing Indebtedness with respect
thereto; provided, that the aggregate principal amount of Indebtedness permitted
by this clause (c), when combined with the aggregate principal amount of all
Indebtedness incurred pursuant to clause (f) of this definition, shall not
exceed $300,000,000 at any time outstanding and in any event the incurrence of
such Indebtedness permitted by this clause (c), when combined with the aggregate
principal amount of all Indebtedness incurred pursuant to clause (f) of this
definition, in any Fiscal Year (commencing with the Fiscal Year in which the
Closing Date occurs) shall not exceed $100,000,000;

 

(d)  obligations (contingent or otherwise) of any Loan Party or any Subsidiary
thereof existing or arising under any Swap Contract, provided that (i) such
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with
fluctuations in interest rates or foreign exchange rates or commodity prices,
and not for purposes of speculation or taking a “market view” and (ii) the
aggregate Swap Termination Value of all such Swap Contracts, excluding Swap
Contracts entered into to mitigate risks associated with interest on the Loans,
shall not exceed $25,000,000 at any time outstanding;

 

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(e)  contingent liabilities under surety bonds or similar instruments incurred
in the ordinary course of business;

 

(f)  Indebtedness incurred after the Closing Date for the construction or
acquisition or improvement of, or to finance or to refinance the construction,
acquisition or improvement of, any Real Estate owned by any Loan Party
(including therein any Indebtedness incurred in connection with sale and
leaseback transactions permitted hereunder), provided, that the aggregate
principal amount of Indebtedness permitted by this clause (f), when combined
with the aggregate principal amount of all Indebtedness incurred pursuant to
clause (c) of this definition, shall not exceed $300,000,000 at any time
outstanding and in any event the incurrence of such Indebtedness permitted by
this clause (f), when combined with the aggregate principal amount of all
Indebtedness incurred pursuant to clause (c) of this definition, in any Fiscal
Year (commencing with the Fiscal Year in which the Closing Date occurs) shall
not exceed $100,000,000;

 

(g)  Indebtedness of any Person that becomes a Subsidiary of a Loan Party in a
Permitted Acquisition, which Indebtedness is existing at the time such Person
becomes a Subsidiary of a Loan Party (other than Indebtedness incurred in
contemplation of such Permitted Acquisition);

 

(h)  the Obligations;

 

(i)  Indebtedness under the ABL Facility in an aggregate outstanding principal
amount not to exceed $1,250,000,000 and any Permitted Refinancing Indebtedness
with respect thereto;

 

(j)  Indebtedness of any Loan Party pursuant to Customer Support Transactions;
provided, that as of the date of incurring such Indebtedness and after giving
effect thereto, (i) the aggregate amount of the exposure of the Loan Parties
under or pursuant to all Customer Support Transactions (including, without
duplication, Customer Support Transactions constituting Permitted Indebtedness,
Permitted Investments and Permitted Dispositions) shall not exceed $250,000,000,
(ii) the aggregate amount of the exposure under any one of the types of
transactions described in clauses (a), (b), (c) or (e) of the definition of
“Customer Support Transactions” shall not exceed $150,000,000 at any time
outstanding and (iii) no Default or Event of Default shall exist or have
occurred and be continuing;

 

(k)  Obligations under, or the net investments outstanding pursuant to, a
receivables financing involving transfers described in clause (s) of the
definition of Permitted Encumbrances, in an amount not to exceed $200,000,000;

 

(l)  Indebtedness of the Borrower and the Restricted Subsidiaries for customary
indemnification, purchase price adjustments or similar obligations (other than
earn-outs and similar obligations) in each case in respect of the purchase price
or other similar adjustments incurred in connection with a Permitted Acquisition
or Permitted Disposition;

 

(m)  Indebtedness of a Loan Party as an account party in respect of letters of
credit issued pursuant to a Commercial LC Facility (as defined in the ABL Credit
Agreement), provided, in no event shall the aggregate amount of all such
Indebtedness in respect of all Commercial LC Facilities exceed $15,000,000 at
any time outstanding;

 

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(n)  other Indebtedness of the Borrower or the Restricted Subsidiaries (in the
case of Indebtedness of the Restricted Subsidiaries, in an aggregate principal
amount not to exceed $150,000,000 at any time outstanding) and Permitted
Refinancing Indebtedness in respect thereof, provided, that with respect to such
Indebtedness or Permitted Refinancing Indebtedness, (i) as of the incurrence of
such Indebtedness (A) both before and after giving effect thereto, no Default or
Event of Default shall have occurred and be continuing and (B) the Total
Leverage Ratio of the Borrower shall not exceed 4.00:1.00 on a pro forma basis
after giving effect to such incurrence of Indebtedness and the use of proceeds
thereof, (ii) such Indebtedness shall have a maturity date that is at least 91
days after the Latest Maturity Date, (iii) the terms and provisions of such
Indebtedness (including any guarantees thereof) shall be, taken as a whole, not
materially more favorable to the lenders than those contained in the Loan
Documents, (iv) such Indebtedness does not provide for any early maturity
(excluding any maturity as the result of an optional redemption by the issuer
thereof or an event of default), is not mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, is not redeemable at the option of the
holder thereof (other than pursuant to customary asset sale and change of
control provisions that permit payment of the Obligations prior to the payment
of such Indebtedness), in whole or in part, and does not require the payment of
any cash dividend or any other scheduled amortization payments in excess of
1.00% of the principal amount thereof in any Fiscal Year constituting a return
of capital, (v) if such Indebtedness is subordinated to any other Indebtedness
of any Loan Party or its Subsidiaries it will be subordinated in right of
payment to the Obligations on terms and conditions no less favorable to the
Administrative Agent and the Lenders than any other holder of senior debt (and
if such Indebtedness is owed to a seller of assets to the Borrower or any other
Loan Party, then it shall be required to be subordinated in right of payment and
shall be subordinated on terms and conditions reasonably satisfactory to the
Administrative Agent) and (vi) the Administrative Agent shall have received 10
Business Days prior written notice of the incurrence of such Indebtedness and
the transactions contemplated thereby and prior to the incurrence thereof shall
have received such information with respect thereto and with respect to such
related transactions as the Administrative Agent shall have reasonably
requested; and

 

(o)  other Indebtedness of the Borrower and the Restricted Subsidiaries in an
aggregate principal amount for all such Persons not to exceed $30,000,000 at any
time outstanding.

 

“Permitted Investments” shall mean each of the following, so long as no Default
or Event of Default exists or would arise from the making of such Investment:

 

(a)  readily marketable obligations issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality thereof
having maturities of not more than 360 days from the date of acquisition
thereof; provided that the full faith and credit of the United States is pledged
in support thereof;

 

(b)  commercial paper issued by any Person organized under the laws of any state
of the United States and rated at least “Prime-1” (or the then equivalent grade)
by Moody’s or at least “A-1” (or the then equivalent grade) by S&P, in each case
with maturities of not more than 180 days from the date of acquisition thereof;

 

(c)  time deposits with, or insured certificates of deposit or bankers’
acceptances of, any commercial bank that (i) is a Lender or is organized under
the laws of the United States, any

 

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state thereof or the District of Columbia or is the principal banking subsidiary
of a bank holding company organized under the laws of the United States, any
state thereof or the District of Columbia, and is a member of the Federal
Reserve System, (ii) issues (or the parent of which issues) commercial paper
rated as described in clause (b) of this definition and (iii) has combined
capital and surplus of at least $1,000,000,000, in each case with maturities of
not more than 180 days from the date of acquisition thereof;

 

(d)  fully collateralized repurchase agreements with a term of not more than 30
days for securities described in clause (a) of this definition (without regard
to the limitation on maturity contained in such clause) and entered into with a
financial institution satisfying the criteria described in clause (c) of this
definition or with any primary dealer and having a market value at the time that
such repurchase agreement is entered into of not less than 100% of the
repurchase obligation of such counterparty entity with whom such repurchase
agreement has been entered into;

 

(e)  Investments, classified in accordance with GAAP as current assets of the
Loan Parties, in any money market fund, mutual fund or other investment
companies that are registered under the Investment Company Act of 1940, as
amended, which are administered by financial institutions that have the highest
rating obtainable from either Moody’s or S&P, and which invest solely in one or
more of the types of securities described in clauses (a) through (d) of this
definition;

 

(f)  Investments described on Schedule 6.02 (and in the case of Investments
covered by the investment policy of Borrower included in Schedule
6.02, Investments of such type), but not any additional payments to increase the
amount thereof or other modification of the terms thereof that increases the
obligations or liabilities of any Loan Party, except to increase the scheduled
Investments or for other modifications of the terms thereof that increase the
obligations or liabilities of any Loan Party if such increases in the aggregate
do not exceed $10,000,000 in any Fiscal Year; provided, that with respect to
other similar short-term investments entered into at the good faith discretion
of the Borrower’s Chief Financial Officer or Treasurer as a means of managing
the Borrower’s cash in the ordinary course of business and in accordance with
the investment policy attached hereto as Schedule 6.02, in each case, such
investments have been specifically identified in writing to the Administrative
Agent and approved by it in its reasonable discretion;

 

(g)  (i) Investments by any Loan Party and its Restricted Subsidiaries in their
respective Restricted Subsidiaries outstanding on the date hereof,
(ii) additional Investments by any Loan Party or Restricted Subsidiary in Loan
Parties (other than the Borrower), (iii) additional Investments by any
Restricted Subsidiary that is not a Loan Party in other Subsidiaries that are
not Loan Parties, (iv) additional investments consisting of loans or advances
made by an Insurance Captive to the Borrower or any Subsidiary, or the purchase
of any real or personal property from the Borrower or any Subsidiary and
(v) additional Investments by any Loan Party in Subsidiaries that are not Loan
Parties (determined without regard to any write-downs or write-offs of such
Instruments) provided that, in the case of clause (v) as of the date of such
Investment and after giving effect thereto, either (A) such Investment gave rise
to Indebtedness of such Subsidiary to the Loan Parties of the type described in
clause(b)(ii) of the definition of Permitted Indebtedness, or (B) such
Investments, excluding those described in subclause (A), in the

 

41

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aggregate do not to exceed $25,000,000 at any time outstanding; and provided
further that in the case of clauses (i) and (ii), to the extent any Investment
consists of Real Estate Collateral Property, (a) the Borrower provides at least
15 Business Days prior written notice thereof to the Administrative Agent (or
such shorter notice as the Administrative Agent may approve) identifying such
Real Estate Collateral Property, (b) such Real Estate Collateral Property is
invested subject in all respects to the Mortgage thereon and such Mortgage
remains a valid first priority lien on such Real Estate Collateral Property so
invested and (c) the Borrower shall have delivered to the Administrative Agent
such documents and other information evidencing that such Real Estate Collateral
Property was invested subject to the Mortgage thereon as the Administrative
Agent may reasonably request;

 

(h)  Investments consisting of extensions of credit in the nature of accounts
receivable or notes receivable arising from the grant of trade credit in the
ordinary course of business and Investments received in satisfaction or partial
satisfaction thereof from financially troubled account debtors to the extent
reasonably necessary in order to prevent or limit loss;

 

(i)  Guarantees constituting Permitted Indebtedness;

 

(j)  Investments by any Loan Party in Swap Contracts entered into in the
ordinary course of business and for bona fide business (and not speculative)
purposes to protect against fluctuations in interest rates in respect of the
Obligations or other Permitted Indebtedness or fluctuations in commodity prices;

 

(k)  Investments received in connection with the bankruptcy or reorganization
of, or settlement of delinquent accounts and disputes with, customers and
suppliers, in each case in the ordinary course of business;

 

(l)  advances to officers, directors and employees of the Loan Parties and their
Subsidiaries in the ordinary course of business in an amount not to exceed
$1,000,000 to any individual at any time or in an aggregate amount not to exceed
$2,000,000 at any time outstanding, for travel, entertainment, relocation and
analogous ordinary business purposes;

 

(m)  Investments constituting a Permitted Store Swap Transaction;

 

(n)  Investments under or pursuant to Customer Support Transactions; provided,
that (i) as of the date of any such Investment and after giving effect thereto,
the aggregate amount of the exposure of the Loan Parties under or pursuant to
all Customer Support Transactions (including, without duplication, Customer
Support Transactions constituting Permitted Indebtedness, Permitted Investments
and Permitted Dispositions) shall not exceed $250,000,000, (ii) the aggregate
amount of the exposure of the Loan Parties under any one of the types of
transactions described in clauses (a), (b), (c) or (e) of the definition of
“Customer Support Transactions” shall not exceed $150,000,000, (iii) as of the
date of such transaction and after giving effect thereto, no Default or Event of
Default shall exist or have occurred and be continuing, (iv) the Administrative
Agent shall have received (A) with respect to any such loan in an amount equal
to or greater than $5,000,000, not less than two Business Days’ prior written
notice thereof setting forth in reasonable detail the nature and terms thereof,
(B) true, correct and complete copies of all agreements, documents and
instruments relating thereto and (C) such

 

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other information with respect thereto as the Administrative Agent may request,
including a report once each month on the outstanding balance of all such
Permitted Investments and including the then outstanding amount of the existing
loans and advances by Loan Parties and Restricted Subsidiaries to third parties
pursuant to this clause (n);

 

(o)  additional investments, loans and advances by the Borrower and the
Restricted Subsidiaries so long as the aggregate amount invested, loaned or
advanced pursuant to this clause (o) (determined without regard to any
write-downs or write-offs of such investments, loans and advances) does not
exceed an amount equal to the sum of (x) $60,000,000 plus (y) the Cumulative
Credit Amount; provided that, at the time of such investment, loan or advance
(i) both before and after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing, (ii) in the case of the foregoing
clause (y), the Total Leverage Ratio of the Borrower shall not exceed 3.75:1:00
on a pro forma basis after giving effect to such payment and (iii) the Borrower
shall have delivered a certificate of a Responsible Officer, certifying as to
the satisfaction of the foregoing clauses (i) and (ii), in form and substance
satisfactory to the Administrative Agent; and

 

(p)  additional investments made with the Net Cash Proceeds of a Moran Sale that
are not required to be applied to prepay Loans hereunder pursuant to
Section 2.13 or to prepay loans or cash collateralize letters of credit under
the ABL Facility and reinvestments of the Net Cash Proceeds of a Term Loan
Priority Collateral Sale or Other Asset Sale permitted pursuant to, and in
compliance with, Section 2.13.

 

“Permitted Refinancing Indebtedness” shall mean Indebtedness of any Loan Party
arising after the Closing Date issued in exchange for, or the proceeds of which
are used to extend, refinance, replace or substitute for other Indebtedness
(such extended, refinanced, replaced or substituted Indebtedness, the
“Refinanced Obligations”) to the extent permitted hereunder; provided that:

 

(a)  the Administrative Agent shall have received not less than 10 Business
Days’ prior written notice of the intention to incur such Indebtedness, which
notice shall set forth in reasonable detail satisfactory to the Administrative
Agent the amount of such Indebtedness, the schedule of repayments and maturity
date with respect thereto and such other information with respect thereto as the
Administrative Agent may reasonably request;

 

(b)  promptly upon the Administrative Agent’s request, the Administrative Agent
shall have received true, correct and complete copies of all agreements,
documents and instruments evidencing or otherwise related to such Indebtedness,
as executed and delivered by the parties thereto;

 

(c)  the principal amount of such Permitted Refinancing Indebtedness shall not
exceed the principal amount of the Refinanced Obligations (plus the amount of
reasonable refinancing fees and expenses incurred in connection therewith);

 

(d)  such Indebtedness shall have a final maturity that is no earlier than
(i) in the case of Refinanced Obligations that constitute Material Indebtedness,
91 days after the Latest Maturity

 

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Date, and (ii) in the case of all other Refinanced Obligations, 364 days after
the final maturity date of such Refinanced Obligations or, if earlier, 91 days
after the Latest Maturity Date;

 

(e)  such Indebtedness shall have a Weighted Average Life to Maturity not less
than the shorter of the Weighted Average Life to Maturity of (i) the Refinanced
Obligations or (ii) the outstanding Loans;

 

(f)  such Indebtedness shall rank in right of payment no more senior than, and
be subordinated (if subordinated) to the Obligations on terms no less favorable
to the Secured Parties than, the Refinanced Obligations;

 

(g)  as of the date of incurring such Indebtedness and after giving effect
thereto, no Default or Event of Default shall have occurred and be continuing;

 

(h)  if the Refinanced Obligations or any Guarantees thereof are unsecured, such
Indebtedness and any Guarantees thereof shall be unsecured;

 

(i)  if the Refinanced Obligations or any Guarantees thereof are secured, such
Indebtedness and any Guarantees thereof shall be secured in all material
respects by substantially the same or less collateral as secured such Refinanced
Obligations or any Guarantees thereof, on terms no less favorable to the
Administrative Agent or the Lenders;

 

(j)  if the Refinanced Obligations or any Guarantees thereof are secured, the
Liens to secure such Indebtedness shall not have a priority more senior than the
Liens securing such Refinanced Obligations and, if subordinated to any other
Liens on such property, shall be subordinated to the Administrative Agent’s
Liens on terms and conditions no less favorable;

 

(k)  if the Refinanced Obligations or any Guarantees thereof are subordinated to
any Indebtedness of the Borrower, such Refinancing Indebtedness and any
Guarantees thereof shall be subordinated to the Obligations on terms (including
intercreditor terms) no less favorable to the Administrative Agent or the
Lenders;

 

(l)  the obligors in respect of the Refinanced Obligations immediately prior to
such refinancing, refunding, extending, renewing or replacing thereof shall be
the only obligors on such Permitted Refinancing Indebtedness; and

 

(m)  the terms and conditions (excluding as to pricing, premiums and optional
prepayment or redemption provisions) of any such Indebtedness, taken as a whole,
are not more restrictive with respect to the Borrower and the Restricted
Subsidiaries, as reasonably determined by the Borrower in good faith, than the
terms and conditions of the Refinanced Obligations.

 

“Permitted Specified Note Prepayment” shall mean the prepayment of the SVU 2016
Notes permitted pursuant to Section 6.07.

 

“Permitted Store Swap Transaction” means the transfer by a Loan Party of
ownership of a Store or Stores to an unaffiliated third party in an arm’s length
transaction in the ordinary course of business in exchange for the transfer to
such Loan Party of a retail store or stores (and the related assets, including
real property, fixtures, equipment, inventory and other property

 

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related thereto) owned and operated by such third party; provided, that, as to
any such exchange, (a) the value of the Store or Stores transferred by such Loan
Party shall be reasonably equivalent to the value of the store or stores (and
related assets) transferred to it, (b) the transfer of such assets by the Loan
Party to such third party and by such third party to such Loan Party shall be
substantially contemporaneous, (c) the aggregate number of such Stores
transferred to unaffiliated third parties by the Loan Parties in any Fiscal Year
pursuant to such exchanges shall not exceed 10, except as Administrative Agent
may otherwise agree in the exercise of its discretion, (d) as of the date of any
such transaction, and after giving effect thereto, no Default or Event of
Default shall exist or have occurred and be continuing and (e) any Material Real
Estate Assets and Related Real Estate Collateral) received in connection with
such an exchange shall be pledged as Collateral to the extent required by
Section 5.12 or Section 5.17.

 

“Person” shall mean any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, limited partnership,
Governmental Authority or other entity.

 

“Plan” shall mean any “employee benefit plan” (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Sections 412 or 430 of the Code or Sections 302 or 303
or Title IV of ERISA, any ERISA Affiliate.

 

“Platform” shall have the meaning assigned to such term in Section 9.01.

 

“Prescription Files” shall mean, as to a Loan Party, all of such Loan Party’s
now owned or hereafter existing or acquired retail customer files with respect
to prescriptions for retail customers and other medical information related
thereto, maintained by the retail pharmacies of Loan Parties, wherever located.

 

“Prime Rate” shall mean the rate of interest per annum quoted in the print
edition of The Wall Street Journal, Money Rates Section as the Prime Rate
(currently defined as the base rate on corporate loans posted by at least 75% of
the nation’s thirty largest banks), as in effect from time to time.  The Prime
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer.  The Administrative Agent or any other
Lender may make commercial loans or other loans at rates of interest at, above
or below the Prime Rate.

 

“PSA” shall mean the Packers and Stockyard Act of 1921, 7 U.S.C. § 181 et. seq.,
as the same now exists or may from time to time hereafter be amended, modified,
recodified or supplemented, together with all rules, regulations and
interpretations thereunder or related thereto.

 

“Public Lender” shall have the meaning assigned to such term in Section 9.01.

 

“Qualified Capital Stock” of any Person shall mean any Equity Interest of such
Person that is not Disqualified Stock.

 

“Real Estate” shall mean all right, title, and interest (including any
leasehold, fee, mineral or other estate) in and to any and all parcels of or
interests in real property owned, leased or operated by the Borrower or any of
its Subsidiaries, whether by lease, license or other means,

 

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and the buildings, structures, parking areas and other improvements thereon, now
or hereafter owned by the Borrower or any of its Subsidiaries, including all
fixtures, easements, hereditaments, appurtenances, rights-of-way and similar
rights relating thereto and all leases, tenancies and occupancies thereof now or
hereafter owned by the Borrower or any of its Subsidiaries.

 

“Real Estate Collateral Properties” shall mean the Real Estate of the Loan
Parties at the sites designated as Material Real Estate Assets on the Applicable
Collateral List.

 

“Receivables Purchase Agreement” shall mean (a) each Purchase Agreement as
defined in the receivables purchase agreement referred to in clause (a) of the
definition of “Receivables Transfer Agreement” and (b) any agreement amending,
supplementing, extending, refinancing or replacing such Receivables Purchase
Agreement, in whole or in part.

 

“Receivables Transfer Agreement” shall mean (a) the Second Amended and Restated
Receivables Purchase Agreement, dated as of November 30, 2011, by and among
Supervalu Receivables Funding Corporation, as seller, the Borrower, as servicer,
the banks and other financial institutions party thereto, as purchasers, and
Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A., “Rabobank Nederland”, New
York Branch, as agent, and (b) any agreement amending, supplementing, extending,
refinancing or replacing, in whole or in part, such Receivables Transfer
Agreement.

 

“Refinanced Obligations” shall have the meaning assigned to such term in the
definition of “Permitted Refinancing Indebtedness”.

 

“Register” shall have the meaning assigned to such term in Section 9.04(d).

 

“Registered Public Accounting Firm” shall have the meaning specified by the
Securities Laws and shall be independent of the Borrower and its Subsidiaries as
prescribed by the Securities Laws.

 

“Regulation D” shall mean Regulation D of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation T” shall mean Regulation T of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation U” shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

 

“Regulation X” shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

 

“Related Fund” shall mean, with respect to any Lender that is a fund or
commingled investment vehicle that invests in bank loans, any other fund that
invests in bank loans and is managed or advised by the same investment advisor
as such Lender or by an Affiliate of such investment advisor.

 

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“Related Parties” shall mean, with respect to any Person, such Person’s
Affiliates and the partners, members, controlling persons, directors, officers,
employees, agents, advisors, representatives and successors and assigns of such
Person and of such Person’s Affiliates.

 

“Related Real Estate Collateral” shall mean all Equipment now or hereafter owned
by the Borrower or any of its Subsidiaries located on any Real Estate Collateral
Property or any Material Related Collateral Location.

 

“Related Real Estate Collateral Security Agreement” shall mean any security
agreement delivered pursuant to clause (a) of the definition of “Term Loan
Priority Collateral Requirements,” substantially in the form of Exhibit P
hereto, or such other form reasonably satisfactory to the Administrative Agent.

 

“Release” shall have the meaning assigned to such term in Section 101(22) of
CERCLA.

 

“Release Property” shall have the meaning assigned to such term in Section 9.21.

 

“Repayment Date” shall have the meaning given such term in Section 2.11(a).

 

“Replaced Property” shall have the meaning assigned to such term in
Section 9.21.

 

“Reportable Event” shall mean any of the events set forth in Section 4043(c) of
ERISA as in effect as of the Closing Date, other than events for which the
30-day notice period has been waived.

 

“Repricing Transaction” shall mean the voluntary prepayment, refinancing,
substitution or replacement of all or a portion of the Loans, except following a
Change of Control, with the incurrence by the Borrower of any debt financing
having an effective interest cost or weighted average yield (with the
comparative determinations to be made by the Administrative Agent consistent
with generally accepted financial practices, after giving effect to, among other
factors, margin, interest rate floors, upfront or similar fees or original issue
discount shared with all providers of such financing, but excluding the effect
of any arrangement, structuring, syndication or other fees payable in connection
therewith that are not shared with all providers of such financing, and without
taking into account any fluctuations in the Adjusted LIBO Rate) that is less
than the effective interest cost or weighted average yield (as determined by the
Administrative Agent on the same basis) of such Loans so repaid, refinanced,
substituted or replaced, including without limitation, as may be effected
through any amendment to this Agreement relating to the interest rate for, or
weighted average yield of, such Loans.

 

“Required Lenders” shall mean, at any time, Lenders having Loans and Commitments
representing more than 50% of the sum of all Loans outstanding and Commitments
at such time.

 

“Responsible Officer” shall mean the chief executive officer, chief financial
officer, vice president of tax, controller, treasurer or assistant treasurer of
a Loan Party or, with the consent of the Administrative Agent, any of the other
individuals designated in writing to the Administrative Agent by an existing
Responsible Officer of a Loan Party as an authorized signatory of any
certificate or other document to be delivered hereunder.

 

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“Restated Collateral List” shall mean, at any date of determination, the Closing
Date Collateral List as modified to reflect all Term Loan Priority Collateral
Releases, Term Loan Priority Collateral Substitutions and Term Loan Priority
Collateral Additions to and including the date of such Restated Collateral List.

 

“Restricted Indebtedness” shall mean Indebtedness of the Borrower or any
Restricted Subsidiary, the payment, prepayment, repurchase or defeasance of
which is restricted under Section 6.07.

 

“Restricted Payment” shall mean any dividend or other distribution (whether in
cash, securities or other property) with respect to any capital stock or other
Equity Interest of any Person or any payment (whether in cash, securities or
other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, defeasance, acquisition, cancellation or
termination of any such capital stock or other Equity Interest, or on account of
any return of capital to such Person’s stockholders, partners or members (or the
equivalent of any thereof), or any holder of an option, warrant or other right
to acquire any such dividend or other distribution or payment and any payment of
management fees (or other fees of a similar nature) by any Person to any holder
of an Equity Interest of any Person or any of its Subsidiaries.  Without
limiting the foregoing, “Restricted Payments” with respect to any Person shall
also include all payments made by such Person to holders of Equity Interests
with any proceeds of a dissolution or liquidation of such Person.

 

“Restricted Subsidiary” shall mean any Subsidiary that is not an Unrestricted
Subsidiary.

 

“Retained Excess Cash Flow Amount” shall mean, at any date of determination, an
amount equal to (a) the sum of the amounts of Excess Cash Flow for each Fiscal
Year (or portion thereof) ending on or prior to the date of determination for
which the amount of Excess Cash Flow shall have been calculated as provided in
Section 2.13(c) and with respect to which the payments required under
Section 2.13(c) have been made (commencing with the period from the Closing Date
until February 22, 2014), minus (b) the sum at the time of determination of the
aggregate amount of prepayments required to be made pursuant to
Section 2.13(c) through the date of determination calculated without regard to
any reduction in such sum that resulted from voluntary prepayments of the Loans
referred to in Section 2.13(c)(y).

 

“S&P” shall mean Standard& Poor’s Ratings Service, or any successor thereto.

 

“Sarbanes-Oxley” shall mean the Sarbanes-Oxley Act of 2002.

 

“SEC” shall mean the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Section 2.23 Additional Agreement” shall have the meaning assigned to such term
in Section 2.23.

 

“Secured Parties” shall mean the collective reference to (a) the Administrative
Agent, (b) the Collateral Agent, (c) the Lenders, (d) the beneficiaries of each
indemnification or reimbursement obligation undertaken by any Loan Party under
any Loan Document and (e) the successors and assigns of each of the foregoing.

 

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“Securities Laws” shall mean the Securities Act of 1933, the Securities Exchange
Act of 1934, Sarbanes-Oxley, and the applicable accounting and auditing
principles, rules, standards and practices promulgated, approved or incorporated
by the SEC or the PCAOB.

 

“Securitization Termination” shall mean the repayment in full of all of the
obligations of the Borrower and its Subsidiaries under the Receivables Transfer
Agreement and each Receivables Purchase Agreement and the termination thereof,
the repurchase by the Borrower and its Subsidiaries of all of the receivables
sold thereunder, the termination or release, as applicable, of all guarantees,
and all security interests and liens, in each case arising thereunder or in
connection therewith, and the Borrower and its Subsidiaries having no further
obligations or liabilities with respect thereto.

 

“Security Agreement” shall mean the Security Agreement, dated of even date
herewith, by and among the Loan Parties and the Collateral Agent, substantially
in the form of Exhibit F hereto.

 

“Security Documents” shall mean the Mortgages, the Facility Guaranty, the
Security Agreement, each Related Real Estate Collateral Security Agreement, the
Collateral Assignment Agreement and each of the security agreements, mortgages
and other instruments and documents executed and delivered to the Administrative
Agent pursuant to this Agreement or any other Loan Document granting a Lien to
secure any of the Obligations.

 

“Shareholders’ Equity” shall mean, as of any date of determination, consolidated
shareholders’ equity of the Borrower and its Subsidiaries as of that date
determined in accordance with GAAP.

 

“Solvent” and “Solvency” shall mean, with respect to any Person on a particular
date, that on such date (a) at fair valuation, all of the properties and assets
of such Person (and including as assets for this purpose, at a fair valuation,
all rights of subrogation, contribution or indemnification in favor of such
Person) are greater than the sum of the liabilities, including contingent
liabilities (and including as liabilities for this purpose, at a fair valuation,
all obligations of subrogation, contribution or indemnification against such
Person), of such Person, (b) the present fair saleable value of the properties
and assets of such Person is not less than the amount that would be required to
pay the probable liability of such Person on its debts as they become absolute
and matured, (c) such Person is able to realize upon its properties and 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 beyond such
Person’s ability to pay as such debts mature and (e) such Person is not engaged
in a business or a transaction, and is not about to engage in a business or
transaction, for which such Person’s properties and assets would constitute
unreasonably small capital after giving due consideration to the prevailing
practices in the industry in which such Person is engaged.  The amount of all
guarantees and other contingent liabilities at any time shall be computed as the
amount that, in light of all the facts and circumstances existing at the time,
can reasonably be expected to become an actual or matured liability.

 

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“Specified Event of Default” shall mean the occurrence of (a) any Event of
Default described in Sections 7.01(a), 7.01(f) or 7.01(g) or (b) the Lender’s
exercise of any of its remedies pursuant to the last paragraph of Section 7.01
following any other Event of Default.

 

“Specified Representations” means those representations and warranties made by
the Borrower and the Guarantors in Sections 3.01(a) and (b)(ii) (solely with
respect to power and authority), 3.02(a), 3.04, 3.05(a), (b) and (f), 3.06, 3.08
(a), (b) and (c), 3.09, 3.12, 3.13, 3.14, 3.15(b), 3.16, 3.19(a), (b) and (c),
3.20(a), 3.31 and 3.32.

 

“Springing Maturity Date” shall mean the earliest of (a) date that is 91 days
before the maturity of the SVU 2016 Notes (provided, that if on or prior to the
date that is 91 days before the maturity date of the SVU 2016 Notes the Borrower
has refinanced and/or prepaid all but an aggregate principal amount of not more
than $250,000,000 of the SVU 2016 Notes pursuant to (x) Permitted Refinancing
Indebtedness having a maturity date that is at least six months after the Fixed
Maturity Date or (y) Permitted Specified Note Prepayments, then the Springing
Maturity Date will not occur) and (b) the date of the occurrence of a Change of
Control.

 

“SPV” shall have the meaning assigned to such term in Section 9.04(i).

 

“Statutory Reserves” shall mean a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board and any other banking authority, domestic or foreign,
to which the Administrative Agent or any Lender (including any branch, Affiliate
or other fronting office making or holding a Loan) is subject for Eurocurrency
Liabilities (as defined in Regulation D).  Eurodollar Loans shall be deemed to
constitute Eurocurrency Liabilities (as defined in Regulation D) and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under Regulation D.  Statutory Reserves shall be adjusted automatically on and
as of the effective date of any change in any reserve percentage.

 

“Store” shall mean any retail store (which may include any Real Estate,
Equipment, inventory and other property related thereto) operated, or to be
operated, by any Loan Party.

 

“Subordinated Indebtedness” shall mean any Indebtedness which is expressly
subordinated in right of payment to the prior payment in full of the Obligations
and which is in form and on terms approved in writing by the Administrative
Agent.

 

“Subsidiary” of a Person shall mean a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of Equity Interests having ordinary voting power for the election of
directors or other governing body are at the time beneficially owned, or the
management of which is otherwise controlled, directly or indirectly, through one
or more intermediaries, or both, by such Person.  Unless otherwise specified,
all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of a Loan Party, and shall exclude NAI and its
subsidiaries.

 

“Substitute Property” shall have the meaning assigned to such term in
Section 9.21.

 

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“SVU 2014 Note Repayment” shall mean (a) to the extent the Borrower has made a
tender offer for any SVU 2014 Notes and any of the SVU 2014 Notes have been
tendered pursuant thereto, the purchase and cancellation of such SVU 2014 Notes
on the Closing Date and (b) the providing of an irrevocable notice of redemption
to the holders of all untendered SVU 2014 Notes, if any (or, to the extent the
Borrower has not made a tender offer therefor, all SVU 2014 Notes) and the
depositing with the trustee under the SVU Indenture in trust on the Closing Date
the full amount (including, without limitation, all interest, fees and
prepayment penalties due and payable on the redemption date) required to redeem,
and the providing of evidence of the delivery to such trustee of all materials
required to redeem, all untendered SVU 2014 Notes, if any (or, to the extent the
Borrower has not made a tender offer therefor, all SVU 2014 Notes), in
accordance with the terms of the SVU Indenture and the SVU 2014 Notes.

 

“SVU 2014 Notes” shall mean the 7.50% Senior Notes due November 15, 2014 issued
by the Borrower pursuant to the SVU Indenture in the original principal amount
of $500,000,000.

 

“SVU 2016 Notes” shall mean the 8.00% Senior Notes due May 1, 2016 issued by the
Borrower pursuant to the SVU Indenture in the original principal amount of
$1,000,000,000.

 

“SVU Indenture” shall mean the Indenture, dated as of July 1, 1987, between the
Borrower and Deutsche Bank Trust Company (formerly Bankers Trust Company), as
trustee, as supplemented by the First Supplemental Indenture dated as of
August 1, 1990, the Second Supplemental indenture dated as of October 1, 1992,
the Third Supplemental Indenture dated as of September 1, 1995, the Fourth
Supplemental Indenture dated as of August 4, 1999, and the Fifth Supplemental
Indenture dated as of September 17, 1999, and as further amended, amended and
restated, supplemented or otherwise modified (including any such modifications
contained in any notes, officer’s certificates or other operative documents) as
of the Closing Date in accordance with the terms hereof.

 

“Swap Contract” shall mean (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.

 

“Swap Termination Value” shall mean, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out

 

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and termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a), the
amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as
determined based upon one or more mid-market or other readily available
quotations provided by any recognized dealer in such Swap Contracts (which may
include a Lender or any Affiliate of a Lender).

 

“Symphony” shall mean Symphony Investors LLC, a Delaware limited liability
company.

 

“Syndication Agents” shall mean CS Securities and MSSF, in their capacities as
syndication agents.

 

“Synthetic Lease Obligations” shall mean the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease or
(b) an agreement for the use or possession of property (including sale and
leaseback transactions), in each case, creating obligations that do not appear
on the balance sheet of such Person but which, upon the application of any
Debtor Relief Laws to such Person, would be characterized as the indebtedness of
such Person (without regard to accounting treatment).

 

“Synthetic Purchase Agreement” shall mean any swap, derivative or other
agreement or combination of agreements pursuant to which the Borrower or any
Restricted Subsidiary is or may become obligated to make (a) any payment in
connection with a purchase by any third party from a Person other than the
Borrower or any Restricted Subsidiary of any Equity Interest or Restricted
Indebtedness or (b) any payment (other than on account of a permitted purchase
by it of any Equity Interest or Restricted Indebtedness) the amount of which is
determined by reference to the price or value at any time of any Equity Interest
or Restricted Indebtedness; provided that no phantom stock or similar plan
providing for payments only to current or former directors, officers or
employees of the Borrower or the Restricted Subsidiaries (or to their heirs or
estates) shall be deemed to be a Synthetic Purchase Agreement.

 

“Taxes” shall mean any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority,
including any interest, penalties and additions to tax related thereto.

 

“Tender Offer Agreement” that certain Tender Offer Agreement dated as of
January 10, 2013 among Symphony, Cerberus and the Borrower.

 

“Term Facility” shall mean the term loan facility provided for by this
Agreement.

 

“Term Loan Priority Collateral” shall have the meaning assigned to such term in
the Intercreditor Agreement.

 

“Term Loan Priority Collateral Addition” shall have the meaning assigned to such
term in Section 9.21.

 

“Term Loan Priority Collateral Release” shall have the meaning assigned to such
term in Section 9.21.

 

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“Term Loan Priority Collateral Requirements” shall mean the collective
requirements that:

 

(a)  the Collateral Agent shall have received:

 

(i) a Mortgage, a Related Real Estate Collateral Security Agreement and a UCC
financing statement with respect to each Real Estate Collateral Property and the
Related Real Estate Collateral thereon, and a Related Real Estate Collateral
Security Agreement and a UCC financing statement with respect to all other
Related Real Estate Collateral, which Security Documents shall be in form and
substance satisfactory to the Administrative Agent, shall have been duly
executed by the parties thereto and delivered to the Collateral Agent and shall
be in full force and effect, together with, in the case of Real Estate
Collateral Property, an acknowledgment by a title insurance company of receipt
of such Mortgage and UCC financing statement and an agreement to record or file,
as applicable, such Mortgage and UCC financing statement in the real estate
records for the county in which the Real Estate Collateral Property is located
(if determined by the Administrative Agent to be necessary under the Laws of the
jurisdiction where such Real Estate Collateral Property is located to perfect in
fixtures), so as to effectively create upon such recording and filing (together
with the filing of a UCC-1 financing statement in the applicable state filing
office) valid and enforceable perfected first-priority Liens upon such Real
Estate Collateral Property and Related Real Estate Collateral, in favor of the
Collateral Agent (or such other trustee as may be desired under local law),
subject only to the Permitted Encumbrances.  Unless otherwise (i) required to
avoid triggering any of the equal and ratable security provisions of the SVU
Indenture or (ii) agreed by the Administrative Agent, and subject to limitations
of local law, each such Mortgage shall secure the total amount of the
Obligations, provided that if the jurisdiction in which any applicable Real
Estate Collateral Property is located imposes a mortgage recording, intangibles
or similar tax and does not permit the allocation of undivided aggregate
indebtedness for the purpose of determining the amount of such tax payable, or
if there are other local state impediments to the Mortgage securing the full
amount of the Obligations, the principal amount secured by such Mortgage shall
be limited to secure a maximum amount acceptable to the Administrative Agent,
not to exceed 125% of the fair market value of such Real Estate Collateral
Property;

 

(ii)  (A) a Title Insurance Policy (or a marked, signed and dated commitment to
issue a Title Insurance Policy) insuring or committing to insure (upon payment
of the premium therefor) the Lien of the Mortgage encumbering each Real Estate
Collateral Property, (1) with respect to each Real Estate Collateral Property
having a Value greater than $3,000,000, with the standard exception for survey
matters deleted and a “same as survey” endorsement, (2) otherwise with the
standard exception for survey matters deleted and a “same as survey” endorsement
but only to the extent available without requirement for the Borrower to procure
a new survey, and (3) in all cases with other lenders’ endorsements and
otherwise as reasonably required by the Administrative Agent but only to the
extent available without requirement for the Borrower to procure a new survey
with respect to any Real Estate Collateral Property having a Value of less than
or equal to $3,000,000 (in the case of a Term Loan Priority Collateral
Substitution, issued by the title company that issued the Title Insurance
Policies insuring the Liens of the

 

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existing Mortgages and dated as of the date of the recording of the Mortgage for
the Substitute Property); (B) to the extent available, a “tie-in” and a “first
loss” endorsement, or similar endorsements, to the Title Insurance Policy, in
form and substance reasonably satisfactory to the Administrative Agent; and
(C) a copy of any survey, plat, or site plan of the Real Estate Collateral
Property that the Borrower provides to the title company issuing the Title
Insurance Policy, with any such surveys recertified to the Collateral Agent to
the extent reasonably available and as reasonably required by the Administrative
Agent; provided, that the Administrative Agent will not require any such
recertification with respect to any such survey that was created or last updated
more than five years before the later of (1) the date of the Loan Parties’
satisfaction of the requirements set forth in Section 5.25 and (2) any Term Loan
Priority Collateral Substitution, as the case may be.  The Collateral Agent also
shall have received copies of paid receipts or other evidence showing that all
premiums in respect of such Title Insurance Policies and endorsements have been
paid;

 

(iii) (A) a completed Flood Certificate with respect to each Real Estate
Collateral Property, which Flood Certificate shall (x) be addressed to the
Collateral Agent, (y) be completed by a company that has guaranteed the accuracy
of the information contained therein and (z) otherwise comply with the Flood
Program; (B) evidence describing whether the community in which each Real Estate
Collateral Property is located participates in the Flood Program; (C) if any
Flood Certificate states that a Real Estate Collateral Property is located in a
Flood Zone, the applicable Loan Party’s written acknowledgement of receipt of
written notification from the Collateral Agent (x) as to the existence of each
such Real Estate Collateral Property and (y) as to whether the community in
which each such Real Estate Collateral Property is located is participating in
the Flood Program; and (D) if any Real Estate Collateral Property is located in
a Flood Zone and is located in a community that participates in the Flood
Program, evidence that the applicable Loan Party has obtained flood insurance
that is in compliance with all applicable regulations of the Flood Program;

 

(iv) if required by the Administrative Agent, documentation regarding
environmental matters acceptable to the Administrative Agent with respect to
each Real Estate Collateral Property, and, if warranted by the findings of such
documentation, a Phase I environmental report acceptable to the Administrative
Agent, and, if warranted by the findings of such Phase I environmental report or
other documentation, a Phase II environmental report acceptable to the
Administrative Agent, which concludes that such Real Estate Collateral Property
(A) does not contain any Hazardous Materials in contravention of Environmental
Law in any material respect and (B) is not subject to any significant risk of
contamination from any off site Hazardous Materials in contravention of
Environmental Law in any material respect;

 

(v) (x) an opinion or opinions of counsel admitted to practice under the laws of
the State in which each Real Estate Collateral Property is located, regarding
the enforceability of the Liens of the Mortgages in that State, (y) a due
execution, delivery, and authority opinion (consistent with the requirements of
Section 4.01f) and (z) an opinion or opinions of counsel regarding each Related
Real Estate Collateral Security

 

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Agreement, in each case in form and substance reasonably acceptable to the
Administrative Agent;

 

(vi) true and correct copies of all Material Contracts relating to the leasing
or operation of each Real Estate Collateral Property and each other property on
which Related Real Estate Collateral is located, each of which shall be in form
and substance reasonably satisfactory to the Administrative Agent;

 

(vii) satisfactory (i.e., showing no Liens other than Permitted Encumbrances)
UCC, tax lien, judgment and litigation searches with respect to each Real Estate
Collateral Property and each other property on which Related Real Estate
Collateral is located and the Loan Party that is the owner or lessee thereof, in
the State in which such Real Estate Collateral Property or such other property
is located and the jurisdictions where each such Loan Party has its principal
place of business; and

 

(viii) in the case of any Ground Lease, (A) a true and correct copy of the
applicable Ground Lease, together with (to the extent required by the
Administrative Agent) all amendments and modifications thereto and a recorded
memorandum thereof, in form and substance reasonably satisfactory in all
respects to the Administrative Agent and subject to leasehold mortgagee
provisions and protections in form and substance reasonably satisfactory in all
respects to the Administrative Agent and which shall provide, among other
things, cure rights reasonably acceptable to the Administrative Agent for Loan
Party defaults thereunder, and (B) if required by the Administrative Agent, a
Ground Lease estoppel executed by the fee owner and ground lessor of such Real
Estate Collateral Property, reasonably acceptable to the Administrative Agent;

 

(b)  the Borrower shall have paid or reimbursed the Administrative Agent for all
reasonable out-of-pocket costs and expenses incurred by the Administrative Agent
(including, without limitation, reasonable attorneys’ fees and disbursements) in
connection with the preparation and negotiation of the Mortgage of each Real
Estate Collateral Property and the Borrower shall have paid all recording
charges, filing fees, taxes or other out-of-pocket expenses (including, without
limitation, title insurance premiums, mortgage and intangibles taxes and
documentary stamp taxes) payable in connection therewith;

 

(c)  on the date of the applicable Mortgage, the grants of security interests in
the Term Loan Priority Collateral on the Applicable Collateral List (after
giving effect to all Term Loan Priority Collateral List Substitutions) will not
violate the SVU Indenture or any other Material Indebtedness or trigger any of
the equal and ratable sharing provisions thereof, as evidenced by (i) a
certificate of a Responsible Officer of the Borrower in substantially the form
of the certificate required to be delivered pursuant to
Section 4.01(h) (covering factual matters supporting the legal opinions
delivered pursuant this clause (c)) and (ii) a customary no conflicts opinion
from the Borrower’s counsel, in each case in form and substance satisfactory to
the Administrative Agent, certifying and opining, respectively, that the grants
of security interests in the Term Loan Priority Collateral on the Applicable
Collateral List will not violate the SVU Indenture or any other Material
Indebtedness or trigger any of the equal and ratable sharing provisions thereof;

 

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(d)  the Administrative Agent shall have received with respect to the initial
satisfaction of the Term Loan Priority Collateral Requirements pursuant to
Section 5.25, a confirmation of the certificates described in
Section 4.01(g)(ii), and thereafter a certificate of the type described in
Section 4.01(g)(ii), in each case from the relevant Loan Parties; and

 

(e)  each Real Estate Collateral Property shall be fee owned or ground leased by
a Loan Party or a Subsidiary which shall have become a Loan Party hereunder
pursuant to and in accordance with the requirements of Section 5.12 prior to the
execution and delivery of the applicable Mortgage.

 

“Term Loan Priority Collateral Sale” shall mean any sale, transfer or other
disposition (including by way of merger, casualty, condemnation or otherwise) of
Term Loan Priority Collateral or Equity Interests of any Subsidiary to the
extent the assets of such Subsidiary consist solely of Term Loan Priority
Collateral that produces $50,000 or more of Net Cash Proceeds and that is not
part of an Other Asset Sale and that is not a Permitted Disposition pursuant to
clauses (a) through (n) (other than clause (j)) of the definition thereof or
clause (p) of the definition thereof.

 

“Term Loan Priority Collateral Substitution” shall have the meaning assigned to
such term in Section 9.21.

 

“Term Loan Refinancing” shall mean the repayment in full of all of the
obligations of the Borrower and its Subsidiaries under the Existing Term Loan
Facility, the termination or release, as applicable of all guarantees and all
security interests and liens, in each case arising under or in connection
therewith, and the Borrower and its Subsidiaries having no further obligations
or liabilities with respect thereto.

 

“Third Party Payor” shall mean any Person, such as a Fiscal Intermediary, Blue
Cross/Blue Shield or private health insurance company, which is obligated to
reimburse or otherwise make payments to health care providers who provide
medical care or medical assistance or other goods or services for eligible
patients under Medicare, Medicaid or any private insurance contract.

 

“Title Insurance Policy” shall mean, with respect to each Real Estate Collateral
Property, an ALTA mortgagee title insurance policy in a form reasonably
acceptable to the Administrative Agent (or, if a Real Estate Collateral Property
is located in a State which does not permit the issuance of such ALTA policy,
such form as shall be permitted in such State and reasonably acceptable to the
Administrative Agent) issued with respect to such Real Estate Collateral
Property and insuring the Lien of the Mortgage encumbering such Real Estate
Collateral Property, which Title Insurance Policy shall (i) provide coverage in
an amount satisfactory to the Administrative Agent (provided that the aggregate
insured amount of all Title Insurance Policies will not exceed the aggregate
amount of the Loans, except as is reasonably necessary to insure Real Estate
Collateral Properties under Title Insurance Policies that cannot be “tied in”
with other Title Insurance Policies), (ii) insure the Collateral Agent that the
relevant Mortgage creates a valid first lien on the Real Estate Collateral
Property encumbered thereby, free and clear of all exceptions from coverage
other than Permitted Encumbrances, (iii) contain such endorsements and
affirmative coverages as have been reasonably requested by the Administrative
Agent to the

 

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extent available in the applicable jurisdiction where such Real Estate
Collateral Property is located (and subject to the availability thereof for Real
Estate Collateral Properties with respect to which additional surveys are not
required pursuant to the definition of Term Loan Priority Collateral
Requirements) and (iv) name the Collateral Agent as the insured.

 

“Total Assets” shall mean, at any date, the amount that would, in conformity
with GAAP, be set forth opposite the caption “total assets” (or any like
caption) on a Consolidated balance sheet of the Borrower and the Restricted
Subsidiaries.

 

“Total Debt” shall mean, at any time, the total Indebtedness of the Borrower and
the Restricted Subsidiaries at such time (excluding Indebtedness of the type
described in clauses (b), (c) and (g) of the definition of such term, except, in
the case of such clause (b), to the extent of any unreimbursed drawings
thereunder, and also excluding the ASC Guarantee and all Synthetic Lease
Obligations).

 

“Total Leverage Ratio” shall mean, on any date, the ratio of (a) Total Debt on
such date (net of the amount of Unrestricted Cash as of such date up to a
maximum amount of $150,000,000 or, when the amount of Total Debt is reduced
pursuant to the proviso set forth in this definition, up to a maximum amount of
$50,000,000) to (b) Consolidated EBITDA for the period of four consecutive
Fiscal Quarters then most recently ended on or prior to such date; provided
that, with respect to any date of determination occurring during the Fiscal
Periods ending closest to October 31, November 30 and December 31 of any Fiscal
Year, an amount equal to $150,000,000 shall be deducted from the calculation of
Total Debt for the purposes of this calculation.

 

“Total Secured Leverage Ratio” shall mean, on any date, the ratio of (a) Total
Debt that is secured by Liens on such date (net of the amount of Unrestricted
Cash as of such date up to a maximum amount of $150,000,000 or, when the amount
of Total Debt is reduced pursuant to the proviso set forth in this definition,
up to a maximum amount of $50,000,000) to (b) Consolidated EBITDA for the period
of four consecutive Fiscal Quarters then most recently ended on or prior to such
date; provided that, with respect to any date of determination occurring during
the Fiscal Periods ending closest to October 31, November 30 and December 31 of
any Fiscal Year, an amount equal to $150,000,000 shall be deducted from the
calculation of Total Debt for the purposes of this calculation.

 

“Transaction Expenses”  shall mean all of the one-time fees, costs, losses,
charges and expenses incurred by the Borrower and its Restricted Subsidiaries in
connection with the Transactions, including employee severance expenses
associated with the Transactions, prepayment premiums payable in connection with
the Term Loan Refinancing, legal, advisory and other professionals fees and
expenses incurred in connection with the Transactions, financing fees incurred
in connection with the Transactions, recruitment expenses associated with the
Transactions, stock transfer taxes payable in connection with the transactions
contemplated by the Tender Offer Agreement, information technology investments
related to the Transactions, corporate expenses incurred in connection with the
Transactions other than personnel expenses, employee retention plan expenses
associated with the Transactions, litigation contingency and legal reserves
related to the Transactions and environmental expenses incurred in connection
with the Transactions.

 

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“Transactions” shall mean (i) the NAI Sale (including the funding of the Escrow
Account (as defined in the Escrow Agreement) substantially contemporaneously
with the consummation of the Albertson’s Asset Purchase (as defined in the
Acquisition Agreement) as contemplated by the Acquisition Agreement and the
Escrow Agreement), (ii) the SVU 2014 Note Repayment, (iii) the Term Loan
Refinancing, (iv) the ABL Refinancing, (v) the Securitization Termination,
(vi) the execution, delivery and performance by the Loan Parties of the Loan
Documents to which they are a party and the making of the Borrowings hereunder,
(vii) the payment of fees and expenses in connection with the foregoing and
(viii) the transactions reasonably related to the foregoing.

 

“Type”, when used in respect of any Loan or Borrowing, shall refer to the Rate
by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined. For purposes hereof, the term “Rate” shall mean the
Adjusted LIBO Rate and the Alternate Base Rate.

 

“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code as in
effect from time to time in the State of New York; provided that (a) if a term
is defined in Article 9 of the Uniform Commercial Code differently than in
another Article thereof, such term shall have the meaning set forth in Article 9
and (b) if by reason of mandatory provisions of law, perfection or the effect of
perfection or non-perfection of a security interest in any Collateral or the
availability of any remedy hereunder is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than the State of New York, “Uniform
Commercial Code” shall mean the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection or availability of such
remedy, as the case may be.

 

“Unfunded Pension Liability” shall mean the excess of a Pension Plan’s benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan’s assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Sections 412 or 430 of the Code and
Sections 302 or 303 of ERISA for the applicable plan year.

 

“Unrestricted Cash” shall mean, at any date of determination, the aggregate
amount of cash of the Borrower and the Restricted Subsidiaries at such date to
the extent that the use of such cash for application to payment of the
Obligations or other Indebtedness is not prohibited by law or any contract or
other agreement and such cash is free and clear of all Liens (other than Liens
in favor of the Collateral Agent and the ABL Facility Agent or as would not
cause such cash to be classified as “restricted” on a consolidated balance sheet
of the Borrower prepared in accordance with GAAP).

 

“Unrestricted Subsidiary” shall mean any Subsidiary of the Borrower that is
designated by the Borrower as an “Unrestricted Subsidiary” as provided in
Section 5.23; provided that an Unrestricted Subsidiary shall cease to be an
Unrestricted Subsidiary if converted to a Restricted Subsidiary in accordance
with Section 5.23; provided further, that in no event will Moran Foods
constitute an Unrestricted Subsidiary.  As of the Closing Date, no Subsidiary of
the Borrower is an Unrestricted Subsidiary.

 

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“USA PATRIOT Act” shall mean The Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001
(Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)).

 

“Value” shall mean (a) the value of the Real Estate sites (and the Equipment
located thereon that is owned by the Borrower or its Subsidiaries) as set forth
in the Closing Date Collateral List, and (b) with respect to any Substitute
Property or Additional Property (and the Equipment located thereon that is owned
by the Borrower or its Subsidiaries), the book value thereof (and, in the case
of any Replaced Property or Released Property, the value thereof as set forth in
the Applicable Collateral List) or, with respect to any Real Estate site valued
pursuant to a New Valuation, the value of such Real Estate site (and the
Equipment located thereon that is owned by the Borrower or its Subsidiaries) set
forth in such New Valuation.

 

“Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness
at any date, the number of years obtained by dividing (a) the then outstanding
principal amount of such Indebtedness by (b) the total of the product of (i) the
amount of each then remaining installment, sinking fund, serial maturity or
other required payments of principal, including payment at final maturity, in
respect thereof multiplied by (ii) the number of years (calculated to the
nearest one-twelfth) that will elapse between such date and the making of such
payment.

 

“Yield Differential” shall have the meaning assigned to such term in
Section 2.22(b).

 

SECTION 1.02.  Terms Generally.  The definitions in Section 1.01 shall apply
equally to both 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”; and the words “asset” and “property” shall be construed as having the
same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and contract
rights.  Any reference to any law, code, statute, treaty, rule, guideline,
regulation or ordinance of a Governmental Authority shall, unless otherwise
specified, refer to such law, code, statute, treaty, rule, guideline, regulation
or ordinance as amended, supplemented or otherwise modified from time to time. 
Any reference to any IRS form shall be construed to include any successor form. 
All references herein to Articles, Sections, Exhibits and Schedules shall be
deemed references to Articles and Sections of, and Exhibits and Schedules to,
this Agreement unless the context shall otherwise require.  Except as otherwise
expressly provided herein, (a) any reference in this Agreement to any Loan
Document or other agreement, document or instrument shall mean such document as
amended, restated, supplemented or otherwise modified from time to time, in each
case, in accordance with the express terms of this Agreement, and (b) all terms
of an accounting or financial nature shall be construed in accordance with GAAP,
as in effect from time to time; provided, however, that if the Borrower notifies
the Administrative Agent that the Borrower wishes to amend any calculation or
any related definition to eliminate the effect of any change in GAAP occurring
after the date of this Agreement on the operation of such covenant (or if the
Administrative Agent notifies the Borrower that the Required Lenders wish to
amend any calculation or any related definition), then the Borrower’s compliance
with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective,

 

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until either such notice is withdrawn or such covenant or definition is amended
in a manner satisfactory to the Borrower and the Required Lenders.  Neither this
Agreement or any other Loan Document nor any other agreement, document or
instrument referred to herein or executed and delivered in connection herewith
shall be construed against any Person as the principal draftsperson hereof or
thereof.

 

SECTION 1.03.  Pro Forma Calculations.  All pro forma calculations permitted or
required to be made by the Borrower or any Subsidiary pursuant to this Agreement
shall include only those adjustments that would be (a) permitted or required by
Regulation S-X under the Securities Act of 1933, as amended, together with those
adjustments that (i) have been certified by a Responsible Officer of the
Borrower as having been prepared in good faith based upon reasonable assumptions
and (ii) are based on reasonably detailed written assumptions reasonably
acceptable to the Administrative Agent and (b) required by the definition
Consolidated EBITDA. 

 

SECTION 1.04.  Classification of Loans and Borrowings.  For purposes of this
Agreement, Loans may be classified and referred to by Class (e.g., an “Other
Loan”) or by Class and Type (e.g., a “Eurodollar Other Loan”) . Borrowings also
may be classified and referred to by Class (e.g., an “Other Borrowing”) or by
Class and Type (e.g., an “Other Eurodollar Borrowing”).

 

ARTICLE II

 

The Credits

 

SECTION 2.01.  Commitments.  (a)   Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Lender
agrees, severally and not jointly, to make a Loan to the Borrower on the Closing
Date in a principal amount not to exceed its Commitment.  Amounts paid or
prepaid in respect of the Loans may not be reborrowed.

 

(b)   Each Lender having an Incremental Loan Commitment, severally and not
jointly, hereby agrees, subject to the terms and conditions and relying upon the
representations and warranties set forth herein and in the applicable
Incremental Loan Assumption Agreement, to make Incremental Loans to the
Borrower, in an aggregate principal amount not to exceed its Incremental Loan
Commitment.  Amounts paid or prepaid in respect of Incremental Loans may not be
reborrowed.

 

SECTION 2.02.  Loans.  (a)  Each Loan shall be made as part of a Borrowing
consisting of Loans made by the Lenders ratably in accordance with their
applicable Commitments; provided, however, that the failure of any Lender to
make any Loan shall not in itself relieve any other Lender of its obligation to
lend hereunder (it being understood, however, that no Lender shall be
responsible for the failure of any other Lender to make any Loan required to be
made by such other Lender).  The Loans comprising any Borrowing shall be in an
aggregate principal amount that is (i) an integral multiple of $1,000,000 and
not less than $5,000,000 (except, with respect to any Incremental Borrowing, to
the extent otherwise provided in the related Incremental Loan Assumption
Agreement) or (ii) equal to the remaining available balance of the applicable
Commitments.

 

(b)  Subject to Sections 2.08 and 2.15, each Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request pursuant
to Section 2.03. Each Lender may at its option make any Eurodollar Loan by
causing any domestic or foreign branch

 

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or Affiliate of such Lender to make such Loan; provided that any exercise of
such option shall not affect the obligation of the Borrower to repay such Loan
in accordance with the terms of this Agreement. Borrowings of more than one Type
may be outstanding at the same time; provided, however, that the Borrower shall
not be entitled to request any Borrowing that, if made, would result in more
than eight Eurodollar Borrowings outstanding hereunder at any time. For purposes
of the foregoing, Borrowings having different Interest Periods, regardless of
whether they commence on the same date, shall be considered separate Borrowings.

 

(c)  Each Lender shall make each Loan or Incremental Loan to be made by it
hereunder on the Closing Date or the proposed date of Borrowing thereof, as
applicable, by wire transfer of immediately available funds to such account in
New York City as the Administrative Agent may designate not later than
9:00 a.m., New York City time, and the Administrative Agent shall promptly wire
transfer the amounts so received in accordance with instructions received from
the Borrower in the applicable Borrowing Request or, if a Borrowing shall not
occur on such date because any condition precedent herein specified shall not
have been met, return the amounts so received to the respective Lenders.

 

(d)  Unless the Administrative Agent shall have received notice from a Lender
prior to the date of any Borrowing that such Lender will not make available to
the Administrative Agent such Lender’s portion of such Borrowing, the
Administrative Agent may assume that such Lender has made such portion available
to the Administrative Agent on the date of such Borrowing in accordance with
Section 2.02(c) and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount.
If the Administrative Agent shall have so made funds available then, to the
extent that such Lender shall not have made such portion available to the
Administrative Agent, such Lender and the Borrower severally agree to repay to
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to the Borrower to but excluding the date such amount is repaid to the
Administrative Agent at (i) in the case of the Borrower, a rate per annum equal
to the interest rate applicable at the time to the Loans comprising such
Borrowing and (ii) in the case of such Lender, a rate determined by the
Administrative Agent to represent its cost of overnight or short-term funds
(which determination shall be conclusive absent manifest error). If such Lender
shall repay to the Administrative Agent such corresponding amount, such amount
shall constitute such Lender’s Loan as part of such Borrowing for purposes of
this Agreement.

 

SECTION 2.03.  Borrowing Procedure.  In order to request a Borrowing, the
Borrower shall notify the Administrative Agent of such request by telephone
(a) in the case of a Eurodollar Borrowing, not later than 2:00 p.m., New York
City time, three Business Days before a proposed Borrowing, and (b) in the case
of an ABR Borrowing, not later than 2:00 p.m., New York City time, one Business
Day before a proposed Borrowing.  Each such telephonic Borrowing Request shall
be irrevocable, and shall be confirmed promptly by hand delivery, e-mail or fax
to the Administrative Agent of a written Borrowing Request and shall specify the
following information: (i) whether the Borrowing then being requested is to be a
Borrowing of Loans or a Borrowing of Incremental Loans and whether such
Borrowing is to be a Eurodollar Borrowing or an ABR Borrowing (provided that,
until the Administrative Agent shall have notified the Borrower that the primary
syndication of the Commitments has been completed (which notice shall be given
as promptly as practicable and, in any event, within 30 days after the Closing

 

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Date), the Borrower shall not be permitted to request a Eurodollar Borrowing
with an Interest Period in excess of one month); provided, however, that the
initial Interest Period of any Eurodollar Borrowing made on the Closing Date
shall commence on the Closing Date and end on March 31, 2013; (ii) the date of
such Borrowing (which shall be a Business Day); (iii) the number and location of
the account to which funds are to be disbursed; (iv) the amount of such
Borrowing; and (v) if such Borrowing is to be a Eurodollar Borrowing, the
Interest Period with respect thereto; provided, however, that, notwithstanding
any contrary specification in any Borrowing Request, each requested Borrowing
shall comply with the requirements set forth in Section 2.02.  If no election as
to the Type of Borrowing is specified in any such notice, then the requested
Borrowing shall be an ABR Borrowing.  If no Interest Period with respect to any
Eurodollar Borrowing is specified in any such notice, then the Borrower shall be
deemed to have selected an Interest Period of one month’s duration.  The
Administrative Agent shall promptly advise the applicable Lenders of any notice
given pursuant to this Section 2.03 (and the contents thereof), and of each
Lender’s portion of the requested Borrowing.

 

SECTION 2.04.  Evidence of Debt; Repayment of Loans.  (a)  The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Lender the principal amount of each Loan of such Lender as provided in
Section 2.11.

 

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

 

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

 

(d)  The entries made in the Register maintained pursuant to
Section 2.04(c) shall be prima facie evidence of the existence and amounts of
the obligations therein recorded; provided, however, that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligations of the Borrower to repay
the Loans in accordance with their terms.

 

(e)  Any Lender may request that Loans made by it hereunder be evidenced by a
promissory note.  In such event, the Borrower shall execute and deliver to such
Lender a promissory note payable to such Lender and its registered assigns and
in the form attached hereto as Exhibit J.  Notwithstanding any other provision
of this Agreement, in the event any Lender shall request and receive such a
promissory note, the interests represented by such note shall at all times
thereafter (including after any assignment of all or part of such interests
pursuant to Section 9.04) be represented by one or more promissory notes payable
to the payee named therein or its registered assigns.

 

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SECTION 2.05.  Fees.  The Borrower agrees to pay to the Administrative Agent,
for its own account, the administrative fees set forth in the Fee Letter at the
times and in the amounts specified therein (the “Administrative Agent Fees”). 
In addition, the Borrower agrees to pay on the Closing Date to each Lender that
is party to this Agreement as a Lender on the Closing Date, as fee compensation
for the funding of such Lender’s Loan, a closing fee (collectively, the
“Participation Fees”) in an amount equal to 1.00% of the stated principal amount
of such Lender’s Loan, payable to such Lender from the proceeds of its Loan as
and when funded on the Closing Date.  Such Participation Fees will be in all
respects fully earned, due and payable on the Closing Date.

 

All Fees shall be paid on the dates due, in immediately available funds, to the
Administrative Agent for distribution, if and as appropriate, among the
Lenders.  Once paid, none of the Fees shall be refundable under any
circumstances.

 

SECTION 2.06.  Interest on Loans.  (a)  Subject to the provisions of
Section 2.07, the Loans comprising each ABR Borrowing shall bear interest
(computed on the basis of the actual number of days elapsed over a year of 365
or 366 days, as the case may be, when the Alternate Base Rate is determined by
reference to the Prime Rate and over a year of 360 days at all other times and
calculated from and including the date of such Borrowing to but excluding the
date of repayment thereof) at a rate per annum equal to the Alternate Base Rate
plus the Applicable Margin.

 

(b)  Subject to the provisions of Section 2.07, the Loans comprising each
Eurodollar Borrowing shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 360 days) at a rate per annum equal to the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin.

 

(c)  Interest on each Loan shall be payable on the Interest Payment Dates
applicable to such Loan except as otherwise provided in this Agreement. The
applicable Alternate Base Rate or Adjusted LIBO Rate for each Interest Period or
day within an Interest Period, as the case may be, shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.

 

SECTION 2.07.  Default Interest.  If any Event of Default under Sections
7.01(a), 7.01(f) or 7.01(g) has occurred and is continuing then, until such
defaulted amount shall have been paid in full, to the extent permitted by law,
such defaulted amounts shall bear interest (after as well as before judgment),
payable on demand, (a) in the case of principal, at the rate otherwise
applicable to such Loan pursuant to Section 2.06 plus 2.00% per annum and (b) in
all other cases, at a rate per annum (computed on the basis of the actual number
of days elapsed over a year of 365 or 366 days, as the case may be, when
determined by reference to the Prime Rate and over a year of 360 days at all
other times) equal to the rate that would be applicable to an ABR Loan plus
2.00% per annum.

 

SECTION 2.08.  Alternate Rate of Interest.  In the event, and on each occasion,
that on the day two Business Days prior to the commencement of any Interest
Period for a Eurodollar Borrowing the Administrative Agent shall have determined
(a) that Dollar deposits in the principal amounts of the Loans comprising such
Borrowing are not generally available in the

 

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London interbank market, (b) that the rates at which such Dollar deposits are
being offered will not adequately and fairly reflect the cost to the Required
Lenders of making or maintaining Eurodollar Loans during such Interest Period or
(c) that reasonable means do not exist for ascertaining the Adjusted LIBO Rate,
the Administrative Agent shall, as soon as practicable thereafter, give written
or fax notice of such determination to the Borrower and the Lenders. In the
event of any such determination, until the Administrative Agent shall have
advised the Borrower and the Lenders that the circumstances giving rise to such
notice no longer exist, any request by the Borrower for a Eurodollar Borrowing
pursuant to Sections 2.03 or 2.10 shall be deemed to be a request for an ABR
Borrowing.  Each determination by the Administrative Agent under this
Section 2.08 shall be conclusive absent manifest error.

 

SECTION 2.09.  Termination of Commitments.  (a)  The Commitments (other than any
Incremental Loan Commitments, which shall terminate as provided in the related
Incremental Loan Assumption Agreement) shall automatically terminate upon the
making of the Loans on the Closing Date.

 

(b)  Upon at least three Business Days’ prior irrevocable written or fax notice
to the Administrative Agent, the Borrower may at any time in whole permanently
terminate, or from time to time in part permanently reduce, the Commitments;
provided, however, that each partial reduction of the Commitments shall be in an
integral multiple of $1,000,000 and in a minimum amount of $5,000,000.

 

(c)  Each reduction in the Commitments hereunder shall be made ratably among the
Lenders in accordance with their respective applicable Commitments.

 

SECTION 2.10.  Conversion and Continuation of Borrowings.  The Borrower shall
have the right at any time upon prior irrevocable notice (including by telephone
or e-mail, which in the case of telephonic notice, shall be promptly followed by
written notice) to the Administrative Agent (a) not later than 2:00 p.m., New
York City time, one Business Day prior to conversion, to convert any Eurodollar
Borrowing into an ABR Borrowing, (b) not later than 2:00 p.m., New York City
time, three Business Days prior to conversion or continuation, to convert any
ABR Borrowing into a Eurodollar Borrowing or to continue any Eurodollar
Borrowing as a Eurodollar Borrowing for an additional Interest Period, and
(c) not later than 2:00 p.m., New York City time, three Business Days prior to
conversion, to convert the Interest Period with respect to any Eurodollar
Borrowing to another permissible Interest Period, subject in each case to the
following:

 

(i)  until the Administrative Agent shall have notified the Borrower that the
primary syndication of the Commitments has been completed (which notice shall be
given as promptly as practicable and, in any event, within 30 days after the
Closing Date), no ABR Borrowing may be converted into a Eurodollar Borrowing
with an Interest Period in excess of one month;

 

(ii)  each conversion or continuation shall be made pro rata among the Lenders
in accordance with the respective principal amounts of the Loans comprising the
converted or continued Borrowing;

 

(iii)  if less than all the outstanding principal amount of any Borrowing shall
be converted or continued, then each resulting Borrowing shall satisfy the
limitations

 

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specified in Sections 2.02(a) and 2.02(b) regarding the principal amount and
maximum number of Borrowings of the relevant Type;

 

(iv)  each conversion shall be effected by each Lender and the Administrative
Agent by recording for the account of such Lender the new Loan of such Lender
resulting from such conversion and reducing the Loan (or portion thereof) of
such Lender being converted by an equivalent principal amount; accrued interest
on any Eurodollar Loan (or portion thereof) being converted shall be paid by the
Borrower at the time of conversion;

 

(v)  if any Eurodollar Borrowing is converted at a time other than the end of
the Interest Period applicable thereto, the Borrower shall pay, upon demand, any
amounts due to the Lenders pursuant to Section 2.16;

 

(vi)  any portion of a Borrowing maturing or required to be repaid in less than
one month may not be converted into or continued as a Eurodollar Borrowing;

 

(vii)  any portion of a Eurodollar Borrowing that cannot be converted into or
continued as a Eurodollar Borrowing by reason of the immediately preceding
clause shall be automatically converted at the end of the Interest Period in
effect for such Borrowing into an ABR Borrowing;

 

(viii)  no Interest Period may be selected for any Eurodollar Borrowing that
would end later than a Repayment Date occurring on or after the first day of
such Interest Period if, after giving effect to such selection, the aggregate
outstanding amount of (A) the Eurodollar Borrowings comprised of Loans or Other
Loans, as applicable, with Interest Periods ending on or prior to such Repayment
Date and (B) the ABR Borrowings comprised of Loans or Other Loans, as
applicable, would not be at least equal to the principal amount of Borrowings to
be paid on such Repayment Date; and

 

(ix)  upon notice to the Borrower from the Administrative Agent given at the
request of the Required Lenders, after the occurrence and during the continuance
of a Default or Event of Default, no outstanding Loan may be converted into, or
continued as, a Eurodollar Loan.

 

Each notice pursuant to this Section 2.10 shall be irrevocable and shall refer
to this Agreement and specify (i) the identity and amount of the Borrowing that
the Borrower requests be converted or continued, (ii) whether such Borrowing is
to be converted to or continued as a Eurodollar Borrowing or an ABR Borrowing,
(iii) if such notice requests a conversion, the date of such conversion (which
shall be a Business Day) and (iv) if such Borrowing is to be converted to or
continued as a Eurodollar Borrowing, the Interest Period with respect thereto. 
If no Interest Period is specified in any such notice with respect to any
conversion to or continuation as a Eurodollar Borrowing, the Borrower shall be
deemed to have selected an Interest Period of one month’s duration. The
Administrative Agent shall advise the Lenders of any notice given pursuant to
this Section 2.10 and of each Lender’s portion of any converted or continued
Borrowing. If the Borrower shall not have given notice in accordance with this
Section 2.10 to continue any Borrowing into a subsequent Interest Period (and
shall not otherwise have given notice in accordance with this Section 2.10 to
convert such Borrowing), such Borrowing shall, at

 

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the end of the Interest Period applicable thereto (unless repaid pursuant to the
terms hereof), automatically be converted to an ABR Borrowing.

 

SECTION 2.11.  Repayment of Borrowings.  (a)  (i)  The Borrower shall pay to the
Administrative Agent, for the account of the Lenders, on the dates set forth
below, or if any such date is not a Business Day, on the next preceding Business
Day (each such date being called a “Repayment Date”), a principal amount of the
Loans other than Other Loans (as adjusted from time to time pursuant to
Sections 2.11(b), 2.12, 2.13(f) and 2.22(d)) equal to the amount set forth below
for such date, together in each case with accrued and unpaid interest on the
principal amount to be paid to but excluding the date of such payment:

 

Repayment Date

 

Amount

 

June 30, 2013

 

$

3,750,000

 

September 30, 2013

 

$

3,750,000

 

December 31, 2013

 

$

3,750,000

 

March 31, 2014

 

$

3,750,000

 

June 30, 2014

 

$

3,750,000

 

September 30, 2014

 

$

3,750,000

 

December 31, 2014

 

$

3,750,000

 

March 31, 2015

 

$

3,750,000

 

June 30, 2015

 

$

3,750,000

 

September 30, 2015

 

$

3,750,000

 

December 31, 2015

 

$

3,750,000

 

March 31, 2016

 

$

3,750,000

 

June 30, 2016

 

$

3,750,000

 

September 30, 2016

 

$

3,750,000

 

December 31, 2016

 

$

3,750,000

 

March 31, 2017

 

$

3,750,000

 

June 30, 2017

 

$

3,750,000

 

September 30, 2017

 

$

3,750,000

 

December 31, 2017

 

$

3,750,000

 

March 31, 2018

 

$

3,750,000

 

June 30, 2018

 

$

3,750,000

 

September 30, 2018

 

$

3,750,000

 

December 31, 2018

 

$

3,750,000

 

Maturity Date

 

Remaining unpaid principal amount of the Loans

 

 

(ii)  The Borrower shall pay to the Administrative Agent, for the account of the
Incremental Lenders, on each Incremental Loan Repayment Date, a principal amount
of the Other Loans (as adjusted from time to time pursuant to Sections 2.11(b),
2.12 and 2.13(f)) equal to the amount set forth for such date in the applicable
Incremental Loan Assumption Agreement, together in each case with accrued and
unpaid interest on the principal amount to be paid to but excluding the date of
such payment.

 

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(b)  In the event and on each occasion that the Incremental Loan Commitments
shall be reduced or shall expire or terminate other than as a result of the
making of an Incremental Loan, the installments payable on each Incremental
Repayment Date shall be reduced pro rata by an aggregate amount equal to the
amount of such reduction, expiration or termination.

 

(c)  To the extent not previously paid, all Loans, Other Loans and Extended
Loans shall be due and payable on the Maturity Date, the Incremental Loan
Maturity Date and the maturity date of such Extended Loans, respectively,
together with accrued and unpaid interest on the principal amount to be paid to
but excluding the date of payment.

 

(d)  All repayments pursuant to this Section 2.11 shall be subject to
Section 2.16, but shall otherwise be without premium or penalty.

 

SECTION 2.12.  Voluntary Prepayments.  (a)  The Borrower shall have the right at
any time and from time to time to prepay any Borrowing, in whole or in part,
upon at least three Business Days’ prior written or fax notice (or telephone
notice promptly confirmed by written or fax notice) in the case of Eurodollar
Loans, or written or fax notice (or telephone notice promptly confirmed by
written or fax notice) at least one Business Day prior to the date of prepayment
in the case of ABR Loans, to the Administrative Agent before 12:00 noon, New
York City time; provided, however, that each partial prepayment shall be in an
amount that is an integral multiple of $1,000,000 and not less than $5,000,000.

 

(b)  Voluntary prepayments of outstanding Loans shall be applied against the
remaining scheduled installments of principal due in respect of the Loans under
Section 2.11 as directed by the Borrower.

 

(c)  Each notice of prepayment shall specify the prepayment date and the
principal amount of each Borrowing (or portion thereof) to be prepaid, shall be
irrevocable and shall commit the Borrower to prepay such Borrowing by the amount
stated therein on the date stated therein; provided, however, that if such
prepayment is for all of the then outstanding Loans, then the Borrower may
revoke such notice and/or extend the prepayment date by not more than five
Business Days; provided, further, however, that the provisions of Section 2.16
shall apply with respect to any such revocation or extension. All prepayments
under this Section 2.12 shall be subject to Section 2.16 but otherwise without
premium or penalty (subject to the last sentence of this Section 2.12(c)).  All
prepayments under this Section 2.12 shall be accompanied by accrued and unpaid
interest on the principal amount to be prepaid to but excluding the date of
payment.  In the event that prior to the first anniversary of the Closing Date,
the Borrower (i) voluntarily prepays or otherwise refinances, substitutes or
replaces any Loans pursuant to any Repricing Transaction or (ii) effects any
amendment of this Agreement resulting in a Repricing Transaction, then the
Borrower shall pay to the Lenders (x) in the case of clause (i), a fee of 1.00%
of the aggregate principal amount of Loans so voluntarily prepaid, refinanced,
substituted or replaced and (y) in the case of clause (ii), a fee equal to 1.00%
of the aggregate principal amount of the applicable Loans outstanding
immediately prior to such amendment.

 

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SECTION 2.13.  Mandatory Prepayments.

 

(a)  Not later than the tenth day following the receipt of Net Cash Proceeds in
respect of any Term Loan Priority Collateral Sale, the Borrower shall apply 100%
of the Net Cash Proceeds received with respect thereto to prepay outstanding
Loans in accordance with Section 2.13(f); provided that, if (i) the Borrower
shall deliver a certificate of a Responsible Officer to the Administrative Agent
at the time of receipt thereof setting forth the Borrower’s intent to reinvest
such proceeds in productive assets of a kind then used or usable in the business
of the Borrower and its Restricted Subsidiaries within 365 days of receipt of
such proceeds, (ii) such proceeds are at all times following the receipt thereof
and prior to such reinvestment, held in a depositary account maintained in
accordance with Section 5.22 hereof and subject to a Blocked Account Agreement
in favor of the Collateral Agent and the ABL Collateral Agent and (iii) no
Default or Event of Default shall have occurred and shall be continuing at the
time of such certificate or at the proposed time of the application of such
proceeds, such proceeds shall not be required to prepay outstanding Loans except
to the extent not so used at the end of such 365-day period or committed to be
so used at the end of and so used within 180 days after the end of such 365-day
period, at which time any such proceeds not so used shall be applied to prepay
outstanding Loans in accordance with Section 2.13(f); provided, further, that
the Net Cash Proceeds received with respect thereto shall be reinvested (v) such
that after giving effect to such reinvestment, the Related Real Estate
Collateral shall not constitute more than 45% of the aggregate Value of the Real
Estate Collateral Properties and the Related Real Estate Collateral, (w) such
that after giving effect to such reinvestment, the owned Real Estate Collateral
Properties shall constitute at least 50% of the aggregate Value of the Real
Estate Collateral Properties and the Related Real Estate Collateral, (x) to the
extent attributable to a Loan Party, in assets of a Loan Party, (y) to the
extent attributable to Related Real Estate Collateral or Real Estate Collateral
Properties, in Related Real Estate Collateral or Real Estate Collateral
Properties and (z) in Term Loan Priority Collateral.

 

(b)  In the event that the Borrower or any Restricted Subsidiary conducts any
Other Asset Sale for which the Net Cash Proceeds exceed $5,000,000, then the
Borrower shall apply 100% of the Net Cash Proceeds received with respect thereto
to prepay outstanding Loans in accordance with Section 2.13(f) not later than
the tenth day following the receipt of such Net Cash Proceeds; provided that if
(x) the Borrower shall deliver a certificate of a Responsible Officer to the
Administrative Agent at the time of receipt thereof setting forth the Borrower’s
intent to reinvest such proceeds in productive assets of a kind then used or
usable in the business of the Borrower and its Restricted Subsidiaries within
365 days of receipt of such proceeds, (y) such proceeds attributable to Term
Loan Priority Collateral are at all times following the receipt thereof and
prior to such reinvestment, held in a depositary account maintained in
accordance with Section 5.22 hereof and subject to a Blocked Account Agreement
in favor of the Collateral Agent and the ABL Collateral Agent and (z) no Default
or Event of Default shall have occurred and shall be continuing at the time of
such certificate or at the proposed time of the application of such proceeds,
such proceeds shall not be required to prepay outstanding Loans except to the
extent not so used at the end of such 365-day period or committed to be so used
at the end of and so used within 180 days after the end of such 365-day period,
at which time any such proceeds not so used shall be applied to prepay
outstanding Loans in accordance with Section 2.13(f); provided, further, that
the Net Cash Proceeds received with respect thereto shall be reinvested (v) to
the extent attributable to Term Loan Priority Collateral, such that after giving
effect to such reinvestment, the Related Real Estate Collateral shall not
constitute more than 45% of the aggregate Value of the Real Estate Collateral
Properties and the Related Real Estate Collateral,

 

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(w) to the extent attributable to Term Loan Priority Collateral, such that after
giving effect to such reinvestment, the owned Real Estate Collateral Properties
shall constitute at least 50% of the aggregate Value of the Real Estate
Collateral Properties and the Related Real Estate Collateral, (x) to the extent
attributable to a Loan Party, in assets of a Loan Party, (y) to the extent
attributable to Term Loan Priority Collateral that is Related Real Estate
Collateral or Real Estate Collateral Properties, in Related Real Estate
Collateral or Real Estate Collateral Properties and (z) to the extent
attributable to Term Loan Priority Collateral, in other Term Loan Priority
Collateral.

 

(c)  No later than 90 days after the end of each Fiscal Year of the Borrower,
commencing with the Fiscal Year ending closest to February 28, 2014, the
Borrower shall prepay outstanding Loans in accordance with Section 2.13(f) in an
aggregate principal amount equal to (x) 50% of Excess Cash Flow for the Fiscal
Year then ended minus (y) voluntary prepayments of Loans under Section 2.12 made
during such Fiscal Year with Internally Generated Cash; provided that such
prepayments do not occur in connection with a refinancing of all or any portion
of such Indebtedness; provided, further, that the Excess Cash Flow percentage
for any Fiscal Year with respect to which Excess Cash Flow is measured shall be
reduced to (A) 25% if the Total Secured Leverage Ratio as of the last day of
such Fiscal Year is less than or equal to 2.00:1.00 but greater than 1.50:1.00
and (B) zero if the Total Secured Leverage Ratio as of the last day of such
Fiscal Year is less than or equal to 1.50:1.00.

 

(d)  In the event that the Borrower or any Restricted Subsidiary shall receive
Net Cash Proceeds from the issuance or incurrence of Indebtedness for money
borrowed (other than Permitted Indebtedness), the Borrower shall, substantially
simultaneously with (and in any event not later than the first Business Day next
following) the receipt of such Net Cash Proceeds by the Borrower or such
Restricted Subsidiary, apply an amount equal to 100% of such Net Cash Proceeds
to prepay outstanding Loans in accordance with Section 2.13(f).

 

(e)  Not later than the tenth day following the receipt of Net Cash Proceeds in
respect of any Moran Sale, the Borrower shall apply an amount equal to (x) 100%
of the first $750,000,000 of Net Cash Proceeds received with respect thereto and
(y) thereafter, 50% of the Net Cash Proceeds in excess of such amount up to an
amount that would cause the Total Secured Leverage Ratio on a pro forma basis
after giving effect to such prepayment to be 1.50:1.00, in each case to prepay
outstanding Loans in accordance with Section 2.13(f).

 

(f)  Mandatory prepayments of outstanding Loans under this Agreement shall be
allocated pro rata between the Loans, the Other Loans and the Extended Loans
(unless Other Loans or Extended Loans agreed to receive less than their pro rata
share) and applied first, to the next four succeeding scheduled installments of
principal due in respect of the Loans, Other Loans and Extended Loans under
Sections 2.11(a)(i) and (ii), respectively, second, pro rata against the
remaining scheduled installments of principal due in respect of the Loans, Other
Loans and the Extended Loans under Sections 2.11(a)(i) and (ii), respectively
(excluding the final payments on the Maturity Date of the Loans (or the maturity
date in respect of such Other Loans or Extended Loans) under Sections
2.11(a)(i) and (ii), respectively and third, to the final payment on the
Maturity Date of the Loans (or the final payment on the maturity date of such
Other Loans or Extended Loans).

 

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(g)  The Borrower shall deliver to the Administrative Agent, at the time of each
prepayment required under this Section 2.13, (i) a certificate signed by a
Responsible Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent practicable
(except in respect of prepayments required under Section 2.13(d)), at least
three Business Days prior written notice of such prepayment.  Each notice of
prepayment shall specify the prepayment date, the Type of each Loan being
prepaid and the principal amount of each Loan (or portion thereof) to be
prepaid.  All prepayments of Borrowings under this Section 2.13 shall be subject
to Section 2.16, but shall otherwise be without premium or penalty, and shall be
accompanied by accrued and unpaid interest on the principal amount to be prepaid
to but excluding the date of payment.

 

SECTION 2.14.  Reserve Requirements; Change in Circumstances. 
(a)  Notwithstanding any other provision of this Agreement, if any Change in Law
shall impose, modify or deem applicable any reserve, special deposit, liquidity
requirement, Tax (other than Indemnified Taxes indemnified pursuant to
Section 2.20 and Excluded Taxes) or similar requirement against assets of,
deposits with or for the account of or credit extended by any Lender (except any
such reserve requirement which is reflected in the Adjusted LIBO Rate) or shall
impose on such Lender or the London interbank market any other condition
affecting this Agreement or Eurodollar Loans made by such Lender, and the result
of any of the foregoing shall be to increase the cost to such Lender of making
or maintaining any Eurodollar Loan or increase the cost to any Lender or to
reduce the amount of any sum received or receivable by such Lender hereunder
(whether of principal, interest or otherwise) by an amount deemed by such Lender
to be material, then the Borrower will pay to such Lender upon demand such
additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.

 

(b)  If any Lender shall have determined that any Change in Law regarding
capital adequacy or liquidity has had or would have the effect of reducing the
rate of return on such Lender’s capital or on the capital of such Lender’s
holding company, if any, as a consequence of this Agreement or the Loans made by
such Lender pursuant hereto to a level below that which such Lender or such
Lender’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s policies and the policies of such Lender’s
holding company with respect to capital adequacy and liquidity) by an amount
deemed by such Lender to be material, then from time to time the Borrower shall
pay to such Lender upon demand such additional amount or amounts as will
compensate such Lender or such Lender’s holding company for any such reduction
suffered.

 

(c)  A certificate of a Lender setting forth (i) the amount or amounts necessary
to compensate such Lender or its holding company, as applicable, and (ii) the
calculations supporting such amount or amounts, as specified in
Sections 2.14(a) or 2.14(b) shall be delivered to the Borrower and shall be
conclusive absent manifest error.  The Borrower shall pay such Lender the amount
shown as due on any such certificate delivered by it within 10 days after its
receipt of the same.

 

(d)  Failure or delay on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital shall not constitute a waiver of such Lender’s right to demand
such compensation; provided that the

 

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Borrower shall not be under any obligation to compensate any Lender under
Sections 2.14(a) or 2.14(b) with respect to increased costs or reductions with
respect to any period prior to the date that is 180 days prior to such request
if such Lender knew or would reasonably have been expected to know of the
circumstances giving rise to such increased costs or reductions and of the fact
that such circumstances would result in a claim for increased compensation by
reason of such increased costs or reductions; provided, further, that the
foregoing limitation shall not apply to any increased costs or reductions
arising out of the retroactive application of any Change in Law within such
180-day period. The protection of this Section 2.14 shall be available to each
Lender regardless of any possible contention of the invalidity or
inapplicability of the Change in Law that shall have occurred or been imposed.

 

SECTION 2.15.  Change in Legality.  (a)  Notwithstanding any other provision of
this Agreement, if any Change in Law shall make it unlawful for any Lender to
make or maintain any Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to any Eurodollar Loan, then, by written notice
to the Borrower and to the Administrative Agent:

 

(i) such Lender may declare that Eurodollar Loans will not thereafter (for the
duration of such unlawfulness) be made by such Lender hereunder (or be continued
for additional Interest Periods) and ABR Loans will not thereafter (for such
duration) be converted into Eurodollar Loans, whereupon any request for a
Eurodollar Borrowing (or to convert an ABR Borrowing to a Eurodollar Borrowing
or to continue a Eurodollar Borrowing for an additional Interest Period) shall,
as to such Lender only, be deemed a request for an ABR Loan (or a request to
continue an ABR Loan as such for an additional Interest Period or to convert a
Eurodollar Loan into an ABR Loan, as the case may be), unless such declaration
shall be subsequently withdrawn; and

 

(ii) such Lender may require that all outstanding Eurodollar Loans made by it be
converted to ABR Loans, in which event all such Eurodollar Loans shall be
automatically converted to ABR Loans as of the effective date of such notice as
provided in Section 2.15(b).

 

In the event any Lender shall exercise its rights under clauses (i) or
(ii) above, all payments and prepayments of principal that would otherwise have
been applied to repay the Eurodollar Loans that would have been made by such
Lender or the converted Eurodollar Loans of such Lender shall instead be applied
to repay the ABR Loans made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Loans.

 

(b)  For purposes of this Section 2.15, a notice to the Borrower by any Lender
shall be effective as to each Eurodollar Loan made by such Lender, if lawful, on
the last day of the Interest Period then applicable to such Eurodollar Loan; in
all other cases such notice shall be effective on the date of receipt by the
Borrower.

 

SECTION 2.16.  Breakage.  The Borrower shall indemnify each Lender against any
loss or expense that such Lender may sustain or incur as a consequence of
(a) any event, other than a default by such Lender in the performance of its
obligations hereunder, which results in (i) such Lender receiving or being
deemed to receive any amount on account of the principal of any Eurodollar Loan
prior to the end of the Interest Period in effect therefor, (ii) the conversion
of

 

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any Eurodollar Loan to an ABR Loan, or the conversion of the Interest Period
with respect to any Eurodollar Loan, in each case other than on the last day of
the Interest Period in effect therefor, or (iii) any Eurodollar Loan to be made
by such Lender (including any Eurodollar Loan to be made pursuant to a
conversion or continuation under Section 2.10) not being made after notice of
such Loan shall have been given by the Borrower hereunder (any of the events
referred to in this clause (a) being called a “Breakage Event”) or (b) any
default in the making of any payment or prepayment of any Eurodollar Loan
required to be made hereunder.  In the case of any Breakage Event, such loss
shall include an amount equal to the excess, as reasonably determined by such
Lender, of (i) its cost of obtaining funds for the Eurodollar Loan that is the
subject of such Breakage Event for the period from the date of such Breakage
Event to the last day of the Interest Period in effect (or that would have been
in effect) for such Loan over (ii) the amount of interest likely to be realized
by such Lender in redeploying the funds released or not utilized by reason of
such Breakage Event for such period.  Each Lender shall provide a certificate
setting forth any amount or amounts which such Lender is entitled to receive
pursuant to this Section 2.16 to the Borrower within 180 days after the Breakage
Event and such certificate shall be conclusive absent manifest error.

 

SECTION 2.17.  Pro Rata Treatment.  Except as required under Section 2.15 or
otherwise stated herein, each Borrowing, each payment or prepayment of principal
of any Borrowing, each payment of interest on the Loans and each conversion of
any Borrowing to or continuation of any Borrowing as a Borrowing of any Type
shall be allocated pro rata among the Lenders in accordance with their
respective applicable Commitments (or, if such Commitments shall have expired or
been terminated, in accordance with the respective principal amounts of their
outstanding Loans).  Each Lender agrees that in computing such Lender’s portion
of any Borrowing to be made hereunder, the Administrative Agent may, in its
discretion, round each Lender’s percentage of such Borrowing to the next higher
or lower whole Dollar amount.

 

SECTION 2.18.  Sharing of Setoffs.  Each Lender agrees that if it shall, through
the exercise of a right of banker’s lien, setoff or counterclaim against the
Borrower or any other Loan Party, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, obtain payment (voluntary or involuntary) in respect of any
Loan or Loans as a result of which the unpaid principal portion of its Loans
shall be proportionately less than the unpaid principal portion of the Loans of
any other Lender, it shall be deemed simultaneously to have purchased from such
other Lender at face value, and shall promptly pay to such other Lender the
purchase price for, a participation in the Loans of such other Lender, so that
the aggregate unpaid principal amount of the Loans held by each Lender shall be
in the same proportion to the aggregate unpaid principal amount of all Loans
then outstanding as the principal amount of its Loans prior to such exercise of
banker’s lien, setoff or counterclaim or other event was to the principal amount
of all Loans outstanding prior to such exercise of banker’s lien, setoff or
counterclaim or other event; provided, however, that (i) if any such purchase or
purchases or adjustments shall be made pursuant to this Section 2.18 and the
payment giving rise thereto shall thereafter be recovered, such purchase or
purchases or adjustments shall be rescinded to the extent of such recovery and
the purchase price or prices or adjustment restored without interest, and
(ii) the provisions of this Section 2.18 shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the

 

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express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans to any assignee or participant, other than to any Affiliates of the
Borrower (as to which the provisions of this Section 2.18 shall apply).  The
Borrower expressly consents to the foregoing arrangements and agrees that any
Lender holding a participation in a Loan deemed to have been so purchased may
exercise any and all rights of banker’s lien, setoff or counterclaim with
respect to any and all moneys owing by the Borrower to such Lender by reason
thereof as fully as if such Lender had made a Loan directly to the Borrower in
the amount of such participation.

 

SECTION 2.19.  Payments.  (a)  The Borrower shall make each payment (including
principal of or interest on any Borrowing or any Fees or other amounts)
hereunder and under any other Loan Document not later than 2:00 p.m., New York
City time, on the date when due in immediately available Dollars, without
setoff, defense or counterclaim. Each such payment shall be made to the
Administrative Agent at its offices described on Schedule 9.01(b) (or as
otherwise notified by the Administrative Agent in writing to the Borrower from
time to time).  Any payments received by the Administrative Agent after
2:00 p.m., New York City time, may, in the Administrative Agent’s sole
discretion, be deemed received on the next succeeding Business Day.  Subject to
Article VIII, the Administrative Agent shall promptly distribute to each Lender
any payments received by the Administrative Agent on behalf of such Lender.

 

(b)  Except as otherwise expressly provided herein, whenever any payment
(including principal of or interest on any Borrowing or any Fees or other
amounts) hereunder or under any other Loan Document shall become due, or
otherwise would occur, on a day that is not a Business Day, such payment may 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, if applicable.

 

SECTION 2.20.  Taxes.  (a)  Any and all payments by or on account of any
obligation of the Borrower or any other Loan Party hereunder or under any other
Loan Document shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided that, if any Indemnified Taxes or
Other Taxes are required to be deducted from such payments, then (i) the sum
payable by the Borrower or other Loan Party shall be increased as necessary so
that after making all required deductions, (including deductions applicable to
additional sums payable under this Section 2.20) the Administrative Agent and
each Lender (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower or such Loan
Party shall make such deductions as required by law and (iii) the Borrower or
such Loan Party shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.

 

(b)  In addition, the Borrower and any other Loan Party, as the case may be,
shall pay any Other Taxes to the relevant Governmental Authority in accordance
with applicable law.

 

(c)  The Borrower shall indemnify the Administrative Agent and each Lender,
within 30 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent or such
Lender, as the case may be, on or with respect to any payment by or on account
of any obligation of the Borrower or any other Loan Party hereunder or otherwise
with respect to any Loan Document (including Indemnified Taxes or Other Taxes

 

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imposed or asserted on or attributable to amounts payable under this
Section 2.20) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or by the Administrative Agent
on behalf of itself or a Lender shall be conclusive absent manifest error.

 

(d)  Not later than 30 days after any payment of Indemnified Taxes or Other
Taxes by the Borrower or any other Loan Party to a Governmental Authority, the
Borrower shall deliver to the Administrative Agent the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.

 

(e)  Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement shall deliver to
the Borrower and the Administrative Agent, at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law and reasonably requested by the Borrower or the Administrative
Agent as will permit such payments to be made without withholding or at a
reduced rate.  Without limiting the generality of the foregoing, each Foreign
Lender shall deliver to the Borrower and the Administrative Agent, on or prior
to the date it becomes a Lender hereunder and thereafter upon the expiration,
obsolescence or invalidity of any previously delivered documentation or upon the
reasonable request of the Borrower or the Administrative Agent, two original,
properly completed IRS Forms W-8BEN (claiming the benefits of an applicable tax
treaty), W-8ECI, W-8EXP or W-8IMY (together with any required attachments) or,
if the Foreign Lender is relying on the so-called “portfolio interest
exemption,” two properly completed IRS Forms W-8BEN and two executed
certificates substantially in the form of Exhibit O hereto stating that the
Foreign Lender is not (i) a “bank” within the meaning of Section 881(c)(3)(A) of
the Code, (ii) a “10-percent shareholder” within the meaning of
Section 871(h)(3)(B) of the Code or (iii) a “controlled foreign corporation”
related to any Loan Party within the meaning of Section 864(d)(4) of the Code,
in the case of any of the foregoing certifying that the Foreign Lender is
entitled to an exemption or reduced rate of U.S. federal withholding tax on
payments hereunder.  Each Lender that is not a Foreign Lender shall deliver to
the Borrower and the Administrative Agent, on or prior to the date it becomes a
Lender hereunder and thereafter upon the expiration, obsolescence or invalidity
of any previously delivered documentation or upon the reasonable request of the
Borrower or the Administrative Agent, two original, properly completed IRS Forms
W-9 or shall otherwise establish an exemption from U.S. backup withholding. 
Notwithstanding the foregoing, this Section 2.20(e) shall not require any Lender
to provide any forms or documentation that it is not legally entitled to
provide.

 

(f)  If a payment made to a Lender hereunder may be subject to U.S. federal
withholding tax under FATCA if such Lender fails to comply with the applicable
reporting requirements of FATCA, such Lender shall deliver to the Borrower and
the Administrative Agent, at the time or times prescribed by law and at such
time or times reasonably requested by the Borrower or the Administrative Agent,
such documentation prescribed by applicable law and such additional
documentation reasonably requested by the Borrower or the Administrative Agent
to comply with its withholding obligations, to determine that such Lender has
complied with such Lender’s

 

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obligations under FATCA or to determine the amount to deduct and withhold from
such payment.  Solely for purposes of this Section 2.20(f), “FATCA” shall
include any amendments made to FATCA after the date of this Agreement.

 

SECTION 2.21.  Assignment of Commitments Under Certain Circumstances; Duty to
Mitigate.  (a)  In the event (i) any Lender delivers a certificate requesting
compensation pursuant to Section 2.14, (ii) any Lender delivers a notice
described in Section 2.15, (iii) the Borrower is required to pay any additional
amount to any Lender or any Governmental Authority on account of any Lender
pursuant to Section 2.20 or (iv) any Lender refuses to consent to any amendment,
waiver or other modification of any Loan Document requested by the Borrower that
requires the consent of a greater percentage of the Lenders than the Required
Lenders and such amendment, waiver or other modification is consented to by the
Required Lenders, then, in each case, the Borrower may, at its sole expense and
effort (including with respect to the processing and recordation fee referred to
in Section 9.04(b)), upon notice to such Lender and the Administrative Agent,
require such Lender to transfer and assign, without recourse (in accordance with
and subject to the restrictions contained in Section 9.04), all of its
interests, rights and obligations under this Agreement (or, in the case of
clause (iv) above, all of its interests, rights and obligations with respect to
the Class of Loans or Commitments that is the subject of the related consent,
amendment, waiver or other modification) to an Eligible Assignee that shall
assume such assigned obligations and, with respect to clause (iv) above, shall
consent to such requested amendment, waiver or other modification of any Loan
Documents (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (x) such assignment shall not conflict with any law,
rule or regulation or order of any court or other Governmental Authority having
jurisdiction, (y) the Borrower shall have received the prior written consent of
the Administrative Agent, which consent shall not unreasonably be withheld or
delayed, and (z) the Borrower or such assignee shall have paid to the affected
Lender in immediately available funds an amount equal to the sum of the
principal of and interest accrued to the date of such payment on the outstanding
Loans of such Lender plus all Fees and other amounts accrued for the account of
such Lender hereunder with respect thereto (including any amounts under
Sections 2.14 and 2.16 and, in the case of any such assignment occurring in
connection with a Repricing Event occurring prior to the first anniversary of
the Closing Date, the prepayment fee pursuant to Section 2.12(c) (with such
assignment being deemed to be a voluntary prepayment for purposes of determining
the applicability of Section 2.12(c), such amount to be payable by the
Borrower)); provided, further, that if prior to any such transfer and assignment
the circumstances or event that resulted in such Lender’s claim for compensation
under Section 2.14, notice under Section 2.15 or the amounts paid pursuant to
Section 2.20, as the case may be, cease to cause such Lender to suffer increased
costs or reductions in amounts received or receivable or reduction in return on
capital, or cease to have the consequences specified in Section 2.15, or cease
to result in amounts being payable under Section 2.20, as the case may be
(including as a result of any action taken by such Lender pursuant to
Section 2.21(b)), or if such Lender shall waive its right to claim further
compensation under Section 2.14 in respect of such circumstances or event or
shall withdraw its notice under Section 2.15 or shall waive its right to further
payments under Section 2.20 in respect of such circumstances or event or shall
consent to the proposed amendment, waiver, consent or other modification, as the
case may be, then such Lender shall not thereafter be required to make any such
transfer and assignment hereunder.  Each Lender hereby grants to the
Administrative Agent an irrevocable power of attorney (which power is coupled
with an interest) to execute and deliver, on behalf of

 

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such Lender, as assignor, any Assignment and Acceptance necessary to effectuate
any assignment of such Lender’s interests hereunder in the circumstances
contemplated by this Section 2.21(a).

 

(b)  If (i) any Lender shall request compensation under Section 2.14, (ii) any
Lender delivers a notice described in Section 2.15 or (iii) the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority on account of any Lender pursuant to Section 2.20, then such Lender
shall use reasonable efforts (which shall not require such Lender to incur an
unreimbursed loss or unreimbursed cost or expense or otherwise take any action
inconsistent with its internal policies or legal or regulatory restrictions or
suffer any disadvantage or burden deemed by it to be significant) (x) to file
any certificate or document reasonably requested in writing by the Borrower or
(y) to assign its rights and delegate and transfer its obligations hereunder to
another of its offices, branches or affiliates, if such filing or assignment
would reduce its claims for compensation under Section 2.14 or enable it to
withdraw its notice pursuant to Section 2.15 or would reduce amounts payable
pursuant to Section 2.20, as the case may be, in the future.  The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such filing or assignment, delegation and transfer.

 

SECTION 2.22.  Incremental Loans.  (a)  The Borrower may, by written notice to
the Administrative Agent from time to time, request Incremental Loan Commitments
in an amount not to exceed the Incremental Loan Amount from one or more
Incremental Lenders, all of which must be Eligible Assignees. Such notice shall
set forth (i) the amount of the Incremental Loan Commitments being requested
(which shall be in minimum increments of $1,000,000 and a minimum amount of
$5,000,000 or such lesser amount equal to the remaining Incremental Loan
Amount), (ii) the date on which such Incremental Loan Commitments are requested
to become effective (which shall not be less than 10 Business Days nor more than
60 days after the date of such notice), and (iii) whether such Incremental Loan
Commitments are commitments to make additional Loans or commitments to make term
loans with terms different from the Loans (“Other Loans”).

 

(b)  The Borrower may seek Incremental Loan Commitments from existing Lenders
(each of which shall be entitled to agree or decline to participate in its sole
discretion) and additional banks, financial institutions and other institutional
lenders who will become Incremental Lenders in connection therewith; provided
that the Borrower and the Administrative Agent shall have consented to such
additional banks, financial institutions and other institutional lenders to the
extent the consent of the Borrower or the Administrative Agent, as applicable,
would be required if such institution were receiving an assignment of Loans
pursuant to Section 9.04 (provided, further, that the consent of the
Administrative Agent shall not be required with respect to an additional bank,
financial institution, or other institutional lender that is an Affiliate of a
Lender or a Related Fund).  The Borrower and each Incremental Lender shall
execute and deliver to the Administrative Agent an Incremental Loan Assumption
Agreement and such other documentation as the Administrative Agent shall
reasonably specify to evidence the Incremental Loan Commitment of each
Incremental Lender.  The terms and provisions of the Incremental Loans shall be
identical to those of the Loans except as otherwise set forth herein or in the
Incremental Loan Assumption Agreement.  Without the prior written consent of the
Administrative Agent, (i) the final maturity date of any Other Loans shall be no
earlier than the Maturity Date, (ii) the average life to maturity of the Other
Loans shall be no shorter than the

 

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remaining average life to maturity of the Loans, (iii) if the initial yield on
such Other Loans (as reasonably determined by the Administrative Agent to be
equal to the sum of (x) the margin above the Adjusted LIBO Rate on such Other
Loans (taking into account any interest rate floors with respect to such Other
Loans) and (y) if such Other Loans are initially made at a discount or the
Lenders making the same receive a fee directly or indirectly from the Borrower
or any Subsidiary for doing so (the amount of such discount or fee, expressed as
a percentage of the Other Loans, being referred to herein as “OID”), the amount
of such OID divided by the lesser of (A) the average life to maturity of such
Other Loans and (B) four) exceeds the Applicable Margin then in effect for
Eurodollar Loans by more than 50 basis points (the amount of such excess above
50 basis points being referred to herein as the “Yield Differential”), then the
Applicable Margin then in effect for Loans shall automatically be increased by
the Yield Differential, effective upon the making of the Other Loans and
(iv) the other terms and documentation in respect of such Other Loans, to the
extent not consistent with the Term Facility, shall be reasonably satisfactory
to the Administrative Agent.  The Administrative Agent shall promptly notify
each Lender as to the effectiveness of each Incremental Loan Assumption
Agreement.  Notwithstanding anything in Section 9.08 to the contrary, each of
the parties hereto hereby agrees that, upon the effectiveness of any Incremental
Loan Assumption Agreement, this Agreement shall be deemed amended to the extent
(but only to the extent) necessary to reflect the existence and terms of the
Incremental Loan Commitment and the Incremental Loans evidenced thereby, and the
Administrative Agent and the Borrower may revise this Agreement to evidence such
amendments.  Incremental Loans and Other Loans shall have the same guarantees
as, and be secured on a pari passu basis with, the Loans.

 

(c)  Notwithstanding the foregoing, no Incremental Loan Commitment shall become
effective under this Section 2.22 unless (i) on the date of such effectiveness,
(x) the representations and warranties set forth in Article III and in each
other Loan Document shall be true and correct in all material respects (or in
all respects to the extent qualified by materiality or Material Adverse Effect)
on and as of such date with the same effect as though made on and as of such
date, except to the extent such representations and warranties expressly relate
to an earlier date, in which case such representations and warranties shall be
true and correct in all material respects (or in all respects to the extent
qualified by materiality or Material Adverse Effect) on and as of such earlier
date and (y) at the time of and immediately after the giving effect to the
Borrowing of Incremental Loans, no Default or Event of Default shall have
occurred and be continuing, and the Administrative Agent shall have received a
certificate to that effect dated such date and executed by a Responsible Officer
of the Borrower, (ii) the Borrower’s Total Secured Leverage Ratio shall not
exceed 2.50:1.00 on a pro forma basis after giving effect to such Incremental
Loan Commitment, the incurrence of the Incremental Loans thereunder the use of
proceeds thereof and the Administrative Agent shall have received a certificate
to that effect showing such calculations in reasonable detail dated such date
and executed by a Responsible Officer of the Borrower, (iii) all fees and
expenses owing to the Administrative Agent and the Lenders in respect of such
increase shall have been paid, (iv) except as otherwise specified in the
applicable Incremental Loan Assumption Agreement, the Administrative Agent shall
have received (with sufficient copies for each of the Incremental Lenders) legal
opinions, board resolutions and other closing certificates reasonably requested
by the Administrative Agent and consistent with those delivered on the Closing
Date under Section 4.01 and (v) to the extent reasonably necessary to maintain
the continuing priority of the Lien of the Mortgages on the Real Estate
Collateral Properties as security for the Obligations, as determined by the

 

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Administrative Agent in its reasonable discretion, (x) the applicable Loan Party
to any Mortgages shall have entered into, and delivered to the Administrative
Agent, at the direction and in the sole discretion of the Administrative Agent a
mortgage modification or new Mortgage in proper form for recording in the
relevant jurisdiction and in a form reasonably satisfactory to the
Administrative Agent, (y) the Borrower shall have caused to be delivered to the
Administrative Agent for the benefit of the Lenders an endorsement to the title
insurance policy, date down(s) or other evidence reasonably satisfactory to the
Administrative Agent insuring that the priority of the Lien of such Mortgages as
security for the Obligations has not changed and confirming and/or insuring that
since the issuance of the title insurance policy there has been no change in the
condition of title and there are no intervening liens or encumbrances that may
then or thereafter take priority over the Lien of such Mortgages (other than
Permitted Encumbrances) and (z) the Borrower shall have delivered, at the
request of the Administrative Agent, to the Administrative Agent and/or all
other relevant third parties all other items reasonably necessary to maintain
the continuing priority of the Lien of such Mortgages as security for the
Obligations.

 

(d)  Each of the parties hereto hereby agrees that the Administrative Agent may,
in consultation with the Borrower, take any and all action as may be reasonably
necessary to ensure that all Incremental Loans (other than Other Loans), when
originally made, are included in each Borrowing of outstanding Loans on a pro
rata basis.  This may be accomplished by requiring each outstanding Eurodollar
Borrowing to be converted into an ABR Borrowing on the date of each Incremental
Loan, or by allocating a portion of each Incremental Loan to each outstanding
Eurodollar Borrowing on a pro rata basis.  Any conversion of Eurodollar Loans to
ABR Loans required by the preceding sentence shall be subject to Section 2.16. 
If any Incremental Loan is to be allocated to an existing Interest Period for a
Eurodollar Borrowing, then the interest rate thereon for such Interest Period
and the other economic consequences thereof shall be as set forth in the
applicable Incremental Loan Assumption Agreement.  In addition, to the extent
any Incremental Loans are not Other Loans, the scheduled amortization payments
under Section 2.11(a)(i) required to be made after the making of such
Incremental Loans shall be ratably increased by the aggregate principal amount
of such Incremental Loans and shall be further increased for all Lenders on a
pro rata basis to the extent necessary to avoid any reduction in the
amortization payments to which the Lenders were entitled before such
recalculation.

 

SECTION 2.23.  Extension Amendments.  (a)  So long as no Event of Default or
Default has occurred and is continuing (after giving effect to any amendments
and/or waivers that are or become effective on the date of the relevant
conversion), the Borrower may at any time and from time to time request that all
or a portion of any Class of Loans then outstanding selected by the Borrower
(such series, the “Original Loans”) be converted to extend the maturity date
thereof and to provide for other terms permitted by this Section 2.23 (any
portion thereof that have been so extended, the “Extended Loans” and the
remainder not so extended, the “Non-Extended Loans”).  Prior to entering into
any Extension Amendment with respect to any Original Loans, the Borrower shall
provide a notice to the Administrative Agent (who shall provide a copy of such
notice to each Lender who has Original Loans) in such form as approved from time
to time by the Borrower and the Administrative Agent (each, an “Extension
Request”) setting forth the terms of the proposed Extended Loans, as applicable,
which terms shall be identical to those applicable to the Original Loans, except
for Section 2.23 Additional Agreements or as otherwise permitted by this
Section 2.23 and except (w) the maturity date of

 

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Extended Loans may be delayed to a date after the Fixed Maturity Date,
(x) Extended Loans may have different amortization payments than the Original
Loans; provided that the Weighted Average Life to Maturity of such Extended
Loans shall be no shorter than the Weighted Average Life to Maturity of the
Original Loans from which they were converted and (y) the initial yield
(including, without limitation, margins, fees and premiums) of the Extended
Loans may be higher or lower than the initial yield (including, without
limitation, margins, fees and premiums) of the Original Loans; provided,
however, that if the initial yield on such Extended Loans (as reasonably
determined by the Administrative Agent to be equal to the sum of (x) the margin
above the Adjusted LIBO Rate on such Extended Loans (taking into account any
interest rate floors with respect to such Extended Loans) and (y) if the
Extending Lenders agreeing to extend their Loans receive a fee directly or
indirectly from the Borrower or any Subsidiary for doing so (the amount of such
fee, expressed as a percentage of the Extended Loans, being referred to herein
as the “Extension Fee”), the amount of such Extension Fee divided by the lesser
of (A) the average life to maturity of such Extended Loans and (B) four) exceeds
the Applicable Margin for the Original Loans by more than 50 basis points (the
amount of such excess above 50 basis points being referred to herein as the
“Extended Loan Yield Differential”), then the Applicable Margin then for such
Loans shall automatically be increased by the Extended Loan Yield Differential,
effective upon the extension of the Extended Loans.  In addition to any other
terms and changes required or permitted by this Section 2.23, each Extension
Amendment establishing a Class of Extended Loans shall amend the scheduled
amortization payments provided under Section 2.11 with respect to the related
Non-Extended Loans to reduce each scheduled installment for such Non-Extended
Loans to an aggregate amount equal to the product of (1) the original aggregate
amount of such installment with respect to the Original Loans, multiplied by
(2) a fraction, the numerator of which is the aggregate principal amount of such
related Non-Extended Loans and (y) the denominator of which is the aggregate
principal amount of such Original Loans prior to the effectiveness of such
Extension Amendment (it being understood that the amount of any installment
payable with respect to any individual Non-Extended Loan shall not be reduced as
a result thereof without the consent of the holder of such individual
Non-Extended Loan).  No Lender shall have any obligation to agree to have any of
its Original Loans converted into Extended Loans pursuant to any Extension
Request.

 

(b)  The Borrower shall provide the applicable Extension Request at least seven
Business Days prior to the date on which the applicable Lenders are requested to
respond (or such later date as the Administrative Agent may agree).  Any Lender
(an “Extending Lender”) wishing to have all or a portion of its Original Loans
converted into Extended Loans shall notify the Administrative Agent (such notice
to be in such form as approved from time to time by the Borrower and the
Administrative Agent) (each, an “Extension Election”) on or prior to the date
specified in such Extension Request (which shall in any event be no less than
three Business Days prior to the effectiveness of the applicable Extension
Amendment) of the amount of its Original Loans that it has elected to convert
into Extended Loans.  In the event that the aggregate amount of the applicable
Original Loans subject to Extension Elections exceeds the amount of the
applicable Extended Loans requested pursuant to the Extension Request, the
applicable Original Loans subject to such Extension Elections shall be converted
to Extended Loans on a pro rata basis based on the amount of the applicable
Original Loans included in each such Extension Election.

 

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(c)  Subject to the requirements of this Section 2.23, so long as no Event of
Default or Default has occurred and is continuing (after giving effect to any
amendments and/or waivers that are or become effective on the date that such
Extended Loans are established), Extended Loans may be established pursuant to a
supplement (which shall set forth the effective date of such extension) to this
Agreement (which, except to the extent otherwise expressly contemplated by this
Section 2.23(c), shall require the consent only of the Lenders who elect to make
the Extended Loans established thereby) in such form as approved from time to
time by the Borrower and the Administrative Agent in the reasonable exercise of
its discretion (each, an “Extension Amendment”) executed by the Loan Parties,
the Administrative Agent and the Extending Lenders.  Any Extension Amendment may
provide for additional terms (other than those referred to or contemplated in
this Section 2.23 or in the form of the Extension Request or Extension Amendment
(each, a “Section 2.23 Additional Agreement”)) to this Agreement and the other
Loan Documents; provided that no such Section 2.23 Additional Agreement shall
become effective prior to the time that such Section 2.23 Additional Agreement
has been consented to by such of the Lenders, Loan Parties and other parties (if
any) as would be required (including, without limitation, under the requirements
of Section 9.08) if such Section 2.23 Additional Agreement were a separate and
independent amendment of this Agreement.  In connection with any Extension
Amendment, (i) if requested by the Administrative Agent, the Borrower shall
deliver an opinion of counsel reasonably acceptable to the Administrative Agent
as to any matters reasonably requested by the Administrative Agent and (ii) to
the extent reasonably necessary to maintain the continuing priority of the Lien
of the Mortgages on the Real Estate Collateral Properties as security for the
Obligations, as determined by the Administrative Agent in its reasonable
discretion, (x) the applicable Loan Party to any Mortgages shall have entered
into, and delivered to the Administrative Agent, at the direction and in the
sole discretion of the Administrative Agent a mortgage modification or new
Mortgage in proper form for recording in the relevant jurisdiction and in a form
reasonably satisfactory to the Administrative Agent, (y) the Borrower shall have
caused to be delivered to the Administrative Agent for the benefit of the
Lenders an endorsement to the title insurance policy, date down(s) or other
evidence reasonably satisfactory to the Administrative Agent insuring that the
priority of the Lien of such Mortgages as security for the Obligations has not
changed and confirming and/or insuring that since the issuance of the title
insurance policy there has been no change in the condition of title and there
are no intervening liens or encumbrances that may then or thereafter take
priority over the Lien of such Mortgages (other than Permitted Encumbrances) and
(z) the Borrower shall have delivered, at the request of the Administrative
Agent, to the Administrative Agent and/or all other relevant third parties all
other items reasonably necessary to maintain the continuing priority of the Lien
of such Mortgages as security for the Obligations.

 

(d)  The Lenders hereby irrevocably authorize the Administrative Agent to enter
into technical amendments to this Agreement and the other Loan Documents with
the applicable Loan Parties as may be necessary or advisable in order to
effectuate the transactions contemplated by this Section 2.23.

 

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ARTICLE III

 

Representations and Warranties

 

To induce the Secured Parties to enter into this Agreement and to make Loans
hereunder, each Loan Party represents and warrants to the Administrative Agent
and the other Secured Parties that:

 

SECTION 3.01.  Existence, Qualification and Power.  Each Loan Party and each
Restricted Subsidiary (a) is a corporation, limited liability company, trust,
partnership or limited partnership, duly incorporated, organized or formed,
validly existing and, where applicable, in good standing under the Laws of the
jurisdiction of its incorporation, organization, or formation; (b) has all
requisite power and authority and all requisite governmental licenses, permits,
authorizations, consents and approvals to (i) own or lease its assets and carry
on its business and (ii) execute, deliver and perform its obligations under the
Loan Documents to which it is a party; and (c) is duly qualified and is licensed
and, where applicable, in good standing under the Laws of each jurisdiction
where its ownership, lease or operation of properties or the conduct of its
business requires such qualification or license; except in each case referred to
in clause (c), to the extent that failure to do so would not reasonably be
expected to have a Material Adverse Effect.  Schedule 3.01 annexed hereto sets
forth, as of the Closing Date, each Loan Party’s name as it appears in official
filings, state of incorporation or organization, organization type, organization
number, if any, issued by its state of incorporation or organization, and its
federal employer identification number.

 

SECTION 3.02.  Authorization; No Contravention.

 

(a)  The execution, delivery and performance by each Loan Party of each Loan
Document to which such Person is a party, have been duly authorized by all
necessary corporate or other organizational action, and do not and will not
(i) contravene the terms of any of such Person’s Organization Documents;
(ii) conflict with or result in any breach, termination, or contravention of, or
constitute a default under or require any payment to be made under (x) any
Material Contract or any Material Indebtedness to which such Person is a party
or affecting such Person or the properties of such Person or any of its
Subsidiaries or (y) any order, injunction, writ or decree of any Governmental
Authority or any arbitral award to which such Person or its property is subject,
in each case under this clause (ii), which has had or would reasonably be
expected to have a Material Adverse Effect; (iii) result in or require the
creation of any Lien upon any asset of any Loan Party or any guarantee by any
Loan Party (other than Liens in favor of the Administrative Agent under the
Security Documents and guarantees in favor of the Administrative Agent);
(iv) violate any applicable Law where such violation has had or would reasonably
be expected to have a Material Adverse Effect; (v) result in any “change of
control” offer or similar offer being required to be made under any Material
Indebtedness to which such Person is a party or affecting such Person or the
properties of such Person or any of its Subsidiaries; or (vi) result in the
application of any of the consolidation, merger, conveyance, transfer or lease
of assets (however so denominated) provisions of any Material Indebtedness to
which such Person is a party or affecting such Person or the properties of such
Person or any of its Subsidiaries.  For purposes of the representations set
forth in this Section 3.02(a) that are made on the Closing Date, (i) the terms
“Material Contract” and “Material Indebtedness” shall

 

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be deemed to include Material Contracts and Material Indebtedness (including the
NAI Notes, the NAI Indenture, the ASC Notes and the ASC Indenture) of NAI and
its subsidiaries as if NAI and its subsidiaries were Subsidiaries of the
Borrower, and (ii) the dollar amount set forth in the definition of the term
“Material Indebtedness” shall be deemed to be $75,000,000.

 

(b)  The consummation of the Transactions does not and will not (i) contravene
the terms of the Organization Documents of the Borrower, NAI or any of their
respective Subsidiaries; (ii) conflict with or result in any breach,
termination, or contravention of, or constitute a default under or require any
payment to be made under (x) any Material Contract or any Material Indebtedness
to which such Person is a party or affecting such Person or the properties of
such Person or any of its Subsidiaries or (y) any order, injunction, writ or
decree of any Governmental Authority or any arbitral award to which such Person
or its property is subject, in each case under this clause (ii), which has had
or would reasonably be expected to have a Material Adverse Effect; (iii) result
in or require the creation of any Lien upon any asset of the Borrower, NAI or
any of their respective Subsidiaries or any guarantee by any such Person (other
than Liens in favor of the Administrative Agent under the Security Documents and
guarantees in favor of the Administrative Agent); (iv) violate any applicable
Law where such violation has had or would reasonably be expected to have a
Material Adverse Effect on the Borrower and its Subsidiaries; (v) result in any
“change of control” offer or similar offer being required to be made under any
Material Indebtedness to which the Borrower, NAI or any of their respective
Subsidiaries is a party or affecting any such Person or the properties of any
such Person or any of its Subsidiaries; or (vi) result in the application of any
of the consolidation, merger, conveyance, transfer or lease of assets (however
so denominated) provisions of any Material Indebtedness to which the Borrower,
NAI or any of their respective Subsidiaries is a party or affecting any such
Person or the properties of any such Person or any of its Subsidiaries.  For
purposes of the representations set forth in this Section 3.02(b) that are made
on the Closing Date, (i) the terms “Material Contract” and “Material
Indebtedness” shall be deemed to include Material Contracts and Material
Indebtedness (including the NAI Notes, the NAI Indenture, the ASC Notes and the
ASC Indenture) of NAI and its subsidiaries as if NAI and its subsidiaries were
Subsidiaries of the Borrower, and (ii) the dollar amount set forth in the
definition of the term “Material Indebtedness” shall be deemed to be
$75,000,000.

 

SECTION 3.03.  Governmental Authorization; Other Consents.  No approval, consent
(including, the consent of equity holders or creditors of any Loan Party or
Restricted Subsidiary), exemption, authorization, license or other action by, or
notice to, or filing with, any Governmental Authority or regulatory body or any
other Person is necessary or required for the grant of the security interest by
such Loan Party or Restricted Subsidiary of the Collateral pledged by it
pursuant to the Security Documents or for the execution, delivery or performance
by, or enforcement against, any Loan Party or Restricted Subsidiary of this
Agreement or any other Loan Document, except for (a) the perfection or
maintenance of the Liens created under the Security Documents (including the
first priority (subject to the Intercreditor Agreement) nature thereof),
(b) such consents which have been obtained or made prior to the date hereof and
are in full force and effect and (c) such consents which are required for the
exercise of remedies with respect to the ABL Priority Collateral, if any, under
the terms of the Intercreditor Agreement or any other Loan Document.

 

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SECTION 3.04.  Binding Effect.  This Agreement has been, and each other Loan
Document, when delivered, will have been, duly executed and delivered by each
Loan Party that is party thereto.  This Agreement constitutes, and each other
Loan Document when so delivered will constitute, a legal, valid and binding
obligation of such Loan Party, enforceable against each Loan Party that is party
thereto in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.

 

SECTION 3.05.  Financial Statements; No Material Adverse Effect.

 

(a)  The Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein, and (ii) fairly present the financial condition of the
Borrower and its Subsidiaries (prior to giving effect to the Transactions) as of
the date thereof and their results of operations for the period covered thereby
in accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein.

 

(b)  The unaudited Consolidated balance sheet of the Borrower and its
Subsidiaries (prior to giving effect to the Transactions) dated December 1,
2012, and the related Consolidated statements of income or operations and cash
flows for the Fiscal Quarter ended on such date (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein, and (ii) fairly present the financial
condition of the Borrower and its Subsidiaries (prior to giving effect to the
Transactions) as of the date thereof and their results of operations for the
period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments.

 

(c)  Since February 25, 2012, as of the Closing Date, there has not occurred any
Closing Date Material Adverse Effect or any event, condition, change or effect
that would reasonably be expected to have, individually or in the aggregate, a
Closing Date Material Adverse Effect.  Since the end of the most recent period
for which financial statements were required to be delivered pursuant to
Sections 5.01(a) or 5.01(b), as applicable, as of each date of the making of
representations and warranties under this Article III (other than the Closing
Date), there has been no event or circumstance, either individually or in the
aggregate, that has had or would reasonably be expected to have a Material
Adverse Effect.

 

(d)  To the best knowledge of the Borrower, no Internal Control Event exists or
has occurred since the date of the Audited Financial Statements that has
resulted in or would reasonably be expected to result in a misstatement in any
material respect, in any financial information delivered or to be delivered to
the Administrative Agent or the Lenders, of (i) the covenant compliance
calculations provided hereunder or (ii) the assets, liabilities, financial
condition or results of operations of the Borrower and its Subsidiaries on a
Consolidated basis.

 

(e)  The Consolidated forecasted balance sheet and statements of income and cash
flows of the Borrower and its Subsidiaries delivered pursuant to
Section 5.01(c) were prepared in good faith on the basis of the assumptions
stated therein, which assumptions were fair in light of the conditions existing
at the time of delivery of such forecasts (it being understood that projections

 

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by their nature are inherently uncertain and that, even though such forecasts
are prepared in good faith on the basis of assumptions believed to be reasonable
at the time such forecasts were prepared, the results reflected in such
forecasts may not be achieved and actual results may differ and such differences
may be material).

 

(f)  The deal basis financial statements described in Section 4.01(n) (the “Deal
Basis Financial Statements”) have been prepared to reflect the historical
financial information of the remaining operations of the Borrower and its
Subsidiaries following the Transactions and exclude the financial information of
NAI’s business operations expected to be sold to the Buyer, other than the
assets and liabilities of NAI and its subsidiaries that are expected to be
retained by the Borrower pursuant to the Acquisition Agreement.  The Deal Basis
Financial Statements reflect periods during which the Borrower and its
Subsidiaries operated as a consolidated entity inclusive of the operations of
NAI and its subsidiaries, and accordingly, the presentation to exclude such
operations has relied on assumptions and allocations to separate the operations
of NAI and its subsidiaries, and are not necessarily indicative of the future
operations or financial position of the Borrower and its Subsidiaries following
the Transactions.  The Borrower believes the assumptions and allocations
underlying the Deal Basis Financial Statements are reasonable and appropriate,
but such assumptions and allocations are preliminary and based on estimates and
are subject to change.

 

SECTION 3.06.  Litigation.  There are no actions, suits, proceedings, claims or
disputes pending or, to the knowledge of the Loan Parties after due and diligent
investigation, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, by or against any Loan Party or any of its
Subsidiaries or against any of its properties, rights or revenues that
(a) purport to materially and adversely affect or pertain to this Agreement or
any other Loan Document, or any of the transactions contemplated hereby, or
(b) except as specifically disclosed in Schedule 3.06, either individually or in
the aggregate, if determined adversely, would reasonably be expected to have a
Material Adverse Effect.  Since the Closing Date, there has been no material
adverse change in the status, or financial effect on any Loan Party or
Restricted Subsidiary, of the matters described on Schedule 3.06.

 

SECTION 3.07.  No Default.  No Loan Party or Restricted Subsidiary is in default
under or with respect to any Material Indebtedness.  No Event of Default (other
than an Event of Default arising from the inaccuracy of the representation set
forth in the second sentence of Section 3.15(a)) has occurred and is continuing
or would result from the consummation of the transactions contemplated by this
Agreement or any other Loan Document.  Neither the Borrower nor any of its
Subsidiaries is a party to any agreement or instrument or subject to any
corporate restriction that has had or would reasonably be expected to have a
Material Adverse Effect.

 

SECTION 3.08.  Ownership of Properties; Liens.

 

(a)  Each Loan Party and each Restricted Subsidiary has good and marketable
title in fee simple to or valid leasehold interests in, all Real Estate
necessary or used in the ordinary conduct of its business and each Loan Party
and each Restricted Subsidiary has good title to, valid leasehold interests in,
or valid licenses or service agreements for all personal property material to
the ordinary conduct of its business, except, in each case, as does not have and
would not reasonably be expected to have a Material Adverse Effect.  The
property of each Loan Party and each Restricted Subsidiary is subject to no
Liens other than Permitted Encumbrances.

 

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(b)  Schedule 3.08(b) sets forth the street address, county and state of each
site of land that is fee-owned by any Loan Party or Restricted Subsidiary as of
the Closing Date.  As of the Closing Date, except as set forth on Schedule
3.08(b), no Responsible Officer for a Loan Party or Restricted Subsidiary has
received any written notice of, or has any knowledge of, any pending or
contemplated condemnation proceeding affecting any Real Estate Collateral
Property or any sale or disposition thereof in lieu of condemnation.  To the
best of the knowledge of any Responsible Officer, except as set forth on
Schedule 3.08(b), no Loan Party or Restricted Subsidiary is obligated under any
unrecorded right of first refusal, option or other contractual right to sell,
assign or otherwise dispose of any such Real Estate Collateral Property or any
interest therein that would not constitute a Permitted Encumbrance.

 

(c)  Schedule 3.08(c) sets forth each lease that constitutes a Material Contract
or a Ground Lease (pursuant to the Closing Date Collateral List) or a lease of
any location where ABL Priority Collateral is located, in each case, to which
any Loan Party or any Restricted Subsidiary is a party as tenant or subtenant,
together with the street address, county and state of the property subject
thereto, and the name and contact information of the lessor thereunder.  Each of
such leases is in full force and effect, the Loan Parties and the Restricted
Subsidiaries are not in default (beyond applicable cure periods) of the terms of
any such leases, and each of the Loan Parties and the Restricted Subsidiaries
enjoys peaceful and undisturbed possession under all such leases, except, in
each case, as would not reasonably be expected to have a Material Adverse
Effect.

 

(d)  Schedule 6.01 sets forth a complete and accurate list of all Liens on the
property or assets of each Loan Party and each Restricted Subsidiary, other than
Liens that would constitute Permitted Encumbrances under clauses (a) through
(h) or clauses (j) through (u) of the definition thereof, showing as of the
Closing Date the lienholder thereof and the property or assets of such Loan
Party or Restricted Subsidiary subject thereto.

 

(e)  Schedule 6.02 sets forth a true and accurate copy of the investment policy
of the Borrower and the Restricted Subsidiaries and a complete and accurate list
of all Investments held by any Loan Party or any Restricted Subsidiary on the
Closing Date, other than Investments in Subsidiaries and Cash Equivalents, in
each case in excess of $10,000,000.

 

(f)  Schedule 6.03 sets forth a complete and accurate list of all Indebtedness
of each Loan Party (other than Indebtedness among the Loan Parties) or any
Restricted Subsidiary on the Closing Date, in each case in excess of
$10,000,000, showing as of the date hereof the amount, obligor or issuer and
maturity thereof and whether such Indebtedness is secured by a Lien; provided,
that for Capital Leases, Schedule 6.03 sets forth only the aggregate amount of
each type of Capital Lease.

 

SECTION 3.09.  Environmental Compliance.

 

(a)  Except as specifically disclosed in Schedule 3.09, no Loan Party or
Restricted Subsidiary (i) has failed to comply in all material respects with
applicable Environmental Law or to obtain, maintain or comply with any permit,
license or other approval required under applicable Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice of any
claim with respect to any material Environmental Liability or (iv) has a

 

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Responsible Officer with knowledge of any basis for any material Environmental
Liability, except, in each case, as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

(b)  Except as specifically disclosed in Schedule 3.09, (i) none of the
properties currently or formerly owned or operated by any Loan Party or
Restricted Subsidiary is or was listed or proposed for listing on the NPL or on
the CERCLIS or any analogous state or local list at any time while such property
was owned by such Loan Party or, to the knowledge of any Responsible Officer, at
any time prior to or after such property was owned by such Loan Party, and, to
the knowledge of any Responsible Officer, no property currently owned or
operated by any Loan Party or Restricted Subsidiary is adjacent to any such
property, in each case in connection with any matter for which any Loan Party or
Restricted Subsidiary would have any material Environmental Liability;
(ii) there are no and never have been any underground or above-ground storage
tanks or any surface impoundments, septic tanks, pits, sumps or lagoons in which
Hazardous Materials are being or have been treated, stored or disposed on any
property currently owned or operated by any Loan Party or Restricted Subsidiary
in violation of any Environmental Laws or, to the best of the knowledge of any
Responsible Officer, on any property formerly owned or operated by any Loan
Party or Restricted Subsidiary; (iii) there is no friable asbestos or friable
asbestos-containing material on any property currently owned or operated by any
Loan Party or Restricted Subsidiary; (iv) Hazardous Materials have not been
Released, discharged or disposed of on any property currently or formerly owned
or operated by any Loan Party or Restricted Subsidiary in violation of any
Environmental Laws; and (v) to the knowledge of any Responsible Officer, there
are no pending or threatened Liens under or pursuant to any applicable
Environmental Laws on any real property or other assets owned or leased by any
Loan Party or Restricted Subsidiary, and to the best of the knowledge of any
Responsible Officer, no actions by any Governmental Authority have been taken or
are in process which would subject any of such properties or assets to such
Liens, except, in the case of clauses (i) through (v) above, as would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

(c)  Except as specifically disclosed in Schedule 3.09, no Loan Party or
Restricted Subsidiary is undertaking, and no Loan Party or Restricted Subsidiary
has completed, either individually or together with other potentially
responsible parties, any investigation or assessment or remedial or response
action relating to any actual or threatened Release, discharge or disposal of
Hazardous Materials at any site, location or operation, either voluntarily or
pursuant to the order of any Governmental Authority or the requirements of any
Environmental Law that has or would reasonably be expected to have a Material
Adverse Effect; and all Hazardous Materials generated, used, treated, handled or
stored at, or transported to or from, any property currently or formerly owned
or operated by any Loan Party or Restricted Subsidiary have been disposed of in
a manner not reasonably expected, individually or in the aggregate, to have a
Material Adverse Effect.

 

SECTION 3.10.  Insurance.  The properties of the Loan Parties and the Restricted
Subsidiaries are insured with financially sound and reputable insurance
companies (including any Insurance Captive) in such amounts (after giving effect
to any self-insurance), with such deductibles and covering such risks
(including, without limitation, workers’ compensation, public liability,
business interruption and property damage insurance) as are customarily carried

 

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by companies engaged in similar businesses and owning similar properties in
localities where the applicable Loan Party or Restricted Subsidiary operates. 
Schedule 3.10 sets forth a description of all such insurance currently
maintained (excluding title, group health and disability, and similar types of
insurance) by or on behalf of the Loan Parties and the Restricted Subsidiaries
as of the Closing Date.  Each insurance policy listed on Schedule 3.10 is in
full force and effect and all premiums in respect thereof that are due and
payable have been paid.

 

SECTION 3.11.  Taxes.  The Loan Parties and the Restricted Subsidiaries have
filed all Federal, state and other material tax returns and reports
(collectively, the “Tax Returns”) required to be filed, and all such Tax Returns
are true, correct and complete in all material respects, and have paid when due
and payable (subject to any grace periods) all Federal, state and other material
Taxes, assessments, fees and other governmental charges levied or imposed upon
them or their properties, income or assets otherwise due and payable, except
those which are being contested in good faith by appropriate proceedings being
diligently conducted, for which adequate reserves have been provided in
accordance with GAAP, as to which Taxes no Lien has been filed and which contest
effectively suspends the collection of the contested obligation and the
enforcement of any Lien securing such obligation.  There is no proposed tax
assessment against any Loan Party or any Restricted Subsidiary that would, if
made, have a Material Adverse Effect.  No Loan Party or Restricted Subsidiary is
a party to any tax sharing agreement.

 

SECTION 3.12.  ERISA Compliance.

 

(a)  Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code and other Federal or state Laws.  Each Plan that
is intended to qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS or an application for such a letter is
currently being processed by the IRS with respect thereto and, to the best
knowledge of the Borrower, nothing has occurred which would prevent, or cause
the loss of, such qualification.  Each Loan Party and each ERISA Affiliate has
made all required contributions, including without limitation any such
contributions required pursuant to the PBGC Agreement, to each Plan subject to
Sections 302 or 303 of ERISA or Sections 412 or 430 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 302 of ERISA or Section 412 of the Code has been made with
respect to any Plan.  No Lien imposed under the Code or ERISA exists or is
likely to arise on account of any Plan.

 

(b)  There are no pending or, to the best knowledge of the Borrower, threatened
claims, actions or lawsuits, or action by any Governmental Authority, with
respect to any Plan that would reasonably be expected to have a Material Adverse
Effect.  There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan that has had or would reasonably
be expected to have a Material Adverse Effect.

 

(c)  (i) No ERISA Event has occurred or is reasonably expected to occur that,
together with all other ERISA Events that have occurred or are reasonably
expected to occur, has had or would reasonably be expected to have a Material
Adverse Effect; (ii) no Pension Plan has any Unfunded Pension Liability; except,
that, based on the latest valuation of the SUPERVALU Inc. Retirement Plan and
Shaw’s Supermarkets, Inc. Pension Plan for Union Employees and on the

 

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actuarial methods and assumptions employed for such valuation (determined in
accordance with the assumptions used for funding such Pension Plan pursuant to
Sections 412 or 430 of the Code or Sections 302 or 303 of ERISA), as of the date
hereof the aggregate current value of accumulated “benefit liabilities” of such
Pension Plan under Section 4001(a)(16) of ERISA is in excess of the aggregate
current value of the assets of such Pension Plan, but the scheduled payments
with respect to such underfunding do not have, and would not reasonably be
expected to have, a Material Adverse Effect and the Loan Parties have complied,
and shall continue to comply, with the requirements of ERISA and the PBGC
Agreement with respect to the funding of each of their Pension Plans;
(iii) neither any Loan Party nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under Section 4007 of
ERISA and amounts payable under the PBGC Agreement) that, individually or in the
aggregate, has or would reasonably be expected to have a Material Adverse
Effect; (iv) neither any Loan Party nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability (and no event has occurred which,
with the giving of notice under Section 4219 of ERISA, would result in such
liability) under Sections 4201 or 4243 of ERISA with respect to a Multiemployer
Plan, that has had or would reasonably be expected to have a Material Adverse
Effect; and (v) neither any Loan Party nor any ERISA Affiliate has engaged in a
transaction that would be subject to Sections 4069 or 4212(c) of ERISA.

 

SECTION 3.13.  Subsidiaries; Equity Interests.  The Loan Parties have no
Subsidiaries other than those specifically disclosed in Part (a) of
Schedule 3.13, which Schedule sets forth the legal name, jurisdiction of
incorporation or formation and the percentage interest of such Loan Party
therein.  The outstanding Equity Interests in such Subsidiaries described on
Part (a) of Schedule 3.13 as owned by a Loan Party (or a Subsidiary of a Loan
Party) have been validly issued, are fully paid and non-assessable and are owned
by a Loan Party (or a Subsidiary of a Loan Party) free and clear of all Liens. 
Except as set forth in Schedule 3.13, there are no outstanding rights to
purchase any Equity Interests in any Restricted Subsidiary.  All of the
outstanding Equity Interests in the Loan Parties have been validly issued, and
are fully paid and non-assessable and, with respect to the Loan Parties and
their Subsidiaries (other than the Borrower and Excluded Subsidiaries), are
owned in the amounts specified on Part (c) of Schedule 3.13 free and clear of
all Liens.  The copies of the Organization Documents of each Loan Party and each
amendment thereto provided pursuant to Section 4.01 are true and correct copies
of each such document, each of which is valid and in full force and effect.

 

SECTION 3.14.  Margin Regulations; Investment Company Act.

 

(a)  No Loan Party or Restricted Subsidiary is engaged or will be engaged,
principally or as one of its important activities, in the business of purchasing
or carrying margin stock (within the meaning of Regulation U), or extending
credit for the purpose of purchasing or carrying margin stock.  None of the
proceeds of the Loans shall be used directly or indirectly for the purpose of
purchasing or carrying any margin stock, for the purpose of reducing or retiring
any Indebtedness that was originally incurred to purchase or carry any margin
stock or for any other purpose that might cause any of the Loans to be
considered a “purpose credit” within the meaning of Regulations T, U or X.

 

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(b)  None of the Loan Parties or any Restricted Subsidiary is or is required to
be registered as an “investment company” under the Investment Company Act of
1940.

 

SECTION 3.15.  Disclosure.  (a)  Each Loan Party has disclosed to the
Administrative Agent and the Lenders all agreements, instruments and corporate
or other restrictions to which it or any of its Subsidiaries is subject, and all
other matters known to it, that, individually or in the aggregate, would
reasonably be expected to result in a Material Adverse Effect.  No report,
financial statement, certificate or other information furnished (whether in
writing or orally) by or on behalf of any Loan Party to the Administrative Agent
or any Lender in connection with the transactions contemplated hereby and the
negotiation of this Agreement or any other Loan Document or delivered hereunder
or under any other Loan Document (in each case, as modified or supplemented by
other information so furnished) 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 they were made, not misleading;
provided that, with respect to projected financial information, the Loan Parties
represent only that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time (based upon accounting
principles consistent with the historical audited financial statements of the
Borrower) and using due care in the preparation of such information, report,
financial statement or certificate.

 

(b)  No material written report, financial statement, certificate or other
information (other than projections and other than information that is
accurately disclosed by the Borrower and is covered by one of the other
representations set forth in this Article III or in the other Loan Documents)
furnished by or on behalf of any Loan Party to the Administrative Agent or any
Lender in connection with the transactions contemplated hereby and the
negotiation of this Agreement or any other Loan Document or delivered hereunder
or under any other Loan Document (in each case, as modified or supplemented by
other information so furnished) that is customarily used by financing sources in
making credit or underwriting decisions in transactions of this type and that is
relevant to the Term Facility 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 they were made, not misleading.

 

SECTION 3.16.  Compliance with Laws.  Each of the Loan Parties and the
Restricted Subsidiaries is in compliance in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its properties, except in such instances in which the
failure to comply therewith, either individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.

 

SECTION 3.17.  Intellectual Property; Licenses, Etc.  The Loan Parties and the
Restricted Subsidiaries own, or possess the right to use, all of the
Intellectual Property, licenses, permits and other authorizations that are
reasonably necessary for the operation of their respective businesses, without
conflict with the rights of any other Person.  To the best of the knowledge of
the Loan Parties, no slogan or other advertising device, product, process,
method, substance, part or other material now employed, or now contemplated to
be employed, by any Loan Party or Restricted Subsidiary infringes upon any
rights held by any other Person.  Except as specifically disclosed in
Schedule 3.17, no claim or litigation regarding any of the foregoing is pending
or, to the best of the knowledge of the Loan Parties, threatened, which, either
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect.

 

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SECTION 3.18.  Labor Matters.  There are no strikes, lockouts, slowdowns or
other material labor disputes against any Loan Party or any Restricted
Subsidiary pending or, to the knowledge of any Loan Party, threatened.  The
hours worked by and payments made to employees of the Loan Parties and the
Restricted Subsidiaries have not been in violation of the Fair Labor Standards
Act and any other applicable federal, state, local or foreign Law dealing with
such matters in any material respect.  All payments due from any Loan Party or
Restricted Subsidiary, or for which any claim may be made against any Loan Party
or Restricted Subsidiary, on account of wages and employee health and welfare
insurance and other benefits, have been paid or properly accrued in accordance
with GAAP as a liability on the books of such Loan Party or Restricted
Subsidiary. The Loan Parties and the Restricted Subsidiaries have disclosed, in
accordance with all applicable Securities Laws, any collective bargaining
agreement, management agreement, employment agreement, bonus, restricted stock,
stock option, or stock appreciation plan or agreement, or any similar plan,
agreement or arrangement required to be disclosed.  There are no complaints,
unfair labor practice charges, grievances, arbitrations, unfair employment
practices charges or any other claims or complaints against any Loan Party or
Restricted Subsidiary pending or, to the knowledge of any Loan Party, threatened
to be filed with any Governmental Authority or arbitrator based on, arising out
of, in connection with, or otherwise relating to the employment or termination
of employment of any employee of any Loan Party or Restricted Subsidiary which
has had or would reasonably be expected to have a Material Adverse Effect.  The
consummation of the transactions contemplated by the Loan Documents will not
give rise to any right of termination or right of renegotiation on the part of
any union under any collective bargaining agreement to which any Loan Party or
Restricted Subsidiary is bound.

 

SECTION 3.19.  Security Documents.

 

(a)  The Security Agreement creates in favor of the Administrative Agent, for
the benefit of the Secured Parties referred to therein, a legal, valid,
continuing and enforceable security interest in the Collateral (as defined in
the Security Agreement), the enforceability of which is subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors’ rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.

 

(b)  The financing statements, releases and other filings are in appropriate
form and have been or will be filed in the offices specified in Schedule II of
the Security Agreement.  Upon such filings and/or the obtaining of “control” (as
defined in the UCC) or possession, the Administrative Agent will have a
perfected Lien on, and security interest in, to and under all right, title and
interest of the Loan Parties in all Collateral that may be perfected by filing,
recording or registering a financing statement or analogous document (including,
without limitation, the proceeds of such Collateral subject to the limitations
relating to such proceeds in the UCC) or by obtaining control or possession,
under the UCC (in effect on the date this representation is made), prior and
superior in right to any other Person, except for those Permitted Encumbrances
that have priority in such Collateral by operation of law and except, as to the
ABL Priority Collateral, for the Liens of the ABL Facility Agent to the extent
provided in the Intercreditor Agreement.

 

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(c)  When the Security Agreement (or a short form thereof) is filed in the
United States Patent and Trademark Office and the United States Copyright Office
and when financing statements, releases and other filings in appropriate form
are filed in the offices specified in Schedule II of the Security Agreement, the
Administrative Agent shall have a fully perfected Lien on, and security interest
in, all right, title and interest of the applicable Loan Parties in the
Intellectual Property (as defined in the Security Agreement) in which a security
interest may be perfected by filing, recording or registering a security
agreement, financing statement or analogous document in the United States Patent
and Trademark Office or the United States Copyright Office, as applicable, in
each case prior and superior in right to any other Person (it being understood
that subsequent recordings in the United States Patent and Trademark Office and
the United States Copyright Office may be necessary to perfect a Lien on
registered trademarks, trademark applications and copyrights acquired by the
Loan Parties after the date hereof), except for those Permitted Encumbrances
that have priority in such Collateral by operation of law.

 

(d)  Upon the execution and delivery thereof, the Mortgages shall create in
favor of the Administrative Agent, for the benefit of the Secured Parties
referred to therein, a legal, valid, continuing and enforceable first-priority
Lien on, and security interests in, the Real Estate Collateral Property
described therein, subject to Permitted Encumbrances, the enforceability of
which is subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.  Upon the filing or recording of the Mortgages with the
appropriate Governmental Authorities, the Administrative Agent will have a
perfected Lien on, and security interest in, to and under all right, title and
interest of the grantors thereunder in all Real Estate Collateral Property that
may be perfected by such filing (including, without limitation, the proceeds of
such Real Estate Collateral Property), in each case prior and superior in right
to any other Person, except for those Permitted Encumbrances that have priority
in such Collateral by operation of law and except, as to the ABL Priority
Collateral, for the Liens of the ABL Facility Agent to the extent provided in
the Intercreditor Agreement.

 

SECTION 3.20.  Solvency.

 

(a)  After giving effect to the Transactions, the Loan Parties, on a
consolidated basis, are Solvent.

 

(b)  No transfer of property has been or will be made by any Loan Party and no
obligation has been or will be 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 any
Loan Party.

 

SECTION 3.21.  Deposit Accounts; Credit Card Arrangements.

 

(a)  Annexed hereto as Schedule 3.21(a) is a list of all DDAs (and including
Blocked Accounts) maintained by the Loan Parties as of the Closing Date, which
Schedule includes, with respect to each DDA (i) the name and address of the
depository; (ii) the purpose of such DDA and (iii) the identification of the
Blocked Account Bank to which funds from such DDA are sent.

 

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(b)  Annexed hereto as Schedule 3.21(b) is a list describing all arrangements as
of the Closing Date to which any Loan Party is a party with respect to the
processing and/or payment to such Loan Party of the proceeds of any credit card
charges and debit card charges for sales made by such Loan Party.

 

SECTION 3.22.  Brokers.  No broker or finder brought about the obtaining, making
or closing of the Loans or transactions contemplated by the Loan Documents, and
no Loan Party, Restricted Subsidiary or Affiliate thereof has any obligation to
any Person in respect of any finder’s or brokerage fees in connection therewith.

 

SECTION 3.23.  Trade Relations.  There exists no actual or, to the knowledge of
any Loan Party, threatened, termination or cancellation of, or any material
adverse modification or change in the business relationship of any Loan Party
with any supplier material to its operations.

 

SECTION 3.24.  Material Contracts.  The Loan Parties and the Restricted
Subsidiaries have disclosed, in accordance with all applicable Securities Laws,
all Material Contracts.  No Loan Party is in breach or in default in any
material respect of or under any Material Contract and has not received any
notice of the intention of any other party thereto to terminate any Material
Contract, in each case, that has had or would reasonably be expected to have a
Material Adverse Effect.

 

SECTION 3.25.  Casualty.  Neither the businesses nor the properties of any Loan
Party or Restricted Subsidiary are affected by any fire, explosion, accident,
strike, lockout or other labor dispute, drought, storm, hail, earthquake,
embargo, act of God or of the public enemy or other casualty (whether or not
covered by insurance) that has had or would reasonably be expected to have a
Material Adverse Effect.

 

SECTION 3.26.  Payable Practices.  No Loan Party has made any material change in
the historical accounts payable practices from those in effect immediately prior
to the Closing Date that has had or would reasonably be expected to have a
Material Adverse Effect.

 

SECTION 3.27.  Notices from Farm Products Sellers, Etc.

 

(a)  No Loan Party has, within the one-year period prior to the Closing Date,
received any written notice pursuant to the applicable provisions of the PSA,
the PACA, the Food Security Act, the UCC or any other applicable local laws from
(i) any Farm Products Seller or (ii) any lender to any Farm Products Seller or
any other Person with a security interest in the assets of any Farm Products
Seller or (iii) the Secretary of State (or equivalent official) or other
Governmental Authority of any State, Commonwealth or political subdivision
thereof in which any Farm Products purchased by such Loan Party are produced, in
any case advising or notifying such Loan Party of the intention of such Farm
Products Seller or other Person to preserve the benefits of any trust applicable
to any assets of the Borrower established in favor of such Farm Products Seller
or other Person under the provisions of any law or claiming a Lien upon or other
claim or encumbrance with respect to any perishable agricultural commodity or
any other Farm Products which may be or have been purchased by a Loan Party or
any related or other assets of such Loan Party (all of the foregoing, together
with any such notices as any Loan Party may at any time hereafter receive,
collectively, the “Food Security Act Notices”).

 

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(b)  No Loan Party is a “live poultry dealer” (as such term is defined in the
PSA) or otherwise purchases or deals in live poultry of any type whatsoever. 
The Loan Parties do not purchase livestock pursuant to cash sales as such term
is defined in the PSA.  Each Loan Party is not engaged in, and shall not engage
in, raising, cultivating, propagating, fattening, grazing or any other farming,
livestock or aquacultural operations.

 

SECTION 3.28.  HIPAA Compliance.

 

(a)  To the extent that and for so long as any Loan Party is a “covered entity”
within the meaning of HIPAA, such Loan Party (i) has undertaken or will promptly
undertake all appropriate surveys, audits, inventories, reviews, analyses and/or
assessments (including any necessary risk assessments) of all areas of its
business and operations required by HIPAA; (ii) has developed or will promptly
develop an appropriate plan and time line for becoming HIPAA Compliant (a “HIPAA
Compliance Plan”); and (iii) has implemented or will implement those provisions
of such HIPAA Compliance Plan in all material respects necessary to ensure that
such Loan Party is or becomes HIPAA Compliant.

 

(b)  For purposes hereof, “HIPAA Compliant” shall mean that a Loan Party or
Restricted Subsidiary (i) is or will be in compliance in all material respects
with each of the applicable requirements of the so-called “Administrative
Simplification” provisions of HIPAA on and as of each date that any part
thereof, or any final rule or regulation thereunder, becomes effective in
accordance with its or their terms, as the case may be (each such date, a “HIPAA
Compliance Date”) and (ii) is not and would not reasonably be expected to
become, as of any date following any such HIPAA Compliance Date, the subject of
any civil or criminal penalty, process, claim, action or proceeding, or any
administrative or other regulatory review, survey, process or proceeding (other
than routine or mandated surveys or reviews conducted by any Governmental
Authority, government health plan or other accreditation entity) that has had or
would reasonably be expected to have a Material Adverse Effect.

 

(c)  Each Loan Party has entered into a business associate agreement with any
third party acting on behalf of the Loan Party as a business associate as
defined in 45 C.F.R. §160.103, where the failure to enter into such a business
associate agreement has had or would reasonably be expected to have a Material
Adverse Effect.

 

SECTION 3.29.  Compliance with Health Care Laws.  Without limiting the
generality of Sections 3.16 or 3.28 or any other representation or warranty made
herein or in any of the other Loan Documents:

 

(a)  Each Loan Party is in compliance in all material respects with all
applicable Health Care Laws, including all Medicare and Medicaid program
rules and regulations applicable to them.  Without limiting the generality of
the foregoing, no Loan Party has received notice by a Governmental Authority of
any violation of any provisions of the Medicare and Medicaid Anti-Fraud and
Abuse or Anti-Kickback Amendments of the Social Security Act (presently codified
in Section 1128(B)(b) of the Social Security Act) or the Medicare and Medicaid
Patient and Program Protection Act of 1987.

 

(b)  Each Loan Party has maintained in all material respects all records
required to be maintained by the Food and Drug Administration, Drug Enforcement
Agency and State Boards of Pharmacy and the Federal and State Medicare and
Medicaid programs and as otherwise

 

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required by applicable Health Care Laws, and each Loan Party has all necessary
permits, licenses, franchises, certificates and other approvals or
authorizations of Governmental Authority as are required under applicable Health
Care Laws.

 

(c)  Each Loan Party and each Restricted Subsidiary who is a Certified Medicare
Provider or Certified Medicaid Provider has in a timely manner filed all
requisite cost reports, claims and other reports required to be filed in
connection with all Medicare and Medicaid programs due on or before the date
hereof, all of which are complete and correct in all material respects.  There
are no known claims, actions or appeals pending before any Third Party Payor or
Governmental Authority, including any Fiscal Intermediary, the Provider
Reimbursement Review Board or the Administrator of the Centers for Medicare and
Medicaid Services, with respect to any Medicare or Medicaid cost reports or
claims filed by any Loan Party or Restricted Subsidiary on or before the date
hereof.  There currently exist no restrictions, deficiencies, required plans of
correction actions or other such remedial measures with respect to Federal and
State Medicare and Medicaid certifications or licensure.

 

SECTION 3.30.  Transaction Documents.  The Borrower has delivered to the
Administrative Agent a complete and correct copy of the Acquisition Agreement
and the Tender Offer Agreement (in each case, including all schedules, exhibits,
amendments, supplements and modifications thereto).

 

SECTION 3.31.  Sanctioned Persons.  No Loan Party or Restricted Subsidiary, nor
to the knowledge of the Borrower, any director, officer, agent, employee or
Affiliate of any Loan Party or Restricted Subsidiary is currently subject to any
U.S. sanctions administered by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”); and the Borrower will not directly or indirectly
use the proceeds of the Loans or otherwise make available such proceeds to any
Person for the purpose of financing the activities of any Person currently
subject to any U.S. sanctions administered by OFAC.

 

SECTION 3.32.  Anti-Terrorism; Foreign Corrupt Practices Act.  To the extent
applicable, each of the Loan Parties and the Restricted Subsidiaries is in
compliance in all material respects with (i) the Trading with the Enemy Act, as
amended, and each of the foreign assets control regulations of the United States
Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) and any other
enabling legislation or executive order relating thereto, and (ii) the USA
PATRIOT Act.  No part of the proceeds of the Loans will be used, directly or
indirectly, for any payments to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977 (the “FCPA”).

 

ARTICLE IV

 

Conditions of Lending

 

The obligations of the Lenders to make the Loans hereunder are subject to the
satisfaction of the following conditions:

 

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SECTION 4.01.  Conditions to Borrowing.  On the Closing Date:

 

(a)  The Administrative Agent shall have received a notice of such Borrowing as
required by Section 2.03 (or such notice shall have been deemed given in
accordance with Section 2.02).

 

(b)  The representations and warranties set forth in Article III and in each
other Loan Document (other than the Specified Representations and the
representation contained in the second sentence of Section 3.15(a)) shall be
true and correct without giving effect to any materiality or Material Adverse
Effect qualifications therein (except for such failures to be so true and
correct as have not had and would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect), on and as of the
date of the Borrowing with the same effect as though made on and as of such
date, except to the extent such representations and warranties expressly relate
to an earlier date, in which case such representations and warranties shall be
true and correct without giving effect to any materiality or Material Adverse
Effect qualifications therein (except for such failures to be so true and
correct as have not had and would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect), on and as of such
earlier date.  The Specified Representations shall be true and correct in all
material respects on and as of the date of the Borrowing with the same effect as
though made on and as of such date, except to the extent such Specified
Representations expressly relate to an earlier date, in which case such
Specified Representations shall be true and correct in all material respects on
and as of such earlier date.  The Acquisition Agreement Representations shall be
true and correct on and as of the date of the Borrowing with the same effect as
though made on and as of such date, except to the extent such Acquisition
Agreement Representations expressly relate to an earlier date, in which case
such Acquisition Agreement Representations shall be true and correct on and as
of such earlier date.

 

(c)  The NAI Sale (including the receipt by the Borrower of proceeds in respect
thereof of at least $100,000,000, as adjusted in accordance with the Acquisition
Agreement) shall have been or, substantially concurrently with the borrowing
under the Term Facility, shall be consummated, in accordance with the terms of
the Acquisition Agreement and all related documents, in each case as amended and
in effect from time to time, but without giving effect to any modifications,
amendments, waivers or consents that are materially adverse to the Initial
Lenders or the Joint Lead Arrangers (each in their respective capacity as such)
without the consent of the Joint Lead Arrangers (provided that it is understood
and agreed that any modifications, amendments, waivers or consents with respect
to Cerberus’ proposed direct or indirect equity ownership stake in the Borrower
after giving effect to the Transactions shall not be deemed materially adverse
to the Initial Lenders or the Joint Lead Arrangers), and the other Transactions
shall have been, or shall substantially concurrently with the borrowing under
the Term Facility, be consummated.  In the event that the Offer is commenced,
Cerberus shall have directly or indirectly purchased, or will purchase
substantially contemporaneously with the Closing Date, at least $165,000,000 of
the Borrower’s outstanding common equity interests pursuant to the terms and
conditions of the Tender Offer Agreement.

 

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(d)  The Borrower shall have received not less than $1,000,000,000 in aggregate
commitments pursuant to and under the ABL Facility.  The terms and conditions of
the ABL Facility (including, but not limited to, terms and conditions relating
to the interest rate, fees, amortization, maturity, lien subordination,
representations and warranties, covenants, events of default and remedies) shall
be reasonably satisfactory to the Joint Lead Arrangers (it being acknowledged
that the terms and conditions expressly set forth in the ABL Facility Documents
and provided to the Joint Lead Arrangers are satisfactory to the Joint Lead
Arrangers).

 

(e)  Since February 25, 2012, there shall not have occurred any Closing Date
Material Adverse Effect or any event, condition, change or effect that would
reasonably be expected to have, individually or in the aggregate, a Closing Date
Material Adverse Effect.

 

(f)  The Administrative Agent shall have received, on behalf of itself and the
Lenders, (i) a favorable written opinion of Dorsey & Whitney LLP, counsel for
the Borrower, substantially to the effect set forth in Exhibit K and (ii) a
favorable written opinion of local counsel in those jurisdictions of
organization of Loan Parties reasonably requested by the Administrative Agent
(or, to the extent agreed by the Administrative Agent with respect to particular
jurisdictions, a favorable written opinion of the Vice President — Business Law
of the Borrower), in each case (A) dated the Closing Date, (B) addressed to the
Administrative Agent, the Collateral Agent and the Lenders and (C) covering such
other matters relating to the Loan Documents and the Transactions as the
Administrative Agent shall reasonably request, and the Borrower hereby requests
such counsel to deliver such opinions.

 

(g)  The Administrative Agent shall have received (i) a copy of the certificate
or articles of incorporation, including all amendments thereto, of each Loan
Party, certified as of a recent date by the Secretary of State of the state of
its organization, and a certificate as to the good standing (to the extent
applicable) of each Loan Party as of a recent date, from such Secretary of
State; (ii) a certificate of the Secretary or the Assistant Secretary (or other
Responsible Officer acceptable to the Administrative Agent) of each Loan Party
dated the Closing Date and certifying (A) that attached thereto is a true and
complete copy of the by-laws or operating agreement of such Loan Party as in
effect on the Closing Date and at all times since a date prior to the date of
the resolutions described in clause (B) below, (B) that attached thereto is a
true and complete copy of resolutions duly adopted by the Board of Directors of
such Loan Party authorizing the execution, delivery and performance of the Loan
Documents to which such Person is a party and, in the case of the Borrower, the
borrowings hereunder, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C) that the certificate
or articles of incorporation of such Loan Party have not been amended since the
date of the last amendment thereto shown on the certificate of good standing
furnished pursuant to clause (i) above, and (D) as to the incumbency and
specimen signature of each officer executing any Loan Document or any other
document delivered in connection herewith on behalf of such Loan Party and
(iii) a certificate of another officer as to the incumbency and specimen
signature of the Secretary or Assistant Secretary (or other Responsible Officer

 

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acceptable to the Administrative Agent) executing the certificate pursuant to
clause (ii) above.

 

(h)  The Administrative Agent shall have received a certificate, dated the
Closing Date and signed by a Responsible Officer of the Borrower, confirming
compliance with the conditions precedent set forth in Sections 4.01(b) and
4.01(e).

 

(i)  All fees required to be paid on the Closing Date pursuant to the Fee Letter
and the Commitment Letter and reasonable and documented out-of-pocket expenses
required to be paid on the Closing Date pursuant to the Commitment Letter (in
the case of out-of-pocket expenses, to the extent invoiced at least two business
days prior to the Closing Date), shall have been paid (which amounts may be
offset against the proceeds of the Loans).

 

(j)  This Agreement and the Security Documents (other than with respect to the
Term Loan Priority Collateral that is not part of the Collateral under the
Security Agreement) shall have been duly executed by each Loan Party that is to
be a party thereto and shall be in full force and effect on the Closing Date. 
The Collateral Agent on behalf of the Secured Parties shall have a security
interest in the Collateral of the type and priority described in each Security
Document (other than with respect to the Term Loan Priority Collateral that is
not part of the Collateral under the Security Agreement) and in the
Intercreditor Agreement.  The Intercreditor Agreement shall have been duly
executed by the ABL Collateral Agent and shall be in full force and effect on
the Closing Date.

 

(k)  The Collateral Agent shall have received the results of judgment searches
and a search of the UCC filings (or equivalent filings) made with respect to the
Loan Parties in the states (or other jurisdictions) of formation of such
Persons, in which the chief executive office of each such Person is located and
in the other jurisdictions in which such Persons maintain property, together
with copies of the financing statements (or similar documents) disclosed by such
search, and accompanied by evidence satisfactory to the Collateral Agent that
the Liens indicated in any such financing statement (or similar document) would
be permitted under Section 6.01 or have been or will be contemporaneously
released or terminated.

 

(l)  The Administrative Agent shall have received certificates or other evidence
of insurance for the insurance policies required by Section 5.07 and the
applicable provisions of the other Loan Documents, in each case in form and
substance reasonably satisfactory to the Administrative Agent.

 

(m)  All Indebtedness for borrowed money owed to the third parties of the Loan
Parties and their Restricted Subsidiaries shall have been or, substantially
concurrently with the borrowing under the Term Facility, shall be repaid and all
commitments (if any) in respect thereof shall have been terminated and all
guarantees (if any) thereof and security (if any) therefor discharged and
released (and the Administrative Agent shall have received reasonably
satisfactory evidence of the foregoing), other than (i) the Term Facility,
(ii) the ABL Facility, (iii) up to $1,000,000,000 of the SVU 2016 Notes and
(iv) up to $400,000,000 of Capital Leases and other Indebtedness.

 

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(n)  The Administrative Agent and the Lenders shall have received (A) deal basis
carve-out consolidated statements of income of the Borrower and its Subsidiaries
as of and for the 2011 fiscal year and the 2012 fiscal year and the 52-week
period ending December 1, 2012, in each case, in the form included in the Lender
Presentation (or the last day of the most recent fiscal quarter of the Borrower
ended at least 45 days prior to the Closing Date (or 90 days prior to the
Closing Date if such fiscal quarter is the final fiscal quarter of the relevant
fiscal year), in such case in the format included in the Lender Presentation)
and (B) deal basis carve-out balance sheets of the Borrower and its Subsidiaries
as of February 25, 2012 and December 1, 2012, in each case, in the form included
in the Lender Presentation (or the last day of the most recent fiscal quarter of
the Borrower ended at least 45 days prior to the Closing Date (or 90 days prior
to the Closing Date if such fiscal quarter is the final fiscal quarter of the
relevant fiscal year), in such case in the format included in the Lender
Presentation), and, in each case, which shall have been made public via an 8-K
filing or otherwise prior to the date of the “lender meeting” for the Term
Facility (or in the case of such financial statements as of and for the last day
of the most recent fiscal quarter of the Borrower ended at least 45 days prior
to the Closing Date (or 90 days prior to the Closing Date if such fiscal quarter
is the final fiscal quarter of the relevant fiscal year), prior to the Closing
Date) such that such financial statements shall not constitute material
non-public information.

 

(o)  The Administrative Agent shall have received a certificate from the chief
financial officer of the Borrower substantially in the form attached to the
Commitment Letter certifying that the Borrower and its Subsidiaries, on a
Consolidated basis after giving effect to the Transactions are Solvent.

 

(p)  The Administrative Agent shall have received, at least three Business Days
prior to the Closing Date, all documentation and other information required by
regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA PATRIOT Act, that has been
reasonably requested by the Initial Lenders at least ten days prior to the
Closing Date.

 

ARTICLE V

 

Affirmative Covenants

 

The Loan Parties covenant and agree with each Lender that so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document shall have been paid in full (other
than contingent indemnification obligations not then due and payable), unless
the Required Lenders shall otherwise consent in writing, the Loan Parties will,
and will, to the extent provided below, cause each of the Restricted
Subsidiaries to:

 

SECTION 5.01.  Financial Statements.  Deliver to the Administrative Agent, in
form and detail satisfactory to the Administrative Agent (for distribution to
each Lender):

 

(a)  as soon as available, but in any event within 90 days after the end of each
Fiscal Year, a Consolidated balance sheet of the Borrower as at the end of such
Fiscal

 

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Year, and the related Consolidated statements of income or operations,
Shareholders’ Equity and cash flows for such Fiscal Year, setting forth in each
case in comparative form the figures for the previous Fiscal Year, all in
reasonable detail and prepared in accordance with GAAP, such Consolidated
statements to be audited and accompanied by (i) a report and opinion of a
Registered Public Accounting Firm of nationally recognized standing reasonably
acceptable to the Administrative Agent, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and shall not
be subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit to the effect that such
Consolidated financial statements fairly present the financial condition and
results of operations of the Borrower and its Subsidiaries on a Consolidated and
consolidating basis in accordance with GAAP consistently applied, together with
a customary “management discussion and analysis” provision and (ii) an opinion
of such Registered Public Accounting Firm independently assessing the Loan
Parties’ internal controls over financial reporting in accordance with Item 308
of SEC Regulation S-K, PCAOB Auditing Standard No. 2 and Section 404 of
Sarbanes-Oxley expressing a conclusion that contains no statement that there is
a material weakness in such internal controls, except for such material
weaknesses as to which the Required Lenders do not object;

 

(b)  as soon as available, but in any event within 45 days after the end of each
of the first three Fiscal Quarters of each Fiscal Year, a Consolidated balance
sheet of the Borrower as at the end of such Fiscal Quarter, and the related
Consolidated statements of income or operations and cash flows for such Fiscal
Quarter and for the portion of the Fiscal Year then ended, setting forth in each
case in comparative form the figures for (i) the corresponding Fiscal Quarter of
the previous Fiscal Year and (ii) the corresponding portion of the previous
Fiscal Year, all in reasonable detail, such Consolidated statements to be
certified by a Responsible Officer of the Borrower as fairly presenting the
financial condition, results of operations and cash flows of the Borrower as of
the end of such Fiscal Quarter in accordance with GAAP consistently applied,
subject to normal year-end audit adjustments, together with a customary
“management discussion and analysis” provision, subject only to normal year-end
audit adjustments and the absence of footnotes;

 

(c)  as soon as available, but in any event no more than 45 days after the end
of each Fiscal Year, forecasts prepared by management of the Borrower, in form
satisfactory to the Administrative Agent, of Consolidated balance sheets and
statements of income or operations, cash flows and availability of the Borrower
and its Subsidiaries on a Consolidated basis using Fiscal Periods for the
immediately following Fiscal Year (including the Fiscal Year in which the
Maturity Date occurs), and as soon as available, any significant revisions to
such forecasts with respect to such Fiscal Year; and

 

(d)  the Borrower hereby acknowledges and agrees that all financial statements
and certificates furnished pursuant to Sections 5.01(a) and 5.01(b) are hereby
deemed to be Borrower Materials suitable for distribution, and to be made
available, to Public Lenders as contemplated by Section 9.01(d) and may be
treated by the Administrative Agent and the Lenders as if the same had been
marked “PUBLIC” in accordance with such paragraph.

 

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SECTION 5.02.  Certificates; Other Information.

 

(a)  Deliver to the Administrative Agent and, upon the Administrative Agent’s
request, each Lender, in form and detail satisfactory to the Administrative
Agent:

 

(i) concurrently with the delivery of the financial statements referred to in
Sections 5.01(a) and (b), a duly completed Compliance Certificate signed by a
Responsible Officer of the Borrower, and in the event of any change in GAAP used
in the preparation of such financial statements, the Borrower shall also provide
a statement of reconciliation conforming such financial statements to GAAP and a
copy of management’s discussion and analysis with respect to such financial
statements;

 

(ii) [reserved];

 

(iii) promptly after the same are available, copies of each annual report, proxy
or financial statement or other report or communication sent to the stockholders
of the Loan Parties, and copies of all annual, regular, periodic and special
reports and registration statements which any Loan Party may file or be required
to file with the SEC under Sections 13 or 15(d) of the Securities Exchange Act
of 1934 or with any national securities exchange, and in any case not otherwise
required to be delivered to the Administrative Agent pursuant hereto;

 

(iv) the financial and collateral reports described on Schedule 5.02 hereto, at
the times set forth in such Schedule;

 

(v) as soon as available, but in any event within 30 days after the end of each
Fiscal Year, and as more frequently as may be reasonably requested by the
Administrative Agent, (A) a report summarizing the insurance coverage
(specifying type, amount and carrier) in effect for each Loan Party and its
Subsidiaries and containing such additional information as the Administrative
Agent may reasonably specify and (B) a report summarizing collective bargaining
agreements then in effect (specifying parties, expiration dates, number of
employees covered and locations) and containing such additional information as
the Administrative Agent, or any Lender through the Administrative Agent, may
reasonably specify;

 

(vi) promptly after the Administrative Agent’s request therefor, copies of all
Material Contracts (but only to the extent not then publicly available from the
SEC) and documents evidencing Material Indebtedness;

 

(vii) promptly after the Administrative Agent’s request therefor, a list of any
“business associate agreements” (as such term is defined in HIPAA) that any Loan
Party is a party to or bound by that is accurate in all material respects as of
the date set forth therein and a copy of any standard form of such agreement
used by any Loan Party;

 

(viii) promptly, and in any event within five Business Days after receipt
thereof by any Loan Party or any Subsidiary thereof, copies of each notice or
other correspondence received from any Governmental Authority (including,
without limitation, the SEC (or comparable agency in any applicable non-U.S.
jurisdiction))

 

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concerning any proceeding with, or investigation or possible investigation or
other inquiry by such Governmental Authority regarding financial or other
operational results of any Loan Party or any Subsidiary thereof or any other
matter which, if adversely determined, would reasonably be expected to have a
Material Adverse Effect;

 

(ix) if requested by the Administrative Agent, promptly, and in any event within
five Business Days after such request, provide to the Administrative Agent the
name(s) used on each tax return filed by the Borrower or any of its
Subsidiaries, together with a copy of the portion of the tax return that shows
such name(s);

 

(x) promptly after the receipt thereof by the Borrower or any of its
Subsidiaries, a copy of any “management letter” received by any such Person from
its certified public accountants and the management’s response thereto;

 

(xi) promptly after the request by any Lender, all documentation and other
information that such Lender reasonably requests in order to comply with its
ongoing obligations under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA PATRIOT Act; and

 

(xii) promptly, such additional information regarding the business affairs,
financial condition or operations of any Loan Party or any Subsidiary, or
compliance with the terms of the Loan Documents, as the Administrative Agent or
any Lender may from time to time reasonably request.

 

(b)  Documents required to be delivered pursuant to Sections 5.01(a), 5.01(b) or
5.02(a)(iv) (to the extent any such documents are included in materials
otherwise filed with the SEC) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (1) specified in
Section 9.01 with respect to e-mail communications, (2) on which the Borrower
posts such documents, or provides a link thereto on the Borrower’s website on
the Internet at the website address listed on Schedule 9.01(a); or (3) on which
such documents are posted on the Borrower’s behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided, that (x) the Borrower shall notify the
Administrative Agent and each Lender (by telecopier or e-mail) of the posting of
any such documents and (y) if for any reason the Administrative Agent is unable
to obtain electronic versions of the documents posted, promptly upon the
Administrative Agent’s request provide to the Administrative Agent by electronic
mail electronic versions (i.e., soft copies) of such documents.  Notwithstanding
anything contained herein, except as the Administrative Agent may specify
otherwise at any time and from time to time, in every instance the Borrower
shall be required to provide paper copies of the Compliance Certificate required
by Section 5.02(a)(i) to the Administrative Agent.  The Administrative Agent
shall have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to
monitor compliance by the Loan Parties with any such request for delivery, and
each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.

 

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SECTION 5.03.  Notices.  Promptly notify the Administrative Agent of:

 

(a)  the occurrence of any Default or Event of Default, specifying the nature
and extent thereof and the corrective action (if any) taken or proposed to be
taken with respect thereto;

 

(b)  any matter that has resulted or would reasonably be expected to result in a
Material Adverse Effect, such as (i) any breach or non-performance of, or any
default under, a Material Contract or with respect to Material Indebtedness of
any Loan Party or any Restricted Subsidiary; (ii) any dispute, litigation,
investigation, proceeding or suspension between any Loan Party or any Restricted
Subsidiary and any Governmental Authority; or (iii) the commencement of, or any
material development in, any litigation or proceeding affecting any Loan Party
or any Restricted Subsidiary, including pursuant to any applicable Environmental
Laws;

 

(c)  the occurrence of any event, including any violation of Environmental Law,
Release of Hazardous Materials, acquisition of any stock, assets or property, or
the receipt of notice, claim, demand, action or suit pertaining to any of the
foregoing, that, in each case, would reasonably be expected to result in
Environmental Liabilities in excess of $25,000,000;

 

(d)  the occurrence of any ERISA Event that itself, or together with any other
ERISA Events that have occurred, has had or would reasonably be expected to have
a Material Adverse Effect;

 

(e)  any material change in accounting policies or financial reporting practices
by any Loan Party or any Subsidiary thereof;

 

(f)  any change in any Loan Party’s chief executive officer, chief financial
officer, chief operating officer or treasurer;

 

(g)  the discharge by any Loan Party of its present Registered Public Accounting
Firm or any withdrawal or resignation by such Registered Public Accounting Firm;

 

(h)  the filing of any Lien for unpaid taxes exceeding $15,000,000 in the
aggregate against the Loan Parties;

 

(i)  any casualty or other insured damage to any material portion of the
Collateral or the commencement of any action or proceeding for the taking of any
interest in a material portion of the Collateral under power of eminent domain
or by condemnation or similar proceeding or if any material portion of the
Collateral is damaged or destroyed;

 

(j)  the receipt of any notice from a supplier, seller or agent pursuant to
either the PACA or the PSA;

 

(k)  any transaction of the nature contained in Article VI hereof, occurring
after the Closing Date, consisting of: (i) the entry by a Loan Party into a
Material Contract, (ii) the incurrence by a Loan Party of Material Indebtedness
(or in the case of Indebtedness of less

 

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than $50,000,000 but greater than $25,000,000, notify the Administrative Agent
at the same time as the next Compliance Certificate to be delivered to the
Administrative Agent), (iii) the voluntary or involuntary grant of any Lien
other than a Permitted Encumbrance upon any property of a Loan Party; or
(iv) the making of any Permitted Investments by a Loan Party in excess of
$50,000,000 (or in the case of any Permitted Investment less than $50,000,000
but greater than $25,000,000, notify the Administrative Agent at the same time
as the next Compliance Certificate to be delivered to the Administrative Agent);
and (v) mergers or acquisitions permitted under Section 6.04;

 

(l)  any failure by the Loan Parties to pay rent at (i) 5.00% or more of the
Loan Parties’ locations in the aggregate or (ii) any of such Loan Party’s
locations if such failure continues for more than 10 days following the day on
which such rent first came due and such failure has had or would reasonably be
expected to have a Material Adverse Effect;

 

(m)  any change in the Borrower’s corporate rating by S&P, in the Borrower’s
corporate family rating by Moody’s or in the ratings of the Term Facility by S&P
or Moody’s, or any notice from either such agency indicating its intent to
effect such a change or to place the Borrower or the Term Facility on a
“CreditWatch” or “WatchList” or any similar list, in each case with negative
implications, or its cessation of, or its intent to cease, rating the Borrower
or the Term Facility; and

 

(n)  (i) any claim being asserted for payment under the ASC Guarantee, (ii) any
payment being made from the Initial Escrow Amount Subaccount (as defined in the
Escrow Agreement) other than to retire principal obligations on the ASC Notes,
or from the Additional Escrow Amount Subaccount (as defined in the Escrow
Agreement) to pay amounts other than interest on the ASC Notes, (iii) any claim
for payment being made from either subaccount of the Escrow Account (as defined
in the Escrow Agreement) and such claim not being honored by the Escrow Agent
(as defined in the Escrow Agreement) or (iv) any claim being asserted for
payment under the Borrower’s guarantee of NAI Workers’ Compensation Liabilities.

 

Each notice pursuant to this Section 5.03 shall be accompanied by a statement of
a Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower has taken and proposes
to take with respect thereto.  Each notice pursuant to Section 5.03(a) shall
describe with particularity any and all provisions of this Agreement and any
other Loan Document that have been breached.

 

SECTION 5.04.  Payment of Obligations.  Pay and discharge as the same shall
become due and payable, all its obligations and liabilities, including (a) all
Taxes, assessments and governmental charges or levies upon it or its properties,
assets, income or profits before the same shall have become delinquent or in
default, (b) all lawful claims (including claims of landlords, warehousemen,
freight forwarders and carriers, and all claims for labor materials and supplies
or otherwise) which, if unpaid, would by law become a Lien upon its property;
and (c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness, except, in each case under clauses (a), (b) or (c), where
(i) and to the extent, the validity or amount thereof is being contested in good
faith by appropriate proceedings, (ii) such Loan Party has set aside on its

 

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books adequate reserves with respect thereto in accordance with GAAP, (iii) such
contest effectively suspends collection of the contested obligation and
enforcement of any Lien securing such obligation, (iv) in the case of any Real
Estate Collateral Property subject to a Mortgage, there is no present risk of
forfeiture or such Real Estate Collateral Property and (v) the failure to make
payment pending such contest would not reasonably be expected to result in a
Material Adverse Effect.

 

SECTION 5.05.  Preservation of Existence, Etc.  (a) Preserve, renew and maintain
in full force and effect its legal existence and good standing under the Laws of
the jurisdiction of its organization or formation except in a transaction
permitted by Section 6.05; (b) take all necessary action to maintain and keep in
full force and effect all rights, privileges, permits, licenses and franchises
material to the normal conduct of its business; and (c) preserve or renew all of
its Intellectual Property, except to the extent such Intellectual Property
(i) is no longer used or useful in the business of any Loan Party or Restricted
Subsidiary and (ii) is not otherwise material to the business of any Loan Party
or Restricted Subsidiary in any respect.

 

SECTION 5.06.  Maintenance of Properties.  (a) Maintain, preserve and protect
all of its material properties and Equipment material to the operation of its
business in good working order and condition, ordinary wear and tear excepted;
and (b) make all repairs thereto and renewals, improvements, additions and
replacements thereof necessary in order that the business carried on in
connection therewith may be properly conducted at all times.

 

SECTION 5.07.  Maintenance of Insurance.

 

(a)  Maintain with financially sound and reputable insurance companies
reasonably acceptable to the Administrative Agent and not Affiliates of the Loan
Parties (except to the extent that the Insurance Captives are Affiliates of the
Loan Parties), insurance with respect to its properties and business against
loss or damage of the kinds customarily insured against by Persons engaged in
the same or similar business and operating in the same or similar locations and
as is otherwise required by applicable Law, of such types and in such amounts
(after giving effect to any self-insurance compatible with the following
standards) as are customarily carried under similar circumstances by such other
Persons and as are reasonably acceptable to the Administrative Agent, including
coverage for business interruption and public liability insurance against claims
for personal injury or death or property damage occurring upon, in, about or in
connection with the use of any properties owned, occupied or controlled by it.

 

(b)  Cause fire and extended coverage policies maintained with respect to any
Collateral and business interruption coverage to provide (by endorsement or
otherwise):

 

(i)                                     a non-contributing mortgage clause
(regarding improvements to real property);

 

(ii)                                  that none of the Loan Parties, Secured
Parties or any other Person (other than an Insurance Captive) shall be a
co-insurer;

 

(iii)                               a customary lender’s loss payable clause, in
form and substance reasonably satisfactory to the Administrative Agent, which
shall provide that the insurance carrier shall pay all proceeds otherwise
payable to the Loan Parties under the policies to the Administrative Agent as
its interests may appear (it being understood that there will be

 

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a separate lender’s loss payable clause for the benefit of the ABL Facility
Agent as its interests may appear, and that the rights of Administrative Agent
and ABL Facility Agent will be subject to the Intercreditor Agreement);

 

(iv)                              that neither the Loan Parties, the
Administrative Agent nor any other Person (other than an Insurance Captive)
shall be a co-insurer thereunder;

 

(v)                                 a “Replacement Cost Endorsement”, without
any deduction for depreciation; and

 

(vi)                              such other provisions as the Administrative
Agent may reasonably require from time to time to protect its and the Lenders’
interests.

 

(c)  Cause commercial general liability policies to provide coverage to the
Administrative Agent as an additional insured.

 

(d)  (i) Cause each policy of insurance required by this Section 5.07 to also
provide that it shall not be canceled by reason of nonpayment of premium except
upon not less than ten (10) days’ prior written notice thereof by the insurer to
the Administrative Agent or for any other reason except upon not less than
thirty (30) days’ prior written notice thereof by the insurer to the
Administrative Agent, except, in each case, in the case of force majeure,
(ii) notify the Administrative Agent promptly (and in any event within five
(5) Business Days) whenever it receives a notice from the insurance carrier that
any policy required by this Section 5.07 will be canceled for any reason and
(iii) use reasonable efforts to include in such clause that the insurance
carrier will provide prior written notice to the loss payee of any modification
to the policy so as to reduce the scope or amount of coverage in any material
respect and otherwise notify the Administrative Agent on or about the date that
any policy required by this Section 5.07 is modified so as to reduce the scope
or amount of coverage in any material respect.

 

(e)  Deliver to the Administrative Agent, on or about the date of cancellation
or non-renewal of any policy of insurance required by this Section 5.07, a
certificate of insurance for the replacement policy; and deliver to the
Administrative Agent, on or about the date of the renewal of any policy of
insurance required by this Section 5.07, a certificate evidencing renewal of
each such policy.

 

(f)  Maintain for themselves and their Subsidiaries, a Directors and Officers
insurance policy, and a “Blanket Crime” policy, the “Blanket Crime” policy
including employee dishonesty, forgery or alteration, theft, disappearance and
destruction, robbery and safe burglary, and computer fraud coverage, placed with
responsible companies and otherwise as customarily insured against by Persons
engaged in the same or similar business and operating in the same or similar
locations and as is otherwise required by applicable Law, of such types and in
such amounts (after giving effect to any self-insurance compatible with the
following standards) as are customarily carried under similar circumstances by
such other Persons, and will upon request by the Administrative Agent furnish
the Administrative Agent certificates evidencing renewal of each such policy.

 

(g)  Permit, upon the reasonable request of the Administrative Agent, any
representatives that are designated by the Administrative Agent to inspect the
insurance policies maintained by

 

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or on behalf of the Loan Parties and to inspect books and records related
thereto and any properties covered thereby at any reasonable time during
business hours.

 

(h)  Deliver to the Administrative Agent, upon the Administrative Agent’s
reasonable request therefor, (A) copies and updated certificates of insurance
for the insurance policies required by this Section 5.07 and the applicable
provisions of the Security Documents, and (B) duplicate originals or certified
copies of all such policies covering any Collateral.

 

(i)  If at any time the area in which any Real Estate Collateral Property
subject to a Mortgage is located is designated (i) in a federally designated
“special flood hazard area,” flood hazard insurance in an amount equal to the
maximum amount of such insurance available under the National Flood Insurance
Act of 1968, the Flood Disaster Protection Act of 1973 or the National Flood
Insurance Reform Act of 1994, as each may be amended to comply with current
regulations required or (ii)  in “seismic zone” 3 or 4 (as defined in the
Uniform Building Code 1997 map published by the International Conference of
Building Officials), obtain earthquake insurance in such total amount as is
customarily carried under similar circumstances by Persons engaged in the same
or similar business and operating in the same or similar locations, and as is
otherwise required by applicable Law, and as is reasonably acceptable to the
Administrative Agent.

 

(j)  With respect to any Real Estate Collateral Property, carry and maintain
commercial general liability insurance on an occurrence basis covering bodily
injury including death, and property damage liability in such amounts (after
giving effect to any self-insurance compatible with the following standards) as
is customarily carried under similar circumstances by Persons engaged in the
same or similar business and operating in the same or similar locations or as
required by applicable Law, and as is reasonably acceptable to the
Administrative Agent, naming the Administrative Agent as an additional insured.

 

(k)  (i) Notify the Administrative Agent promptly whenever any separate
insurance concurrent in form or contributing in the event of loss with that
required to be maintained under this Section 5.07 is taken out by any Loan
Party, and (ii) deliver to the Administrative Agent a certificate of insurance
for such policy or policies within thirty (30) days of such policy or policies
(or, at the reasonable request of the Administrative Agent, duplicate originals
thereof) being taken out by any Loan Party.

 

(l)  The insurance companies providing the insurance required to be maintained
under this Section 5.07 shall have no rights of subrogation against any Secured
Party or its agents or employees.  If, however, the insurance policies do not
provide waiver of subrogation rights against such parties, as required above,
then the Loan Parties hereby agree, to the extent permitted by law, to waive
their right of recovery, if any, against the Secured Parties and their agents
and employees to the extent payment for such loss or damage is actually made by
the insurance companies issuing the insurance policies required to be maintained
under this Section 5.07.  The designation of any form, type or amount of
insurance coverage by any Secured Party under this Section 5.07 shall in no
event be deemed a representation, warranty or advice by such Secured Party that
such insurance is adequate for the purposes of the business of the Loan Parties
or the protection of their properties.

 

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SECTION 5.08.  Compliance with Laws.  Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which the failure to comply therewith would not reasonably be expected to have a
Material Adverse Effect.

 

SECTION 5.09.  Books and Records; Accountants; Maintenance of Ratings.

 

(a)  Maintain proper books of record and account, in which full, true and
correct entries in conformity with GAAP consistently applied shall be made of
all financial transactions and matters involving the assets and business of the
Loan Parties or such Subsidiary, as the case may be; and maintain such books of
record and account in material conformity with all applicable requirements of
any Governmental Authority having regulatory jurisdiction over the Loan Parties
or such Subsidiary, as the case may be.

 

(b)  At all times retain a Registered Public Accounting Firm which is reasonably
satisfactory to the Administrative Agent and shall instruct such Registered
Public Accounting Firm to cooperate with, and be available to, the
Administrative Agent or its representatives to discuss, with a representative of
the Borrower present, the Loan Parties’ financial performance, financial
condition, operating results, controls, and such other matters, within the scope
of the retention of such Registered Public Accounting Firm, as may be raised by
the Administrative Agent.

 

(c)  Use commercially reasonable efforts to cause the Term Facility to be
continuously rated by S&P and Moody’s, and use commercially reasonable efforts
to maintain a corporate rating from S&P and a corporate family rating from
Moody’s, in each case in respect of the Borrower.

 

SECTION 5.10.  Inspection Rights.  Permit representatives and independent
contractors of the Administrative Agent to visit and inspect any of its
properties, to examine its corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and Registered Public Accounting Firm,
all at the expense of the Loan Parties and at such reasonable times during
normal business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; provided, that when an Event of Default exists,
the Administrative Agent (or any of its representatives or independent
contractors) may do any of the foregoing at the expense of the Loan Parties at
any time during normal business hours.

 

SECTION 5.11.  Use of Proceeds.  Use the proceeds of the Loans (other than
Incremental Loans) to consummate the Transactions and to pay fees and expenses
in connection therewith, and for no other purpose.

 

SECTION 5.12.  Additional Loan Parties.  Notify the Administrative Agent at the
time that any Person becomes a Subsidiary, whether such Person shall be an
Excluded Subsidiary (and if so, pursuant to which clause or clauses of the
definition thereof), and promptly thereafter (and in any event within 30 days),
cause any such Person which is not an Excluded Subsidiary, (i) to become a Loan
Party and grant a Lien to the Collateral Agent on such Person’s assets of the
types constituting Collateral to secure the Obligations by executing and
delivering to the Administrative Agent a joinder to each of the Security
Agreement and the Facility Guaranty and such other documents (including, to the
extent applicable, Mortgages and Related Real Estate Collateral Security
Agreements) as the Administrative Agent shall deem appropriate for such purpose
and by

 

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complying with the Term Loan Priority Collateral Requirements with respect to
any Material Real Estate Assets and Material Related Collateral Locations,
(ii) deliver to the Administrative Agent documents of the types referred to in
Sections 4.01(g) and 4.01(k) and, upon the Administrative Agent’s reasonable
request, favorable opinions of counsel to such Person (which shall cover, among
other things, the legality, validity, binding effect and enforceability of the
documentation referred to in this sentence) and (iii) if any Indebtedness of
such Person is owned by or on behalf of any Loan Party in an amount greater than
or equal to $10,000,000 individually or in the aggregate, to pledge such
Indebtedness and promissory notes evidencing such Indebtedness, in each case in
form, content and scope reasonably satisfactory to the Administrative Agent.  In
no event shall compliance with this Section 5.12 waive or be deemed a waiver or
consent to any transaction giving rise to the need to comply with this
Section 5.12 if such transaction was not otherwise expressly permitted by this
Agreement.

 

SECTION 5.13.  Cash Management.

 

(a)  On or prior to the Closing Date, deliver to the Administrative Agent copies
of notifications (each, a “Credit Card Notification”) substantially in the form
attached hereto as Exhibit M (with such changes as may be approved by the ABL
Facility Agent) which have been executed on behalf of such Loan Party and
delivered to such Loan Party’s Credit Card Processors listed on
Schedule 3.21(b).

 

(b)  Within 60 days after the Closing Date (or such longer period as the ABL
Facility Agent may approve in writing in its sole discretion), deliver to the
Administrative Agent (i) Blocked Account Agreements reasonably satisfactory in
form and substance to the ABL Facility Agent duly authorized, executed and
delivered by such Loan Party and the applicable Blocked Account Bank with which
such Loan Party maintains each Blocked Account covering each such Blocked
Account and (ii) control agreements reasonably satisfactory in form and
substance to the ABL Facility Agent duly authorized executed and delivered by
such Loan Party and any securities intermediary with which such Loan Party
maintains any securities or investment accounts, covering each such securities
or investment account maintained with such securities intermediary that at any
time holds or constitutes any Related Collateral (as defined in the Security
Agreement).

 

(c)  All funds received in the Agent Payment Account shall be applied to the
Obligations as provided in accordance with Section 7.02 of this Agreement to the
extent that the Obligations are then due and payable.

 

SECTION 5.14.  Information Regarding the Collateral.

 

(a)  Furnish to the Administrative Agent (i) at least 10 Business Days prior
written notice of any change in any Loan Party’s name, organizational structure,
jurisdiction of incorporation or formation or other change in Article 9
location; or (ii) notice not less than 30 days after any Loan Party makes a
change in any trade name used to identify it in the conduct of its business or
in the ownership of its properties, the location of any office in which it
maintains books or records relating to Collateral owned by it, any office or
facility at which Collateral owned by it is located (including the establishment
of any such new office or facility) or its Federal Taxpayer Identification
Number or the organizational identification number assigned to it by its state
of organization.  The Loan Parties agree not to effect or permit any change
referred to in clause (i) of the preceding sentence unless all filings have been

 

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made under the UCC or otherwise that are required in order for the
Administrative Agent to continue at all times following such change to have a
valid, legal and perfected first priority security interest in all of the Term
Loan Priority Collateral and a valid, legal and perfected second priority
security interest in all of the ABL Priority Collateral, in each case, for its
own benefit and the benefit of the other Secured Parties.

 

(b)  Should any of the information on any (i) Periodic Update Schedule hereto
become inaccurate or misleading in any material respect as a result of changes
after the Closing Date, the Borrower shall provide updated versions of such
Periodic Update Schedule together with the next delivery of financial statements
required to be delivered to the Administrative Agent pursuant to
Section 5.01(a) or (b) and (ii) Occurrence Update Schedule become inaccurate or
misleading in any material respect as a result of changes after the Closing
Date, the Borrower shall advise the Administrative Agent in writing of such
revisions or updates as may be necessary or appropriate to update or correct the
same promptly, but in any event within 10 Business Days.  From time to time as
may be reasonably requested by the Administrative Agent, the Borrower shall
supplement each Schedule hereto, or any representation herein or in any other
Loan Document, with respect to any matter arising after the Closing Date that,
if existing or occurring on the Closing Date, would have been required to be set
forth or described in such Schedule or as an exception to such representation or
that is necessary to correct any information in such Schedule or representation
which has been rendered inaccurate thereby (and, in the case of any supplements
to any Schedule, such Schedule shall be appropriately marked to show the changes
made therein).  Notwithstanding the foregoing, no supplement or revision to any
Schedule or representation shall be deemed the Secured Parties’ consent to the
matters reflected in such updated Schedules or revised representations nor
permit the Loan Parties to undertake any actions otherwise prohibited hereunder
or fail to undertake any action required hereunder from the restrictions and
requirements in existence prior to the delivery of such updated Schedules or
such revision of a representation; nor shall any such supplement or revision to
any Schedule or representation be deemed the Secured Parties’ waiver of any
Default resulting from the matters disclosed therein.

 

SECTION 5.15.  [Reserved].

 

SECTION 5.16.  Environmental Laws.  (a) Conduct its operations and keep and
maintain its Real Estate, and require all lessees and sublessees of such Real
Estate to operate and maintain such Real Estate, in material compliance with all
Environmental Laws; (b) obtain and renew all environmental permits necessary for
its operations and properties; and (c) implement any and all investigation,
remediation, removal and response actions that are appropriate or necessary to
comply with Environmental Laws pertaining to the presence, generation,
treatment, storage, use, disposal, transportation or Release of any Hazardous
Materials on, at, in, under, above, to, from or about any of its Real Estate,
provided, that neither a Loan Party nor any Restricted Subsidiary shall be
required to undertake any such cleanup, removal, remedial or other action to the
extent that its obligation to do so is being contested in good faith and by
proper proceedings and adequate reserves have been set aside and are being
maintained by the Loan Parties and Restricted Subsidiaries with respect to such
circumstances in accordance with GAAP.

 

SECTION 5.17.  Further Assurances.

 

(a)  Execute any and all further documents, financing statements, agreements and
instruments, and take all such further actions

 

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(including the filing and recording of financing statements and other
documents), that may be required under any applicable Law, or which the
Administrative Agent may reasonably request, to carry out the terms and
conditions of this Agreement and the other Loan Documents and to establish,
maintain, renew, preserve or protect the rights and remedies of Administrative
Agent and other Secured Parties hereunder and under the other Loan Documents, or
to grant, preserve, protect or perfect the Liens created or intended to be
created by the Security Documents or the validity or priority of any such Lien,
all at the expense of the Loan Parties.  The Loan Parties also agree to provide
to the Administrative Agent, from time to time upon request, evidence
satisfactory to the Administrative Agent as to the perfection and priority of
the Liens created or intended to be created by the Security Documents.

 

(b)  If any Collateral is acquired by any Loan Party after the Closing Date that
does not become subject to the Lien of the Security Documents upon acquisition
thereof, notify the Administrative Agent thereof, and the Loan Parties will
cause such assets to be subjected to a Lien securing the Obligations and will
take such actions as shall be necessary or shall be requested by the
Administrative Agent to grant and perfect such Liens, including actions
described in Section 5.17(a), all at the expense of the Loan Parties. In no
event shall compliance with this Section 5.17(b) waive or be deemed a waiver or
Consent to any transaction giving rise to the need to comply with this
Section 5.17(b) if such transaction was not otherwise expressly permitted by
this Agreement.

 

(c)  Other than for Store Locations, if the Borrower or any Loan Party leases
any Material Related Collateral Location, then the Borrower shall use
commercially reasonable efforts, or shall cause such Loan Party to use
commercially reasonable efforts, on or before the date that is 90 days after the
Closing Date or the initial leasing of such property (or such later date as the
Administrative Agent may approve in its sole discretion), to obtain Collateral
Access Agreements and Lien Waivers for each such Material Related Collateral
Location.

 

(d)  Upon the request of the Administrative Agent, deliver to the Administrative
Agent copies of notifications (each, a “DDA Notification”) substantially in the
form attached hereto as Exhibit L, with such changes reasonably acceptable to
the ABL Facility Agent, which have been executed on behalf of such Loan Party
and delivered to each depository institution at which a DDA (other than an
Excluded DDA) is maintained.

 

(e)  If the Borrower or any Loan Party acquires a Material Real Estate Asset
(including, without limitation, pursuant to a Permitted Acquisition or a
Permitted Store Swap Transaction), and the Term Loan Priority Collateral
Requirements and the requirements of Section 9.21 applicable to Additional
Properties have not otherwise been satisfied with respect to such Material Real
Estate Asset, then the Borrower shall satisfy, or shall cause such Loan Party to
satisfy, on or before the date that is 45 days after the acquisition of such
Material Real Estate Asset (or such later date as the Administrative Agent may
approve in its sole discretion) the Term Loan Priority Collateral Requirements
and the other requirements of Section 9.21 with respect to such Material Real
Estate Asset; provided that the satisfaction of such requirements will not
violate the SVU

 

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Indenture or any other Material Indebtedness or trigger any of the equal and
ratable sharing provisions thereof.  If the Borrower or any Loan Party acquires
a Material Related Collateral Location (including, without limitation, pursuant
to a Permitted Acquisition or a Permitted Store Swap Transaction), and such
requirements have not otherwise been satisfied with respect to such Material
Related Collateral Location, then the Borrower shall, or shall cause such Loan
Party to, on or before the date that is 45 days after the acquisition of such
Material Related Collateral Location (or such later date as the Administrative
Agent may approve in its sole discretion) deliver to the Collateral Agent a
Related Real Estate Collateral Security Agreement and a UCC financing statement
with respect to such Material Related Collateral Location, which Security
Documents shall have been duly executed by the parties thereto and delivered to
the Collateral Agent and shall be in full force and effect, together with a
certificate of the type described in Section 4.01(g)(ii); provided that the
satisfaction of such requirements will not violate the SVU Indenture or any
other Material Indebtedness or trigger any of the equal and ratable sharing
provisions thereof.

 

(f)  As of the date hereof, if Borrower or any Loan Party has entered into a
lease or other agreement with a third party with respect to any such Material
Real Estate Asset and such lease or other agreement expressly prohibits the
granting of a Lien encumbering the Material Real Estate Asset as Collateral in
accordance with the terms of this Agreement, then Borrower shall use
commercially reasonable efforts, or shall cause the applicable Loan Party to use
commercially reasonable efforts, for a period of 90 days after the Closing Date,
to obtain such third party’s written consent expressly permitting Borrower’s or
such Loan Party’s grant of a Lien on such Material Real Estate Asset. If such
consent is obtained within such 90 day period, then Borrower shall satisfy or
cause such Loan Party to satisfy the requirements set forth in
Section 9.21(c) with respect to such Material Real Estate Asset within
forty-five (45) days after the date of receipt of such consent by Borrower.  If
such consent is not obtained within such 90 day period, then Borrower shall have
no further obligation to pursue such consent. In addition, if Borrower is unable
to obtain such consent and such lease or other agreement is subsequently
terminated or amended or modified after the Closing Date to permit the
applicable Material Real Estate Asset to become subject to a Lien, then Borrower
shall satisfy all such requirements set forth in Section 9.21(c) with respect to
such Material Real Estate Asset within forty-five (45) days after the date of
such termination, amendment or modification.

 

SECTION 5.18.  Ground Leases.  Perform and observe all the terms and provisions
of each Ground Lease to be performed or observed by it, maintain each such
Ground Lease in full force and effect, enforce each such Ground Lease in
accordance with its material terms, take all such action to such end as may be
from time to time reasonably requested by the Administrative Agent and, upon
reasonable request of the Administrative Agent, make to each other party to each
such Ground Lease such demands and requests for information and reports or for
action as any Loan Party or any of its Subsidiaries is entitled to make under
such Ground Lease, and cause each of its Subsidiaries that are party to Ground
Leases to do so.

 

SECTION 5.19.  [Reserved].

 

SECTION 5.20.  ERISA.

 

(a)  Each Loan Party shall, and shall cause each of its ERISA Affiliates to:
(i) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal and

 

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State law; (ii) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; (iii) not terminate any Pension Plan so as
to incur any material liability to the PBGC; (iv) not allow or suffer to exist
any prohibited transaction involving any Plan or any trust created thereunder
which would subject such Loan Party or ERISA Affiliate to a material tax or
other liability on prohibited transactions imposed under Section 4975 of the
Code or ERISA; (v) make all required contributions to any Plan which it is
obligated to pay under Sections 302 or 303 of ERISA, Sections 412 or 430 of the
Code, the PBGC Agreement or the terms of such Plan; (vi) not allow or suffer to
exist any violation of the “minimum funding standards” (within the meaning of
Section 302 of ERISA and Section 412 of the Code), whether or not waived, with
respect to any such Pension Plan; (vii) not engage in a transaction that could
be subject to Sections 4069 or 4212(c) of ERISA; and (viii) not allow or suffer
to exist any occurrence of a Reportable Event or any other event or condition,
to the extent such Reportable Event or other event or condition presents a
material risk of termination by the PBGC of any Plan that is a single employer
plan, if such termination could result in any material liability to the PBGC.

 

(b)  Promptly upon each determination of the amount of the contributions or
other payments required to be made for any calendar year by any Loan Party in
respect of any underfunded Pension Plan in order to eliminate or reduce the
funding deficiency and prior to any Loan Party making any contribution of other
payment in respect of such calendar year, the Borrower shall notify the
Administrative Agent of such determination and provide such information with
respect thereto as the Administrative Agent may reasonably request.

 

SECTION 5.21.  Agricultural Products.

 

(a)  The Borrower shall at all times comply in all material respects with all
existing and future Food Security Act Notices during their periods of
effectiveness under the Food Security Act, including, without limitation,
directions to make payments to the Farm Products Seller by issuing payment
instruments directly to the secured party with respect to any assets of the Farm
Products Seller or jointly payable to the Farm Products Seller and any secured
party with respect to the assets of such Farm Products Seller, as specified in
the Food Security Act Notice, so as to terminate or release the security
interest in any Farm Products maintained by such Farm Products Seller or any
secured party with respect to the assets of such Farm Products Seller under the
Food Security Act.

 

(b)  The Borrower shall take all other actions as may be reasonably required, if
any, to ensure that any perishable agricultural commodity (in whatever form) or
other Farm Products are purchased free and clear of any Lien or other claims in
favor of any Farm Products Seller or any secured party with respect to the
assets of any Farm Products Seller.

 

(c)  The Borrower shall promptly notify the Administrative Agent in writing
after receipt by or on behalf of the Borrower of any Food Security Act Notice or
amendment to a previous Food Security Act Notice, and including any notice from
any Farm Products Seller of the intention of such Farm Products Seller to
preserve the benefits of any trust

 

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applicable to any assets of any Loan Party under the provisions of the PSA, the
PACA or any other statute and, upon the request of the ABL Facility Agent (or,
after the Discharge of ABL Debt (as defined in the Intercreditor Agreement),
upon the request of the Administrative Agent), the Borrower shall promptly
provide the Administrative Agent with a true, correct and complete copy of such
Food Security Act Notice or amendment, as the case may be, and other information
delivered to or on behalf of the Borrower pursuant to the Food Security Act.

 

(d)  To the extent that the Borrower purchases any Farm Products from a Person
who produces such Farm Products in a state with a central filing system
certified by the United States Secretary of Agriculture, the Borrower shall
immediately register, as a buyer, with the Secretary of State of such state (or
the designated system operator).  The Borrower shall forward promptly to the
Administrative Agent a copy of such registration as well as a copy of all
relevant portions of the master list periodically distributed by any such
Secretary of State (or the designated system operator).  The Borrower shall
comply with any payment of obligations in connection with the purchase of any
Farm Products imposed by a secured party as a condition of the waiver or release
of a security interest effective under the Food Security Act or other applicable
law whether or not as a result of direct notice or the filing under any
applicable central filing system.  The Borrower shall also provide to the
Administrative Agent from time to time upon its request true and correct copies
of all state filings recorded in any such central filing system in respect of a
Person from whom the Borrower has purchased Farm Products within the preceding
12 months.

 

SECTION 5.22.  Term Loan Priority Account.  The Borrower shall maintain a
depositary account subject to a Blocked Account Agreement in favor of the
Collateral Agent and the ABL Facility Agent in which solely the proceeds of the
Term Loan Priority Collateral (as defined in the Intercreditor Agreement) are
deposited.  The Borrower will deposit, or will cause to be deposited, all Net
Cash Proceeds of the Term Loan Priority Collateral (as defined in the
Intercreditor Agreement) into such account.

 

SECTION 5.23.  Designation of Subsidiaries.  The Borrower may from time to time
after the Closing Date, pursuant to a determination by its board of directors,
designate any of its Subsidiaries as an Unrestricted Subsidiary or any
Unrestricted Subsidiary as a Restricted Subsidiary; provided that
(i) immediately before and after such designation, no Default or Event of
Default shall have occurred and be continuing or would result therefrom,
(ii) each Subsidiary to be designated as an Unrestricted Subsidiary and its
Subsidiaries has not at the time of such designation and does not thereafter
create incur, issue, assume, guarantee or otherwise become directly or
indirectly liable with respect to any Indebtedness pursuant to which the lender
thereof has recourse to any of the assets of the Borrower, any Guarantor or any
Restricted Subsidiary, (iii) the fair market value of any such Subsidiary to be
designated as an Unrestricted Subsidiary and its Subsidiaries would be permitted
as an Investment under Section 6.04, (iv) the designation of any Unrestricted
Subsidiary as a Restricted Subsidiary will constitute the incurrence at the time
of designation of all Indebtedness and Liens of such Subsidiary existing at the
time of such designation, (v) no Restricted Subsidiary may be designated as an
Unrestricted Subsidiary if it is a “restricted subsidiary” (or a term having a
similar effect) for purposes of any other Material Indebtedness of the Borrower
and its Subsidiaries; and (vi) any Unrestricted Subsidiary that has been
designated as a Restricted Subsidiary may not subsequently be re-designated as
an Unrestricted Subsidiary

 

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without the prior consent of the Administrative Agent.  Any such designation by
the Board of Directors shall be evidenced to the Administrative Agent by
promptly delivering to the Administrative Agent a copy of the resolution of the
Borrower’s board of directors giving effect to such designation and a
certificate signed by a Responsible Officer of the Borrower certifying that such
designation complied with the foregoing provisions.

 

SECTION 5.24.  Preparation of Environmental Reports.

 

(a)  If a Default caused by reason of a breach of Section 3.09 or Section 5.16
shall have occurred and be continuing for more than 20 days without any Loan
Party commencing activities reasonably likely to cure such Default, at the
written request of the Lenders through the Administrative Agent, provide to the
Lenders within 90 days after such request, at the expense of the Borrower, an
environmental site assessment report regarding the matters which are the subject
of such Default prepared by an environmental consulting firm reasonably
acceptable to the Administrative Agent and indicating the presence or absence of
Hazardous Materials and the estimated cost of any compliance or remedial action
in connection with such Default.

 

(b)  If any Event of Default shall have occurred, at the written request of the
Lenders through the Administrative Agent, provide to the Lenders within 45 days
after such request, at the expense of the Borrower, an environmental site
assessment report for any Real Estate Collateral Property (whether owned or
leased) prepared by an environmental consulting firm reasonably acceptable to
the Administrative Agent regarding the presence or absence of Hazardous
Materials at such property, the extent of any Environmental Liabilities
associated with such Loan Party’s operations thereon, and the estimated cost of
any compliance or remedial action in connection therewith.

 

(c)  If any Loan Party has not promptly commenced preparation for completion of
an environmental report duly requested by the Lenders pursuant to this
Section 5.24, the Administrative Agent may, after prior notice to the Borrower
and at the Borrower’s expense, engage a qualified environmental consultant to
prepare such reports.  The Loan Parties shall provide the Administrative Agent,
its consultant or other designated representative, with reasonable access to its
Real Estate, records and personnel for the purpose of completing all necessary
investigations related to preparation of the requested environmental reports
(the scope of which shall be consistent with the then current ASTM Phase I
standard practice, but which shall not include the taking of soil, groundwater,
surface water, air or building samples or other invasive testing unless the
Borrower has provided its prior written consent, which consent shall not be
unreasonably withheld; provided, that such testing is reasonably related to
information set forth in the Phase I report or reasonably related to the
specific Event of Default that has occurred and is continuing).

 

SECTION 5.25.  Post-Closing Collateral.  The Borrower shall have satisfied, and
shall have caused each Loan Party to have satisfied, the Term Loan Priority
Collateral Requirements on or prior to (x) the date that is 90 days after the
Closing Date (or such later date as may be agreed by the Administrative Agent in
its sole discretion) with respect to Term Loan Priority Collateral consisting of
Real Estate Collateral Properties and Related Real Estate Collateral located
thereon, and (y) within 120 days after the Closing (or such later date as may be
agreed by the Administrative Agent in its sole discretion) with respect to Term
Loan Priority Collateral consisting of Related Real Estate Collateral located at
Material Related Collateral Locations.

 

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After the Closing Date, the Borrower may substitute one or more fee-owned or
ground leasehold interests in Real Estate (and the Equipment located thereon)
for any Term Loan Priority Collateral on the Applicable Collateral List subject
to the satisfaction of the terms and conditions set forth in Section 9.21, but
provided that any such substitution prior to the completion of the requirements
of the previous sentence shall not affect the amount of time permitted for
taking any action required under this Section 5.25.  In addition to the
foregoing, Loan Parties shall deliver or cause to be delivered to the
Administrative Agent on or before May 21, 2013 (unless the Administrative Agent,
in its sole discretion, shall have agreed to any longer period), a lender’s loss
payable endorsement for each of the property insurance policies (including
Marine insurance policies insuring inventory) required to be maintained pursuant
to Section 5.07, each in form and substance reasonably satisfactory to the
Administrative Agent and naming the Administrative Agent as a loss payee and
additional insured. Such endorsements shall, or the insurer shall otherwise
agree in writing, to make the Administrative Agent a payee on any payment of a
claim under such policies and provide for delivery of such payment directly to
the ABL Facility Agent (subject to the rights of the Administrative Agent with
respect to Term Loan Priority Collateral).

 

SECTION 5.26.  Escrow Agreement and Indemnity.

 

(a)  To the extent that any demand for payment has been made on the Borrower in
respect of its obligations under the ASC Guarantee, the Borrower shall
diligently exercise its rights pursuant to the Escrow Agreement and
Section 5.11(c) of the Acquisition Agreement to obtain payment (directly or
indirectly to the indenture trustee under the ASC Indenture in satisfaction in
full of the amount demanded) in respect of any amount demanded under the ASC
Guarantee prior to the Borrower making any payment in respect thereof and, to
the extent the Borrower makes any payment in respect thereof, the Borrower will
appropriately exercise its rights pursuant to the Escrow Agreement and
Section 5.11(c) of the Acquisition Agreement to obtain reimbursement for such
payment.

 

(b)  The Escrow Fund (as defined in the Escrow Agreement) and all other assets
and property subject to the Escrow Agreement shall at all times be and remain
invested in a MMMF or one or more other investments reasonably satisfactory to
the Administrative Agent, except for cash or Cash Equivalents received in
connection with liquidations distributing proceeds thereof and except for other
liquid non-cash investments of the type described in clauses (a) through (e) of
the term “Permitted Investments”.

 

ARTICLE VI

 

Negative Covenants

 

The Loan Parties covenant and agree with each Lender that so long as this
Agreement shall remain in effect and until the Commitments have been terminated
and the principal of and interest on each Loan, all Fees and all other expenses
or amounts payable under any Loan Document shall have been paid in full (other
than contingent indemnification obligations not then due and payable), unless
the Required Lenders shall otherwise consent in writing, the Loan Parties will
not, and will not, to the extent provided below, cause or permit any Restricted
Subsidiary to:

 

SECTION 6.01.  Liens.  Create, incur, assume or suffer to exist any Lien upon
any of its property, assets or revenues, whether now owned or hereafter acquired
or sign or file or suffer to

 

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exist under the UCC or any similar Law or statute of any jurisdiction a
financing statement that names any Loan Party or any Subsidiary thereof as
debtor; sign or suffer to exist any security agreement authorizing any Person
thereunder to file such financing statement; sell any of its property or assets
subject to an understanding or agreement (contingent or otherwise) to repurchase
such property or assets with recourse to it or any of its Subsidiaries; or
assign or otherwise transfer any accounts or other rights to receive income,
except as to all of the above, Permitted Encumbrances.

 

SECTION 6.02.  Investments, Loans and Advances.  Make any Investments except:

 

(a)  Permitted Investments; and

 

(b)  the Borrower or any Subsidiary may acquire all or substantially all the
assets of a Person or line of business of such Person, or not less than 100% of
the Equity Interests (other than directors’ qualifying shares) of a Person
(referred to herein as the “Acquired Entity”); provided that (i) such
acquisition was not preceded by an unsolicited tender offer for such Equity
Interests by, or proxy contest initiated by, the Borrower or any Subsidiary and
the board of directors (or other comparable governing body) of the Person to be
acquired shall not have announced that it will oppose such acquisition or shall
not have commenced any action or proceeding which alleges that such acquisition
will violate any applicable law; (ii) the Acquired Entity shall be in a
substantially similar, reasonably related or incidental to line of business as
that of the Borrower and its Subsidiaries as conducted during the current and
most recent calendar year; (iii) the Administrative shall have received 10
Business Days prior written notice of such acquisition and prior to the
consummation thereof shall have received such information with respect thereto
as the Administrative Agent shall have reasonably requested and (iv) at the time
of such transaction (A) both before and after giving effect thereto, no Default
or Event of Default shall have occurred and be continuing; (B) the Total
Leverage Ratio of the Borrower shall not exceed 3.50:1:00 on a pro forma basis
after giving effect to such acquisition, any incurrence or assumption of
Indebtedness in connection therewith and the use of proceeds thereof; (C) the
Borrower shall have delivered a certificate of a Responsible Officer, certifying
as to the satisfaction of the foregoing clauses (A) and (B) and containing
reasonably detailed calculations in support thereof, in form and substance
satisfactory to the Administrative Agent; (D) the Acquired Entity, if a Person,
shall become a Loan Party prior to or substantially simultaneously with such
acquisition or, if all or substantially all of the assets or a line of business
of a Person shall be acquired, the same shall be acquired by a Person who is a
Loan Party or becomes a Loan Party substantially simultaneously with such
acquisition; and (E) the Borrower shall comply, and shall cause the Acquired
Entity to comply, with the applicable provisions of Section 5.12, Section 5.17
and the Security Documents (any acquisition of an Acquired Entity meeting all
the criteria of this Section 6.02(b) being referred to herein as a “Permitted
Acquisition”).

 

SECTION 6.03.  Indebtedness.  Incur, create, assume or permit to exist any
Indebtedness, except Permitted Indebtedness.

 

SECTION 6.04.  Fundamental Changes.  Merge, dissolve, liquidate or consolidate
with or into another Person (or agree to do any of the foregoing), except that,
so long as no Default or Event of Default shall have occurred and be

 

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continuing prior to or immediately after giving effect to any action described
below or would result therefrom:

 

(a)  any Loan Party may merge with any Excluded Subsidiary; provided that the
Loan Party shall be the continuing or surviving Person;

 

(b)  any Loan Party may merge into any Loan Party, provided that, (i) in any
merger involving the Borrower, the Borrower shall be the continuing or surviving
Person and (ii) in any merger involving Moran Foods or any of its Subsidiaries
and a Loan Party that is not Moran Foods or any of its Subsidiaries, Moran Foods
or such Subsidiary shall be the continuing or surviving person;

 

(c)  in connection with a Permitted Acquisition, any Subsidiary of a Loan Party
may merge with or into or consolidate with any other Person or permit any other
Person to merge with or into or consolidate with it; provided that (i) the
Person surviving such merger shall be a Subsidiary of a Loan Party and (ii) in
the case of any such merger to which any Loan Party is a party, such Loan Party
is the surviving Person; and

 

(d)  any Restricted Subsidiary may be wound up and dissolved, provided, promptly
upon the commencement of the winding up or any action to dissolve such
Restricted Subsidiary, (i) any assets of such Restricted Subsidiary which
constitute Collateral are either (A) transferred to a Loan Party and are subject
to the valid perfected second priority security interest of the Administrative
Agent as to any ABL Priority Collateral and valid perfected first priority
security interest of the Administrative Agent as to any Term Loan Priority
Collateral or (B) are subject to a Permitted Disposition and (ii) any such
Restricted Subsidiary that is a Loan Party shall cease to be a Loan Party;
provided that notwithstanding the foregoing, Moran Foods and its Subsidiaries
may not be wound up or dissolved.

 

SECTION 6.05.  Dispositions.  Make any Disposition, or enter into any agreement
to make any Disposition, except Permitted Dispositions.

 

SECTION 6.06.  Restricted Payments.  Declare or make, or agree to declare or
make, directly or indirectly, any Restricted Payment (including pursuant to any
Synthetic Purchase Agreement), or incur any obligation (contingent or otherwise)
to do so; provided, however, that as of the date of any such Restricted Payment
and after giving effect thereto, (i) any Restricted Subsidiary may declare and
pay dividends or make other distributions ratably to its equity holders, (ii) so
long as no Event of Default or Default shall have occurred and be continuing or
would result therefrom, the Borrower may repurchase its Equity Interests owned
by employees of the Borrower or the Subsidiaries or make payments to employees
of the Borrower or the Subsidiaries upon termination of employment in connection
with the exercise of stock options, stock appreciation rights or similar equity
incentives or equity based incentives pursuant to management incentive plans or
in connection with the death or disability of such employees, (iii) the Borrower
may make other Restricted Payments in an aggregate amount when combined with all
payments made pursuant to Section 6.07(a)(vi) not to exceed $175,000,000 and
(iv) the Borrower may make other Restricted Payments in an aggregate amount not
to exceed the Cumulative Credit Amount; provided, that (x) in the case of
clause (i), to the extent any such

 

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dividends or distributions consist of Real Estate Collateral Property, (1) the
Borrower provides at least 15 Business Days prior written notice thereof (or
such shorter notice as the Administrative Agent may approve) identifying such
Real Estate Collateral Property, (2) such Real Estate Collateral Property is
distributed subject in all respects to the Mortgage thereon and such Mortgage
remains a valid first priority lien on such Real Estate Collateral Property so
distributed and (3) the Borrower shall have delivered to the Administrative
Agent such documents and other information evidencing that such Real Estate
Collateral Property was distributed subject to the Mortgage thereon as the
Administrative Agent may reasonably request; (y) in the case of clause (iv), the
Total Leverage Ratio of the Borrower shall not exceed 3.50:1.00 on a pro forma
basis after giving effect to such payment; and (z) in the case of
clauses (iii) and (iv), at the time of the declaration and making of such
Restricted Payment, (A) both before and after giving effect thereto, no Default
or Event of Default shall have occurred and be continuing and (B) the Borrower
shall have delivered a certificate of a Responsible Officer, certifying as to
compliance with the remaining availability pursuant to clause (iii) and the
usage of the Cumulative Credit Amount, as applicable, and the satisfaction of
the foregoing clauses (y) and (z)(A), as applicable, and containing reasonably
detailed calculations in support thereof, in form and substance satisfactory to
the Administrative Agent.

 

SECTION 6.07.  Prepayments of Other Indebtedness.  (a) Make any distribution,
whether in cash, property, securities or a combination thereof, other than
regular scheduled payments of principal and interest as and when due (to the
extent not prohibited by applicable subordination provisions), in respect of, or
pay, or commit to pay, or directly or indirectly (including pursuant to any
Synthetic Purchase Agreement) redeem, repurchase, retire or otherwise acquire
for consideration, or set apart any sum for the aforesaid purposes, any
Indebtedness (other than Indebtedness in respect of the ASC Guarantee) except
(i) the payment of the Indebtedness created hereunder or under the ABL Facility,
(ii) refinancings of Permitted Indebtedness with Permitted Refinancing
Indebtedness, (iii) payments of the SVU 2016 Notes (A) with proceeds of
borrowings under the ABL Facility (including any Permitted Refinancing
Indebtedness with respect thereto) (provided, that the ABL Facility or such
Permitted Refinancing Indebtedness with respect thereto has a final maturity
date at least six months after the Latest Maturity Date), (B) so long as no
Default or Event of Default shall have occurred and be continuing, with the Net
Cash Proceeds of a Moran Sale that are not required to be applied to prepay
Loans hereunder pursuant to Section 2.13 or prepay loans or cash collateralize
letters of credit under the ABL Facility and (C) so long as no Default or Event
of Default shall have occurred and be continuing, with other sources of cash
that are not required to be applied to prepay Loans hereunder or prepay loans or
cash collateralize letters of credit under the ABL Facility, (iv) the payment of
secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness, (v) [Reserved],
(vi) payments in an aggregate amount when combined with all Restricted Payments
made pursuant to Section 6.06(iii) not to exceed $175,000,000 and (vii) other
payments of Indebtedness in an aggregate amount not to exceed the Cumulative
Credit Amount; provided that, in the case of clauses (vi) and (vii), (A) at the
time of such payment, both before and after giving effect thereto, no Default or
Event of Default shall have occurred and be continuing and (B) the Borrower
shall have delivered a certificate of a Responsible Officer, certifying as to
the satisfaction of the foregoing clause (A), and containing reasonably detailed
calculations certifying as to compliance with the remaining availability
pursuant to clause (vi) or the usage of the Cumulative Credit Amount, as
applicable, in form and substance satisfactory to the

 

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Administrative Agent or (b) pay in cash any amount in respect of any
Indebtedness or preferred Equity Interests that may at the obligor’s option be
paid in kind or in other securities.  Payments originally made in reliance on
clause (vi) above may subsequently be reallocated to clauses (v) or (vii) to the
extent permitted at the time of reallocation under such clauses.

 

SECTION 6.08.  Business of Borrower and Restricted Subsidiaries.  Engage in any
line of business substantially different from the Business conducted by the Loan
Parties and their Subsidiaries on the date hereof or any business substantially
related or incidental thereto.

 

SECTION 6.09.  Transactions with Affiliates.  Enter into, renew, extend or be a
party to any transaction of any kind with any Affiliate of any Loan Party,
whether or not in the ordinary course of business, other than (a) those set
forth on Schedule 6.09 hereto, (b) Restricted Payments permitted under
Section 6.06, (c) the payment of compensation and benefits and the providing of
indemnification to officers and directors in the ordinary course of business and
consistent with past practices or (d) on fair and reasonable terms substantially
as favorable to the Loan Parties as would be obtainable by the Loan Parties at
the time in a comparable arm’s-length transaction with a Person other than an
Affiliate.  The foregoing restriction shall not restrict (i) a transaction
between or among the Loan Parties, (ii) advances for commissions, travel and
other similar purposes in the ordinary course of business to directors, officers
and employees, (iii) the issuance of Equity Interests of the Borrower to any
officer, director or employee of the Borrower or any of its Subsidiaries in the
ordinary course of business, (iv) the payment of reasonable fees and
out-of-pocket costs to directors, and compensation and employee benefit
arrangements paid to, and indemnities provided for the benefit of, directors,
officers or employees of the Borrower or any of its Subsidiaries, and (v) any
issuances of Qualified Equity Interests of the Borrower (other than Disqualified
Stock and other Equity Interests not permitted hereunder) or other payments,
awards or grants in cash, securities or otherwise pursuant to, or the funding
of, severance agreements, retention plans, employment agreements, deferred
compensation agreements, stock options, restricted stock agreements and stock
ownership plans (in each case in respect of Qualified Equity Interests of the
Borrower) of the Borrower or any of its Subsidiaries.

 

SECTION 6.10.  Burdensome Agreements.  Enter into or permit to exist any
Contractual Obligation (other than this Agreement or any other Loan Document or
any ABL Facility Documents) that (a) limits the ability (i) of any Subsidiary to
make Restricted Payments or other distributions to any Loan Party or to
otherwise transfer property to or invest in a Loan Party, (ii) of any Subsidiary
(other than an Excluded Subsidiary) to Guarantee the Obligations, (iii) of any
Subsidiary (other than an Excluded Subsidiary) to make or repay loans to a Loan
Party or (iv) of the Loan Parties or any Subsidiary (other than an Excluded
Subsidiary) to create, incur, assume or suffer to exist Liens on property of
such Person in favor of the Administrative Agent; provided, that this
clause (iv) shall not prohibit any negative pledge incurred or provided in favor
of any holder of Indebtedness permitted under clauses (c) or (f) of the
definition of “Permitted Indebtedness” solely to the extent any such negative
pledge relates to the property financed by or securing such Indebtedness; or
(b) other than the SVU Indenture and any Permitted Refinancing Indebtedness in
respect thereof, requires the grant of a Lien to secure an obligation of such
Person if a Lien is granted to secure another obligation of such Person.

 

SECTION 6.11.  Use of Proceeds.  Use the proceeds of any Loan, whether directly
or indirectly, and whether immediately, incidentally or ultimately, (a) to
purchase or carry margin stock (within the meaning of Regulation U) or to extend
credit to others for the purpose of

 

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purchasing or carrying margin stock or to refund Indebtedness originally
incurred for such purpose; or (b) for purposes other than those permitted under
this Agreement.

 

SECTION 6.12.  Amendment of Material Documents.  Amend, modify, consent to or
waive any of a Loan Party’s rights under or any provision of (a) its
Organization Documents, the Acquisition Agreement or any document related to the
Acquisition Agreement (including the Escrow Agreement and the transition
services agreements referred to in the Acquisition Agreement), in each case in a
manner materially adverse to the Secured Parties or (b) the SVU Indenture, the
SVU 2016 Notes, the ASC Guarantee or any other Material Indebtedness, in each
case in a manner that would be materially adverse to the Secured Parties
(including, in the case of the SVU Indenture, the SVU 2016 Notes and the ASC
Guarantee, changing the obligors with respect to such Material Indebtedness) or
to the extent that such amendment, modification or waiver would reasonably be
expected to have a Material Adverse Effect.

 

SECTION 6.13.  Fiscal Year.  Change the Fiscal Year of any Loan Party, or the
accounting policies or reporting practices of the Loan Parties, except as
required by GAAP.

 

SECTION 6.14.  Disqualified Stock.  Issue any Disqualified Stock.

 

ARTICLE VII

 

Events of Default

 

SECTION 7.01.  Events of Default.  In case of the happening of any of the
following events (“Events of Default”).

 

(a)  Non-Payment.  The Borrower or any Restricted Subsidiary fails to pay when
and as required to be paid herein, whether at the due date thereof or at a date
fixed for prepayment thereof or by acceleration thereof or otherwise, (i) any
amount of principal of any Loan or (ii) any interest on any Loan, or any fee due
hereunder, within five Business Days of the due date or (iii) any other amount
payable hereunder or under any other Loan Document, within five Business Days of
the due date; or

 

(b)  Specific Covenants.  The Borrower or any Restricted Subsidiary fails to
perform or observe any term, covenant or agreement contained in any of
Sections 5.01, 5.02(a)(i), 5.02(a)(iv), 5.03, 5.05, 5.07, 5.11, 5.12 or 5.13 or
Article VI; or

 

(c)  Other Defaults.  The Borrower or any Restricted Subsidiary fails to perform
or observe (i) any term, covenant or agreement contained in Section 4.9 of the
Security Agreement, (ii) any term, covenant or agreement contained in Sections
5(a), the first sentence of Section 5(c), Section 6 or Section 7 of any of the
Mortgages, or (iii) any other term, covenant or agreement (not specified in
Sections 7.01(a) or 7.01(b) above) contained in any Loan Document on its part to
be performed or observed and such failure continues for 30 days after the date
written notice thereof shall have been given to the Borrower by the
Administrative Agent or any Lender; provided, that in the case of clause (iii),
in the event the Borrower fails to notify the Administrative Agent pursuant to
Section 5.03(a) within three Business Days after the occurrence of its failure
to perform or observe such term, covenant or agreement as provided therein, an
Event of Default will occur as a result of the failure to perform or observe
such term, covenant or agreement 30 days after the

 

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earlier of (x) the date of the event or occurrence which is the basis for such
Event of Default and (b) the date written notice thereof shall have been given
to the Borrower by the Administrative Agent or any Lender; or

 

(d)  Representations and Warranties.  Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of the
Borrower or any Restricted Subsidiary herein, in any other Loan Document, or in
any document, report, certificate, financial statement or other instrument
delivered in connection herewith or therewith shall be incorrect or misleading
in any material respect when made or deemed made, except that such materiality
qualifier shall not be applicable to any representation or warranty that is
already qualified by materiality or “material adverse effect”; or

 

(e)  Cross-Default.  (i) Any Loan Party or Restricted Subsidiary (a) fails to
make any payment when due (regardless of amount and whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) in respect of
any Material Indebtedness (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated credit
arrangement), or (b) fails to observe or perform any other agreement or
condition relating to any such Material Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event occurs, the effect of which default or other event is to cause, or to
permit the holder or holders of such Material Indebtedness or the beneficiary or
beneficiaries of any Guarantee thereof (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, with or without the
giving of notice, lapse of time or both, such Indebtedness to be demanded,
accelerated or to become due or to be repurchased, prepaid, defeased or redeemed
(automatically or otherwise), or an offer to repurchase, prepay, defease or
redeem such Indebtedness to be made, prior to its stated maturity, or such
Guarantee to become payable or cash collateral in respect thereof to be
demanded; (ii) there occurs under any Swap Contract an Early Termination Date
(as defined in such Swap Contract) resulting from (a) any event of default under
such Swap Contract as to which a Loan Party or any Subsidiary thereof is the
Defaulting Party (as defined in such Swap Contract) or (b) any Termination Event
(as defined in such Swap Contract) under such Swap Contract as to which a Loan
Party or any Subsidiary thereof is an Affected Party (as defined in such Swap
Contract) and, in either event, the Swap Termination Value owed by the Loan
Party or such Subsidiary as a result thereof is greater than $50,000,000;
(iii) (a) any party to the Escrow Agreement fails to pay any amount due to the
Borrower thereunder, to deposit any amount required to be deposited thereunder,
or follow the terms of the Escrow Agreement with respect to any dispute by
Borrower thereunder, (b) the Escrow Agent (as defined in the Escrow Agreement)
fails to comply with its obligations not to enter into any control agreement or
any other agreement with any other Person relating to the securities accounts
established pursuant to the Escrow Agreement, (c) ASC fails to comply with its
obligations not to grant any Lien on its rights under the Escrow Agreement or on
any funds deposited pursuant thereto except as contemplated by the Escrow
Agreement or (d) the Escrow Agent (as defined in the Escrow Agreement) disburses
funds deposited pursuant to the Escrow Agreement other than in accordance with
the terms thereof, and in each case with respect to this clause (iii) such
failure continues for 45 days (after the Borrower obtains knowledge thereof
other than in the case of any such failure on the part of the Borrower);
(iv) the Borrower fails to observe or

 

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perform any agreement or condition contained in the ASC Guarantee, or any other
event occurs, the effect of which default or other event is to cause the ASC
Guarantee to be in default, and such failure continues for 45 days; or (v) the
Borrower fails to observe or perform its obligations under any guarantee of NAI
Workers’ Compensation Liabilities, and such failure continues for 45 days; or

 

(f)  Insolvency Proceedings, Etc.  Any Loan Party or Subsidiary (other than an
Excluded Subsidiary) (i) institutes or consents to the institution of any
voluntary or involuntary proceeding under any Debtor Relief Law, or makes a
general assignment for the benefit of creditors; or (ii) applies for or consents
to the appointment of any receiver, trustee, custodian, sequestrator,
conservator, liquidator, rehabilitator or similar officer for it or for all or
any material part of its property; or (iii) a proceeding shall be commenced or a
petition filed, without the application or consent of such Person, seeking or
requesting the appointment of any receiver, trustee, custodian, sequestrator,
conservator, liquidator, rehabilitator or similar officer is appointed and the
appointment continues undischarged, undismissed or unstayed for 60 calendar days
or an order or decree approving or ordering any of the foregoing shall be
entered; (iv) files an answer admitting the material allegations of a petition
filed against it in any proceeding described in the foregoing clauses (i),
(ii) or (iii), or (v) any proceeding under any Debtor Relief Law relating to any
such Person or to all or any material part of its property is instituted without
the consent of such Person and continues undismissed or unstayed for 60 calendar
days, or an order for relief is entered in any such proceeding; or

 

(g)  Inability to Pay Debts; Attachment.  (i) Any Loan Party or Subsidiary
(other than an Excluded Subsidiary) becomes unable or admits in writing its
inability or fails generally to pay its debts as they become due in the ordinary
course of business, or (ii) any writ or warrant of attachment or execution or
similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated or fully bonded within
30 days after its issuance or levy, or (iii) takes any action for the purpose of
effecting the events described in the foregoing paragraph (f) or this
paragraph (g); or

 

(h)  Judgments.  There is entered against any Loan Party or Subsidiary (other
than an Excluded Subsidiary) (i) one or more judgments or orders or any
combination thereof for the payment of money in an aggregate amount (as to all
such judgments and orders) exceeding $50,000,000 (to the extent not covered by
independent third-party insurance as to which the insurer is rated at least “A”
by A.M. Best Company, has been notified of the potential claim and does not
dispute coverage), or (ii) any one or more non-monetary judgments that have, or
would reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (a) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (b) there is a period
of 45 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, is not in effect; or

 

(i)  Racketeering.  There is filed against any Loan Party or Subsidiary by any
federal or state Governmental Authority any action, suit or proceeding under any
federal or state racketeering statute (including the Racketeer Influenced and
Corrupt Organization Act of 1970), which action, suit or proceeding: (i) is not
dismissed within 120 days and

 

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(ii) would reasonably be expected to result in the confiscation or forfeiture of
any material portion of the Collateral; or

 

(j)  ERISA.  (i) An ERISA Event occurs with respect to a Pension Plan,
Multiemployer Plan or the PBGC Agreement which, in the case of a Pension Plan or
Multiemployer Plan, has resulted or would reasonably be expected to result in
the liability of any Borrower or any Restricted Subsidiary under Title IV of
ERISA to the Pension Plan, Multiemployer Plan or the PBGC and that has or would
reasonably be expected to have a Material Adverse Effect when taken together
with all other such ERISA Events or (ii) a Loan Party or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under Section 4201
of ERISA under a Multiemployer Plan or any installment in connection with an
underfunded Pension Plan as provided in Section 5.20, in either case as to any
such installment that is in excess of $50,000,000; or

 

(k)  Invalidity of Loan Documents.  (i) Any provision of any Loan Document, at
any time after its execution and delivery and for any reason other than as
expressly permitted hereunder or thereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect (other than in accordance
with its terms) and as a result thereof, a Material Adverse Effect would occur
or would reasonably be expected to occur; or any Loan Party or any other Person
contests in any manner the validity or enforceability of any provision of any
Loan Document; or any Loan Party denies that it has any or further liability or
obligation under any provision of any Loan Document (other than as a result of
the discharge of such Loan Party in accordance with the terms of the applicable
Loan Document), or purports to revoke, terminate or rescind any provision of any
Loan Document or seeks to avoid, limit or otherwise adversely affect any Lien
purported to be created under any Security Document; or (ii) any Lien purported
to be created under any Security Document shall cease to be, or shall be
asserted by any Loan Party or any other Person not to be, a valid and perfected
Lien on any Collateral, with the priority required by the applicable Security
Document; or

 

(l)  Cessation of Business.  Except as otherwise expressly permitted hereunder,
the Borrower or any Restricted Subsidiary shall take any action to suspend the
operation of its business in the ordinary course, liquidate all or a material
portion of its assets or Store locations, or employ an agent or other third
party to conduct a program of closings, liquidations or “going-out-of-business”
sales of any material portion of its business; or

 

(m)  Loss of Collateral.  There occurs any uninsured loss to any material
portion of the Term Loan Priority Collateral having a value in excess of
$50,000,000; or

 

(n)  Indictment.  The indictment or institution of any legal process or
proceeding against, any Loan Party or any Restricted Subsidiary, under any
federal or state criminal statute, rule, regulation, order, or other requirement
having the force of law for a felony; or

 

(o)  Guaranty.  The termination or attempted termination of any Facility
Guaranty except as expressly permitted hereunder or under any other Loan
Document; or

 

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(p)  Subordination; Intercreditor Agreement.  (i) The subordination provisions
of the documents evidencing or governing any Subordinated Indebtedness, or
provisions of the Intercreditor Agreement (or any other intercreditor agreement
entered into by the Administrative Agent after the date hereof), any such
provisions being referred to as the “Intercreditor Provisions,” shall, in whole
or in part, terminate, cease to be effective or cease to be legally valid,
binding and enforceable against any holder of the applicable Indebtedness as a
result of any act or omission of any Loan Party or any Restricted Subsidiary; or
(ii) any Loan Party or any Restricted Subsidiary shall, directly or indirectly,
disavow or contest in any manner (a) the effectiveness, validity or
enforceability of any of the Intercreditor Provisions, (b) that the
Intercreditor Provisions exist for the benefit of the Secured Parties or (c) in
the case of Subordinated Indebtedness, that all payments of principal of or
premium and interest on the applicable Subordinated Indebtedness, or realized
from the liquidation of any property of any Loan Party or Restricted Subsidiary,
shall be subject to any of the Intercreditor Provisions;

 

(q)  Maturity of ABL Facility.  The maturity of the ABL Facility prior to its
originally scheduled maturity date (as a result of the failure of the Borrower
or any Restricted Subsidiary to obtain refinancing or otherwise as a result of
any act or omission of the Borrower or any Restricted Subsidiary after the
Closing Date); or

 

(r)  Payments Under ASC Guarantee.  Make any payment, whether in cash, property,
securities or a combination thereof, in respect of the ASC Guarantee using
Internally Generated Cash or proceeds of Indebtedness in an aggregate amount in
excess of $40,000,000 (other than amounts subsequently reimbursed to the
Borrower from the Escrow Fund (as defined in the Escrow Agreement) or other
assets or property subject to the Escrow Agreement or pursuant to
Section 5.11(c) of the Acquisition Agreement), or (b) make any payment, whether
in cash, property, securities or a combination thereof, in respect of the ASC
Guarantee in an aggregate amount in excess of $40,000,000 in respect of
interest, fees, expenses, indemnities and other amounts (other than principal)
from the proceeds of the Escrow Fund (as defined in the Escrow Agreement) or
other assets or property subject to the Escrow Agreement, other than payments
made or reimbursed from the Additional Escrow Amount Subaccount (as defined in
the Escrow Agreement);

 

then, and in every such event (other than an event with respect to the Borrower
described in Sections 7.01(f) or 7.01(g)), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of
the Required Lenders shall, by notice to the Borrower, take either or both of
the following actions, at the same or different times:  (i) terminate forthwith
the Commitments and (ii) declare the Loans then outstanding to be forthwith due
and payable in whole or in part, whereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and any
unpaid accrued Fees and all other liabilities of the Borrower accrued hereunder
and under any other Loan Document, shall become forthwith due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower, anything contained herein or
in any other Loan Document to the contrary notwithstanding; and in any event
with respect to the Borrower described in Sections 7.01(f) or 7.01(g), the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and any unpaid accrued Fees
and all other liabilities of the Borrower accrued hereunder and

 

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under any other Loan Document, shall automatically become due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived by the Borrower, anything contained herein or
in any other Loan Document to the contrary notwithstanding and the
Administrative Agent and the Collateral Agent shall have the right to take all
or any actions and exercise any remedies available under the Loan Documents or
applicable law or in equity.

 

SECTION 7.02.  Application of Funds.  After the exercise of remedies provided
for in this Article VII (or after the Loans have automatically become
immediately due and payable as set forth in this Article VII), any amounts
received on account of the Obligations shall (subject to the Intercreditor
Agreement) be applied by the Administrative Agent in the following order:

 

first, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agent and the Collateral Agent
and amounts payable under Section 2.20) payable to the Administrative Agent and
the Collateral Agent, in their capacities as such;

 

second, to payment of that portion of the Obligations constituting indemnities,
expenses, and other amounts (other than principal, interest and fees) payable to
the Lenders (including fees, charges and disbursements of counsel to the
respective Lenders and amounts payable under Section 2.20), ratably among them
in proportion to the amounts described in this clause second payable to them;

 

third, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Loans and other Obligations, and fees, ratably among the
Lenders in proportion to the respective amounts described in this clause third
payable to them;

 

fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans, ratably among the Lenders in proportion to the
respective amounts described in this clause fourth held by them;

 

fifth, to payment of all other Obligations ratably among the Secured Parties in
proportion to the respective amounts described in this clause fifth held by
them; and

 

last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full, to the Loan Parties or as otherwise required by Law.

 

ARTICLE VIII

 

The Administrative Agent and the Collateral Agent; Etc.

 

(a)  Each Lender hereby irrevocably appoints the Administrative Agent and the
Collateral Agent (for purposes of this Article VIII, the Administrative Agent
and the Collateral Agent are referred to collectively as the “Agents”) its agent
hereunder and under the other Loan Documents and authorizes the Agents to take
such actions on its behalf and to exercise such powers as are delegated to such
Agent by the terms hereof and thereof, together with such actions and powers as
are reasonably incidental thereto.  The provisions of this Article VIII are
solely for the benefit of the Agents and the Lenders, and

 

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neither the Borrower nor any other Loan Party shall have rights as a third-party
beneficiary of any of such provisions.  It is understood and agreed that the use
of the term “agent” herein or in any other Loan Documents (or any other similar
term) with reference to the Administrative Agent or Collateral Agent, as
applicable, 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.  Without limiting the generality of the foregoing, the Agents are
hereby expressly authorized to (i) execute any and all documents (including
releases and the Security Documents) with respect to the Collateral and the
rights of the Secured Parties with respect thereto, as contemplated by and in
accordance with the provisions of this Agreement and the Security Documents and
(ii) negotiate, enforce or the settle any claim, action or proceeding affecting
the Lenders in their capacity as such, at the direction of the Required Lenders,
which negotiation, enforcement or settlement will be binding upon each Lender.

 

(b)  The Person serving as the Administrative Agent and/or the Collateral Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not an Agent, and
the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or
unless the context otherwise requires, include the Person serving as an Agent
hereunder in its individual capacity.  Such Person and its Affiliates may accept
deposits from, lend money to, own securities of, act as the financial advisor or
in any other advisory capacity for, and generally engage in any kind of business
with the Borrower or any Subsidiary or other Affiliate thereof (subject to
securities law and other requirements of applicable law) as if it were not an
Agent hereunder and without any duty to account therefor to the Lenders.

 

(c)  Neither Agent shall have any duties or obligations except those expressly
set forth herein and in the Loan Documents, and its duties hereunder shall be
administrative in nature.  Without limiting the generality of the foregoing,
(a) neither Agent shall be subject to any fiduciary or other implied duties,
regardless of whether a Default or Event of Default has occurred and is
continuing, (b) neither Agent shall have any duty to take any discretionary
action or exercise any discretionary powers, except discretionary rights and
powers expressly contemplated hereby that such Agent is instructed in writing to
exercise by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided for herein or
in the other Loan Documents); provided that neither Agent shall be required to
take any action that, in its opinion or the opinion of its counsel, may expose
such Agent to liability or that is contrary to any Loan Document or applicable
law and (c) except as expressly set forth herein and in the other Loan
Documents, neither Agent shall have any duty to disclose, nor shall it be liable
for the failure to disclose, any information relating to the Borrower or any of
the Subsidiaries that is communicated to or obtained by the Person serving as
the Administrative Agent and/or the Collateral Agent or any of its Affiliates in
any capacity.  Neither Agent shall be liable for any action taken or not taken
by it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary, or as such Agent
shall believe in good faith shall be necessary, under the circumstances as
provided in Article VII or Section 9.08) or in the absence of its own

 

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gross negligence or willful misconduct as determined by a court of competent
jurisdiction by a final non-appealable judgment.  Neither Agent shall be deemed
to have knowledge of any Default or Event of Default unless and until written
notice thereof is given to such Agent by the Borrower or a Lender.  Neither
Agent shall be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered thereunder or in connection therewith,
(iii) the performance or observance of any of the covenants, agreements or other
terms or conditions set forth in any Loan Document or the occurrence of any
Default, (iv) the validity, enforceability, effectiveness or genuineness of any
Loan Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
delivered to such Agent.

 

(d)  Each Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution) believed by
it to be genuine and to have been signed, sent or otherwise authenticated by the
proper Person.  Each Agent may also rely upon any statement made to it orally or
by telephone and believed by it to have been made by the proper Person, and
shall not incur any liability for relying thereon.  In determining compliance
with any condition hereunder to the making of a Loan that by its terms must be
fulfilled to the satisfaction of a Lender, each Agent may presume that such
condition is satisfactory to such Lender unless such Administrative Agent shall
have received notice to the contrary from such Lender prior to the making of
such Loan.  Each Agent may consult with legal counsel (who may be counsel for
the Borrower), independent accountants and other experts selected by it, and
shall not be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.

 

(e)  Each Agent may perform any and all its duties and exercise its rights and
powers hereunder or under any other Loan Document by or through any one or more
sub-agents appointed by it.  Each Agent and any such sub-agent may perform any
and all its duties and exercise its rights and powers by or through their
respective Related Parties.  The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of each
Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the Term Facility as well as activities as
Agent.  Neither Agent shall be responsible for the negligence or misconduct of
any sub-agents except to the extent that a court of competent jurisdiction
determines in a final and non-appealable judgment that such Agent acted with
gross negligence or willful misconduct in the selection of such sub-agents.

 

(f)  Either Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right,
with the consent of the Borrower (prior to the occurrence of a Specified Event
of Default), to appoint a successor. If no successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 60 days after the retiring Agent gives notice of its resignation, then
the retiring Agent may, on behalf of the Lenders, appoint a

 

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successor Agent which shall be a financial institution with an office in New
York, New York, or an Affiliate of any such financial institution. If no
successor Agent has been appointed pursuant to the immediately preceding
sentence by the 60th day after the date such notice of resignation was given by
such Agent, such Agent’s resignation shall become effective (and such Agent
shall be discharged from its duties and obligations hereunder) and the Required
Lenders shall thereafter perform all the duties of such Agent hereunder and/or
under any other Loan Document until such time, if any, as the Required Lenders
appoint a successor Administrative Agent and/or Collateral Agent, as the case
may be, with the consent of the Borrower (prior to the occurrence of a Specified
Event of Default).  Upon the acceptance of its appointment as Agent hereunder by
a successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder (if not
already discharged therefrom as provided above).  The fees payable by the
Borrower to a successor Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrower and such successor. 
After an Agent’s resignation hereunder, the provisions of this Article VIII and
Section 9.05 shall continue in effect for the benefit of such retiring Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while acting as Agent.

 

(g)  Each Lender acknowledges that it has, independently and without reliance
upon the Agents or any other Lender or any of their Related Parties and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement.  Each Lender also
acknowledges that it will, independently and without reliance upon the Agents or
any other Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document, any related agreement or any document furnished
hereunder or thereunder.

 

(h)  Notwithstanding any other provision of this Agreement or any provision of
any other Loan Document, each of the Joint Lead Arrangers, the Syndication
Agents and the Documentation Agents are named as such for recognition purposes
only, and in their respective capacities as such shall have no duties,
responsibilities or liabilities with respect to this Agreement or any other Loan
Document; it being understood and agreed that each of the Joint Lead Arrangers,
the Syndication Agents and the Documentation Agents shall be entitled to all
indemnification and reimbursement rights in favor of the Agents provided herein
and in the other Loan Documents.  Without limitation of the foregoing, neither
the Joint Lead Arrangers, the Syndication Agents nor the Documentation Agents in
their respective capacities as such shall, by reason of this Agreement or any
other Loan Document, have any fiduciary relationship in respect of any Lender,
Loan Party or any other Person.

 

(i)  In case of the pendency of any proceeding under any Debtor Relief Law or
any other judicial proceeding relative to any Loan Party, each 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
such Agent shall have made any

 

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demand on the Borrower) 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 Lenders and the Agents (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders and the Agents and their
respective agents and counsel and all other amounts due the Lenders and Agents
under Section 9.05) allowed in such judicial proceeding and (b) to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same and, in either case, any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Lender and each other
Secured Party to make such payments to such Agent and, in the event that such
Agent shall consent to the making of such payments directly to the Lenders, to
pay to such Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of such Agent and its agents and counsel, and any
other amounts due such Agent under Section 9.05.

 

(j)  To the extent required by any applicable law, the Administrative Agent may
withhold from any payment to any Lender an amount equivalent to any applicable
withholding Tax.  If any payment has been made to any Lender by the
Administrative Agent without the applicable withholding Tax being withheld from
such payment and the Administrative Agent has paid over the applicable
withholding Tax to the IRS or any other Governmental Authority, or the IRS or
any other Governmental Authority asserts a claim that the Administrative Agent
did not properly withhold Tax from amounts paid to or for the account of any
Lender because the appropriate form was not delivered or was not properly
executed or because such Lender failed to notify the Administrative Agent of a
change in circumstance which rendered the exemption from, or reduction of,
withholding Tax ineffective or for any other reason, such Lender shall indemnify
the Administrative Agent fully for all amounts paid, directly or indirectly, by
the Administrative Agent as Tax or otherwise, including any penalties or
interest and together with all expenses (including legal expenses, allocated
internal costs and out-of-pocket expenses) incurred.

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01.  Notices; Electronic Communications.

 

(a)  Notices and other communications provided for herein shall be in writing
and shall be delivered by hand or overnight courier service, mailed by certified
or registered mail or sent by fax, as follows:

 

(i) if to the Borrower, to it at SUPERVALU Inc., 250 Park Center Boulevard,
P.O. Box 20, Boise, Idaho 83706, Attention: Treasurer, Fax: (208) 395-6631, with
a copy to SUPERVALU Inc., 7075 Flying Cloud Drive, Eden Prairie, Minnesota
55344, Attention: Vice President, Business Law, Fax: (952) 828-4403;

 

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(ii) if to the Administrative Agent, to Goldman Sachs Bank USA, to the address,
facsimile number, electronic mail address or telephone number specified for such
Person on Schedule 9.01(b);

 

(iii) if to the Collateral Agent, to Goldman Sachs Bank USA, to the address,
facsimile number, electronic mail address or telephone number specified for such
Person on Schedule 9.01(b); and

 

(iv) if to a Lender, to such Lender at its address (or fax number) set forth on
Schedule 2.01 or in the Assignment and Acceptance pursuant to which such Lender
shall have become a party hereto.

 

(b)  All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt if delivered by hand or overnight courier service
or sent by fax or on the date five Business Days after dispatch by certified or
registered mail if mailed, in each case delivered, sent or mailed (properly
addressed) to such party as provided in this Section 9.01 or in accordance with
the latest unrevoked direction from such party given in accordance with this
Section 9.01.

 

(c)  As agreed to among the Borrower, the Administrative Agent and the
applicable Lenders from time to time, notices and other communications may also
be delivered by e-mail to the e-mail address of a representative of the
applicable Person provided from time to time by such Person.  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 Administrative Agent; provided that the
foregoing shall not apply to notices to any Lender pursuant to Article II if
such Lender has notified the Administrative Agent that it is incapable of
receiving notices under Article II by electronic communication.  The
Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications.

 

(d)  Unless the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
intended recipient’s receipt of the notice or communication, which shall be
evidenced by an acknowledgment from the intended recipient (such as by the
“delivery receipt” function, as available, return e-mail or other written
acknowledgement); provided that, if such notice 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; provided, further, that if the sender
receives an “out-of-office” reply e-mail containing instructions regarding
notification to another person in the intended recipient’s absence, such notice
or other communication shall be deemed received upon the sender’s compliance
with such instructions, and (ii) 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

 

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described in the foregoing clause (i) of notification that such notice or
communication is available and identifying the website address therefor.

 

(e)  The Borrower hereby agrees, unless directed otherwise by the Administrative
Agent or unless the e-mail address referred to below has not been provided by
the Administrative Agent to the Borrower, that it will, or will cause its
Subsidiaries to, provide to the Administrative Agent all information, documents
and other materials that it is obligated to furnish to the Administrative Agent
pursuant to the Loan Documents or to the Lenders under Article V, including all
notices, requests, financial statements, financial and other reports,
certificates and other information materials, but excluding any such
communication that (i) is or relates to a Borrowing Request, a notice pursuant
to Section 2.10, (ii) relates to the payment of any principal or other amount
due under this Agreement prior to the scheduled date therefor, (iii) provides
notice of any Default or Event of Default under this Agreement or any other Loan
Document or (iv) is required to be delivered to satisfy any condition precedent
to the effectiveness of this Agreement and/or any Borrowing or other extension
of credit hereunder (all such non-excluded communications being referred to
herein collectively as “Communications”), by transmitting the Communications in
an electronic/soft medium that is properly identified in a format acceptable to
the Administrative Agent to an e-mail address as directed by the Administrative
Agent.  In addition, the Borrower agrees, and agrees to cause its Subsidiaries,
to continue to provide the Communications to the Administrative Agent or the
Lenders, as the case may be, in the manner specified in the Loan Documents but
only to the extent requested by the Administrative Agent.

 

(f)  The Borrower hereby acknowledges that (i) the Administrative Agent will
make available to the Lenders materials and/or information provided by or on
behalf of the Borrower hereunder (collectively, the “Borrower Materials”) by
posting the Borrower Materials on IntraLinks or another similar electronic
system (the “Platform”) and (ii) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public
information with respect to the Borrower, its Subsidiaries or their respective
securities for purposes of United States federal and state securities laws)
(each, a “Public Lender”).  The Borrower hereby agrees that (w) all Borrower
Materials that are to be made available to Public Lenders shall be clearly and
conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof; (x) by marking
Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the
Administrative Agent and the Lenders to treat such Borrower Materials as not
containing any material non-public information with respect to the Borrower, its
Subsidiaries or their respective securities for purposes of United States
federal and state securities laws (provided, however, that to the extent such
Borrower Materials constitute Information, they shall be treated as set forth in
Section 9.16); (y) all Borrower Materials marked “PUBLIC” are permitted to be
made available through a portion of the Platform designated as “Public
Investor;” and (z) the Administrative Agent shall be entitled to treat any
Borrower Materials that are not marked “PUBLIC” as being suitable only for
posting on a portion of the Platform not marked as “Public Investor.”
Notwithstanding the foregoing, the following Borrower Materials shall be marked
“PUBLIC” and the Borrower agrees that the following documents may be distributed
to all Lenders (including Public Lenders) unless, solely with respect to the

 

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documents described in clauses (B) and (C) below, the Borrower advises the
Administrative Agent in writing (including by e-mail) within a reasonable time
prior to their intended distribution that such material should only be
distributed to Lenders other than Public Lenders (it being agreed that the
Borrower and its counsel shall have been given a reasonable opportunity to
review such documents and comply with applicable securities law disclosure
obligations): (A) the Loan Documents; (B) administrative materials prepared by
the Administrative Agent for prospective Lenders; (C) term sheets and
notification of changes in the terms of the Term Facility; and (D) the Audited
Financial Statements, the Deal Basis Financial Statements and the financial
statements and certificates furnished pursuant to Sections 5.01(a) and 5.01(b).

 

(g)  Each Public Lender agrees to cause at least one individual at or on behalf
of such Public Lender to at all times have selected the “Private Side
Information” or similar designation on the content declaration screen of the
Platform in order to enable such Public Lender or its delegate, in accordance
with such Public Lender’s compliance procedures and applicable law, including
United States Federal and state securities laws, to make reference to
Communications that are not made available through the “Public Side Information”
portion of the Platform and that may contain material non-public information
with respect to the Borrower or its securities for purposes of United States
Federal or state securities laws.

 

(h)  THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE”.  NEITHER THE
ADMINISTRATIVE AGENT NOR ANY OF ITS RELATED PARTIES WARRANTS THE ACCURACY OR
COMPLETENESS OF THE COMMUNICATIONS OR THE ADEQUACY OF THE PLATFORM AND EACH
EXPRESSLY DISCLAIMS LIABILITY FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS.  NO
WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS IS MADE BY THE
ADMINISTRATIVE AGENT OR ANY OF ITS RELATED PARTIES IN CONNECTION WITH THE
COMMUNICATIONS OR THE PLATFORM.  IN NO EVENT SHALL THE ADMINISTRATIVE AGENT OR
ANY OF ITS RELATED PARTIES HAVE ANY LIABILITY TO ANY LOAN PARTY, ANY LENDER OR
ANY OTHER PERSON FOR DAMAGES OF ANY KIND, WHETHER OR NOT BASED ON STRICT
LIABILITY AND INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT
OF ANY LOAN PARTY’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS
THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY SUCH PERSON IS
FOUND IN A FINAL RULING BY A COURT OF COMPETENT JURISDICTION TO HAVE RESULTED
PRIMARILY FROM SUCH PERSON’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

 

(i)  The Administrative Agent agrees that the receipt of the Communications by
the Administrative Agent at its e-mail address set forth above shall constitute
effective delivery of the Communications to the Administrative Agent for
purposes of the Loan

 

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Documents.  Each Lender agrees that receipt of notice to it (as provided in the
next sentence) specifying that the Communications have been posted to the
Platform shall constitute effective delivery of the Communications to such
Lender for purposes of the Loan Documents.  Each Lender agrees to notify the
Administrative Agent in writing (including by electronic communication) from
time to time of such Lender’s e-mail address to which the foregoing notice may
be sent by electronic transmission and that the foregoing notice may be sent to
such e-mail address.

 

SECTION 9.02.  Survival of Agreement.  Nothing herein shall prejudice the right
of the Administrative Agent or any Lender to give any notice or other
communication pursuant to any Loan Document in any other manner specified in
such Loan Document.  All covenants, agreements, representations and warranties
made by the Borrower herein and in the certificates or other instruments
prepared or delivered in connection with or pursuant to this Agreement or any
other Loan Document shall be considered to have been relied upon by the Lenders
and shall survive the making by the Lenders of the Loans, regardless of any
investigation made by the Lenders or on their behalf, and shall continue in full
force and effect as long as the principal of or any accrued interest on any Loan
or any Fee or any other amount payable under this Agreement or any other Loan
Document is outstanding and unpaid and so long as the Commitments have not been
terminated.  The provisions of Sections 2.14, 2.16, 2.20 and 9.05 shall remain
operative and in full force and effect regardless of the expiration of the term
of this Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the expiration of the Commitments, the invalidity
or unenforceability of any term or provision of this Agreement or any other Loan
Document, or any investigation made by or on behalf of the Administrative Agent,
the Collateral Agent or any Lender.

 

SECTION 9.03.  Binding Effect.  This Agreement shall become effective when the
Administrative Agent shall have received executed counterparts hereof from each
of the Borrower, the other Loan Parties, the Administrative Agent, the
Collateral Agent and each Person who is a Lender on the Closing Date.

 

SECTION 9.04.  Successors and Assigns.  (a)  Whenever in this Agreement any of
the parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of the Borrower, the other Loan Parties, the
Administrative Agent, the Collateral Agent or the Lenders that are contained in
this Agreement shall bind and inure to the benefit of their respective
successors and assigns.

 

(b)  Each Lender may assign to one or more Eligible Assignees all or a portion
of its interests, rights and obligations under this Agreement (including all or
a portion of its Commitment and the Loans at the time owing to it), with the
prior written consent of the Administrative Agent (not to be unreasonably
withheld or delayed) and the Borrower (not to be unreasonably withheld or
delayed); provided, however, that (i) the consent of the Borrower shall not be
required to any assignment made (x) to a Lender, an Affiliate of a Lender or a
Related Fund, (y) in connection with the initial syndication of the Term
Facility to Persons identified by the Joint Lead Arrangers to the Borrower prior
to the Closing Date or (z) after the occurrence and during the continuance of
any Specified Event of Default (provided, further, that the Borrower shall be
deemed to have consented to any such assignment unless it shall object thereto
by written notice to the Administrative Agent within five Business Days after
having received notice thereof), (ii) the consent of the Administrative Agent
shall not be required to any assignment (x) made by an

 

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assigning Lender to a Related Fund of such Lender or (y) of an amount less than
$1,000,000 by an assigning Lender to a Related Fund of such Lender, (iii) the
amount of the Commitment or Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Acceptance with respect
to such assignment is delivered to the Administrative Agent) shall be in an
integral multiple of, and not less than, $1,000,000 (or, if less, the entire
remaining amount of such Lender’s Commitment or Loans of the relevant Class);
provided that simultaneous assignments by two or more Related Funds shall be
combined for purposes of determining whether the minimum assignment requirement
is met, (iv) the parties to each assignment shall (A) execute and deliver to the
Administrative Agent an Assignment and Acceptance via an electronic settlement
system acceptable to the Administrative Agent or (B) if previously agreed with
the Administrative Agent, manually execute and deliver to the Administrative
Agent an Assignment and Acceptance, and, in each case, shall pay to the
Administrative Agent a processing and recordation fee of $3,500 (which fee may
be waived or reduced in the sole discretion of the Administrative Agent);
provided that only one such fee shall be payable in the event of simultaneous
assignments to or from two or more Related Funds by a single Lender and (v) the
assignee, if it shall not be a Lender, shall deliver to the Administrative Agent
an Administrative Questionnaire (in which the assignee shall designate one or
more credit contacts to whom all syndicate-level information (which may contain
material non-public information about the Loan Parties and their Related Parties
or their respective securities) will be made available and who may receive such
information in accordance with the assignee’s compliance procedures and
applicable laws, including Federal and state securities laws) and all applicable
tax forms.  Upon acceptance and recording pursuant to Section 9.04(e), from and
after the effective date specified in each Assignment and Acceptance, (A) the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of a
Lender under this Agreement and (B) the assigning Lender thereunder shall, to
the extent of the interest assigned by such Assignment and Acceptance, 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 but shall continue to be entitled to the benefits of
Sections 2.14, 2.16, 2.20 and 9.05, as well as to any Fees accrued for its
account and not yet paid).

 

(c)  By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows:  (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and that its
Commitment and the outstanding balances of its Loans, in each case without
giving effect to assignments thereof which have not become effective, are as set
forth in such Assignment and Acceptance, (ii) except as set forth in
clause (i) above, such 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 the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement, any other Loan Document or any other instrument or document furnished
pursuant hereto, or the financial condition of the Borrower or any Subsidiary or
the performance or observance by the Borrower or any

 

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Subsidiary of any of its obligations under this Agreement, any other Loan
Document or any other instrument or document furnished pursuant hereto;
(iii) such assignee represents and warrants that it is an Eligible Assignee
legally authorized to enter into such Assignment and Acceptance; (iv) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the most recent financial statements referred to in Section 3.05(a) or
delivered pursuant to Section 5.01 and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (v) such assignee will independently and
without reliance upon the Administrative Agent, the Collateral Agent, such
assigning Lender or any other Lender and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement; (vi) such
assignee appoints and authorizes the Administrative Agent and the Collateral
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement as are delegated to the Administrative Agent and the
Collateral Agent, respectively, by the terms hereof, together with such powers
as are reasonably incidental thereto; and (vii) such assignee agrees that it
will perform in accordance with their terms all the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.

 

(d)  The Administrative Agent, acting solely for this purpose as a non-fiduciary
agent of the Borrower, shall maintain at one of its offices in New York City a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive absent manifest error and the Borrower, the Administrative Agent, the
Collateral Agent and the Lenders shall treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary.  The
Register shall be available for inspection by the Borrower, the Collateral Agent
and any Lender (solely with respect to any entry relating to such Lender’s Loans
and Commitments), at any reasonable time and from time to time upon reasonable
prior notice.

 

(e)  Upon its receipt of, and consent to, a duly completed Assignment and
Acceptance executed by an assigning Lender and an assignee, an Administrative
Questionnaire completed in respect of the assignee (unless the assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in Section 9.04(b), if applicable, and the written consent of the Administrative
Agent and, if required, the Borrower to such assignment and any applicable tax
forms, the Administrative Agent shall (i) accept such Assignment and Acceptance
and (ii) record the information contained therein in the Register.  No
assignment shall be effective unless it has been recorded in the Register as
provided in this Section 9.04(e).

 

(f)  Each Lender may, without the consent of, or notice to, the Borrower or the
Administrative Agent, sell participations to one or more banks or other Persons
in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
provided, however, that (i) no Lender shall, without the written consent of the
Borrower, sell participations in Loans or Commitments

 

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to any Competitor of the Borrower, (ii) such Lender’s obligations under this
Agreement shall remain unchanged, (iii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iv) the participating banks or other Persons shall be entitled to the benefit
of the cost protection provisions contained in Sections 2.14, 2.16 and 2.20 to
the same extent as if they were Lenders (but, with respect to any particular
participant, to no greater extent than the Lender that sold the participation to
such participant unless a greater payment results from a Change in Law occurring
after such particular participant acquired the applicable participation or the
sale of such participation was approved in writing by the Borrower), (v) the
Borrower, the Administrative Agent and the Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement, and such Lender shall retain the sole right to
enforce the obligations of the Borrower relating to the Loans and to approve any
amendment, modification or waiver of any provision of this Agreement (other than
amendments, modifications or waivers decreasing any fees payable to such
participating bank or Person hereunder or the amount of principal of or the rate
at which interest is payable on the Loans in which such participating bank or
Person has an interest, extending any scheduled principal payment date or date
fixed for the payment of interest on the Loans in which such participating bank
or Person has an interest, increasing or extending the Commitments in which such
participating bank or Person has an interest or releasing all or substantially
all of the value of the Facility Guaranty or all or substantially all of the
Collateral) and (v) such Lender shall maintain a register on which it records
the name and address of each participant and the principal amounts of each
participant’s participating interest with respect to the Loans, Commitments or
other interests hereunder, which entries shall be conclusive absent manifest
error; provided, further, that no Lender shall have any obligation to disclose
any portion of such register to any Person except to the extent disclosure is
necessary to establish that the Loans, Commitments or other interests hereunder
are in registered form for United States federal income tax purposes.  To the
extent permitted by law, each participating bank or other Person also shall be
entitled to the benefits of Section 9.06 as though it were a Lender, provided
such participating bank or other Person agrees to be subject to Section 2.18 as
though it were a Lender.

 

(g)  Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 9.04, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; provided that, prior to any such disclosure of
information designated by the Borrower as confidential, each such assignee or
participant or proposed assignee or participant shall execute an agreement
whereby such assignee or participant shall agree (subject to customary
exceptions) to preserve the confidentiality of such confidential information on
terms no less restrictive than those applicable to the Lenders pursuant to
Section 9.16.

 

(h)  Any Lender may at any time assign all or any portion of its rights under
this Agreement to secure extensions of credit to such Lender or in support of
obligations owed by such Lender; provided that no such assignment shall release
a Lender from any of its obligations hereunder or substitute any such assignee
for such Lender as a party hereto.

 

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(i)  Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle (an “SPV”),
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower, the option to provide to the Borrower all
or any part of any Loan that such Granting Lender would otherwise be obligated
to make to the Borrower pursuant to this Agreement; provided that (i) nothing
herein shall constitute a commitment by any SPV to make any Loan and (ii) if an
SPV elects not to exercise such option or otherwise fails to provide all or any
part of such Loan, the Granting Lender shall be obligated to make such Loan
pursuant to the terms hereof.  The making of a Loan by an SPV hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender.  Each party hereto hereby agrees
that no SPV shall be liable for any indemnity or similar payment obligation
under this Agreement (all liability for which shall remain with the Granting
Lender).  In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPV, it will
not institute against, or join any other Person in instituting against, such SPV
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any State thereof.  In
addition, notwithstanding anything to the contrary contained in this
Section 9.04, any SPV may (i) with notice to, but without the prior written
consent of, the Borrower and the Administrative Agent and without paying any
processing fee therefor, assign all or a portion of its interests in any Loans
to the Granting Lender or to any financial institutions (consented to by the
Borrower and Administrative Agent) providing liquidity and/or credit support to
or for the account of such SPV to support the funding or maintenance of Loans
and (ii) disclose on a confidential basis any non-public information relating to
its Loans to any rating agency, commercial paper dealer or provider of any
surety, guarantee or credit or liquidity enhancement to such SPV.

 

(j)  Neither the Borrower nor any Guarantor shall assign or delegate any of its
rights or duties hereunder or any other Loan Document without the prior written
consent of the Administrative Agent and each Lender, and any attempted
assignment without such consent shall be null and void.

 

(k)  Notwithstanding anything to the contrary contained in this Section 9.04 or
any other provision of this Agreement, so long as no Default or Event of Default
has occurred and is continuing or would result therefrom, each Lender shall have
the right at any time to sell, assign or transfer all or a portion of its Loans
owing to it to the Borrower on a non-pro rata basis (provided, however, that
each assignment shall be of a uniform, and not varying, percentage of all rights
and obligations under and in respect of any applicable Loan), subject to the
following limitations:

 

(i) The Borrower shall conduct one or more modified Dutch auctions (each, an
“Auction”) to repurchase all or any portion of the Loans, provided that,
(A) notice of the Auction shall be made to all Lenders and (B) the Auction shall
be conducted pursuant to such procedures as the Auction Manager may establish
which are consistent with this

 

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Section 9.04(k) and the Auction Procedures set forth on Exhibit Q and are
otherwise reasonably acceptable to Borrower, the Auction Manager and
Administrative Agent;

 

(ii) With respect to all repurchases made by the Borrower pursuant to this
Section 9.04(k), (A) the Borrower shall deliver to the Auction Manager and the
Administrative Agent a certificate of a Responsible Officer stating that no
Default or Event of Default has occurred and is continuing or would result from
such repurchase, (B) the Borrower shall not use the proceeds of any loans under
the ABL Facility to acquire such Loans, (C) Loans so purchased shall not
constitute a prepayment of Loans hereunder for the purposes of calculating
Excess Cash Flow, (D) the assigning Lender and the Borrower shall execute and
deliver to the Auction Manager and the Administrative Agent a Borrower
Assignment and Acceptance and (E) no representation or warranty regarding the
possession of any information that has not been disclosed to the Administrative
Agent or non-Public Lenders and that may be material to a Lender’s decision to
participate in such repurchase shall be required;

 

(iii) Following repurchase by the Borrower pursuant to this Section 9.04(k), the
Loans so repurchased shall, without further action by any Person, be deemed
cancelled for all purposes and no longer outstanding (and may not be resold by
the Borrower), for all purposes of this Agreement and all other Loan Documents,
including, but not limited to (A) the making of, or the application of, any
payments to the Lenders under this Agreement or any other Loan Document, (B) the
making of any request, demand, authorization, direction, notice, consent or
waiver under this Agreement or any other Loan Document or (C) the determination
of Required Lenders, or for any similar or related purpose, under this Agreement
or any other Loan Document.  In connection with any Loans repurchased and
cancelled pursuant to this Section 9.04(k), the Administrative Agent is
authorized to make appropriate entries in the Register to reflect any such
cancellation; and

 

(l)  Each Lender acknowledges that (i) the Borrower currently may have
information regarding the Loan Parties, their ability to perform their
Obligations or any other matter that may be material to a decision by any Lender
to participate in any repurchase contemplated by Section 9.04(k) and that has
not previously been disclosed to the Administrative Agent and the Lenders
(“Excluded Information”), (ii) the Excluded Information may not be available to
it, the Administrative Agent or the other Lenders and (iii) it has independently
and without reliance on any other party made its own analysis and determined to
participate in any repurchase contemplated by Section 9.04(k) thereby
notwithstanding its lack of knowledge of the Excluded Information.

 

SECTION 9.05.  Expenses; Indemnity.  (a)  The Borrower agrees to pay all
reasonable out-of-pocket expenses incurred by the Joint Lead Arrangers, the
Administrative Agent, the Collateral Agent, the Syndication Agents and the
Documentation Agents in connection with the syndication of the Term Facility
and, all reasonable out-of-pocket expenses incurred by the Administrative Agent
and the Collateral Agent in connection with the preparation, execution and
delivery and administration of this Agreement and the other Loan Documents or in
connection with any amendments, modifications or waivers of the provisions
hereof or thereof (whether or not the transactions hereby or thereby
contemplated shall be consummated) or incurred by the

 

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Joint Lead Arrangers, the Administrative Agent, the Collateral Agent,
Syndication Agents, the Documentation Agents or any Lender in connection with
the enforcement or protection of its rights in connection with this Agreement
and the other Loan Documents or in connection with the Loans made hereunder,
including the fees, charges and disbursements of one primary counsel for such
Persons taken as a whole (and, to the extent deemed reasonably necessary by the
Administrative Agent in its good faith discretion, one local counsel in each
relevant jurisdiction to the Joint Lead Arrangers, the Administrative Agent, the
Collateral Agent, the Syndication Agent, the Documentation Agent and the
Lenders, taken as a whole, and one special or regulatory counsel in each
relevant specialty), and, solely in the case of a conflict of interest or a
potential conflict of interest, one additional primary counsel (and, to the
extent deemed reasonably necessary or advisable by the affected persons in their
good faith discretion, one local counsel in each relevant jurisdiction and one
special or regulatory counsel in each relevant specialty) to the affected
persons, taken as a whole.

 

(b)  The Borrower agrees to indemnify the Joint Lead Arrangers, the
Administrative Agent, the Collateral Agent, the Syndication Agent, the
Documentation Agent, each Lender and each Related Party of any of the foregoing
Persons (each such Person being called an “Indemnitee”) against, and to hold
each Indemnitee harmless from, any and all losses, claims, damages, liabilities
and related expenses, including reasonable counsel fees, charges and
disbursements, incurred by or asserted against any Indemnitee arising out of, in
any way connected with, or as a result of (i) the execution or delivery of this
Agreement or any other Loan Document or any agreement or instrument contemplated
thereby, the performance by the parties thereto of their respective obligations
thereunder or the consummation of the Transactions and the other transactions
contemplated thereby (including the Term Facility and the syndication thereof),
(ii) the use of the proceeds of the Loans, (iii) any claim, litigation,
investigation or proceeding relating to any of the foregoing, whether or not any
Indemnitee is a party thereto (and regardless of whether such matter is
initiated by a third party or by the Borrower, any other Loan Party or any of
their respective Affiliates or equity holders) or (iv) any actual or alleged
presence or Release of Hazardous Materials on any property currently or formerly
owned or operated by the Borrower or any of the Subsidiaries, or any
Environmental Liability related in any way to the Borrower or the Subsidiaries;
provided that such indemnity shall not, as to any Indemnitee, be available
(A) to the extent that such losses, claims, damages, liabilities or related
expenses are determined by a court of competent jurisdiction by final and
non-appealable judgment to have resulted primarily from (1) the bad faith, gross
negligence or willful misconduct of such Indemnitee, (2) disputes solely among
Indemnitees (or their Related Persons) (other than claims against any Indemnitee
(x) in its capacity or in fulfilling its role as agent or arranger or any
similar role under the Term Facility or (y) arising out of any act or omission
on the part of the Borrower or any of its Subsidiaries or Affiliates) or (B) in
respect of legal fees or expenses of the Indemnitees, other than the reasonable
invoiced fees, expenses and charges of one primary counsel for all Indemnitees
taken as a whole (and, to the extent deemed reasonably necessary by the
Administrative Agent in its good faith discretion, one local counsel in each
relevant jurisdiction and one special or regulatory counsel in each relevant
specialty), and solely in the case of a conflict of interest or a potential
conflict of interest, one additional primary counsel (and, to the extent deemed
reasonably necessary by the Administrative Agent in its good faith discretion,
one local counsel in each relevant

 

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jurisdiction and one special or regulatory counsel in each relevant specialty)
to the affected Indemnitees, taken as a whole.

 

(c)  To the extent that the Borrower fails to pay any amount required to be paid
by it to the Administrative Agent or the Collateral Agent under
Sections 9.05(a) or 9.05(b), each Lender severally agrees to pay to the
Administrative Agent or the Collateral Agent, as the case may be, such Lender’s
pro rata share (determined as of the time that the applicable unreimbursed
expense or indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent or the Collateral Agent in its capacity as such.  For
purposes hereof, a Lender’s “pro rata share” shall be determined based upon its
share of the sum of the outstanding Loans and unused Commitments at the time.

 

(d)  To the extent permitted by applicable law, no Loan Party shall assert, and
hereby waives, any claim against any Indemnitee, and no Indemnitee shall assert,
and hereby waives, any claim against any Loan Party, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions,
any Loan or the use of the proceeds thereof; provided  that nothing contained in
this sentence will limit the indemnity obligations of any Loan Party to the
extent indirect, special, punitive or consequential damages are included in any
third party claim in connection with which such Indemnitee is entitled to
indemnification hereunder.

 

(e)  No Indemnitee seeking indemnification or reimbursement under this Agreement
will, without the Borrower’s prior written consent (not to be unreasonably
withheld, delayed or conditioned), settle, compromise, consent to the entry of
any judgment in or otherwise seek to terminate any claim, litigation, action,
investigation or proceeding referred to herein; provided that the foregoing
indemnity will apply to any such settlement in the event that (i) the Borrower
was offered the ability to assume the defense of the action that was the subject
matter of such settlement and elected not to so assume or (ii) such settlement
is entered into more than seventy-five (75) days after receipt by the Borrower
of a request by the applicable Indemnitee for reimbursement of its legal or
other expenses incurred in connection with such claim, litigation, action,
investigation or proceeding and the Borrower not having reimbursed such
Indemnitee in accordance with such request prior to the date of such settlement
(provided that the foregoing indemnity will not apply to any settlement made in
accordance with this clause (ii) if the Borrower is disputing such expenses in
good faith in accordance with paragraph (b) of this Section 9.05), and the
foregoing indemnity will also apply to any settlement with the Borrower’s
written consent or if there is a final judgment for the plaintiff against an
Indemnitee in any such proceeding.

 

(f)  Notwithstanding the foregoing, each Indemnitee (and its Related Persons)
shall be obligated to refund and return promptly any and all amounts paid by the
Loan Parties under Section 9.05(b) to such Indemnitee (or such Related Person)
for any such fees, expenses or damages to the extent such Indemnitee (or such
Related Person) is not entitled

 

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to payment of such amounts in accordance with the terms hereof, as determined by
a final non-appealable judgment of a court of competent jurisdiction.

 

(g)  The provisions of this Section 9.05 shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Loans, the expiration of the Commitments, the invalidity or unenforceability
of any term or provision of this Agreement or any other Loan Document, or any
investigation made by or on behalf of the Administrative Agent, the Collateral
Agent or any Lender.  All amounts due under this Section 9.05 shall be payable
on written demand therefor.

 

SECTION 9.06.  Right of Setoff.  If an Event of Default shall have occurred and
be continuing, each Lender is hereby authorized at any time and from time to
time, except to the extent prohibited by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender to or for the
credit or the account of the Borrower against any of and all the obligations of
the Borrower now or hereafter existing under this Agreement and other Loan
Documents held by such Lender, irrespective of whether or not such Lender shall
have made any demand under this Agreement or such other Loan Document and
although such obligations may be unmatured.  The rights of each Lender under
this Section 9.06 are in addition to other rights and remedies (including other
rights of setoff) which such Lender may have.

 

SECTION 9.07.  Applicable Law.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND
ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER SOUNDING IN
CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT (EXCEPT, AS TO ANY OTHER LOAN DOCUMENT, AS
EXPRESSLY SET FORTH THEREIN) AND THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES (OTHER THAN
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).

 

SECTION 9.08.  Waivers; Amendment.  (a)  No failure or delay of the
Administrative Agent, the Collateral Agent or any Lender in exercising any power
or right hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies of the Administrative Agent, the
Collateral Agent and the Lenders hereunder and under the other Loan Documents
are cumulative and are not exclusive of any rights or remedies that they would
otherwise have.  No waiver of any provision of this Agreement or any other Loan
Document or consent to any departure by the Borrower or any other Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
Section 9.08(b), and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given.  No notice or demand on
the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances.

 

(b)  Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the

 

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Borrower and the Required Lenders; provided, however, that no such agreement
shall (i) decrease the principal amount of, or extend the maturity of or any
scheduled principal payment date or date for the payment of any interest on any
Loan, or waive or excuse any such payment or any part thereof, or decrease the
rate of interest on any Loan, without the prior written consent of each Lender
directly adversely affected thereby, (ii) increase or extend the Commitment or
decrease or extend the date for payment of any Fees of any Lender without the
prior written consent of such Lender, (iii) amend or modify the pro rata
requirements of Section 2.17, the provisions of Section 9.04(k) or the
provisions of this Section 9.08 or release all or substantially all of the value
of the Facility Guaranty or all or substantially all of the Collateral, without
the prior written consent of each Lender, (iv) change the provisions of any Loan
Document in a manner that by its terms adversely affects the rights in respect
of payments due to Lenders holding Loans of one Class differently from the
rights of Lenders holding Loans of any other Class without the prior written
consent of Lenders holding a majority in interest of the outstanding Loans and
unused Commitments of each adversely affected Class, (v) modify the protections
afforded to an SPV pursuant to the provisions of Section 9.04(i) without the
written consent of such SPV, (vi) reduce the percentage contained in the
definition of “Required Lenders” without the prior written consent of each
Lender (it being understood that with the consent of the Required Lenders,
additional extensions of credit pursuant to this Agreement may be included in
the determination of the Required Lenders on substantially the same basis as the
Commitments on the date hereof) or (vii) modify any other provision, if any, of
this Agreement that expressly requires the consent of each Lender or each
directly affected Lender without the prior written consent of each Lender;
provided, further, that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent or the Collateral Agent
hereunder or under any other Loan Document without the prior written consent of
the Administrative Agent or the Collateral Agent.

 

(c)  The Administrative Agent and the Borrower may amend any Loan Document to
correct administrative errors or omissions, or to effect administrative changes
that are not adverse to any Lender.  Notwithstanding anything to the contrary
contained herein, such amendment shall become effective without any further
consent of any other party to such Loan Document.

 

SECTION 9.09.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section 9.09 shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or participations or periods
shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.

 

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SECTION 9.10.  Entire Agreement.  This Agreement, the Fee Letter and the other
Loan Documents constitute the entire contract between the parties relative to
the subject matter hereof.  Any other previous agreement among the parties with
respect to the subject matter hereof is superseded by this Agreement and the
other Loan Documents.  Nothing in this Agreement or in the other Loan Documents,
expressed or implied, is intended to confer upon any Person (other than the
parties hereto and thereto, their respective successors and assigns permitted
hereunder and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent, the Collateral Agent and the Lenders) any
rights, remedies, obligations or liabilities under or by reason of this
Agreement or the other Loan Documents.

 

SECTION 9.11.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS.  EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.

 

SECTION 9.12.  Severability.  In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in
and of itself affect the validity of such provision in any other jurisdiction). 
The parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

 

SECTION 9.13.  Counterparts.  This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which shall
constitute an original but all of which when taken together shall constitute a
single contract, and shall become effective as provided in Section 9.03. 
Delivery of an executed signature page to this Agreement by facsimile
transmission or by other electronic transmission (including “.pdf” or “.tif”)
shall be as effective as delivery of a manually signed counterpart of this
Agreement.

 

SECTION 9.14.  Headings.  Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

 

SECTION 9.15.  Jurisdiction; Consent to Service of Process.  (a)  The Borrower
and each other Loan Party hereby irrevocably and unconditionally submits, for
itself and its property, to the exclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in New York
County, and any appellate court from any thereof, in any action or

 

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proceeding arising out of or relating to this Agreement or the other Loan
Documents, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent permitted by law, in such Federal court.  Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.  Nothing in this Agreement
shall affect any right that the Administrative Agent, the Collateral Agent or
any Lender may otherwise have to bring any action or proceeding relating to this
Agreement or the other Loan Documents against the Borrower or its properties in
the courts of any jurisdiction if required to realize upon the Collateral as
determined in good faith by the Person bringing such action or proceeding.

 

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

 

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

 

SECTION 9.16.  Confidentiality.  Each of the Administrative Agent, the
Collateral Agent and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates’ officers, directors, employees and agents, including
accountants, legal counsel, numbering, administration and settlement service
providers and other advisors (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested or required by any regulatory authority or quasi-regulatory
authority (such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) in connection with the exercise of any remedies
hereunder or under the other Loan Documents or any suit, action or proceeding
relating to the enforcement of its rights hereunder or thereunder, (e) subject
to an agreement containing provisions substantially the same as or no less
restrictive than those of this Section 9.16, to any actual or prospective
assignee of or participant in any of its rights or obligations under this
Agreement and the other Loan Documents, (f) with the consent of the Borrower,
(g) to the extent such Information becomes publicly available other than as a
result of a breach of this Section 9.16, (h) subject to an agreement containing
provisions substantially the same as or no less restrictive than those of this
Section 9.16, to actual or proposed direct or indirect counterparties in
connection with any Swap Contract relating to the Loan Parties or their
obligations or (i) disclosure to any rating agency when required by it, provided
that, prior to any disclosure, such rating agency shall undertake in writing to
preserve the confidentiality of any confidential information relating to Loan
Parties received by it from any Agent or any Lender.  In addition, each Agent
and each

 

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Lender may disclose the existence of this Agreement and the information about
this Agreement to market data collectors, similar services providers to the
lending industry, and service providers to the Agents and the Lenders in
connection with the administration and management of this Agreement and the
other Loan Documents.  For the purposes of this Section 9.16, “Information”
shall mean all information received from the Borrower and related to the
Borrower or its business, other than any such information that was available to
the Administrative Agent, the Collateral Agent or any Lender on a
nonconfidential basis prior to its disclosure by the Borrower.  Any Person
required to maintain the confidentiality of Information as provided in this
Section 9.16 shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord its own
confidential information.

 

SECTION 9.17.  Lender Action; Intercreditor Agreement.  (a)  Each Lender agrees
that it shall not take or institute any actions or proceedings, judicial or
otherwise, for any right or remedy against any Loan Party or any other obligor
under any of the Loan Documents (including the exercise of any right of setoff,
rights on account of any banker’s lien or similar claim or other rights of
self-help), or institute any actions or proceedings, or otherwise commence any
remedial procedures, with respect to any Collateral or any other property of any
such Loan Party, unless expressly provided for herein or in any other Loan
Document, without the prior written consent of the Administrative Agent.  The
provisions of this Section 9.17 are for the sole benefit of the Lenders and
shall not afford any right to, or constitute a defense available to, any Loan
Party.

 

(b)  Each Lender that has signed this Agreement shall be deemed to have
consented to and hereby irrevocably authorizes the Collateral Agent to enter
into the Intercreditor Agreement (and including any and all amendments,
amendments and restatements, modifications, supplements and acknowledgments
thereto) from time to time, and agree to be bound by the provisions thereof.

 

(c)  Notwithstanding anything herein to the contrary, each Lender and the Agents
acknowledge that the Lien and security interest granted to the Collateral Agent
pursuant to the Security Documents and the exercise of any right or remedy by
the Collateral Agent thereunder, are subject to the provisions of the
Intercreditor Agreement.  In the event of a conflict or any inconsistency
between the terms of the Intercreditor Agreement and the Security Documents, the
terms of the Intercreditor Agreement shall prevail.

 

SECTION 9.18.  USA PATRIOT Act Notice.  Each Lender and the Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies the Borrower and
the Guarantors that pursuant to the requirements of the USA PATRIOT Act, it is
required to obtain, verify and record information that identifies the Borrower
and the Guarantors, which information includes the name and address of the
Borrower and the Guarantors and other information that will allow such Lender or
the Administrative Agent, as applicable, to identify the Borrower and the
Guarantors in accordance with the USA PATRIOT Act.

 

SECTION 9.19.  No Fiduciary Duty.  The parties hereto hereby acknowledge that
each Agent, each Joint Lead Arranger, each Syndication Agent, each Documentation
Agent, each Lender and their respective Affiliates (collectively, solely for
purposes of this paragraph, the “Lenders”), may have economic interests that
conflict with those of any Loan Party, its stockholders and/or their respective
Affiliates.  The Borrower agrees, on behalf of itself and each

 

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other Loan Party, that nothing in the Loan Documents or otherwise will be deemed
to create an advisory, fiduciary or agency relationship or fiduciary or other
implied duty between any Lender, on the one hand, and any Loan Party, its
stockholders or their respective Affiliates on the other hand.  The Borrower
acknowledges and agrees, on behalf of itself and each other Loan Party, that
(a) the transactions contemplated by the Loan Documents (including the exercise
of rights and remedies hereunder and thereunder) are arm’s-length commercial
transactions between the Lenders, on the one hand, and the Loan Parties, on the
other hand, and (b) in connection therewith and with the process leading
thereto, (i) no Lender has assumed an advisory or fiduciary responsibility in
favor of any Loan Party, with respect to the transactions contemplated hereby
(or the exercise of rights or remedies with respect thereto) or the process
leading thereto (irrespective of whether any Lender has advised, is currently
advising or will advise any Loan Party, on other matters) or any other
obligation to any Loan Party except the obligations expressly set forth in the
Loan Documents and (ii) each Lender is acting solely as principal and not as the
agent or fiduciary of any Loan Party.

 

The Borrower acknowledges and agrees, on behalf of itself and each other Loan
Party, that it has consulted its own legal and financial advisors to the extent
it deemed appropriate and that it is responsible for making its own independent
judgment with respect to such transactions and the process leading thereto.  The
Borrower agrees, on behalf of itself and each other Loan Party, that it will not
claim that any Lender has rendered advisory services of any nature or respect,
or owes a fiduciary or similar duty to any Loan Party, in connection with such
transaction or the process leading thereto.

 

Goldman Sachs & Co. has been retained by the Borrower as financial advisor and
Barclays Capital Inc. has been retained by Cerberus as financial advisor (each
in such capacity, a “Financial Advisor”), in each case in connection with the
potential sale of all or a portion of the businesses of the Borrower and its
Subsidiaries, including the NAI Sale.  Each party hereto agrees to such
retention, and further agrees not to assert any claim it might allege based on
any actual or potential conflicts of interest that might be asserted to arise or
result from (x) on the one hand, the engagement of Goldman Sachs & Co, in its
capacity as a Financial Advisor and, on the other hand, Goldman Sachs’ and its
affiliates’ relationships with such party as described and referred to herein or
(y) on the one hand, the engagement of Barclays Capital Inc., in its capacity as
a Financial Advisor and, on the other hand, Barclays’ and its affiliates’
relationships with such party as described and referred to herein.  Nothing in
this Agreement shall affect the agreements and obligations between the Borrower
and Goldman Sachs & Co. as a Financial Advisor.

 

SECTION 9.20.  Collateral and Guarantee Matters.  Each of the Lenders
irrevocably authorizes the Collateral Agent, at its option and in its
discretion:

 

(a)  to release any Lien on any property granted to or held by the Collateral
under any Loan Document (i) upon termination of the Commitments and payment in
full of all Obligations (other than contingent, unasserted indemnification
obligations) (the occurrence of the events described in this clause (i), the
“Discharge of Obligations”), (ii) that is sold or otherwise disposed of or to be
sold or otherwise disposed of as part of or in connection with any sale or other
disposition permitted hereunder (including, without limitation, in connection
with a receivables facility described in clause (k) of the definition of
Permitted Indebtedness) or under any other Loan Document and, in the case of any

 

146

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Lien on any Real Estate Collateral Property, which sale or other disposition is
made in accordance with the requirements of Section 9.21, (iii) in connection
with a release permitted by and in accordance with Section 9.21 or (iv) subject
to Section 9.08, if approved, authorized or ratified in writing by the Required
Lenders; and

 

(b)  to release any Guarantor from its obligations under each of the Security
Agreement and the Facility Guaranty if such Person ceases to be a Subsidiary as
a result of a transaction permitted under the Loan Documents.

 

Upon request by the Administrative Agent at any time, the Required Lenders will
confirm in writing the Collateral Agent’s authority to release its interest in
particular types or items of property, or to release any Guarantor from its
obligations under the Facility Guaranty pursuant to this Section 9.20. In each
case as specified in this Section 9.20, the Administrative Agent will, at the
Borrower’s expense, execute and deliver to the applicable Loan Party such
documents as such Loan Party may reasonably request to evidence the release of
such item of Collateral from the assignment and security interest granted under
the Security Documents, or to release such Guarantor from its obligations under
the Facility Guaranty, in each case in accordance with the terms of the Loan
Documents and this Section 9.20.

 

The Collateral Agent shall not be responsible for or have a duty to ascertain or
inquire into any representation or warranty regarding the existence, value or
collectability 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 Administrative Agent be responsible or
liable to the Lenders for any failure to monitor or maintain any portion of the
Collateral.

 

SECTION 9.21.  Substitution, Release and Addition of Term Loan Priority
Collateral.  Subject to the terms and conditions of this Section 9.21 and the
requirements of Section 5.25, the Borrower may, after the Closing Date,
(i) substitute one or more fee-owned or ground leased Real Estate sites (and the
Equipment located thereon owned by the Borrower or any of its Subsidiaries) as
Term Loan Priority Collateral (each, a “Substitute Property”), in lieu of any
one or more Real Estate Collateral Properties (each, a “Replaced Property”) and
the Related Real Estate Collateral located thereon (each such substitution, once
the requirements of Section 5.25 and this Section 9.21 have been satisfied with
respect to such Replaced Property, a “Term Loan Priority Collateral
Substitution”), provided that no such substitution shall affect the amount of
time permitted for taking any action in accordance with Section 5.25,
(ii) request that the Collateral Agent release its Lien on any Real Estate
Collateral Property and the Related Real Estate Collateral located thereon, or
on the Related Real Estate Collateral located on any Material Related Collateral
Location (each, a “Release Property”) and, with respect to such Release
Property, to the extent the relevant requirements of this Section 9.21 are
satisfied, the Collateral Agent shall release such Lien in accordance with
Section 9.20 (each, a “Term Loan Priority Collateral Release”) and (iii) add one
or more fee-owned or ground leased Real Estate sites (and the Equipment located
thereon owned by the Borrower or any of its Subsidiaries) or Related Real Estate
Collateral on additional Material Related Collateral Locations (in each case
including pursuant to the requirements of Section 5.12 or Section 5.17) (each,
an “Additional Property”) as Term Loan Priority Collateral (each, a “Term Loan
Priority Collateral Addition”); provided that the following conditions have been
satisfied:

 

147

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(a)  In the case of a Term Loan Priority Collateral Substitution, (i) the
Administrative Agent shall have received at least 15 Business Days’ prior
written notice thereof (or such shorter notice as may be approved by the
Administrative Agent) identifying the proposed Substitute Property and Replaced
Property, (ii) if the New Valuation Conditions are satisfied with respect to
such Substitute Property and/or Replaced Property, the Administrative Agent
shall have received a New Valuation of such Substitute Property and/or Replaced
Property to the extent requested by the Administrative Agent within 10 Business
Days of receiving the notice described in clause (i) above, (iii) both before
and after giving effect thereto, no Default or Event of Default shall have
occurred and be continuing, (iv) the Administrative Agent shall have received a
Restated Collateral List after giving effect thereto, (v)(a) the aggregate Value
of the Term Loan Priority Collateral set forth on such Restated Collateral List
shall not be less than the Value of the Term Loan Priority Collateral on the
Applicable Collateral List (prior to giving effect to such restatement), (b) the
Related Real Estate Collateral on a pro forma basis after giving effect to such
Term Loan Priority Collateral Substitution shall not constitute more than 45% of
the aggregate Value of the Real Estate Collateral Properties and the Related
Real Estate Collateral and (c) the owned Real Estate Collateral Properties on a
pro forma basis after giving effect to such Term Loan Priority Collateral
Substitution shall constitute at least 50% of the aggregate Value of the Real
Estate Collateral Properties and the Related Real Estate Collateral, (vi) no
fee-owned Real Estate Collateral Property shall have been replaced by a ground
leased Real Estate site, (vii)  the Term Loan Priority Collateral Requirements
shall have been satisfied with respect to the applicable Substitute Property and
(viii) at the request of the Administrative Agent, the Administrative Agent
shall have received (A) a certificate of a Responsible Officer of the Borrower
(1) certifying that the requirements set forth in the foregoing clauses
(i) through (vii) have been satisfied and (2) setting forth in reasonable detail
the calculations described in clause (v), if applicable, all in form and
substance reasonably satisfactory to the Administrative Agent, (B) a certificate
of a Responsible Officer of the Borrower of the type described in
Section 4.01(g)(ii), and (C) (1) a certificate of a Responsible Officer of the
Borrower as to factual matters supporting the legal opinions delivered pursuant
to this clause (C) and (2) a customary no conflicts opinion from Borrower’s
counsel, in each case in form and substance satisfactory to the Administrative
Agent, opining that the grants of security interests in the Term Loan Priority
Collateral on the Restated Collateral List (after giving effect to such Term
Loan Priority Collateral Substitution) will not violate the SVU Indenture or any
other Material Indebtedness or trigger any of the equal and ratable sharing
provisions thereof.

 

(b)  In the case of a Term Loan Priority Collateral Release, (i) the
Administrative Agent shall have received at least 15 Business Days’ prior
written notice thereof (or such shorter notice as may be approved by the
Administrative Agent) identifying the proposed Release Property, (ii) both
before and after giving effect thereto, no Default or Event of Default shall
have occurred and be continuing, (iii) unless the Term Loan Priority Collateral
Release is in connection with a Permitted Disposition, if the New Valuation
Conditions are satisfied with respect to such Release Property, the
Administrative Agent shall have received a New Valuation of such Release
Property to the extent requested by the Administrative Agent within 10 Business
Days of receiving the notice described in clause (i) above, (iv) unless the Term
Loan Priority Collateral Release is in connection with a Permitted Disposition,
(a) the aggregate Value of the Term Loan Priority Collateral set forth on such
Restated Collateral List shall not be less than the Value of the Term Loan
Priority Collateral on the Applicable Collateral List (prior to giving effect to
such restatement), (b) the Related Real Estate Collateral on a pro forma basis
after giving effect to

 

148

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such Term Loan Priority Collateral Release shall not constitute more than 45% of
the aggregate Value of the Real Estate Collateral Properties and the Related
Real Estate Collateral and (c) the owned Real Estate Collateral Properties on a
pro forma basis after giving effect to such Term Loan Priority Collateral
Release shall constitute at least 50% of the aggregate Value of the Real Estate
Collateral Properties and the Related Real Estate Collateral, (v) the
Administrative Agent shall have received a Restated Collateral List after giving
effect thereto, (vi) to the extent applicable, the Borrower shall have made any
payments required by Section 2.13 and (vii) the Administrative Agent shall have
received an officer’s certificate of a Responsible Officer of the Borrower
(A) certifying that the requirements set forth in the foregoing
clauses (i) through (vi) have been satisfied and (B) setting forth in reasonable
detail the calculations described in clause (iv), if applicable, all in form and
substance reasonably satisfactory to the Administrative Agent.

 

(c)  In the case of a Term Loan Priority Collateral Addition, (i) the
Administrative Agent shall have received at least 15 Business Days’ prior
written notice thereof (or such shorter notice as may be approved by the
Administrative Agent) identifying the proposed Additional Property, (ii) if the
New Valuation Conditions are satisfied with respect to such Additional Property,
(at the request of the Administrative Agent) the Administrative Agent shall have
received a New Valuation of such Additional Property to the extent requested by
the Administrative Agent within 10 Business Days of receiving the notice
described in clause (i) above, (iii) the Administrative Agent shall have
received a Restated Collateral List after giving effect thereto, (iv) the Term
Loan Priority Collateral Requirements shall have been satisfied with respect to
the applicable Additional Property, except to the extent additional time to
satisfy the Term Loan Priority Collateral Requirements is provided elsewhere in
this Agreement, (v) the Administrative Agent shall have received (A) an
officer’s certificate of a Responsible Officer of the Borrower certifying that
the requirements set forth in the foregoing clauses (i) through (iv) have been
satisfied, all in form and substance reasonably satisfactory to the
Administrative Agent, (B) a certificate of a Responsible Officer of the Borrower
in substantially the form of the certificate required to be delivered pursuant
to Section 4.01(g)(ii) and (C) (1) a certificate of a Responsible Officer of the
Borrower as to factual matters supporting the legal opinions delivered pursuant
to this clause (C) and (2)  a customary no conflicts opinion from Borrower’s
counsel, in each case in form and substance satisfactory to the Administrative
Agent, opining that the grants of security interests in the Term Loan Priority
Collateral on the Restated Collateral List (after giving effect to such Term
Loan Priority Collateral Addition) will not violate the SVU Indenture or any
other Material Indebtedness or trigger any of the equal and ratable sharing
provisions thereof.

 

[Signature Pages Follow]

 

149

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

 

 

SUPERVALU INC.,

 

as Borrower

 

 

 

 

 

By:

/s/ Sherry Smith

 

 

Name:

Sherry M. Smith

 

 

Title:

Executive Vice President and Chief

 

 

 

Financial Officer

 

 

 

 

 

ADVANTAGE LOGISTICS — SOUTHEAST, INC.

 

EASTERN REGION MANAGEMENT CORPORATION

 

BUTSON’S ENTERPRISES, INC.

 

FF ACQUISITION, L.L.C.

 

FOODARAMA LLC

 

RICHFOOD, INC.

 

RICHFOOD HOLDINGS, INC.

 

RICHFOOD PROCUREMENT, L.L.C.

 

SCOTT’S FOOD STORES, INC.

 

SFW HOLDING CORP.

 

SFW LICENSING CORP.

 

SHOP ‘N SAVE ST. LOUIS, INC.

 

SHOP ‘N SAVE WAREHOUSE FOODS, INC.

 

SHOPPERS FOOD WAREHOUSE CORP.

 

SUPER RITE FOODS, INC.

 

SUPERMARKET OPERATORS OF AMERICA INC.

 

SUPERVALU HOLDINGS, INC.

 

SUPERVALU HOLDINGS-PA LLC

 

By: SUPERVALU Holdings, Inc., its sole member

 

SUPERVALU PHARMACIES, INC.

 

SUPERVALU TRANSPORTATION, INC.

 

SUPERVALU TTSJ, INC.

 

SVH REALTY, INC.

 

W. NEWELL & CO., LLC

 

 

 

 

 

By:

/s/ Sherry Smith

 

 

Name:

Sherry M. Smith

 

 

Title:

Vice President

 

SUPERVALU INC.

TERM LOAN CREDIT AGREEMENT

 

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

 

 

CHAMPLIN 2005 L.L.C.

 

 

By: SUPERVALU INC., its sole member

 

 

 

 

 

By:

/s/ Sherry Smith

 

 

Name:

Sherry M. Smith

 

 

Title:

Executive Vice President and Chief

 

 

 

Financial Officer

 

 

 

 

 

MORAN FOODS, LLC

 

 

 

 

 

By:

/s/ Santiago Roces

 

 

Name:

Santiago Roces

 

 

Title:

Chief Executive Officer

 

 

 

 

 

SAVE-A-LOT TYLER GROUP, LLC

 

 

 

 

 

By:

/s/ Sherry Smith

 

 

Name:

Sherry M. Smith

 

 

Title:

Senior Vice President, Finance, Treasurer

 

SUPERVALU INC.

TERM LOAN CREDIT AGREEMENT

 

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

 

 

GOLDMAN SACHS BANK USA,

 

as Administrative Agent and Collateral Agent and

 

as a Lender

 

 

 

 

 

By:

/s/ Robert Ehudin

 

 

Robert Ehudin

 

 

Authorized Signatory

 

SUPERVALU INC.

TERM LOAN CREDIT AGREEMENT

 

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

 

SCHEDULES TO TERM LOAN CREDIT AGREEMENT

 

This document constitutes the Schedules referred to in the TERM LOAN CREDIT
AGREEMENT (“Agreement”) entered into as of March 21, 2013, among SUPERVALU INC.,
a Delaware corporation (the “Borrower”), the Guarantors (such term and each
other capitalized term used but not defined in this introductory statement
having the meaning given it in Article I of the Agreement) party hereto, the
Lenders party hereto and GOLDMAN SACHS BANK USA (“Goldman Sachs”), as
administrative agent (in such capacity, including any successor thereto, the
“Administrative Agent”) and as collateral agent (in such capacity, including any
successor thereto, the “Collateral Agent”) for the Lenders, and contains
information referenced in the Agreement, including certain disclosures and
exceptions to the representations and warranties of the Borrower and Guarantors
made in the Agreement.  Capitalized terms used in these Schedules but not
otherwise defined herein shall have the same meanings ascribed to such terms in
the Agreement.

 

The numbered sections and subsections referenced in these Schedules correspond
to the numbered sections and subsections of the Agreement.  The headings in
these Schedules are for reference purposes only.  Any matter disclosed in any
section or subsection of these Schedules shall be deemed to respond to the
related section or subsection of the Agreement and any other sections or
subsections of the Agreement or these Schedules where the applicability of such
disclosure is reasonably discernible, even if there is no cross-reference in
such section or sub-section to such other sections or subsections.  To the
extent a disclosure in these Schedules makes reference to or describes a
provision of any agreement or other document, such reference or description is
qualified in its entirety by the actual terms and provisions of such agreement
or other document.  Agreements and documents referenced within an agreement or
document disclosed herein shall not be deemed to be disclosed pursuant to these
Schedules unless specifically referred to in these Schedules.

 

The fact that any item of information is disclosed in these Schedules shall not
be construed as an admission of liability with respect to the matters covered by
such information.  No implication should be drawn that any information provided
in these Schedules is necessarily material or otherwise required to be
disclosed, or that the inclusion of such information establishes or implies a
standard of materiality, a standard for what is or is not a Material Adverse
Effect or any other standard contrary to that set forth in the Agreement.  No
disclosure in these Schedules relating to any possible breach, violation of, or
noncompliance with, any Law or contract or other topic to which such disclosure
is applicable shall be construed as an admission or indication that any such
breach, violation or noncompliance exists or has actually occurred.  These
Schedules are qualified in their entirety by reference to the specific
provisions of the Agreement and the representations, warranties, covenants and
agreements to which the disclosures herein pertain and to the extent these
Schedules modify such representations, warranties, covenants or agreements of
the Borrowers and the Guarantors, it shall become a part of and be read together
with the representations, warranties, covenants or agreements of the Borrowers
and the Guarantors contained in the Agreement.

 

The information contained herein is in all events subject to Section 9.16 of the
Agreement.

 

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

 

Schedule 2.01

 

Lenders and Commitments

 

Lender

 

Commitment

 

Goldman Sachs Bank USA

 

$

1,500,000,000

 

Total:

 

$

1,500,000,000

 

 

Sch. 2.01 - 1

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

 

Schedule 3.01

 

Loan Parties Organizational Information

 

Name

 

Type

 

State

 

Org #

 

FEIN

1.

Advantage Logistics - Southeast, Inc.

 

Corporation

 

Alabama

 

168-431

 

[**]

2.

Butson’s Enterprises, Inc.

 

Corporation

 

New
Hampshire

 

005800

 

[**]

3.

Champlin 2005 L.L.C.

 

LLC

 

Delaware

 

3928464

 

[**]

4.

Eastern Region Management Corporation

 

Corporation

 

Virginia

 

0392564-1

 

[**]

5.

FF Acquisition, L.L.C.

 

LLC

 

Virginia

 

S023920-4

 

[**]

6.

Foodarama LLC

 

LLC

 

Delaware

 

2053114

 

[**]

7.

Moran Foods, LLC

 

LLC

 

Missouri

 

LC1235424

 

[**]

8.

Richfood Holdings, Inc.

 

Corporation

 

Delaware

 

3051876

 

[**]

9.

Richfood, Inc.

 

Corporation

 

Virginia

 

0043962-0

 

[**]

10.

Richfood Procurement, L.L.C.

 

LLC

 

Virginia

 

S031919-6

 

[**]

11.

Save-A-Lot Tyler Group, LLC

 

LLC

 

Missouri

 

LC0035762

 

[**]

12.

Scott’s Food Stores, Inc.

 

Corporation

 

Indiana

 

1991110292

 

[**]

13.

SFW Holding Corp.

 

Corporation

 

Delaware

 

2704081

 

[**]

14.

SFW Licensing Corp.

 

Corporation

 

Delaware

 

2403136

 

[**]

15.

Shop ‘N Save St. Louis, Inc.

 

Corporation

 

Missouri

 

00473225

 

[**]

16.

Shop ‘N Save Warehouse Foods, Inc.

 

Corporation

 

Missouri

 

00243351

 

[**]

17.

Shoppers Food Warehouse Corp.

 

Corporation

 

Ohio

 

1825906

 

[**]

18.

Super Rite Foods, Inc.

 

Corporation

 

Delaware

 

2019543

 

[**]

19.

Supermarket Operators of America Inc.

 

Corporation

 

Delaware

 

0849965

 

[**]

20.

SUPERVALU Holdings, Inc.

 

Corporation

 

Missouri

 

00101405

 

[**]

21.

SUPERVALU Holdings - PA LLC

 

LLC

 

Pennsylvania

 

2893444

 

[**]

22.

SUPERVALU INC.

 

Corporation

 

Delaware

 

194304

 

41-0617000

23.

SUPERVALU Pharmacies, Inc.

 

Corporation

 

Minnesota

 

4X-214

 

[**]

24.

SUPERVALU Transportation Inc.

 

Corporation

 

Minnesota

 

7C-793

 

[**]

25.

SUPERVALU TTSJ, Inc.

 

Corporation

 

Delaware

 

5292861

 

[**]

26.

SVH Realty, Inc.

 

Corporation

 

Delaware

 

2694033

 

[**]

27.

W. Newell & Co., LLC

 

LLC

 

Delaware

 

3932547

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 3.01 - 1

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

 

Schedule 3.06

 

Litigation

 

·                  In September 2008, a class action complaint was filed against
the Company, as well as International Outsourcing Services, LLC
(“IOS”), Inmar, Inc., Carolina Manufacturer’s Services, Inc., Carolina Coupon
Clearing, Inc. and Carolina Services, in the United States District Court in the
Eastern District of Wisconsin. The plaintiffs in the case are a consumer goods
manufacturer, a grocery co-operative and a retailer marketing services company
who allege on behalf of a purported class that the Company and the other
defendants (i) conspired to restrict the markets for coupon processing services
under the Sherman Act and (ii) were part of an illegal enterprise to defraud the
plaintiffs under the Federal Racketeer Influenced and Corrupt Organizations Act.
The plaintiffs seek monetary damages, attorneys’ fees and injunctive relief. The
Company intends to vigorously defend this lawsuit, however all proceedings have
been stayed in the case pending the result of the criminal prosecution of
certain former officers of IOS.

 

·                  In December 2008, a class action complaint was filed in the
United States District Court for the Western District of Wisconsin against the
Company alleging that a 2003 transaction between the Company and C&S Wholesale
Grocers, Inc. (“C&S”) was a conspiracy to restrain trade and allocate markets.
In the 2003 transaction, the Company purchased certain assets of the Fleming
Corporation as part of Fleming Corporation’s bankruptcy proceedings and sold
certain assets of the Company to C&S which were located in New England. Since
December 2008, three other retailers have filed similar complaints in other
jurisdictions. The cases have been consolidated and are proceeding in the United
States District Court for the District of Minnesota. The complaints allege that
the conspiracy was concealed and continued through the use of non-compete and
non-solicitation agreements and the closing down of the distribution facilities
that the Company and C&S purchased from each other. Plaintiffs are seeking
monetary damages, injunctive relief and attorneys’ fees. The Company is
vigorously defending these lawsuits. Separately from these civil lawsuits, on
September 14, 2009, the United States Federal Trade Commission (“FTC”) issued a
subpoena to the Company requesting documents related to the C&S transaction as
part of the FTC’s investigation into whether the Company and C&S engaged in
unfair methods of competition. The Company cooperated with the FTC. On March 18,
2011, the FTC notified the Company that it had determined that no additional
action was warranted by the FTC and that it had closed its investigation.

 

Sch. 3.06 - 1

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

 

Schedule 3.08(b)

 

I.                                        Condemnation Proceedings

 

None.

 

II.                                   Owned Real Estate

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 3.08(b) - 1

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

 

Schedule 3.08(c)

 

Leases

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 3.08(c) - 1

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

 

Schedule 3.09

 

Environmental Matters

 

None.

 

Sch. 3.09 - 1

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

 

Schedule 3.10

 

Insurance

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 3.10 - 1

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

 

Schedule 3.13

 

Subsidiaries; Other Equity Investments

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 3.13 - 1

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

 

Schedule 3.17

 

Intellectual Property Matters

 

None.

 

Sch. 3.17 - 1

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

 

Schedule 3.21(a)

 

Demand Deposit Accounts

 

(See attached)

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 3.21(a) - 1

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

 

Schedule 3.21(b)

 

Credit Card Arrangements

 

EFT Services and License Agreement dated March 27, 1997, between BUYPASS
Corporation and SUPERVALU INC., as amended.

 

Agreement for American Express Card Acceptance/Supermarket dated October 29,
1999, between American Express Travel Related Services Company, Inc., and
SUPERVALU Holdings, Inc., as amended.

 

Merchant Services Agreement effective as of October 1, 2006, between Discover
Financial Services LLC and SUPERVALU INC., as amended.

 

Cash Over Amendment to Merchant Services Agreement dated July 15, 2011, between
DFS Services LLC and SUPERVALU INC.

 

Promotional Merchant Fee Letter Agreement dated December 22, 2008, between DFS
Services LLC and SUPERVALU INC., as amended by letter agreement dated August 1,
2011, between the parties.

 

Visa Promotional Agreement dated as of October 1, 2011, between Visa U.S.A. Inc.
and SUPERVALU INC.

 

Sch. 3.21(b) - 1

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

 

Schedule 5.02

 

Financial and Collateral Reporting

 

In addition to the other materials and information required to be provided
pursuant to the terms of the Agreement, the Loan Parties shall provide
Administrative Agent, on the applicable day specified below, the following
documents (each in such form and detail as the Administrative Agent from time to
time may specify):

 

1.                                      On (i) the tenth (10th) day of each
Fiscal Period (or, if such day is not a Business Day, on the next succeeding
Business Day) or (ii) on the fourth Business day of each week as of the closing
of business on the immediately preceding week, upon the occurrence and during
the continuation of an Accelerated Borrowing Base Delivery Event (as defined in
the ABL Credit Agreement), supporting source documents for the Borrowing Base
Certificate (as defined in the ABL Credit Agreement) delivered in accordance
with Section 6.02(a)(ii) of the ABL Credit Agreement.

 

2.                                      Within fifteen (15) days of the end of
each Fiscal Period for the immediately preceding Fiscal Period:

 

(a)                                 Statement of store activity for the Borrower
and its Restricted Subsidiaries on a Consolidated basis in form reasonably
acceptable the Administrative Agent;

 

(b)                                 Reconciliation of the stock ledger to the
general ledger and the calculation of Excess Availability (as defined in the ABL
Credit Agreement);

 

(c)                                  Agings of Wholesale Trade Receivables (as
defined in the ABL Credit Agreement), together with a reconciliation to the
general ledger; and

 

(d)                                 Agings of Pharmacy Receivables (as defined
in the ABL Credit Agreement), together with a reconciliation to the general
ledger.

 

Capitalized terms used herein and not defined herein shall have the meanings
specified in the Agreement.

 

Sch. 5.02 - 1

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

 

Schedule 6.01

 

Existing Liens

 

 

 

State

 

Debtor

 

Secured Party

 

Filing Information

 

Collateral

1.

 

VA

 

FF Acquisition, L.L.C.

 

American Bank Note Company, as Agent for the United States Postal Service

 

File No. 02092373445
Filed: 9/23/2002
Lapse Date: 9/23/2012

Continuation
File No. 07070670920
Filed: 7/6/2007

 

The Consigned Goods are all USPS postage delivered to Consignee for sale to the
public from all establishments maintained by Consignee, including, but not
limited to, First Class postage, etc.

2.

 

VA

 

FF Acquisition, L.L.C.

 

American Greetings Corporation

 

File No. 10031072883
Filed: 3/10/2010
Lapse Date: 3/10/2015

 

Inventory sold or delivered by Secured Party or its affiliates to Debtor, etc.

3.

 

MO

 

Shop ‘n Save Warehouse Foods Inc

 

American Bank Note Company, as Agent for the United States Postal Service

 

File No. 4176312
Filed: 6/15/2001
Lapse Date: 6/15/2016

Continuation
File No. 20060066189K
Filed: 6/14/2006

Continuation
File No. 20110062748B
Filed: 6/7/2011

 

The Consigned Goods are all USPS postage delivered to Consignee for sale to the
public from all establishments maintained by Consignee, including, but not
limited to, First Class postage, etc.

4.

 

MO

 

Shop ‘N Save Warehouse Foods, Inc.

 

American Greetings Corporation

 

File No. 20100025327C
Filed: 3/10/2010
Lapse Date: 3/10/2015

 

Inventory sold or delivered by Secured Party or its affiliates to Debtor, etc.

5.

 

OH

 

Shoppers Food Warehouse Corp.

 

American Greetings Corporation

 

File No. OH00140730723
Filed: 3/10/2010
Lapse Date: 3/10/2015

 

Inventory sold or delivered by Secured Party or its affiliates to Debtor, etc.

6.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20073461901
Filed: 9/12/2007
Lapse Date: 9/12/2012

 

[Specific equipment]

7.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20074524020
Filed: 11/29/2007
Lapse Date: 11/29/2012

 

[Specific equipment]

 

Sch. 6.01 - 1

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

 

8.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20074868013
Filed: 12/26/2007
Lapse Date: 12/26/2012

 

[Specific equipment]

9.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20080895555
Filed: 3/13/2008
Lapse Date: 3/13/2013

Collateral Amendment
File No. 20080999456
Filed: 3/21/2008

 

[Specific equipment]

10.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20081416633
Filed: 4/23/2008
Lapse Date: 4/23/2013

 

[Specific equipment]

11.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20081974151
Filed: 6/10/2008
Lapse Date: 6/10/2013

 

[Specific equipment]

12.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20081974219
Filed: 6/10/2008

Lapse Date: 6/10/2013

 

[Specific equipment]

13.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20081996477
Filed: 6/11/2008
Lapse Date: 6/11/2013

 

[Specific equipment]

14.

 

DE

 

SUPERVALU, Inc.

 

American Color Graphics, Inc.

 

File No. 20082237202
Filed: 6/30/2008
Lapse Date: 6/30/2013

 

[Specific equipment]

15.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20082839361

Filed: 8/20/2008
Lapse Date: 8/20/2013

 

[Specific equipment]

 

Sch. 6.01 - 2

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

 

16.

 

DE

 

SUPERVALU Inc.

 

MassMutual Asset Finance LLC

 

File No. 20082840617
Filed: 8/20/2008
Lapse Date: 8/20/2013

Secured Party Amendment
File No. 20083388772
Filed: 10/7/2008

Secured Party Amendment
File No. 20083394192
Filed: 10/7/2008

Partial Assignment
File No. 20083395132
Filed: 10/7/2008

Full Assignment
File No. 20083436589
Filed: 10/10/2008

 

[Specific equipment]

17.

 

DE

 

SUPERVALU Inc

 

Teradata Operations, Inc.

 

File No. 20090427317
Filed: 2/9/2009
Lapse Date: 2/9/2014

 

All products, equipment, etc. acquired from Secured Party and all proceeds, etc.

18.

 

DE

 

SUPERVALU Inc.

 

National City Commercial Capital Company, LLC

 

File No. 20091208096
Filed: 4/7/2009
Lapse Date: 4/7/2014

 

[Specific equipment]

19.

 

DE

 

SUPERVALU Inc.

 

National City Commercial Capital Company, LLC

 

File No. 20091208195
Filed: 4/7/2009
Lapse Date: 4/7/2014

 

[Specific equipment]

20.

 

DE

 

SUPERVALU Inc

 

NCR Corporation

 

File No. 20092513429
Filed: 8/5/2009
Lapse Date: 8/5/2014

 

All products, including without limitations, equipment, components, software,
deliverables and supplies, whether now or hereafter acquired, which are acquired
(directly or indirectly) from NCR Corporation and/or the acquisition of which is
financed by NCR Corporation, and all proceeds.

21.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20100447478
Filed: 2/9/2010
Lapse Date: 2/9/2015

 

[Specific equipment]

 

Sch. 6.01 - 3

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

 

22.

 

DE

 

SUPERVALU Inc.

 

American Greetings Corporation

 

File No. 20100806459
Filed: 3/10/2010
Lapse Date: 3/10/2015

 

Inventory sold or delivered by Secured Party or its affiliates to Debtor, etc.

23.

 

DE

 

SUPERVALU Inc.

 

The Bank of Holland

 

File No. 20102851487
Filed: 8/16/2010
Lapse Date: 8/16/2015

Full Assignment
File No. 20102977639
Filed: 8/25/2010

 

[Specific equipment]

24.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20114575224
Filed: 11/30/2011
Lapse Date: 11/30/2016

 

[Specific equipment]

25.

 

DE

 

SUPERVALU Inc.

 

Banc of America Leasing & Capital, LLC

 

File No. 20114575240
Filed: 11/30/2011
Lapse Date: 11/30/2016

 

[Specific equipment]

26.

 

DE

 

SUPERVALU Inc.

 

Nestle Dreyer’s Ice Cream Company

 

File No. 20115000438
Filed: 12/20/2011
Lapse Date: 12/20/2016

 

[Specific consigned products]

27.

 

DE

 

SUPERVALU Inc.

 

Papyrus-Recycled Greetings, Inc.

 

File No. 20122461111
Filed: 6/26/2012
Lapse Date: 6/26/2017

 

Inventory sold or delivered by Secured Party to Debtor on a scan based trading
and consignment basis, etc.

28.

 

MO

 

SUPERVALU Holdings, Inc.

 

American Bank Note Company, as Agent for the United States Postal Service

 

File No. 20050068215M
Filed: 6/29/2005
Lapse Date: 6/29/2015

Continuation
File No. 20100060676K
Filed: 6/9/2010

 

The Consigned Goods are all USPS postage delivered to Consignee for sale to the
public from all establishments maintained by Consignee, including, but not
limited to, First Class postage, etc.

29.

 

MO

 

SUPERVALU Holdings, Inc.

 

American Greetings Corporation

 

File No. 20100025328E
Filed: 3/10/2010
Lapse Date: 3/10/2015

 

Inventory sold or delivered by Secured Party or its affiliates to Debtor, etc.

 

Sch. 6.01 - 4

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

 

Capital Lease Obligations as of March 21, 2013

 

[**]

 

One or more of the Loan Parties is contingently liable for leases that have been
assigned to various third parties in connection with facility closings and
dispositions.  The Loan Parties could be required to satisfy the obligations
under the leases if any of the assignees are unable to fulfill their lease
obligations.  Due to the wide distribution of the Loan Parties’ assignments
among third parties, and various other remedies available, the Loan Parties
believe the likelihood that the Loan Parties will be required to assume a
material amount of these obligations is remote.

 

PURCHASE AND SALE AGREEMENTS

 

[**]

 

ADDITIONAL ENCUMBRANCES

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 6.01 - 5

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

 

Schedule 6.02

 

Investments

 

I.             Non-Wholly Owned Entities:

 

[**]

 

II.            Investment Policy

 

SUPERVALU INC.

INVESTMENT GUIDELINES

August 22, 2012

 

PURPOSE:

 

To state clearly the responsibility for the investment of surplus cash, the
approved types of investments and their maturities.

 

POLICY STATEMENT:

 

Cash temporarily not needed for Company operations or to reduce debt will be
invested by the Cash Management Team (in Treasury Services), following approval
from either the Treasurer, Controller, Vice President—Tax, or Chief Financial
Officer.  The investments will be of appropriate maturities to meet projected
cash requirements of the Company, and will be made according to the following
written guidelines.  The objectives of such investments will be, in order of
importance: safety of principal, liquidity of funds, diversification and
investment yield.

 

GUIDELINES:

 

All surplus Company cash will be forwarded to the parent.  Subsidiaries are not
authorized to invest cash with outside parties without prior approval from
either the Treasurer, Controller or Chief Financial Officer.

 

APPROVED INVESTMENTS:

 

1.                                      U.S. Treasury Securities and general
obligations fully guaranteed with respect to principal and interest by the U. S.
Government.

 

2.                                      Obligations of U.S. Government Agencies
(i.e. GNMA’s and FNMA’s).

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 6.02 - 1

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

 

3.                                      Commercial paper of prime quality (rated
A-1 by Standard and Poor’s and P-1 by Moody’s), purchased through recognized
money market dealers (see list of “Authorized Dealers”).

 

4.                                      Certificates of Deposit and Time
Deposits of Banks and their overseas branches are limited to:

 

a.                                      Top 50 worldwide banks as measured by
assets, and

 

b.                                      Banks rated A—1/AA and/or P—1/Aa or
better

 

5.                                      Repurchase Agreements, with authorized
money market dealers (see list of “Authorized Dealers”) or major banks as
defined in item #4, executed against those securities approved for direct
purchase (1-4 above). The current market value of the collateral must cover the
principal amount of the investment and collateral must be held in our name.

 

6.                                      Diversified money market investment
funds (see list of “Authorized Money Market Funds”) meeting the following
conditions:

 

a.                                      AAAm rating from Standard and Poor’s or
AAA rating from Moody’s

 

b.                                      Total assets of at least $5 billion

 

c.                                       Rule 2a-7 compliant

 

d.                                      At least three years of history

 

e.                                       Previously approved by either the
Treasurer, Controller, or Chief Financial Officer

 

7.                                      Other investments, including commercial
paper rated A-2/P-2, may be allowed from time to time with specific written
authorization from the Chief Financial Officer or the Treasurer.

 

8.                                      During a period of time where demand
deposit accounts (DDA’s) are federally guaranteed by the Temporary Liquitidy
Guarantee Program or any other similar FDIC guarantee programs, surplus funds
may be held in the company’s DDA accounts at authorized participating depository
banks.

 

9.                                      Surplus funds may be held at authorized
depository banks not participating in guarantee programs described in #8 above
to earn the earnings credit rate that meet one of the following requirements:

 

a.                                      A Long Term issuer rating no lower than

 

i.                                          A3 from Moody’s or

 

ii.                                       A- from Standard and Poor’s

 

Sch. 6.02 - 2

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

 

b.                                      Market Credit Default Swap (CDS) rate of
no greater than 250 basis points

 

INVESTMENT LIMITATIONS:

 

1.                                      All short-term investments shall be
denominated in U.S. dollars.

 

2.                                      A maximum principal investment of up to:

 

a.                                      $50 million per money market fund
(determined by CUSIP number)

 

b.                                      $25 million per DDA Account

 

3.                                      For direct securities purchases, the
commitment to any one name will be limited to $10 million with the exception of
U.S. Government and U.S. Government Agencies (no limit).

 

4.                                      All securities that are purchased will
be held in “safekeeping” by the seller or by a Safekeeping Agent (see list of
“Authorized Dealers”) named by SUPERVALU INC. who will issue trade confirmation
for all transactions.

 

5.                                      Maturities for investments are not to
exceed 90 days.

 

AUTHORIZED INSTITUTIONS/ FUNDS:

 

The following lists include the Authorized Dealers, Authorized Money Market
Funds and Authorized Depository Banks that have been approved as part of the
investment policy.

 

Authorized Dealers:

 

1.

Bank of America

2.

US Bank

3.

Wells Fargo

 

Authorized Money Market Funds:

 

1.

JP Morgan Government Fund

2.

Federated Government Obligations Fund

3.

Fidelity Institutional Government Fund

4.

Dreyfus Government Cash Management Fund (BNY Mellon)

5.

Columbia Government Reserves Fund (Bank of America)

6.

First American Government Obligations

7.

Goldman Sachs Financial Square Government Fund

8.

BlackRock Liquidity FedFund Institutional Fund

9.

Western Asset Institutional Government Fund

10.

Funds For Institutions Government Fund (Merrill Lynch)

 

Sch. 6.02 - 3

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

 

Authorized Depository Banks Participating in Government Sponsored Guarantee
Programs

 

1.

Bank of America

2.

US Bank

3.

PNC Bank

4.

JP Morgan

5.

Wells Fargo

6.

Northern Trust

7.

Banco Santander (Sovereign)

8.

TCF Bank

9.

Union Bank

10.

Key Bank

 

Nothing in this Schedule 6.02 modifies any Loan Party’s obligations contained in
(i) the proviso at the end of the definition of Permitted Investments or
(ii) Section 6.13 of the ABL Credit Agreement.

 

Sch. 6.02 - 4

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

 

Schedule 6.03

 

Existing Indebtedness

 

Part (a):

 

 

 

MATURITY

 

FACE VALUE BALANCE March 21, 2013

 

Secured/Unsecured

 

SUPERVALU DEBT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SVU NOTES PAYABLE:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DUE 11/15/14

 

11/15/2014

 

489,890,000.00

 

Unsecured

 

DUE 5/1/16

 

5/1/2016

 

1,000,000,000.00

 

Unsecured

 

 

 

 

 

 

 

 

 

TOTAL SVU NOTES PAYABLE:

 

 

 

1,489,890,000.00

 

 

 

 

 

 

 

 

 

 

 

SVU MORTGAGES AND OTHER DEBT:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[**]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SVU MORTGAGES AND OTHER DEBT:

 

 

 

29,081,683.61

 

 

 

 

 

 

 

 

 

 

 

TOTAL COMPANY DEBT

 

 

 

1,518,971,683.61

 

 

 

 

Part (b):

 

Existing Letters of Credit

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 6.03 - 1

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

 

Commercial Letters of Credit

No commercial letters of credit outstanding on the Closing Date.

 

Surety Bonds

 

[**]

 

Part (c):

 

Swap Termination Value

 

[**]

 

Part (f):

 

Capital Lease Obligations as of March 21, 2013

 

[**]

 

One or more of the Loan Parties is contingently liable for leases that have been
assigned to various third parties in connection with facility closings and
dispositions.  The Loan Parties could be required to satisfy the obligations
under the leases if any of the assignees are unable to fulfill their lease
obligations.  Due to the wide distribution of the Loan Parties’ assignments
among third parties, and various other remedies available, the Loan Parties
believe the likelihood that the Loan Parties will be required to assume a
material amount of these obligations is remote.

 

Part (g):

 

None.

 

Part (i):

 

Financial Guaranties

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 6.03 - 2

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

 

Retailer Lease Guaranties

 

[**]

 

Other Lease Guaranties

 

[**]

 

CALIFORNIA WORKERS’ COMPENSATION GUARANTIES

 

(Unsecured)

 

July 27, 2006

 

Agreement of Assumption and Guarantee of Workers’ Compensation Liabilities
executed by SUPERVALU for the benefit of Albertson’s, Inc. in consideration for
the Department of Industrial Relations permission for Albertson’s, Inc. to
operate as certified self-insured employers in the State of California. 
SUPERVALU agrees to assume and guarantee to pay all liabilities and obligations
which Albertson’s, Inc. may incur as a self-insurer of its California workers’
compensation liabilities on or after 7/27/2006.

 

August 8, 2007

 

Agreement of Assumption and Guarantee of Workers’ Compensation Liabilities
executed by SUPERVALU for the benefit of American Drug Stores LLC in
consideration for the Department of Industrial Relations permission for American
Drug Store LLC to operate as certified self-insured employers in the State of
California.  SUPERVALU agrees to assume and guarantee to pay all liabilities and
obligations which American Drug Store LLC may incur as a self-insurer of its
California workers’ compensation liabilities arising on or after 8/3/2007.

 

September 8, 2010

 

Agreement of Assumption and Guarantee of Worker’s Compensation Liabilities
executed by SUPERVALU for the benefit of New Albertson’s, Inc. in consideration
for the Department of Industrial Relations permission for New Albertson’s, Inc.
to operate as certified self-insured employers in the State of California. 
SUPERVALU agrees to assume and guarantee to pay all liabilities and obligations
which New Albertson’s, Inc. may incur as a self-insurer of its California
workers’ compensation liabilities on or after 9/8/2010.

 

Sch. 6.03 - 3

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

 

ASC NOTES GUARANTEE

 

(Unsecured)

 

On July 6, 2005, the Borrower executed that certain ASC Notes Guarantee, dated
as of July 6, 2005, guaranteeing the obligations of ASC under the ASC Indenture
and the ASC Notes.

 

Sch. 6.03 - 4

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

 

Schedule 6.09

 

Transactions with Affiliates

 

Investments in Non-Wholly Owned Entities:

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 6.09 - 1

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

 

Schedule 9.01(a)

 

Web Address:

 

http://www.supervaluinvestors.com

 

Sch. 9.01(a) - 1

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

 

Schedule 9.01(b)

 

Administrative Agent’s Notice and Account Information

 

Notices:

 

Goldman Sachs Bank USA

c/o Goldman Sachs Group, Inc.

6031 Connection Drive

Irving, Texas 75039

Attention: Ken Moua

Telephone: 972-368-2746

Email: gs-sbdagency-borrowernotices@ny.email.gs.com

 

Account Information:

Entity Name: Goldman Sachs Bank USA

Bank Name: Citibank N.A.

ABA: [**]

A/C #: [**]

City: New York

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

Sch. 9.01(b) - 1

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

 

Exhibit A
to the Credit Agreement

 

ADMINISTRATIVE QUESTIONNAIRE

 

Legal Name of Institution/Fund:

 

 

 

 

 

 

 

 

Address:

 

 

 

 

 

 

 

 

Parent Company:

 

 

 

 

 

Signature Block:

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

Attention:

 

Phone:

 

 

 

Address:

 

Fax:

 

 

 

 

 

 

 

 

 

Loan Activity To:

 

 

 

 

 

Attention:

 

Phone:

 

 

 

Address:

 

Fax:

 

 

 

 

 

 

USD Payment Instructions:

 

 

 

 

 

Bank Name:

 

 

 

 

 

ABA #:

 

 

 

 

 

Account Name:

 

 

 

 

 

Account Number:

 

 

 

 

 

Further credit to:

 

 

 

 

 

Account number:

 

 

 

A-1

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

 

Financials, Amendments, Credit Documentation, Voting:

 

Attention:

 

Phone:

 

 

 

Address:

 

Fax:

 

 

 

 

 

 

Tax ID Information:

 

 

 

 

 

Tax ID number:

 

Please attach appropriate tax form

 

 

 

Indicate “Offshore” if applicable

 

 

 

 

 

 

Fund Type (Check One):

 

o            Hedge Fund

 

o            Private Investment Vehicle

 

o            Mutual Fund

 

o            CLO/CDO

 

A-2

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

 

Exhibit B
to the Credit Agreement

 

FORM OF ASSIGNMENT AND ACCEPTANCE

 

This Assignment and Acceptance Agreement (the “Assignment”) is dated as of the
Effective Date set forth below and is entered into by and between [Insert name
of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). 
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (as amended, the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. 
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, the interest in and to all of the
Assignor’s rights and obligations under the Credit Agreement and any other
documents or instruments delivered pursuant thereto that represents the amount
and percentage interest identified below of all of the Assignor’s outstanding
rights and obligations under the facility identified below (the “Assigned
Interest”).  Such sale and assignment is without recourse to the Assignor and,
except as expressly provided in this Assignment, without representation or
warranty by the Assignor.

 

1.

 

Assignor:

 

                                                    

 

 

 

 

 

2.

 

Assignee:

 

                                                    is an Eligible Assignee [and
a[n] [Lender/Affiliate of a Lender/Related Fund]]1

 

 

 

 

 

3.

 

Borrower:

 

SUPERVALU Inc.

 

 

 

 

 

4.

 

Administrative Agent:

 

Goldman Sachs Bank USA, as Administrative Agent under the Credit Agreement

 

 

 

 

 

5.

 

Credit Agreement:

 

Term Loan Credit Agreement dated as of March 21, 2013 among SUPERVALU Inc., a
Delaware corporation, the Guarantors party thereto, the Lenders parties thereto
and Goldman Sachs Bank USA, as Administrative Agent and Collateral Agent

 

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

1                                           Select as applicable.

 

B-1

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

 

6.

 

Assigned Interest:

 

 

 

Aggregate
Amount of Loans for all
Lenders

 

Amount of Loans
Assigned

 

Percentage
Assigned of Loans2

 

$

 

 

$

 

 

 

%

 

[Remainder of page intentionally left blank]

 

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

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

 

B-2

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

 

Effective Date:                                  , 20       [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]

 

The terms set forth in this Assignment are hereby agreed to:

 

 

 

ASSIGNOR:

 

 

 

 

 

[NAME OF ASSIGNOR]

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ASSIGNEE:

 

 

 

 

 

[NAME OF ASSIGNEE]

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

Consented to and Accepted:

 

 

 

 

 

GOLDMAN SACHS BANK USA,

 

 

as Administrative Agent

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

[Consented to:

 

 

 

 

 

SUPERVALU INC.

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:]3

 

 

 

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

3                                           If required pursuant to
Section 9.04(b) of the Credit Agreement.

 

B-3

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

 

Annex 1
to Assignment and Acceptance

 

SUPERVALU INC.
TERM LOAN CREDIT AGREEMENT

 

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
AND ACCEPTANCE AGREEMENT

 

1.             Representations and Warranties.

 

1.1          Assignor.  The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim,
(iii) its Commitment and the outstanding balances of its Loans, without giving
effect to assignments thereof that have not become effective, are as set forth
in this Assignment and (iv) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and to consummate the
transactions contemplated hereby; and (b) except as set forth in
clause (a) above, makes no representation or warranty and assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement, (ii) the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Credit Agreement, any other Loan Document or any other instrument or document
delivered pursuant thereto, other than this Assignment (herein, collectively,
the “Loan Documents”), (iii) the financial condition of Borrower or any of its
Subsidiaries or (iv) the performance or observance by the Borrower or any of its
Subsidiaries of any of their respective obligations under any Loan Document or
any other instrument or document furnished pursuant thereto.

 

1.2          Assignee.  The Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby
and to become a Lender under the Credit Agreement, (ii) it meets all
requirements of an Eligible Assignee under the Credit Agreement, (iii) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements referred to in Section 3.05(a) thereof or delivered
pursuant to Section 5.01 thereof, as applicable, and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and (iv) attached to this Assignment is
any documentation required to be delivered by it pursuant to the terms of the
Credit Agreement, duly completed and executed by the Assignee, including to the
extent required pursuant to Section 2.20(e) of the Credit Agreement, two
properly completed originals of IRS Forms W-8BEN, W-8ECI, W-8EXP, W-8IMY or W-9
and, if applicable, a portfolio interest exemption certificate substantially in
the form of Exhibit O to the Credit Agreement; (b) agrees that (i) it will,
independently and without reliance upon the Administrative Agent, the Collateral
Agent, the Assignor or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement and
(ii) it will perform in accordance with their terms all of the obligations which
by the terms of the Credit Agreement are required to be performed by it as a
Lender; and (c) appoints and authorizes the Administrative Agent and the
Collateral Agent to take such action as agent on its behalf and to

 

B-4

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

 

exercise such powers under the Credit Agreement as are delegated to the
Administrative Agent and the Collateral Agent, respectively, by the terms
thereof, together with such powers as are reasonably incidental thereto.

 

2.             Payments.  From and after the Effective Date, Administrative
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for
amounts which have accrued to but excluding the Effective Date and to the
Assignee for amounts which have accrued from and after the Effective Date.

 

3.             General Provisions.  This Assignment shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns.  This Assignment may be executed in any number of counterparts, which
together shall constitute one instrument.  Delivery of an executed counterpart
of a signature page of this Assignment by telecopy or other electronic
transmission shall be effective as delivery of a manually executed counterpart
of this Assignment.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK.

 

[Remainder of page intentionally left blank]

 

B-5

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

 

Exhibit C
to the Credit Agreement

 

FORM OF BORROWING REQUEST

 

Goldman Sachs Bank USA, as Administrative Agent

for the Lenders referred to below

c/o Goldman Sachs Group, Inc.

6031 Connection Drive

Irving, Texas 75039

Attention: Ken Moua

Telephone: 972-368-2746

Email: gs-sbdagency-borrowernotices@ny.email.gs.com

 

[Date]

 

Ladies and Gentlemen:

 

The undersigned, SUPERVALU INC., a Delaware corporation (the “Borrower”), refers
to that certain Term Loan Credit Agreement, dated as of March 21, 2013 (as may
be amended, restated, replaced, refinanced, supplemented or otherwise modified
from time to time, the “Credit Agreement”), among the Borrower, the Guarantors
party thereto, the Lenders party thereto (the “Lenders”) and GOLDMAN SACHS BANK
USA, as Administrative Agent for the Lenders (in such capacity, including any
successor thereto, the “Administrative Agent”) and Collateral Agent for the
Secured Parties.  Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in the Credit Agreement.  The
Borrower hereby gives you notice pursuant to Section 2.03 of the Credit
Agreement that it requests a Borrowing under the Credit Agreement, and in
connection therewith sets forth below the terms on which such Borrowing is
requested to be made:

 

(A)                               Date of Borrowing
(which is a Business Day):

 

(B)                               Principal Amount of Borrowing:

 

(C)                               Class of Borrowing:4

 

(D)                               Type of Borrowing:5

 

(E)                                Interest Period and the last day thereof:6

 

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

4                      Specify Borrowing of Loans or Borrowing of Incremental
Loans

 

5                      Specify Eurodollar Borrowing or ABR Borrowing.

 

6                      Applicable only for Eurodollar Borrowings and shall be
subject to the definition of “Interest Period” and Section 2.02 of the Credit
Agreement and end not later than the Maturity Date.

 

C-1

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

 

(F)                                 Funds are requested to be disbursed to the
Borrower’s account with:
                                                    (Account
No.                                   ).

 

The Borrower hereby represents and warrants to the Administrative Agent and the
Lenders that, on the date of this Borrowing Request and on the date of the
related Borrowing, the conditions to lending specified in Section 4.01(b) of the
Credit Agreement have been satisfied.

 

[Remainder of page intentionally left blank]

 

C-2

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

 

IN WITNESS WHEREOF, the undersigned has caused this Borrowing Request to be duly
executed and delivered by its officer as of the date first above written.

 

 

SUPERVALU INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

C-3

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

 

Exhibit D
to the Credit Agreement

 

FORM OF COMPLIANCE CERTIFICATE

 

The undersigned hereby certifies that he or she is the
[                    ]7 of SUPERVALU Inc. (the “Borrower”), and certifies on
behalf of the Borrower, and not in his or her individual capacity, as follows:

 

I have reviewed the terms of the Term Loan Credit Agreement, dated as of
March 21, 2013 (as amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Guarantors party thereto, the Lenders party thereto from time to time and
Goldman Sachs Bank USA, as Administrative Agent for the Lenders (in such
capacity, including any successor thereto, the “Administrative Agent”) and
Collateral Agent for the Secured Parties, and I have made, or have caused to be
made under my supervision, a review in reasonable detail of the transactions and
condition of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements.

 

Terms defined in the Credit Agreement and not otherwise defined in this
Compliance Certificate (this “Compliance Certificate”) shall have the meanings
assigned to such terms in the Credit Agreement.  Section references herein
relate to the Credit Agreement unless stated otherwise.  In the event of any
conflict between the calculations set forth in this Compliance Certificate and
the manner of calculation required by the Credit Agreement, the terms of the
Credit Agreement shall govern and control.

 

The examinations described in the second paragraph above did not disclose the
existence of any condition or event which constitutes an Event of Default or
Default as of the date of this Compliance Certificate, except as set forth in a
separate attachment, if any, to this Compliance Certificate, specifying the
nature and extent thereof and the corrective action taken or proposed to be
taken with respect thereto by the Borrower.

 

This Compliance Certificate is delivered in accordance with
Section 5.02(a)(i) of the Credit Agreement.  This Compliance Certificate is
delivered for the fiscal [quarter][year] (the “Test Period”) ended [          ],
20[    ] (the “Test Date”).  A computation of the Cumulative Credit Amount and a
description of the uses thereof, in each case during the Test Period, are set
forth on Annex A hereto.  [A statement of reconciliation conforming the
financial statements delivered herewith to any changes in GAAP used in the
preparation thereof and copy of management’s discussion and analysis with
respect to such financial statements are attached as Annex B hereto]8.

 

[Remainder of page intentionally left blank]

 

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

7                      Insert title of applicable Responsible Officer.

 

8                      Delivery of Annex A required only in the event of a
change in GAAP used in the preparation of the financial statements delivered
pursuant to Sections 5.01(a) and 5.01(b) of the Credit Agreement.

 

D-1

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

 

The foregoing certifications, together with the computations set forth in
Annex A hereto[, the statement of reconciliation and management’s discussion and
analysis attached as Annex B hereto] and the financial statements delivered with
this Compliance Certificate in support hereof, are made and delivered as of
[          ], 20[    ] pursuant to Section 5.02(a)(i) of the Credit Agreement.

 

 

SUPERVALU INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title: [                    ]9

 

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

9                      Insert title of applicable Responsible Officer.

 

D-2

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

 

Annex A
to Compliance Certificate

 

FOR THE FISCAL [QUARTER][YEAR] ENDING [                ], 20[  ]

 

A.            Computation of Cumulative Credit Amount:

 

[1.          CONSOLIDATED NET INCOME

 

 

 

 

 

 

 

(i)             the net income or loss of the Borrower and the Restricted
Subsidiaries for such period determined on a Consolidated basis in accordance
with GAAP

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(ii)          (a)         income of any Restricted Subsidiary to the extent that
the declaration or payment of dividends or similar distributions by such
Restricted Subsidiary of such income is not at the time permitted by operation
of the terms of its charter or any agreement, instrument, judgment, decree,
statute, rule or governmental regulation applicable to such Restricted
Subsidiary

 

$

[      ,      ,      ]

 

 

 

 

 

(b)         the income of any Person (other than the Borrower and the Restricted
Subsidiaries) in which any other Person (other than the Borrower and the
Restricted Subsidiaries or any director holding qualifying shares in compliance
with applicable law) owns an Equity Interest, except to the extent of the amount
of dividends or other distributions actually paid to the Borrower and the
Restricted Subsidiaries during such period

 

$

[      ,      ,      ]

 

 

 

 

 

(c)          the income or loss of any Person accrued prior to the date it
becomes a Subsidiary of the Borrower or is merged into or consolidated with the
Borrower or any Restricted Subsidiary or the date that such Person’s assets are
acquired by the Borrower or any Restricted Subsidiary

 

$

[      ,      ,      ]

 

 

 

 

 

(d)         any gains attributable to Dispositions

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

Consolidated Net Income

 

$

[      ,      ,      ]

 

 

D-3

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

 

2.              CONSOLIDATED EBITDA

 

 

 

 

 

 

 

(i)             Consolidated Net Income for such period

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

plus

 

 

 

 

 

(ii)          (a)         Consolidated Interest Expense for such period

 

$

[      ,      ,      ]

 

 

 

 

 

(b)         Consolidated income tax expense for such period

 

$

[      ,      ,      ]

 

 

 

 

 

(c)          depreciation and amortization expense for such period

 

$

[      ,      ,      ]

 

 

 

 

 

(d)         extraordinary, non-recurring or unusual charges for such period
(including such charges reflected in the financial statements provided to the
Lenders prior to the Closing Date)

 

$

[      ,      ,      ]

 

 

 

 

 

(e)          non-cash charges, losses or expenses (and minus the amount of such
cash gains) resulting from the application of FAS No. 123(R)

 

$

[      ,      ,      ]

 

 

 

 

 

(f)           Transaction Expenses incurred within one year after the Closing
Date

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(iii)       (a)         cash payments made during such period on account of
reserves and restructuring charges

 

$

[      ,      ,      ]

 

 

 

 

 

(b)         cash payments made during such period on account of non-cash
extraordinary, non-recurring or unusual charges added to Consolidated Net Income
pursuant to Section (ii)(d) in a previous period

 

$

[      ,      ,      ]

 

 

 

 

 

(c)          cash payments made during such period on account of non-cash
charges, losses or expenses resulting from the application of FAS
No. 123(R) added to Consolidated Net Income pursuant to Section (ii)(e) in a
previous period

 

$

[      ,      ,      ]

 

 

 

 

 

(d)         extraordinary, non-recurring or unusual gains for such period to the
extent included in determining Consolidated Net Income

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

Consolidated EBITDA

 

$

[      ,      ,      ]

 

 

D-4

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

 

3.              EXCESS CASH FLOW

 

 

 

 

 

 

 

(i)             (a)         Consolidated EBITDA for such period

 

$

[      ,      ,      ]

 

 

 

 

 

(b)         reductions to non-cash working capital of the Borrower and the
Restricted Subsidiaries for such period (i.e., the decrease, if any, in Current
Assets minus Current Liabilities from the beginning to the end of such period)

 

$

[      ,      ,      ]

 

 

 

 

 

(c)          the amount by which the Pension Expense for such period exceeds the
Cash Pension Contribution for such period, if any

 

$

[      ,      ,      ]

 

 

 

 

 

(d)         the Net Cash Proceeds of any Other Asset Sale (whether a single
transaction or a series of related transactions) received by the Borrower and
the Restricted Subsidiaries during such period in which such Net Cash Proceeds
are greater than $50,000 but less than $5,000,000

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(ii)          (a)         the amount of Taxes payable in cash by the Borrower
and the Restricted Subsidiaries with respect to such period

 

$

[      ,      ,      ]

 

 

 

 

 

(b)         Consolidated Interest Expense for such period paid in cash

 

$

[      ,      ,      ]

 

 

 

 

 

(c)          Capital Expenditures made in cash during such period, except to the
extent financed with the proceeds of Indebtedness, equity issuances, casualty
proceeds, condemnation proceeds or other proceeds that would not be included in
Consolidated EBITDA

 

$

[      ,      ,      ]

 

 

 

 

 

(d)         scheduled repayments of Indebtedness (other than Indebtedness in
respect of the ABL Facility) made in cash by the Borrower and the Restricted
Subsidiaries during such period, but only to the extent that the Indebtedness so
repaid by its terms cannot be reborrowed or redrawn and such repayments do not
occur in connection with a refinancing of all or any portion of such
Indebtedness

 

$

[      ,      ,      ]

 

 

 

 

 

(e)          additions to non-cash working capital for such period (i.e., the
increase, if any, in Current Assets minus Current Liabilities from the beginning
to the end of such period)

 

$

[      ,      ,      ]

 

 

 

 

 

(f)           the amount by which the Cash Pension Contribution for such period
exceeds the Pension Expense for such period, if any

 

$

[      ,      ,      ]

 

 

 

 

 

(g)          the amount of Restricted Payments paid in cash during such period
to the extent permitted under Section 6.06 of the Credit Agreement

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

Excess Cash Flow

 

$

[      ,      ,      ]]

10

 

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

10                                      Include calculation of Excess Cash Flow
(including calculations of its constituent parts) for any certificate delivered
in connection with the Borrower’s Fiscal Year end.

 

D-5

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

 

4.              RETAINED EXCESS CASH FLOW AMOUNT

 

 

 

 

 

 

 

(i)             sum of the amounts of Excess Cash Flow for each Fiscal Year (or
portion thereof) ending on or prior to the date of determination for which the
amount of Excess Cash Flow shall have been calculated as provided in
Section 2.13(c) of the Credit Agreement and with respect to which the payments
required under Section 2.13(c) of the Credit Agreement have been made,
consisting of:

 

 

 

 

 

 

 

(a)         the period from the Closing Date until February 22, 2014

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

plus

 

 

 

 

 

[(b)     Fiscal Year ending February [    ], 20[    ]]11

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

 

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(ii)          the sum at the time of determination of the aggregate amount of
prepayments required to be made pursuant to Section 2.13(c) of the Credit
Agreement through the date of determination calculated without regard to any
reduction in such sum that resulted from voluntary prepayments of the Loans
referred to in Section 2.13(c)(y) of the Credit Agreement, consisting of:

 

 

 

 

 

 

 

(a)         the period from the Closing Date until February 22, 2014

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

plus

 

 

 

 

 

[(b)     Fiscal Year ending February [    ], 20[    ]]12

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

 

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

Retained Excess Cash Flow Amount:

 

$

[      ,      ,      ]

 

 

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

11                                      Insert additional years, as applicable.

 

12                                      Insert additional years, as applicable.

 

D-6

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

 

5.              CUMULATIVE CREDIT AMOUNT

 

 

 

 

 

 

 

(a)         Retained Excess Cash Flow Amount

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

plus

 

 

 

 

 

(b)         Cumulative amount of Net Cash Proceeds received by the Borrower
after the Closing Date from issuances of the Borrower’s Qualified Capital Stock
(but excluding any such sale or issuance by the Borrower of its Equity Interests
upon the exercise of any warrant or option by directors, officers or employees
of any Loan Party or any Subsidiary)

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(c)          Cumulative amount of Permitted Investments made in reliance on
clause (o) of the definition of “Permitted Investments”

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(d)         Cumulative amount of Restricted Payments made in reliance on
Section 6.06(iv) of the Credit Agreement

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

minus

 

 

 

 

 

(e)          Cumulative amount of payments of Indebtedness made in reliance on
Section 6.07(a)(vii) of the Credit Agreement

 

$

[      ,      ,      ]

 

 

 

 

 

 

 

equals

 

 

 

 

 

Cumulative Credit Amount

 

$

[      ,      ,      ]

 

 

D-7

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

 

B.            Description of Cumulative Credit Amount Uses:

 

Type of Use

 

Description of Use

 

 

 

Permitted Investments made pursuant to clause (o) of the definition thereof

 

 

 

 

 

Restricted Payments made pursuant to Section 6.06(iv) of the Credit Agreement

 

 

 

 

 

Payments of Indebtedness made pursuant to Section 6.07(a)(vii) of the Credit
Agreement

 

 

 

D-8

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

 

Annex B
to Compliance Certificate

 

STATEMENT OF RECONCILIATION
AND
MANAGEMENT’S DISCUSSION AND ANALYSIS

 

(See attached)

 

D-9

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

 

Exhibit E
to the Credit Agreement

 

FORM OF PERFECTION CERTIFICATE

 

(See attached)

 

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

 

PERFECTION CERTIFICATE

 

SUPERVALU INC., et al.

 

[          ], 20[    ]

 

In connection with (i) that certain Amended and Restated Credit Agreement (the
“ABL Credit Agreement”) to be entered into by and among SUPERVALU INC., a
Delaware corporation having an office at 7075 Flying Cloud Drive, Eden Prairie,
Minnesota (“SUPERVALU”), the other Borrowers and Guarantors party thereto
(together with SUPERVALU, individually, a “Company”, and collectively, the
“Companies”), the Lenders party thereto from time to time, and Wells Fargo Bank,
National Association, as administrative agent (in such capacity, the “ABL
Administrative Agent”) and as collateral agent, and (ii) that certain Term Loan
Credit Agreement (the “Term Loan Credit Agreement” together with the ABL Credit
Agreement, collectively, the “Credit Agreements” and terms used but not defined
herein shall have the meaning given in the Credit Agreements) to be entered into
by and among SUPERVALU, the lenders from time to time party thereto and Goldman
Sachs Bank USA, as administrative agent (in such capacity, “Term Loan
Administrative Agent” together with the ABL Administrative Agent, collectively,
the “Administrative Agents”), SUPERVALU hereby certifies on behalf of itself and
the Companies under the Credit Agreements as follows:

 

I.                                        Current Information

 

A.                                    Legal Name, Organizations, Corporate
Functions, Jurisdiction of Organization and Organizational Identification
Number. The full and exact legal name (as it appears in its certificate or
articles of organization, limited liability membership agreement, or similar
organizational documents, in each case as amended to date), the type of
organization, the jurisdiction of organization and the state organizational
identification number and federal taxpayer identification number) of each
Company are as follows:

 

·                  Attached hereto as Schedule I.A.

 

B.                                    Chief Executive Offices, Mailing Addresses
and other Locations.  The mailing address of each Loan Party for purposes of
completing a UCC-1 financing statement is:

 

c/o SUPERVALU INC.

7075 Flying Cloud Drive

Attention: Treasurer

Eden Prairie, MN 55344

 

Schedules V.A. and V.B. contain the mailing addresses of distribution centers at
which each Company maintains any collateral or any books and records relating
thereto.

 

C.                                    Warehousemen, Bailees, etc.  Except as set
forth below, no warehouseman or bailee has possession of any inventory of any
Company:

 

·                  Attached hereto as Schedule I.C.

 

D.                                    Changes in Names, Jurisdiction of
Organization or Corporate Structure.  Except as set forth below, no Company has
changed its name, jurisdiction of organization or its corporate structure in any
way (e.g. by merger, consolidation, change in corporate form, change in
jurisdiction of organization or otherwise) within the past four (4) months.

 

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

 

E.                                    Acquisitions of Equity Interests or
Assets.  No Company has acquired the controlling equity interests of another
entity or substantially all the assets of another entity within the past four
(4) months.

 

F.                                     Corporate Ownership and Organizational
Structure.  Attached as Exhibit A hereto is a true and correct organizational
chart showing the ownership of the Companies.

 

G.                                   Federal Tax Return.  Attached hereto as
Schedule I.G. are true and correct copies of the cover pages of the federal tax
returns most recently filed by SUPERVALU with the Internal Revenue Service.

 

II.                                   Investment Related Property

 

A.                                    Securities.  Schedule II.A. sets forth a
true and accurate copy of the investment policy of the SUPERVALU.

 

B.                                    Securities Accounts.  Set forth below is a
list of all securities accounts of each Company:

 

Name of Company

 

Type of Account

 

Name & Address of Financial
Institutions/Financial Intermediary

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C.                                    Deposit Accounts.  Set forth below is a
list of all bank accounts (checking, savings, money market or the like) of the
Companies:

 

·                  Attached hereto as Schedule II.C.

 

D.                                    Instruments.  Set forth below is a list of
all third party instruments held by or payable to the Companies:

 

·                  Attached hereto as Schedule II.D.

 

III.                              Intellectual Property

 

A.                                    Set forth below is a list of United States
registered copyrights, patents, trademarks and other intellectual property owned
by any Company:

 

·                  Attached hereto as Schedule III.

 

B.                                    Set forth below is a list of United States
registered trademarks owned by Save-A-Lot Food Stores, Ltd.:

 

·                  Attached hereto as Schedule III.B.

 

IV.                               Commercial Tort Claims.  The Companies
currently have the following commercial tort claims against other parties, none
of which constitute Related Collateral (as defined in the Security Agreement).

 

·                  Attached hereto as Schedule IV.

 

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

 

V.                                    Real Estate Related UCC Collateral.

 

·                  Schedule V.A. sets forth, as of the date hereof, the street
address, county and state of each site of land that is fee owned by any Company
or any Restricted Subsidiary.

 

·                  Schedule V.B. sets forth, as of the date hereof, each lease
that constitutes a Material Contract or a Ground Lease (pursuant to the Closing
Date Collateral List) or a lease of any location where ABL Priority Collateral
is located, in each case to which any Loan Party or any Restricted Subsidiary is
a party as tenant or subtenant, together with the street address, county and
state of the property subject thereto, and the name and contact information of
the lessor thereunder.

 

VI.                               AUTHORITY TO FILE FINANCING STATEMENTS

 

The undersigned, on behalf of the Companies, hereby authorizes the
Administrative Agents to file financing or continuation statements, and
amendments thereto, in all jurisdictions and with all filing offices as each
Administrative Agent may determine, in its sole discretion, are necessary or
advisable to perfect the security interest granted or to be granted to the
Administrative Agents.  Such financing statements may describe the collateral in
the same manner as described in the Security Documents (to be defined in the
Credit Agreements) or may contain an indication or description of collateral
that describes such property in any other manner as the Administrative Agents
may determine, in its sole discretion, is necessary, advisable or prudent to
ensure the perfection of the security interest in the collateral granted to the
Administrative Agents, including, without limitation, describing such property
as “all assets” or “all personal property.”

 

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

 

IN WITNESS WHEREOF, the undersigned hereto have caused this Perfection
Certificate to be executed as of the date above first written by its officer
thereunto duly authorized.

 

 

 

SUPERVALU INC., on behalf of the Companies

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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

 

Exhibit A

 

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

 

Schedule I.A

 

Entity Information

 

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

 

Schedule I.C

 

Description of Warehousemen

 

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

 

Schedule I.G

 

Tax Return

 

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

 

Schedule II.A

 

Investment Policy

 

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

 

Schedule II.C

 

Deposit Accounts

 

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

 

Schedule II.D

 

Instruments

 

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

 

Schedule III

 

Pledged Intellectual Property

 

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

 

Schedule III.A

 

Save-A-Lot Food Stores, Ltd. Intellectual Property

 

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

 

Schedule IV

 

Commercial Tort Claims

 

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

 

Schedule V.A.i

 

Owned Real Estate

 

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

 

Schedule V.A.ii

 

Leases

 

E-1

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

 

Exhibit F
to the Credit Agreement

 

FORM OF SECURITY AGREEMENT

 

(See attached)

 

1

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

 

EXECUTION COPY

 

 

TERM LOAN SECURITY AGREEMENT

 

dated as of

 

March 21, 2013

 

by

 

SUPERVALU INC.
as Borrower,

 

and

 

THE GUARANTORS PARTY HERETO FROM TIME TO TIME

 

in favor of

 

GOLDMAN SACHS BANK USA,
as Collateral Agent

 

 

2

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

 

Table of Contents

 

 

 

ARTICLE I DEFINITIONS AND INTERPRETATION

1

 

 

SECTION 1.1 Definitions

1

SECTION 1.2 Interpretation

6

SECTION 1.3 Perfection Certificate

6

 

 

ARTICLE II GRANT OF SECURITY AND SECURED OBLIGATIONS

6

 

 

SECTION 2.1 Pledge; Grant of Security Interest

6

SECTION 2.2 Secured Obligations

7

SECTION 2.3 Security Interest

7

 

 

ARTICLE III PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES; USE OF COLLATERAL

8

 

 

SECTION 3.1 Delivery of Securities Collateral

8

SECTION 3.2 Perfection of Security Interest in Pledged Interests

9

SECTION 3.3 Financing Statements and Other Filings; Maintenance of Perfected
Security Interest

9

SECTION 3.4 Other Actions

10

SECTION 3.5 Supplements; Further Assurances

12

 

 

ARTICLE IV REPRESENTATIONS, WARRANTIES AND COVENANTS

12

 

 

SECTION 4.1 Title

12

SECTION 4.2 Limitation on Liens; Defense of Claims; Transferability of
Collateral

13

SECTION 4.3 Chief Executive Office; Change of Name; Jurisdiction of Organization

13

SECTION 4.4 Location of Inventory

14

SECTION 4.5 [Reserved]

14

SECTION 4.6 Fair Labor Standards Act

14

SECTION 4.7 No Conflicts, Consents, etc.

14

SECTION 4.8 Collateral

14

SECTION 4.9 Insurance

14

SECTION 4.10 Payment of Taxes; Compliance with Laws; Contested Liens; Claims

15

SECTION 4.11 [Reserved]

15

SECTION 4.12 New Subsidiaries

15

 

 

ARTICLE V CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL

15

 

 

SECTION 5.1 Pledge of Additional Securities Collateral

15

SECTION 5.2 Voting; Distributions; etc.

15

SECTION 5.3 Turnover

16

SECTION 5.4 Defaults, Etc.

17

SECTION 5.5 Certain Agreements of Grantors as Issuers and Holders of Equity
Interests

17

 

 

ARTICLE VI CERTAIN PROVISIONS CONCERNING INTELLECTUAL PROPERTY

17

 

3

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

 

SECTION 6.1 Grant of License

17

SECTION 6.2 Registrations

17

SECTION 6.3 No Violations or Proceedings

18

SECTION 6.4 Protection of Collateral Agent’s Security

18

SECTION 6.5 After-Acquired Property

19

SECTION 6.6 Modifications

19

SECTION 6.7 Litigation

19

SECTION 6.8 Third Party Consents

19

 

 

ARTICLE VII CERTAIN PROVISIONS CONCERNING ACCOUNTS

20

 

 

SECTION 7.1 Special Representations and Warranties

20

SECTION 7.2 Maintenance of Records

20

SECTION 7.3 Legend

20

SECTION 7.4 Modification of Terms, Etc.

20

SECTION 7.5 Collection

20

 

 

ARTICLE VIII REMEDIES

21

 

 

SECTION 8.1 Remedies

21

SECTION 8.2 Notice of Sale

22

SECTION 8.3 Waiver of Notice and Claims

22

SECTION 8.4 Certain Sales of Collateral

23

SECTION 8.5 No Waiver; Cumulative Remedies

24

SECTION 8.6 Certain Additional Actions Regarding Intellectual Property

24

SECTION 8.7 Application of Proceeds

24

SECTION 8.8 Third Party Agreements

24

 

 

ARTICLE IX MISCELLANEOUS

25

 

 

SECTION 9.1 Concerning the Collateral Agent

25

SECTION 9.2 Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact

25

SECTION 9.3 Expenses

26

SECTION 9.4 Continuing Security Interest; Assignment

26

SECTION 9.5 Termination; Release

26

SECTION 9.6 Modification in Writing

27

SECTION 9.7 Notices

27

SECTION 9.8 GOVERNING LAW

27

SECTION 9.9 CONSENT TO JURISDICTION; SERVICE OF PROCESS; WAIVER OF JURY TRIAL

28

SECTION 9.10 Severability of Provisions

29

SECTION 9.11 Execution in Counterparts; Effectiveness

29

SECTION 9.12 No Release

29

SECTION 9.13 Obligations Absolute

29

SECTION 9.14 Intercreditor Agreement

30

 

4

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

 

EXHIBIT 1

Form of Securities Pledge Amendment

 

 

SCHEDULE I

Intercompany Notes

SCHEDULE 3.3

Filings, Registrations and Recordings

SCHEDULE 3.4(a)

Instruments

SCHEDULE 4.3(a)

Other Legal and Fictitious Names, Mergers, Consolidations, Acquisitions

 

Annex I

Form of Joinder

 

5

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

 

TERM LOAN SECURITY AGREEMENT

 

TERM LOAN SECURITY AGREEMENT dated as of March 21, 2013 (as amended, amended and
restated, supplemented or otherwise modified from time to time in accordance
with the provisions hereof, this “Security Agreement”) made by SUPERVALU INC., a
Delaware corporation having an office at 7075 Flying Cloud Drive, Eden Prairie,
MN, as borrower (the “Borrower”) and the Guarantors listed on the signature
pages hereto (the “Original Guarantors”) and the other guarantors from time to
time party hereto by execution of a Joinder Agreement (the “Additional
Guarantors” and, together with the Original Guarantor, the “Guarantors”), as
pledgors, assignors and debtors (the Borrower, together with the Guarantors, in
such capacities and together with any successors in such capacities,
collectively, the “Grantors” and, each, a “Grantor”), in favor of GOLDMAN SACHS
BANK USA, having an office at 30 Hudson St, 5th Floor, Jersey City, NJ 07302, in
its capacity as collateral agent for the Secured Parties, as pledgee, assignee
and secured party (in such capacities and together with any successors in such
capacities, the “Collateral Agent”).

 

RECITALS:

 

A.            The Borrower, the Collateral Agent, the Guarantors party thereto
and the Lenders party thereto have, in connection with the execution and
delivery of this Security Agreement, entered into that certain Term Loan Credit
Agreement, dated as of the date hereof (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”).

 

B.            The Original Guarantors have, pursuant to that certain Term Loan
Guaranty dated as of the date hereof (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Guaranty”), among
other things, unconditionally guaranteed the Guaranteed Obligations (as defined
in the Guaranty).

 

C.            The Borrower and the Guarantors will receive substantial benefits
from the execution, delivery and performance of the Obligations and the
Guaranteed Obligations and each is, therefore, willing to enter into this
Security Agreement.

 

D.            This Security Agreement is given by each Grantor in favor of the
Collateral Agent for the benefit of the Secured Parties to secure the payment
and performance of all of the Secured Obligations (as hereinafter defined).

 

E.            It is a condition to the obligations of the Lenders to make the
Loans under the Credit Agreement that each Grantor execute and deliver the
applicable Loan Documents, including this Security Agreement.

 

AGREEMENT:

 

NOW THEREFORE, in consideration of the foregoing premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each Grantor and the Collateral Agent hereby agree as follows:

 

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

 

ARTICLE I

 

DEFINITIONS AND INTERPRETATION

 

SECTION 1.1  Definitions.

 

(a)   Unless otherwise defined herein or in the Credit Agreement, capitalized
terms used herein that are defined in the UCC shall have the meanings assigned
to them in the UCC.

 

(b)   Capitalized terms used but not otherwise defined herein that are defined
in the Credit Agreement shall have the meanings assigned to them in the Credit
Agreement.

 

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

 

“Additional Guarantors” shall have the meaning assigned to such term in the
Preamble hereof.

 

“Borrower” shall have the meaning assigned to such term in the Preamble hereof.

 

“Claims” shall mean any and all property taxes and other taxes, assessments and
special assessments, levies, fees and all governmental charges imposed upon or
assessed against, and all claims (including, without limitation, landlords’,
carriers’, mechanics’, workmen’s, repairmen’s, laborers’, materialmen’s,
suppliers’ and warehousemen’s Liens and other claims arising by operation of
law) against, all or any portion of the Collateral.

 

“Collateral” shall have the meaning assigned to such term in Section 2.1 hereof.

 

“Collateral Agent” shall have the meaning assigned to such term in the Preamble
hereof.

 

“Contracts” shall mean, collectively, with respect to each Grantor, all sale,
service, performance, equipment or property lease contracts, agreements and
grants and all other contracts, agreements or grants (in each case, whether
written or oral, or third party or intercompany), between such Grantor and any
other party, and all assignments, amendments, restatements, supplements,
extensions, renewals, replacements or modifications thereof.

 

“Control” shall mean (a) in the case of each DDA, “control,” as such term is
defined in Section 9-104 of the UCC, and (b) in the case of any security
entitlement, “control,” as such term is defined in Section 8-106 of the UCC.

 

“Control Agreements” shall mean, collectively, the Blocked Account Agreements
and the Securities Account Control Agreements.

 

“Copyrights” shall mean, collectively, with respect to each Grantor, all
copyrights (whether statutory or common Law, whether established or registered
in the United States or any other country or group of countries or any political
subdivision thereof whether registered or unregistered and whether published or
unpublished) and all copyright registrations and applications made by such
Grantor, in each case, whether now owned or hereafter created or acquired by or
assigned to such Grantor, including, without limitation, the registrations and

 

2

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

 

applications listed in Schedule III of the Perfection Certificate, together with
any and all (a) rights and privileges arising under applicable Law with respect
to such Grantor’s use of such copyrights, (b) reissues, renewals, continuations
and extensions thereof, (c) income, fees, royalties, damages, claims and
payments now or hereafter due and/or payable with respect thereto, including,
without limitation, damages and payments for past, present or future
infringements thereof, (d) rights corresponding thereto throughout the world and
(e) rights to sue for past, present or future infringements thereof.

 

“Credit Agreement” shall have the meaning assigned to such term in Recital A
hereof.

 

“Distributions” shall mean, collectively, with respect to each Grantor, all
amounts from time to time received, receivable or otherwise distributed to such
Grantor in respect of or in exchange for any or all of the Pledged Interests and
Successor Interests or Intercompany Notes.

 

“Excluded Assets” shall mean the following:

 

(a)   Equity Interests issued by any Subsidiary of any Grantor, other than the
Pledged Interests and Successor Interests;

 

(b)   Excluded DDAs;

 

(c)   all accounts receivables financed by a Grantor pursuant to a Permitted
Securitization Facility (as defined in the ABL Credit Agreement);

 

(d)   any rights or interests in any contract, agreement, lease, permit,
license, charter or license agreement, as such, if under the terms of such
contract, agreement, lease, permit, license, charter or license agreement, or
applicable law with respect thereto, the valid grant of a Lien therein to the
Collateral Agent would constitute or result in a breach, termination or default
under such contract, agreement, lease, permit, license, charter or license
agreement and such breach, termination or default has not been or is not waived
or the consent of the other party to such contract, agreement, lease, permit,
license, charter or license agreement has not been or is not otherwise obtained
or under applicable law such prohibition cannot be waived; provided, that, the
foregoing exclusion shall in no way be construed (i) to apply if any such
prohibition is unenforceable under Sections 9-406, 9-407 or 9-408 of the UCC or
other applicable law or (ii) so as to limit, impair or otherwise affect the
Collateral Agent’s unconditional continuing Liens in any rights or interests of
a Grantor in or to monies due or to become due under any such contract, lease,
permit, license, charter or license agreement;

 

(e)   assets of any Excluded Subsidiary;

 

(f)    all Real Estate and all Equipment; and

 

(g)   any trademark or servicemark applications that have been filed with the
U.S. Patent and Trademark Office on the basis of an “intent-to-use” with respect
to such trademarks or servicemarks, unless and until a statement of use or
amendment to allege use is filed or any other filing is made or circumstances
otherwise change so that the interests of a Grantor in such marks in no longer
on an “intent-to-use” basis, at which time such trademarks and servicemarks

 

3

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

 

shall automatically and without further action by the parties be subject to the
security interests and liens granted by such Grantor to Collateral Agent.

 

Notwithstanding anything to the contrary, the Excluded Assets shall not include
any “proceeds” (as defined in the UCC), substitutions or replacements of
Excluded Assets (unless such proceeds, substitutions or replacements would
otherwise constitute Excluded Assets).  The security interest granted pursuant
to Section 2.1 hereof shall attach to property and assets immediately and
automatically (without the need for any further grant or act) at such time as
the applicable condition described in clause (d) ceases to exist.

 

“Goodwill” shall mean, collectively, with respect to each Grantor, the goodwill
connected with such Grantor’s business including, without limitation, (a) all
goodwill connected with the use of and symbolized by any of the Trademarks in
which such Grantor has any interest, (b) all know-how, trade secrets, customer
and supplier lists, proprietary information, inventions, methods, procedures,
formulae, descriptions, compositions, technical data, drawings, specifications,
name plates, catalogs, confidential information and the right to limit the use
or disclosure thereof by any Person, pricing and cost information, business and
marketing plans and proposals, consulting agreements, engineering contracts and
such other assets which relate to such goodwill and (c) all product lines of
such Grantor’s business.

 

“Grantor” shall have the meaning assigned to such term in the Preamble hereof.

 

“Guarantors” shall have the meaning assigned to such term in the Preamble
hereof.

 

“Guaranty” shall have the meaning assigned to such term in Recital B hereof.

 

“Intellectual Property” shall mean, collectively, Patents, Trademarks,
Copyrights, Licenses and Goodwill.

 

“Intercompany Notes” shall mean, with respect to each Grantor, all intercompany
notes described in Schedule I hereto and each promissory note hereafter acquired
by such Grantor and made by the Borrower or one of its Subsidiaries, and all
certificates, instruments or agreements evidencing such intercompany notes, and
all assignments, amendments, restatements, supplements, extensions, renewals,
replacements or modifications thereof to the extent permitted pursuant to the
terms hereof.

 

“Joinder Agreement” shall mean each Joinder to this Security Agreement executed
and delivered by the Collateral Agent and each Additional Guarantor listed on
the signature pages thereto, in substantially the form of Annex 1 hereto.

 

“Licenses” shall mean, collectively, with respect to each Grantor, all license
and distribution agreements with any other Person with respect to any Patent,
Trademark or Copyright or any other patent, trademark or copyright, whether such
Grantor is a licensor or licensee, distributor or distributee under any such
license or distribution agreement, together with any and all (a) renewals,
extensions, supplements and continuations thereof, (b) income, fees, royalties,
damages, claims and payments now and hereafter due and/or payable thereunder and
with respect thereto including, without limitation, damages and payments for
past, present or future infringements or violations thereof, (c) rights to sue
for past, present and future

 

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infringements or violations thereof and (d) other rights to use, exploit or
practice any or all of the Patents, Trademarks or Copyrights or any other
patent, trademark or copyright.

 

“Patents” shall mean, collectively, with respect to each Grantor, all patents
issued or assigned to and all patent applications made by such Grantor (whether
established or registered or recorded in the United States or any other country
or group of countries or any political subdivision thereof), including, without
limitation, those patents, patent applications listed in Schedule III of the
Perfection Certificate, together with any and all (a) rights and privileges
arising under applicable Law with respect to such Grantor’s use of any patents,
(b) inventions and improvements described and claimed therein, (c) reissues,
divisions, continuations, renewals, extensions and continuations-in-part
thereof, (d) income, fees, royalties, damages, claims and payments now or
hereafter due and/or payable thereunder and with respect thereto including,
without limitation, damages and payments for past, present or future
infringements thereof, (e) rights corresponding thereto throughout the world and
(f) rights to sue for past, present or future infringements thereof.

 

“Perfection Certificate” shall mean that certain Perfection Certificate dated as
of the date hereof, executed and delivered by each Grantor in favor of the
Collateral Agent for the benefit of the Secured Parties, and each other
Perfection Certificate (which shall be in form and substance reasonably
acceptable to the Collateral Agent) executed and delivered by the applicable
Grantor in favor of the Collateral Agent for the benefit of the Secured Parties
contemporaneously with the execution and delivery of a Joinder Agreement
executed in accordance with Section 4.12 hereof, in each case, as the same may
be amended, amended and restated, restated, supplemented or otherwise modified
from time to time in accordance with the Credit Agreement.

 

“Pledged Interests” shall mean, collectively, with respect to each Grantor, all
Equity Interest in Moran Foods now existing or hereafter acquired or formed,
including, without limitation, all Equity Interests of Moran Foods described in
Schedule P-1, together with all rights, privileges, authority and powers of such
Grantor relating to such Equity Interests issued by Moran Foods under the
Organization Documents of Moran Foods, the certificates, instruments and
agreements representing such Equity Interests and any and all interest of such
Grantor in the entries on the books of Moran Foods or of any financial
intermediary pertaining to such Equity Interests, from time to time acquired by
such Grantor in any manner.

 

“Registered Intellectual Property” shall mean, collectively, all Intellectual
Property owned by the Grantors that is the subject of:  (a) a pending patent
application or an issued patent; (b) a pending trademark application (except to
the extent any such application is an Excluded Asset) or trademark registration;
or (c) a copyright registration.

 

“Related Collateral” shall mean all Documents, Instruments, Securities
Collateral, Investment Property, Letters of Credit and Letter-of-Credit Rights,
Commercial Tort Claims (including, without limitation, those described in
Schedule IV of the Perfection Certificate), General Intangibles and Supporting
Obligations, in each case to the extent evidencing, governing, securing or
otherwise reasonably related to any of the Collateral described in
Sections 2.1(a) through 2.1(g) hereof or any Specified Fixed Asset Collateral
(as defined in the Related Real Estate Collateral Security Agreements).

 

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“Secured Obligations” shall mean the Obligations (as defined in the Credit
Agreement) and the Guaranteed Obligations.

 

“Securities Account Control Agreement” shall mean an agreement in form and
substance satisfactory to the Collateral Agent with respect to any Securities
Account of a Grantor.

 

“Securities Act” means the Securities Exchange Act of 1934 and the applicable
regulations promulgated by the Securities and Exchange Commission pursuant to
such Act.

 

“Securities Collateral” shall mean, collectively, the Pledged Interests and
Successor Interests, the Intercompany Notes and the Distributions.

 

“Security Agreement” shall have the meaning assigned to such term in the
Preamble hereof.

 

“Successor Interests” shall mean, collectively, with respect to each Grantor,
all shares of each class of the capital stock of the successor corporation or
interests or certificates of the successor limited liability company,
partnership or other entity owned by such Grantor (unless such successor is such
Grantor itself) formed by or resulting from any consolidation or merger in which
Moran Foods is not the surviving entity.

 

“Trademarks” shall mean, collectively, with respect to each Grantor, all
trademarks (including service marks), slogans, logos, certification marks, trade
dress, uniform resource locations (URLs), domain names, corporate names and
trade names, whether registered or unregistered, owned by or assigned to such
Grantor and all registrations and applications for the foregoing (whether
statutory or common Law and whether established or registered in the United
States or any other country or group of countries or any political subdivision
thereof), including, without limitation, the registrations and applications
listed in Schedule III of the Perfection Certificate, together with any and all
(a) rights and privileges arising under applicable Law with respect to such
Grantor’s use of any trademarks, (b) reissues, continuations, extensions and
renewals thereof, (c) income, fees, royalties, damages and payments now and
hereafter due and/or payable thereunder and with respect thereto, including,
without limitation, damages, claims and payments for past, present or future
infringements thereof, (d) all of the Goodwill associated with any of the
foregoing, (e) rights corresponding thereto throughout the world and (f) rights
to sue for past, present and future infringements thereof.

 

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of New York; provided, that, (a) if a term is defined in Article 9 of the
Uniform Commercial Code differently than in another Article thereof, the term
shall have the meaning set forth in Article 9 of the Uniform Commercial Code and
(b) if by reason of mandatory provisions of law, perfection, or the effect of
perfection or non-perfection, of a security interest in any Collateral or the
availability of any remedy hereunder is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than the State of New York, “UCC” means the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such perfection or effect of perfection or
non-perfection or availability of such remedy, as the case may be.

 

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“UETA” shall have the meaning assigned to such term in Section 4.1.

 

SECTION 1.2  Interpretation.  The rules of interpretation specified in
Section 1.02 of the Credit Agreement shall be applicable to this Security
Agreement.

 

SECTION 1.3  Perfection Certificate.  The Collateral Agent and each Grantor
agree that the Perfection Certificate and all schedules, amendments and
supplements thereto are, and shall at all times remain, a part of this Security
Agreement.

 

ARTICLE II

 

GRANT OF SECURITY AND SECURED OBLIGATIONS

 

SECTION 2.1  Pledge; Grant of Security Interest.  As collateral security for the
payment and performance in full of all the Secured Obligations, each Grantor
hereby pledges and grants to the Collateral Agent for its benefit and for the
benefit of the other Secured Parties, a lien on and security interest in and to
all of the right, title and interest of such Grantor in, to and under the
following personal property and interests in such personal property, wherever
located, and whether now existing or hereafter arising or acquired from time to
time (collectively, the “Collateral”), consisting of the following:

 

(a)         all Accounts;

 

(b)         all Inventory;

 

(c)          all Chattel Paper;

 

(d)         all Intellectual Property;

 

(e)          all Deposit Accounts (and all cash, checks and other negotiable
instruments, funds and other evidences of payment held therein);

 

(f)           all Money;

 

(g)          all Prescription Files;

 

(h)         all Securities Collateral;

 

(i)             all rights under the Acquisition Agreement and the Escrow
Agreement;

 

(j)            all Related Collateral;

 

(k)         all books and records and documents relating to the Collateral
(including databases, customer lists and other records, whether tangible or
electronic, which contain any information relating to any of the foregoing); and

 

(l)             all Proceeds and products of each of the foregoing and all
accessions to, substitutions and replacements for, and rents, profits and
products of, each of the foregoing, any and all proceeds of any insurance
(including proceeds of business interruption and other

 

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insurance claims against third parties), indemnity, warranty or guaranty payable
to such Grantor from time to time with respect to any of the foregoing.

 

Notwithstanding anything to the contrary contained in clauses (a) through
(l) above, the security interest created by this Security Agreement shall not
extend to, and the term “Collateral” shall not include, any Excluded Assets and
the Grantors shall from time to time at the request of the Collateral Agent give
written notice to the Collateral Agent identifying in reasonable detail the
Excluded Assets and shall provide to the Collateral Agent such other information
regarding the Excluded Assets as the Collateral Agent may reasonably request.

 

SECTION 2.2  Secured Obligations.  This Security Agreement secures, and the
Collateral is collateral security for, the payment and performance in full when
due of the Secured Obligations.

 

SECTION 2.3  Security Interest.

 

(a)         Each Grantor hereby irrevocably authorizes the Collateral Agent at
any time and from time to time to authenticate and file in any relevant
jurisdiction any financing statements (including fixture filings) and amendments
thereto that contain the information required by Article 9 of the UCC of each
applicable jurisdiction for the filing of any financing statement or amendment
relating to the Collateral, including, without limitation, (i) the type of
organization and any organizational identification number issued to such Grantor
and (ii) a description of the Collateral.  Each Grantor agrees to provide all
information described in the immediately preceding sentence to the Collateral
Agent promptly upon request.

 

(b)         Each Grantor hereby ratifies its prior authorization for the
Collateral Agent to file in any relevant jurisdiction any financing statements
or amendments thereto relating to the Collateral if filed prior to the date
hereof.

 

(c)          Each Grantor hereby further authorizes the Collateral Agent to file
filings with the United States Patent and Trademark Office and, other than with
respect to agreements under 17 U.S.C. § 201(d)(2), United States Copyright
Office, (or any successor office or any similar office in any other country) or
other necessary documents for the purpose of perfecting, confirming, continuing,
enforcing or protecting the security interest granted by such Grantor hereunder
in any Collateral consisting of Intellectual Property (excluding any authority
or requirement to register Intellectual Property in the United States Patent and
Trademark Office or United States Copyright Office except as required under
Section 6.4 of this Security Agreement), without the signature of such Grantor,
and naming such Grantor, as debtor, and the Agent, as secured party.

 

ARTICLE III

 

PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES; USE OF COLLATERAL

 

SECTION 3.1  Delivery of Securities Collateral.

 

(a)         Each Grantor represents and warrants that all agreements or
instruments representing or evidencing Related Collateral constituting
Investment Property and Securities

 

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Collateral (other than Pledged Interests) having a value in excess of
$10,000,000 in existence on the date hereof have been delivered to the
Collateral Agent in suitable form for transfer by delivery or accompanied by
duly executed instruments of transfer or assignment in blank and that the
Collateral Agent has a perfected first priority (subject to Permitted
Encumbrances having priority by operation of law and Permitted Encumbrances
permitted by clause (t) of the definition of “Permitted Encumbrances” in the
Credit Agreement) security interest therein.  Each Grantor hereby agrees that
all agreements or instruments representing or evidencing Related Collateral
constituting Investment Property and Securities Collateral (other than Pledged
Interests) having a value in excess of $10,000,000 acquired by such Grantor
after the date hereof, shall promptly (and in any event within three Business
Days) upon receipt thereof by such Grantor be delivered to and held by or on
behalf of the Collateral Agent pursuant hereto.  The Collateral Agent shall have
the right, at any time upon the occurrence and during the continuance of any
Event of Default, to endorse, assign or otherwise transfer to or to register in
the name of the Collateral Agent or any of its nominees or endorse for
negotiation any or all of the Securities Collateral, without any indication that
such Securities Collateral is subject to the security interest hereunder.

 

(b)         Each Grantor represents and warrants that all certificates
representing or evidencing the Pledged Interests in existence on the date hereof
have been delivered to the Collateral Agent in suitable form for transfer by
delivery or accompanied by duly executed instruments of transfer or assignment
in blank and that the Collateral Agent has a perfected first priority (subject
to Permitted Encumbrances having priority by operation of law and Permitted
Encumbrances permitted by clause (t) of the definition of “Permitted
Encumbrances” in the Credit Agreement) security interest therein.  Each Grantor
hereby agrees that (subject to Permitted Encumbrances having priority by
operation of law and Permitted Encumbrances permitted by clause (t) of the
definition of “Permitted Encumbrances” in the Credit Agreement) all certificates
representing or evidencing the Pledged Interests and Successor Interests
acquired by such Grantor after the date hereof, shall promptly (and in any event
within three Business Days) upon receipt thereof by such Grantor be delivered to
and held by or on behalf of the Collateral Agent pursuant hereto.  The
Collateral Agent shall have the right, at any time upon the occurrence and
during the continuance of any Event of Default, to endorse, assign or otherwise
transfer to or to register in the name of the Collateral Agent or any of its
nominees or endorse for negotiation any or all of the Pledged Interests and
Successor Interests, without any indication that such Pledged Interests or
Successor Interests are subject to the security interest hereunder.

 

(c)          Schedule P-1 hereto sets forth all of the Pledged Interests owned
by any Grantor and such Pledged Interests constitute the percentage of issued
and outstanding shares of stock, percentage of membership interests or
percentage of partnership interests of the respective issuers thereof indicated
on such Schedule.  The Pledged Interests and Successor Interests pledged by such
Grantor hereunder constitute all of the issued and outstanding shares of all
classes of the Equity Interests of each issuer owned by such Grantor.  All the
shares of the Pledged Interests and Successor Interests have been duly and
validly issued and are fully paid and nonassessable.  No Grantor is in default
of its obligations under any Organization Document of any issuer of Pledged
Interests and Successor Interests.

 

(d)         None of the Pledged Interests and Successor Interests are, or
represent interests in entities that (i) are registered as investment companies,
(ii) are dealt in or traded on

 

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securities exchanges or markets or (iii) have opted to be treated as securities
under the UCC of any jurisdiction.

 

(e)          Such Grantor is the record and beneficial owner of, and has good
and marketable title to, the Pledged Interests and Successor Interests pledged
by it hereunder, free of any and all Liens or options in favor of, or claims of,
any other Person, except for Permitted Liens arising pursuant to a requirement
of Law, and there are no outstanding warrants, options or other rights to
purchase, or members’, voting trust or similar agreements outstanding with
respect to, or property that is convertible into, or that requires the issuance
or sale of, any Pledged Interests and Successor Interests.

 

SECTION 3.2  Perfection of Security Interest in Pledged Interests.  Each Grantor
represents and warrants that the Collateral Agent has a perfected first priority
(subject to Permitted Encumbrances having priority by operation of law and
Permitted Encumbrances permitted by clause (t) of the definition of “Permitted
Encumbrances” in the Credit Agreement) security interest in all Pledged
Interests and Successor Interests pledged by it hereunder and that the
applicable Organization Documents do not require the consent of the other
members, or other Person to permit the Collateral Agent or its designee to be
substituted for the applicable Grantor as a member thereto.  Each Grantor hereby
agrees that if any of the Pledged Interests and Successor Interests are at any
time not evidenced by certificates of ownership, then each applicable Grantor
shall, to the extent permitted by applicable Law and upon the request of the
Collateral Agent, cause such pledge to be recorded on the equityholder register
or the books of the issuer, execute customary pledge forms or other documents,
in each case as necessary or reasonably requested to complete the pledge and
give the Collateral Agent the right to transfer such Pledged Interests and
Successor Interests under the terms hereof.

 

SECTION 3.3  Financing Statements and Other Filings; Maintenance of Perfected
Security Interest.  Each Grantor represents and warrants that the only filings,
registrations and recordings necessary and appropriate to create, preserve,
protect, publish notice of and perfect the security interest granted by each
Grantor to the Collateral Agent (for the benefit of the Secured Parties)
pursuant to this Security Agreement in respect of the Collateral are listed in
Schedule 3.3 hereto (other than agreements under 17 U.S.C. § 201(d)(2) and any
registrations with respect to Intellectual Property other than Registered
Intellectual Property required in the United States Patent and Trademark Office
or the United States Copyright Office, except to the extent such registration is
required under Section 6.4 of this Security Agreement).  Each Grantor represents
and warrants that all such filings, registrations and recordings have been
delivered to the Collateral Agent in completed and, to the extent necessary or
appropriate, duly executed form for filing in each governmental, municipal or
other office specified in Schedule 3.3 hereto .  Each Grantor agrees that at the
sole cost and expense of the Grantors, (a) such Grantor will maintain the
security interest created by this Security Agreement in the Collateral as a
perfected first priority security interest (subject to, with respect to
priority, the Intercreditor Agreement and Permitted Encumbrances having priority
by operation of law and Permitted Encumbrances permitted by clause (t) of the
definition of “Permitted Encumbrances” in the Credit Agreement) and shall defend
such security interest against the claims and demands of all Persons (other than
with respect to Permitted Encumbrances), (b) such Grantor shall furnish to the
Collateral Agent from time to time statements and schedules further identifying
and describing the Collateral (other than agreements under 17 U.S.C. §
201(d)(2)) and such other reports in connection with

 

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the Collateral as the Collateral Agent may reasonably request, all in reasonable
detail and (c) at any time and from time to time, upon the written request of
the Collateral Agent, such Grantor shall promptly and duly execute and deliver,
and file and have recorded, such further instruments and documents and take such
further action as the Collateral Agent may reasonably request, including the
filing of any financing statements, continuation statements and other documents
(including this Security Agreement) under the UCC (or other applicable Laws) in
effect in any jurisdiction with respect to the security interest created hereby
and the execution and delivery of Control Agreements, all in form reasonably
satisfactory to the Collateral Agent and in such offices (including, without
limitation, the United States Patent and Trademark Office and United States
Copyright Office) wherever required by applicable Law in each case to perfect,
continue and maintain a valid, enforceable, first priority security interest
(subject to Permitted Encumbrances having priority by operation of law and
Permitted Encumbrances permitted by clause (t) of the definition of “Permitted
Encumbrances” in the Credit Agreement) in the Collateral (other than agreements
under 17 U.S.C. § 201(d)(2) and any registrations with respect to Intellectual
Property other than Registered Intellectual Property required in the United
States Patent and Trademark Office or the United States Copyright Office, except
to the extent such registration is required under Section 6.4 of this Security
Agreement) as provided herein and to preserve the other rights and interests
granted to the Collateral Agent hereunder, as against the Grantors and third
parties (other than with respect to Permitted Encumbrances), with respect to the
Collateral.

 

SECTION 3.4  Other Actions.  In order to further evidence the attachment,
perfection and priority of, and the ability of the Collateral Agent to enforce,
the Collateral Agent’s security interest in the Collateral, each Grantor
represents, warrants and agrees, in each case at such Grantor’s own expense,
with respect to the following Collateral that:

 

(a)         Instruments and Tangible Chattel Paper.  As of the date hereof
(i) no amount payable under or in connection with any of the Collateral in
excess of $10,000,000 is evidenced by any Instrument or Tangible Chattel Paper
other than such Instruments and Tangible Chattel Paper listed in
Schedule 3.4(a) hereto and (ii) each Instrument and each item of Tangible
Chattel Paper listed in Schedule 3.4(a) hereto, to the extent requested by the
Collateral Agent, has been properly endorsed, assigned and delivered to the
Collateral Agent, accompanied by instruments of transfer or assignment and
letters of direction duly executed in blank.  If any amount payable under or in
connection with any of the Collateral shall be evidenced by any Instrument or
Tangible Chattel Paper, the Grantor acquiring such Instrument or Tangible
Chattel Paper in excess of $10,000,000 individually or $20,000,000 in the
aggregate shall forthwith endorse, assign and deliver the same to the Collateral
Agent, accompanied by such instruments of transfer or assignment duly executed
in blank as the Collateral Agent may reasonably request from time to time.

 

(b)         Deposit Accounts.  Such Grantor does not have any Deposit Accounts
as of the date hereof, except as set forth in Schedule 3.21(a) of Credit
Agreement.

 

(c)          Investment Property.

 

(i)             As of the date hereof (A) it has no Securities Accounts
containing any Collateral or proceeds of Collateral, and (B) it does not hold,
own or have any interest in any certificated securities or uncertificated
securities evidencing any Collateral or proceeds of

 

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Collateral other than those constituting Pledged Interests with respect to which
the Collateral Agent has a perfected first priority security interest.

 

(ii)          If any Grantor shall at any time hold or acquire any certificated
securities evidencing any Collateral or proceeds of Collateral having a value in
excess of $10,000,000, such Grantor shall promptly (A) notify the Collateral
Agent thereof and endorse, assign and deliver the same to the Collateral Agent,
accompanied by such instruments of transfer or assignment duly executed in
blank, all in form and substance reasonably satisfactory to the Collateral Agent
or (B) deliver such securities into a Securities Account with respect to which a
Securities Account Control Agreement is in effect in favor of the Collateral
Agent.  If any securities now or hereafter acquired by any Grantor evidencing
any Collateral or proceeds of Collateral having a value in excess of $10,000,000
are uncertificated, such Grantor shall promptly notify the Collateral Agent
thereof and pursuant to an agreement in form and substance reasonably
satisfactory to the Collateral Agent, either (1) grant Control to the Collateral
Agent and cause the issuer to agree to comply with instructions from the
Collateral Agent as to such securities, without further consent of any Grantor
or such nominee, (2) cause a security entitlement with respect to such
uncertificated security to be held in a Securities Account with respect to which
the Collateral Agent has Control or (3) arrange for the Collateral Agent to
become the registered owner of the securities.  The Collateral Agent agrees with
each Grantor that the Collateral Agent shall not give any entitlement orders or
instructions or directions to any issuer of uncertificated securities or
Securities Intermediary, and shall not withhold its consent to the exercise of
any withdrawal or dealing rights by such Grantor, unless an Event of Default has
occurred and is continuing.

 

(iii)       As between the Collateral Agent and the Grantors, the Grantors shall
bear the investment risk with respect to the Investment Property, and the risk
of loss of, damage to, or the destruction of the Investment Property, whether in
the possession of, or maintained as a security entitlement or deposit by, or
subject to the control of, the Collateral Agent, a Securities Intermediary, any
Grantor or any other Person; provided, that, nothing contained in this
Section 3.4(c) shall release or relieve any Securities Intermediary of its
duties and obligations to the Grantors or any other Person under any Securities
Account Control Agreement or under applicable Law and nothing contained herein
shall excuse the Collateral Agent from its duty to exercise reasonable care in
the custody and preservation of the Collateral in its possession; provided,
further, that, the Collateral Agent shall be deemed to have exercised reasonable
care in the custody and preservation of any Collateral in its actual possession
if such Collateral is accorded treatment substantially equal to that which the
Collateral Agent accords its own property. Each Grantor shall promptly pay all
Claims and fees of whatever kind or nature with respect to the Pledged Interests
and Successor Interests pledged by it under this Security Agreement.  In the
event any Grantor shall fail to make such payment contemplated in the
immediately preceding sentence, the Collateral Agent may do so for the account
of such Grantor and the Grantors shall promptly reimburse and indemnify the
Collateral Agent for all costs and expenses incurred by the Collateral Agent
under this Section 3.4(c) and under Section 9.3.

 

(d)         Electronic Chattel Paper and Transferable Records.  As of the date
hereof no amount payable under or in connection with any of the Collateral is
evidenced by any Electronic Chattel Paper or any “transferable record” (as
defined in Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or in Section 16 of the UETA).  If any amount

 

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payable under or in connection with any of the Collateral shall be evidenced by
any Electronic Chattel Paper or any transferable record, the Grantor acquiring
such Electronic Chattel Paper or transferable record shall promptly notify the
Collateral Agent thereof and shall take such action as the Collateral Agent may
reasonably request to vest in the Collateral Agent “control” (within the meaning
of Section 9-105 of the UCC) of such Electronic Chattel Paper or “control”
(within the meaning of Section 201 of the Federal Electronic Signatures in
Global and National Commerce Act or Section 16 of the UETA) of such transferable
record.  The Collateral Agent agrees with such Grantor that the Collateral Agent
will arrange, pursuant to procedures reasonably satisfactory to the Collateral
Agent and so long as such procedures will not result in the Collateral Agent’s
loss of control, for the Grantor to make alterations to the Electronic Chattel
Paper or transferable record permitted under Section 9-105 of the UCC or, as the
case may be, Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or Section 16 of the UETA for a party in control to allow
without loss of control, unless an Event of Default has occurred and is
continuing or would occur after taking into account any action by such Grantor
with respect to such Electronic Chattel Paper or transferable record.

 

(e)          Letter-of-Credit Rights.  If such Grantor is at any time a
beneficiary under a Letter of Credit now or hereafter issued in favor of such
Grantor that constitutes Related Collateral, such Grantor shall promptly notify
the Collateral Agent thereof and such Grantor shall, at the request of the
Collateral Agent, pursuant to an agreement in form and substance reasonably
satisfactory to the Collateral Agent, either (i) arrange for the issuer and any
confirmer of such Letter of Credit to consent to an assignment to the Collateral
Agent of, and to pay to the Collateral Agent, the proceeds of, any drawing under
the Letter of Credit or (ii) arrange for the Collateral Agent to become the
beneficiary of such Letter of Credit, with the Collateral Agent agreeing, in
each case, that the proceeds of any drawing under the Letter of Credit are to be
applied as provided in the Credit Agreement.

 

(f)           Commercial Tort Claims.  As of the date hereof it holds no
Commercial Tort Claims that constitute Related Collateral.  If any Grantor shall
at any time hold or acquire a Commercial Tort Claim that constitutes Related
Collateral, such Grantor shall immediately notify the Collateral Agent in
writing signed by such Grantor of the brief details thereof and grant to the
Collateral Agent in such writing a security interest therein and in the Proceeds
thereof, all upon the terms of this Security Agreement, with such writing to be
in form and substance reasonably satisfactory to the Collateral Agent.

 

SECTION 3.5  Supplements; Further Assurances.  Each Grantor shall take such
further actions, and execute and deliver to the Collateral Agent such additional
assignments, agreements, supplements, powers and instruments, as the Collateral
Agent may in its reasonable judgment deem necessary or appropriate, wherever
required by Law, in order to perfect, preserve and protect the security interest
in the Collateral (other than agreements under 17 U.S.C. § 201(d)(2) and to the
extent such further actions require registrations with respect to Intellectual
Property in the United States Patent and Trademark Office or the United States
Copyright Office, excluding Registered Intellectual Property, except as required
under Section 6.4 of this Security Agreement) as provided herein and the rights
and interests granted to the Collateral Agent hereunder, or better to assure and
confirm unto the Collateral Agent or permit the Collateral Agent to exercise and
enforce its rights, powers and remedies hereunder with respect to any
Collateral.  Without limiting the generality of the foregoing, each Grantor
shall make, execute,

 

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endorse, acknowledge, file or refile and/or deliver to the Collateral Agent from
time to time upon reasonable request such lists, descriptions and designations
of the Collateral, copies of warehouse receipts, receipts in the nature of
warehouse receipts, bills of lading, documents of title, vouchers, invoices,
schedules, confirmatory assignments, supplements, additional security
agreements, conveyances, financing statements, transfer endorsements, powers of
attorney, certificates, reports and other assurances or instruments.  If an
Event of Default has occurred and is continuing, the Collateral Agent may
institute and maintain, in its own name or in the name of any Grantor, such
suits and proceedings as the Collateral Agent may be advised by counsel shall be
necessary or expedient to prevent any impairment of the security interest in or
the perfection thereof in the Collateral.  All of the foregoing shall be at the
sole cost and expense of the Grantors.  The Grantors and the Collateral Agent
acknowledge that this Security Agreement is intended to grant to the Collateral
Agent for the benefit of the Secured Parties a security interest in and Lien
upon the Collateral and shall not constitute or create a present assignment of
any of the Collateral.

 

ARTICLE IV

 

REPRESENTATIONS, WARRANTIES AND COVENANTS

 

In addition to, and without limitation of, each of the representations,
warranties and covenants set forth in the Credit Agreement and the other Loan
Documents, each Grantor represents, warrants and covenants as follows:

 

SECTION 4.1  Title.  No financing statement, mortgage, or other public notice
with respect to all or any part of the Collateral is on file or of record in any
public office, except such as have been filed in favor of the Collateral Agent
pursuant to this Security Agreement or as are permitted by the Credit
Agreement.  The security interests granted pursuant to this Security Agreement
constitute a legal and valid security interest in favor of the Collateral Agent,
for the benefit of the Secured Parties, securing the payment and performance of
each Grantor’s Obligations and upon completion of the filings and other actions
specified on Schedule 3.3 hereto (all of which, in the case of all filings and
other documents referred to on such Schedule, have been delivered to the
Collateral Agent in duly completed and duly executed form, as applicable, and
may be filed by the Collateral Agent at any time) and payment of all filing
fees, will constitute fully perfected security interests in all of the
Collateral (other than agreements under 17 U.S.C. § 201(d)(2) and Intellectual
Property, other than Registered Intellectual Property to the extent such
perfection requires registration with the United States Patent and Trademark
Office or United States Copyright Office, except to the extent such registration
is required under Section 6.4 of this Security Agreement) prior to all other
Liens on the Collateral except for Permitted Encumbrances arising by operation
of law that have priority under such law and Permitted Encumbrances permitted by
clause (t) of the definition of “Permitted Encumbrances” in the Credit
Agreement.  Without limiting the foregoing, each Grantor has taken all actions
necessary or desirable, including without limitation those specified in
Section 3.4(c) hereof to: (a) establish the Collateral Agent’s “control” (within
the meanings of Sections 8-106 and 9-106 of the UCC) over any portion of the
Related Collateral constituting Certificated Securities, Uncertificated
Securities, Securities Accounts, Securities Entitlements or Commodity Accounts
(other than as provided for in Sections 3.1 and 3.4(c) hereof), (b) establish
the Collateral Agent’s “control” (within the meaning of Section 9-104 of the
UCC) over all Deposit Accounts (other

 

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than Excluded DDAs), (c) establish the Collateral Agent’s “control” (within the
meaning of Section 9-107 of the UCC) over all Related Collateral constituting
Letter-of-Credit Rights, (d) establish the Collateral Agent’s control (within
the meaning of Section 9-105 of the UCC) over all Related Collateral
constituting Electronic Chattel Paper and (e) establish the Collateral Agent’s
“control” (within the meaning of Section 16 of the UETA) over all Related
Collateral constituting “transferable records” (as defined in the UETA).

 

SECTION 4.2  Limitation on Liens; Defense of Claims; Transferability of
Collateral.  Each Grantor, as to Collateral now owned by it or acquired by it
from time to time after the date hereof, is or will be the sole direct and
beneficial owner of such Collateral free from any Lien or other right, title or
interest of any Person other than the Liens and security interest created by
this Security Agreement and Permitted Encumbrances.  Each Grantor shall, at its
own cost and expense, defend title to the Collateral pledged by it hereunder and
the security interest therein and Lien thereon granted to the Collateral Agent
and the priority thereof against all claims and demands of all Persons, at its
own cost and expense, at any time claiming any interest therein adverse to the
Collateral Agent or any other Secured Party other than Permitted Encumbrances. 
There is no agreement, and no Grantor shall enter into any agreement or take any
other action, that would restrict the transferability of any of the Collateral
or otherwise impair or conflict with such Grantors’ obligations or the rights of
the Collateral Agent hereunder.

 

SECTION 4.3  Chief Executive Office; Change of Name; Jurisdiction of
Organization.

 

(a)         The exact legal name, type of organization, jurisdiction of
organization, federal taxpayer identification number, organizational
identification number and the mailing address for purposes of completing a UCC-1
financing statement of such Grantor is indicated next to its name in Schedules
I(A) and I(B) of the Perfection Certificate.  No Grantor has, during the four
months prior to the date of this Security Agreement, been known by or used any
other legal or fictitious name or been a party to any merger or consolidation,
or acquired all or substantially all of the assets of any Person, or acquired
any of its property or assets out of the ordinary course of business, except as
set forth in Schedule 4.3(a) hereto.

 

(b)         The Collateral Agent may rely on advice of counsel as to whether any
or all UCC financing statements of the Grantors need to be amended as a result
of any of the changes described in any Periodic Update Schedule or Occurrence
Update Schedule.  If any Grantor fails to provide information to the Collateral
Agent about such changes on a timely basis, the Collateral Agent shall not be
liable or responsible to any party for any failure to maintain a perfected
security interest in such Grantor’s property constituting Collateral, for which
the Collateral Agent needed to have information relating to such changes.  The
Collateral Agent shall have no duty to inquire about such changes if any Grantor
does not inform the Collateral Agent of such changes, the parties acknowledging
and agreeing that it would not be feasible or practical for the Collateral Agent
to search for information on such changes if such information is not provided by
any Grantor.

 

SECTION 4.4  Location of Inventory.  As of the Closing Date, all Inventory of
such Grantor is located at one of the locations listed in Schedule 3.08(b) and
Schedule 3.08(c) to the Credit Agreement.

 

SECTION 4.5  [Reserved]

 

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SECTION 4.6  Fair Labor Standards Act.  Any Inventory now or hereafter produced
by any Grantor included in the Collateral has been and will be produced in
compliance with the requirements of the Fair Labor Standards Act, as amended,
and any other applicable federal, state, local or foreign Law dealing with such
matters.

 

SECTION 4.7  No Conflicts, Consents, etc.  No consent of any party (including,
without limitation, equityholders or creditors of such Grantor) and no consent,
authorization, approval, license or other action by, and no notice to or filing
with, any Governmental Authority or regulatory body or other Person is required
for the grant of the security interest by such Grantor of the Collateral pledged
by it pursuant to this Security Agreement or for the execution, delivery or
performance hereof by such Grantor, except for the perfection or maintenance of
the Liens created under this Security Agreement (including the first priority
nature thereof, subject to Permitted Encumbrances having priority by operation
of law and, with respect to the ABL Priority Collateral, to Permitted
Encumbrances permitted by clause (t) of the definition of “Permitted
Encumbrances” in the Credit Agreement) and such consents which have been
obtained or made prior to the date hereof and are in full force and effect. 
Following the occurrence and during the continuation of an Event of Default, if
the Collateral Agent desires to exercise any remedies, voting or consensual
rights or attorney-in-fact powers set forth in this Security Agreement and
determines it necessary to obtain any approvals or consents of any Governmental
Authority or any other Person therefor, then, upon the reasonable request of the
Collateral Agent, such Grantor agrees to use commercially reasonable efforts to
assist and aid the Collateral Agent to obtain as soon as commercially
practicable any necessary approvals or consents for the exercise of any such
remedies, rights and powers.

 

SECTION 4.8  Collateral.  All information set forth herein, including the
schedules annexed hereto, and all information contained in any documents,
schedules and lists heretofore delivered to any Secured Party in connection with
this Security Agreement, in each case, relating to the Collateral, is accurate
and complete in all material respects.  The Collateral described on the
schedules annexed hereto constitutes all of the property of such type of
Collateral owned or held by the Grantors.

 

SECTION 4.9  Insurance.  Such Grantor shall (a) maintain or shall cause to be
maintained such insurance as is required pursuant to Section 5.07 of the Credit
Agreement; (b) maintain such other insurance as may be required by applicable
Law; and (c) furnish to the Collateral Agent, upon written request, full
information as to the insurance carried.  Each Grantor hereby irrevocably makes,
constitutes and appoints the Collateral Agent (and all officers, employees or
agents designated by the Collateral Agent) as such Grantor’s true and lawful
agent (and attorney-in-fact), exercisable only after the occurrence and during
the continuance of an Event of Default, for the purpose of making, settling and
adjusting claims in respect of the Collateral under policies of insurance,
endorsing the name of such Grantor on any check, draft, instrument or other item
of payment for the proceeds of such policies of insurance and for making all
determinations and decisions with respect thereto.  In the event that any
Grantor at any time or times shall fail to obtain or maintain any of the
policies of insurance required hereby or to pay any premium in whole or in part
relating thereto, the Collateral Agent may, without waiving or releasing any
obligation or liability of the Grantors hereunder or any Default or Event of
Default, in its sole discretion, obtain and maintain such policies of insurance
and pay such premium and take any other actions with respect thereto as the
Collateral Agent deems advisable.  All sums disbursed by the Collateral Agent in
connection with this Section 4.9, including

 

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reasonable attorneys’ fees, court costs, expenses and other charges relating
thereto, shall be payable, upon demand, by the Grantors to the Collateral Agent
and shall be additional Secured Obligations secured hereby.

 

SECTION 4.10  Payment of Taxes; Compliance with Laws; Contested Liens; Claims. 
Each Grantor represents and warrants that all Claims imposed upon or assessed
against the Collateral have been paid and discharged except to the extent such
Claims constitute a Lien not yet due and payable or a Permitted Encumbrance. 
Each Grantor shall comply with all applicable Law relating to the Collateral the
failure to comply with which, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.  Each Grantor may at its own
expense contest the validity, amount or applicability of any Claims so long as
the contest thereof shall be conducted in accordance with, and permitted
pursuant to the provisions of, the Credit Agreement.  Notwithstanding the
foregoing provisions of this Section 4.10, no contest of any such obligation may
be pursued by such Grantor if such contest would expose the Collateral Agent or
any other Secured Party to (a) any possible criminal liability or (b) any
additional civil liability for failure to comply with such obligations unless
such Grantor shall have furnished a bond or other security therefor satisfactory
to the Collateral Agent or such other Secured Party, as the case may be.

 

SECTION 4.11  [Reserved].

 

SECTION 4.12  New Subsidiaries.  Pursuant to Section 5.12 of the Credit
Agreement, certain Subsidiaries (whether by acquisition or creation) of any
Grantor are required to enter into this Security Agreement by executing and
delivering in favor of the Collateral Agent a Joinder Agreement.  Upon the
execution and delivery of a Joinder Agreement by any such new Subsidiary, such
Subsidiary shall become a Grantor hereunder with the same force and effect as if
originally named as a Grantor herein.  The execution and delivery of any
instrument adding an additional Grantor as a party to this Security Agreement
shall not require the consent of any other Grantor hereunder.  The rights and
obligations of each Grantor hereunder shall remain in full force and effect
notwithstanding the addition of any new Grantor hereunder.

 

ARTICLE V

 

CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL

 

SECTION 5.1  Pledge of Additional Securities Collateral.  Each Grantor shall,
upon obtaining any Pledged Interests, Successor Interests or Intercompany Notes
required to be pledged hereunder, accept the same in trust for the benefit of
the Collateral Agent and forthwith deliver to the Collateral Agent a pledge
amendment, duly executed by such Grantor, in substantially the form of Exhibit 1
annexed hereto (each, a “Pledge Amendment”), and the certificates and other
documents required under Sections 3.1 and 3.2 hereof in respect of the
additional Pledged Interests, Successor Interests or Intercompany Notes which
are to be pledged pursuant to this Security Agreement, and confirming the
attachment of the Lien hereby created on and in respect of such additional
Pledged Interests, Successor Interests or Intercompany Notes.  Each Grantor
hereby authorizes the Collateral Agent to attach each Pledge Amendment to this
Security Agreement and agrees that all Pledged Interests, Successor Interests or
Intercompany Notes listed on any Pledge Amendment delivered to the Collateral
Agent shall for all purposes hereunder be considered Collateral.

 

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SECTION 5.2  Voting; Distributions; etc.

 

(a)         So long as no Event of Default shall have occurred and be
continuing, each Grantor shall be entitled to exercise any and all voting and
other consensual rights pertaining to the Securities Collateral or any part
thereof for any purpose not inconsistent with the terms or purposes hereof, the
Credit Agreement or any other Loan Document evidencing the Secured Obligations;
provided, that, no vote shall be cast or corporate or other ownership right
exercised or other action taken that could reasonably be expected to impair the
Collateral or to be inconsistent with or result in any violation of any
provision of the Credit Agreement, this Security Agreement or any other Loan
Document.  The Collateral Agent shall be deemed without further action or
formality to have granted to each Grantor all necessary consents relating to
voting rights and shall, if necessary, upon written request of any Grantor and
at the sole cost and expense of the Grantors, from time to time execute and
deliver (or cause to be executed and delivered) to such Grantor all such
instruments as such Grantor may reasonably request in order to permit such
Grantor to exercise the voting and other rights which it is entitled to exercise
pursuant to this Section 5.2(a).

 

(b)         Upon the occurrence and during the continuance of any Event of
Default, all rights of each Grantor to exercise the voting and other consensual
rights it would otherwise be entitled to exercise pursuant to
Section 5.2(a) hereof without any action, other than, in the case of any
Securities Collateral, or the giving of any notice, shall immediately cease, and
all such rights shall thereupon become vested in the Collateral Agent, which
shall thereupon have the sole right (but shall be under no obligation) to
exercise such voting and other consensual rights; provided, that, the Collateral
Agent shall have the right, in its sole discretion, from time to time following
the occurrence and continuance of an Event of Default to permit such Grantor to
exercise such rights under Section 5.2(a) hereof.  After such Event of Default
is no longer continuing, each Grantor shall have the right to exercise the
voting, managerial and other consensual rights and powers that it would
otherwise be entitled to pursuant to Section 5.2(a) hereof.

 

(c)          So long as no Event of Default shall have occurred and be
continuing, each Grantor shall be entitled to receive and retain, and to utilize
free and clear of the Lien hereof, any and all Distributions, but only if and to
the extent made without violating, and to the extent permitted by, the
provisions of the Credit Agreement; provided, that, any and all such
Distributions consisting of rights or interests in the form of securities shall
be forthwith delivered to the Collateral Agent to hold as Collateral and shall,
if received by any Grantor, be received in trust for the benefit of the
Collateral Agent, be segregated from the other property or funds of such Grantor
and be forthwith delivered to the Collateral Agent as Collateral in the same
form as so received (with any necessary endorsement).  The Collateral Agent
shall, if necessary, upon written request of any Grantor and at the sole cost
and expense of the Grantors, from time to time execute and deliver (or cause to
be executed and delivered) to such Grantor all such instruments as such Grantor
may reasonably request in order to permit such Grantor to receive the
Distributions which it is authorized to receive and retain pursuant to this
Section 5.2(c).

 

(d)         Upon the occurrence and during the continuance of any Event of
Default, all rights of each Grantor to receive Distributions which it would
otherwise be authorized to receive and retain pursuant to Section 5.2(c) hereof
shall cease and all such rights shall thereupon become vested in the Collateral
Agent, which shall thereupon have the sole right to receive and

 

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hold as Collateral such Distributions.  After such Event of Default is no longer
continuing, each Grantor shall have the right to receive the Distributions which
it would be authorized to receive and retain pursuant to Section 5.2(c) hereof.

 

(e)          Each Grantor shall, at its sole cost and expense, from time to time
execute and deliver to the Collateral Agent appropriate proxies, dividend
payment orders and other instruments as the Collateral Agent may reasonably
request in order to permit the Agent to exercise the voting and other rights
which it may be entitled to exercise pursuant to Section 5.2(b) and to receive
all Distributions which it may be entitled to receive under Section 5.2(c).

 

SECTION 5.3  Turnover.  All Distributions which are received by any Grantor
contrary to the provisions of Section 5.2(c) hereof shall be received in trust
for the benefit of the Collateral Agent, shall be segregated from other funds of
such Grantor and shall immediately be paid over to the Collateral Agent as
Collateral in the same form as so received (with any necessary endorsement).

 

SECTION 5.4  Defaults, Etc.  Such Grantor is not in default in the payment of
any portion of any mandatory capital contribution, if any, required to be made
under any agreement to which such Grantor is a party relating to the Pledged
Interests and Successor Interests pledged by it, and such Grantor is not in
violation of any other provisions of any such agreement to which such Grantor is
a party, or otherwise in default or violation thereunder.  No Securities
Collateral pledged by such Grantor is subject to any defense, offset or
counterclaim, nor have any of the foregoing been asserted or alleged against
such Grantor by any Person with respect thereto, and as of the date hereof,
there are no certificates, instruments, documents or other writings (other than
the Organization Documents and certificates, if any, delivered to the Collateral
Agent) which evidence any Pledged Interests and Successor Interests of such
Grantor.

 

SECTION 5.5  Certain Agreements of Grantors as Issuers and Holders of Equity
Interests.

 

(a)         In the case of each Grantor which is an issuer of Securities
Collateral, such Grantor agrees to be bound by the terms of this Security
Agreement relating to the Securities Collateral issued by it and will comply
with such terms insofar as such terms are applicable to it.

 

(b)         In the case of each Grantor which is a partner in a partnership,
limited liability company or other entity, such Grantor hereby consents to the
extent required by the applicable Organization Documents to the pledge by each
other Grantor, pursuant to the terms hereof, of the Pledged Interests in such
partnership, limited liability company or other entity and, upon the occurrence
and during the continuance of an Event of Default, to the transfer of such
Pledged Interests to the Collateral Agent or its nominee and to the substitution
of the Collateral Agent or its nominee as a substituted partner or member in
such partnership, limited liability company or other entity with all the rights,
powers and duties of a general partner or a limited partner or member, as the
case may be.

 

(c)          Without the prior written consent of the Collateral Agent, such
Grantor will not (i) vote to enable, or take any other action to permit, any
issuer of Pledged Interests and Successor Interests to amend its Organization
Documents in any manner that adversely affects the validity, perfection or
priority of the Collateral Agent’s Lien therein or (ii) enter into any

 

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agreement or undertaking restricting the right or ability of such Grantor or the
Collateral Agent to sell, assign or transfer any of the Pledged Interests and
Successor Interests or Proceeds thereof or any interest therein.

 

ARTICLE VI

 

CERTAIN PROVISIONS CONCERNING INTELLECTUAL
PROPERTY

 

SECTION 6.1  Grant of License.  For the purpose of enabling the Collateral
Agent, during the continuance of an Event of Default, to exercise rights and
remedies under Article VIII hereof with respect to the Collateral at such time
as the Collateral Agent shall be lawfully entitled to exercise such rights and
remedies, and for no other purpose, each Grantor hereby grants to the Collateral
Agent, to the extent assignable, an irrevocable, non-exclusive license
(exercisable without payment of royalty or other compensation to such Grantor)
to use, assign, license or sublicense any of the Intellectual Property now owned
or hereafter acquired by such Grantor, wherever the same may be located,
including in such license access to all media in which any of the licensed items
may be recorded or stored and to all computer programs used for the compilation
or printout hereof.

 

SECTION 6.2  Registrations.  Except pursuant to licenses and other user
agreements entered into by any Grantor in the ordinary course of business that
are listed in Schedule III of the Perfection Certificate, on and as of the date
hereof (a) each Grantor is the sole and exclusive owner of the entire right,
title and interest in, free and clear of all Liens except Permitted
Encumbrances, and possesses the right to use, and has done nothing to authorize
or enable any other Person to use, any material Copyright, Patent or Trademark
listed in Schedule III of the Perfection Certificate, (b) all registrations and
issuances listed in Schedule III of the Perfection Certificate are subsisting,
valid and in full force and effect, and each Grantor has performed all acts and
has paid all renewal, maintenance and other fees required to maintain each and
every registration and application in the material Copyrights, Patents and
Trademarks listed in Schedule III of the Perfection Certificate, (c) no holding,
decision, ruling or judgment has been rendered in any action or proceeding
before any court or administrative authority challenging the validity,
enforceability, or scope of , or such Grantor’s right to register, own or use
any material Copyrights, Patents and Trademarks listed in Schedule III of the
Perfection Certificate and no such action or proceeding is pending or, to the
best of such Grantor’s knowledge, threatened, (d) all registrations, issuances
and applications for material Copyrights, Patents and Trademarks listed in
Schedule III of the Perfection Certificate are standing in the name of such
Grantor, and (e) each Grantor controls the nature and quality in accordance with
industry standards of all products sold and all services rendered under or in
connection with all Trademarks of such Grantor and has taken all action
necessary to insure that all licensees of the Trademarks owned by such Grantor
comply with such Grantor’s standards of quality and each Grantor has taken
commercially reasonable steps to protect the confidentiality of its trade
secrets in accordance with industry standards.

 

SECTION 6.3  No Violations or Proceedings.  To each Grantor’s knowledge, on and
as of the date hereof, there is no violation by others of any right of such
Grantor with respect to any

 

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Copyright, Patent or Trademark listed in Schedule III of the Perfection
Certificate, respectively, pledged by it under the name of such Grantor.

 

SECTION 6.4  Protection of Collateral Agent’s Security.  On a continuing basis,
each Grantor shall, at its sole cost and expense, (a) promptly following its
becoming aware thereof, notify the Collateral Agent of (i) any adverse
determination in any proceeding in the United States Patent and Trademark Office
or United States Copyright Office with respect to any Copyright, Patent or
Trademark necessary for the conduct of business of such Grantor or (ii) the
institution of any proceeding or any adverse determination in any federal, state
or local court or administrative body regarding such Grantor’s claim of
ownership in or right to use any of the Intellectual Property material to the
use and operation of the Collateral, its right to register such Intellectual
Property or its right to keep and maintain such registration in full force and
effect, (b) maintain and protect the Intellectual Property necessary for the
conduct of business of such Grantor, (c) not permit to lapse or become abandoned
any Intellectual Property necessary for the conduct of business of such Grantor,
and not settle or compromise any pending or future litigation or administrative
proceeding with respect to such Intellectual Property, in each case except as
shall be consistent with commercially reasonable business judgment and, if any
Event of Default has occurred and is continuing, with the prior approval of the
Collateral Agent (such approval not to be unreasonably withheld), (d) upon such
Grantor’s obtaining knowledge thereof, promptly notify the Collateral Agent in
writing of any event which may be reasonably expected to materially and
adversely affect the value or utility of the Intellectual Property or any
portion thereof material to the use and operation of the Collateral, the ability
of such Grantor or the Collateral Agent to dispose of the Intellectual Property
or any portion thereof or the rights and remedies of the Collateral Agent in
relation thereto including, without limitation, a levy or threat of levy or any
legal process against the Intellectual Property or any portion thereof, (e) not
license the Intellectual Property other than licenses entered into by such
Grantor in, or incidental to, the ordinary course of business, or amend or
permit the amendment of any of the material licenses in a manner that materially
and adversely affects the right to receive payments thereunder, or in any manner
that would materially impair the value of the Intellectual Property or the Lien
on and security interest in the Intellectual Property intended to be granted to
the Collateral Agent for the benefit of the Secured Parties, without the consent
of the Collateral Agent, (f) until the Collateral Agent exercises its rights to
make collection, diligently keep adequate records respecting the Intellectual
Property and (g) furnish to the Collateral Agent from time to time upon the
Collateral Agent’s reasonable request therefor detailed statements and amended
schedules further identifying and describing the material Intellectual Property
and such other materials evidencing or reports pertaining to the material
Intellectual Property as the Collateral Agent may from time to time request. 
Notwithstanding the foregoing, nothing herein shall prevent any Grantor from
selling, disposing of or otherwise using any material Intellectual Property as
permitted under the Credit Agreement.

 

SECTION 6.5  After-Acquired Property.  If at any time before this Security
Agreement shall have been terminated in accordance with Section 9.5(a) hereof,
any Grantor shall (a) obtain any rights to any additional Intellectual Property
or (b) become entitled to the benefit of any additional Intellectual Property or
any renewal or extension thereof, including any reissue, division, continuation,
or continuation-in-part of any Intellectual Property, or any improvement on any
Intellectual Property, the provisions hereof shall automatically apply thereto
and any such item enumerated in clauses (a) or (b) of this Section 6.5 with
respect to such Grantor shall automatically constitute Intellectual Property if
such would have constituted Intellectual Property

 

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at the time of execution hereof and be subject to the Lien and security interest
created by this Security Agreement without further action by any party.  With
respect to any federally registered Intellectual Property, each Grantor shall
promptly (i) provide to the Collateral Agent written notice of any of the
foregoing and (ii) confirm the attachment of the Lien and security interest
created by this Security Agreement to any rights described in clauses (a) and
(b) of the immediately preceding sentence of this Section 6.5 by execution of an
instrument in form reasonably acceptable to the Collateral Agent.

 

SECTION 6.6  Modifications.  Each Grantor authorizes the Collateral Agent to
modify this Security Agreement by amending Schedule III of the Perfection
Certificate to include any Intellectual Property acquired or arising after the
date hereof of such Grantor including, without limitation, any of the items
listed in Section 6.5 hereof.

 

SECTION 6.7  Litigation.  Unless there shall occur and be continuing any Event
of Default, each Grantor shall have the right to commence and prosecute in its
own name, as the party in interest, for its own benefit and at the sole cost and
expense of the Grantors, such applications for protection of the Intellectual
Property and suits, proceedings or other actions to prevent the infringement,
counterfeiting, unfair competition, dilution, diminution in value or other
damage as are necessary to protect the Intellectual Property.  Upon the
occurrence and during the continuance of any Event of Default, the Collateral
Agent shall have the right but shall in no way be obligated to file applications
for protection of the Intellectual Property and/or bring suit in the name of any
Grantor, the Collateral Agent or the other Secured Parties to enforce the
Intellectual Property and any license thereunder.  In the event of such suit,
each Grantor shall, at the reasonable request of the Collateral Agent, do any
and all lawful acts and execute any and all documents requested by the
Collateral Agent in aid of such enforcement and the Grantors shall promptly
reimburse and indemnify the Collateral Agent, as the case may be, for all costs
and expenses incurred by the Collateral Agent in the exercise of its rights
under this Section 6.7 in accordance with Section 9.3 hereof.  In the event that
the Collateral Agent shall elect not to bring suit to enforce the Intellectual
Property, each Grantor agrees, at the request of the Collateral Agent, to take
all commercially reasonable actions necessary, whether by suit, proceeding or
other action, to prevent the infringement, counterfeiting, unfair competition,
dilution, diminution in value of or other damage to any of the Intellectual
Property by others and for that purpose agrees to diligently maintain any suit,
proceeding or other action against any Person so infringing necessary to prevent
such infringement.

 

SECTION 6.8  Third Party Consents.  Each Grantor shall use reasonable commercial
efforts to obtain the consent of third parties to the extent such consent is
necessary or desirable to create a valid, perfected security interest in favor
of the Collateral Agent in any Intellectual Property.

 

ARTICLE VII

 

CERTAIN PROVISIONS CONCERNING ACCOUNTS

 

SECTION 7.1  Special Representations and Warranties.  As of the time when each
of its Accounts is included in the Borrowing Base (as defined in the ABL Credit
Agreement) as an Eligible Credit Card Receivable (as defined in the ABL Credit
Agreement) each Grantor shall be deemed to have represented and warranted that
such Account constituting a Credit Card Receivable and all records, papers and
documents relating thereto (a) are genuine and correct and

 

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in all material respects what they purport to be, (b) represent the legal, valid
and binding obligation of the account debtor, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws
relating to or limiting creditors’ rights generally or by equitable principles
relating to enforceability (including limitations on the enforceability of
credit card charges), evidencing indebtedness unpaid and owed by such account
debtor, arising out of the performance of labor or services or the sale, lease,
license, assignment or other disposition and delivery of the goods or other
property listed therein or out of an advance or a loan and (c) are in all
material respects in compliance and conform with all applicable material
federal, state and local Laws and applicable Laws of any relevant foreign
jurisdiction.

 

SECTION 7.2  Maintenance of Records.  Each Grantor shall keep and maintain at
its own cost and expense materially complete records of each Account, in a
manner consistent with prudent business practice, including, without limitation,
records of all payments received, all credits granted thereon, all merchandise
returned and all other documentation relating thereto.  Each Grantor shall, at
such Grantor’s sole cost and expense, upon the Collateral Agent’s demand made at
any time after the occurrence and during the continuance of any Event of
Default, deliver all tangible evidence of Accounts, including, without
limitation, all documents evidencing Accounts and any books and records relating
thereto to the Collateral Agent or to its representatives (copies of which
evidence and books and records may be retained by such Grantor).  Upon the
occurrence and during the continuance of any Event of Default, the Collateral
Agent may transfer a full and complete copy of any Grantor’s books, records,
credit information, reports, memoranda and all other writings relating to the
Accounts to and for the use by any Person that has acquired or is contemplating
acquisition of an interest in the Accounts or the Collateral Agent’s security
interest therein in accordance with applicable Law without the consent of any
Grantor.

 

SECTION 7.3  Legend.  To the extent reasonably practical, each Grantor shall
legend, at the request of the Collateral Agent made at any time after the
occurrence and during the continuance of any Event of Default and in form and
manner reasonably satisfactory to the Collateral Agent, the books, records and
documents of such Grantor evidencing or pertaining to the Credit Card
Receivables with an appropriate reference to the fact that the Credit Card
Receivables have been collaterally assigned to the Collateral Agent for the
benefit of the Secured Parties and that the Collateral Agent has a security
interest therein.

 

SECTION 7.4  Modification of Terms, Etc.  No Grantor shall rescind or cancel any
indebtedness evidenced by any Account or modify any term thereof or make any
adjustment with respect thereto except in the ordinary course of business
consistent with prudent business practice, or extend or renew any such
indebtedness except in the ordinary course of business consistent with prudent
business practice or compromise or settle any dispute, claim, suit or legal
proceeding relating thereto or sell any Account or interest therein except in
the ordinary course of business consistent with prudent business practice or in
accordance with the Credit Agreement without the prior written consent of the
Collateral Agent; provided, that, the foregoing shall not apply to any Account
that is an Excluded Asset because it has been sold pursuant to a Permitted
Securitization Facility (as defined in the ABL Credit Agreement).

 

SECTION 7.5  Collection.  Each Grantor shall cause to be collected from the
account debtor of each of the Accounts constituting Credit Card Receivables, as
and when due in the ordinary course of business consistent with prudent business
practice, any and all amounts owing

 

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under or on account of such Accounts constituting Credit Card Receivables, and
apply forthwith upon receipt thereof all such amounts as are so collected to the
outstanding balance of such Accounts constituting Credit Card Receivables.  The
costs and expenses (including, without limitation, attorneys’ fees) of
collection, in any case, whether incurred by any Grantor, the Collateral Agent
or any other Secured Party, shall be paid by the Grantors.

 

ARTICLE VIII

 

REMEDIES

 

SECTION 8.1  Remedies.  Upon the occurrence and during the continuance of any
Event of Default the Collateral Agent may, and at the direction of the Required
Lenders, shall, from time to time in respect of the Collateral, in addition to
the other rights and remedies provided for herein, under applicable Law or
otherwise available to it, subject to the Intercreditor Agreement:

 

(a)         Personally, or by agents or attorneys, immediately take possession
of the Collateral or any part thereof, from any Grantor or any other Person who
then has possession of any part thereof with or without notice or process of
law, and for that purpose may enter upon any Grantor’s premises where any of the
Collateral is located, remove such Collateral, remain present at such premises
to receive copies of all communications and remittances relating to the
Collateral and use in connection with such removal and possession any and all
services, supplies, aids and other facilities of any Grantor;

 

(b)         Demand, sue for, collect or receive any money or property at any
time payable or receivable in respect of the Collateral including, without
limitation, instructing the obligor or obligors on any agreement, instrument or
other obligation constituting part of the Collateral to make any payment
required by the terms of such agreement, instrument or other obligation directly
to the Collateral Agent, and in connection with any of the foregoing,
compromise, settle, extend the time for payment and make other modifications
with respect thereto; provided, that, in the event that any such payments are
made directly to any Grantor, prior to receipt by any such obligor of such
instruction, such Grantor shall segregate all amounts received pursuant thereto
in trust for the benefit of the Collateral Agent and shall promptly pay such
amounts to the Collateral Agent;

 

(c)          Sell, assign, grant a license to use or otherwise liquidate, or
direct any Grantor to sell, assign, grant a license to use or otherwise
liquidate, any and all investments made in whole or in part with the Collateral
or any part thereof, and take possession of the proceeds of any such sale,
assignment, license or liquidation;

 

(d)         Take possession of the Collateral or any part thereof, by directing
any Grantor in writing to deliver the same to the Collateral Agent at any place
or places so designated by the Collateral Agent, in which event such Grantor
shall at its own expense:  (i) forthwith cause the same to be moved to the place
or places designated by the Collateral Agent and therewith delivered to the
Collateral Agent, (ii) store and keep any Collateral so delivered to the
Collateral Agent at such place or places pending further action by the
Collateral Agent and (iii) while the Collateral shall be so stored and kept,
provide such security and maintenance services as shall be necessary to protect
the same and to preserve and maintain them in good condition.  Each

 

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Grantor’s obligation to deliver the Collateral as contemplated in this
Section 8.1 is of the essence hereof.  Upon application to a court of equity
having jurisdiction, the Collateral Agent shall be entitled to a decree
requiring specific performance by any Grantor of such obligation;

 

(e)          Withdraw all moneys, instruments, securities and other property in
any bank, financial securities, deposit or other account of any Grantor
constituting Collateral for application to the Secured Obligations as provided
in Section 7.02 of the Credit Agreement;

 

(f)           Retain and apply the Distributions to the Secured Obligations as
provided in Section 7.02 of the Credit Agreement;

 

(g)          Exercise any and all rights as beneficial and legal owner of the
Collateral, including, without limitation, perfecting assignment of and
exercising any and all voting, consensual and other rights and powers with
respect to any Collateral; and

 

(h)         Exercise all the rights and remedies of a secured party under the
UCC, and the Collateral Agent may also in its sole discretion, without notice
except as specified in Section 8.2 hereof, sell, assign or grant a license to
use the Collateral or any part thereof in one or more parcels at public or
private sale, at any exchange, broker’s board or at any of the Collateral
Agent’s offices or elsewhere, for cash, on credit or for future delivery, and at
such price or prices and upon such other terms as the Collateral Agent may deem
commercially reasonable.  The Collateral Agent or any other Secured Party or any
of their respective Affiliates may be the purchaser, licensee, assignee or
recipient of any or all of the Collateral at any such sale and shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold, assigned or
licensed at such sale, to use and apply any of the Secured Obligations owed to
such Person as a credit on account of the purchase price of any Collateral
payable by such Person at such sale.  Each purchaser, assignee, licensee or
recipient at any such sale shall acquire the property sold, assigned or licensed
absolutely free from any claim or right on the part of any Grantor, and each
Grantor hereby waives, to the fullest extent permitted by Law, all rights of
redemption, stay and/or appraisal which it now has or may at any time in the
future have under any rule of law or statute now existing or hereafter enacted. 
The Collateral Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given.  The Collateral Agent may
adjourn any public or private sale from time to time by announcement at the time
and place fixed therefor, and such sale may, without further notice, be made at
the time and place to which it was so adjourned.  To the fullest extent
permitted by Law, each Grantor hereby waives any claims against the Collateral
Agent arising by reason of the fact that the price at which any Collateral may
have been sold, assigned or licensed at such a private sale was less than the
price which might have been obtained at a public sale, even if the Collateral
Agent accepts the first offer received and does not offer such Collateral to
more than one offeree.

 

SECTION 8.2  Notice of Sale.  Each Grantor acknowledges and agrees that, to the
extent notice of sale or other disposition of Collateral shall be required by
applicable Law and unless the Collateral is perishable or threatens to decline
speedily in value, or is of a type customarily sold on a recognized market (in
which event the Collateral Agent shall provide such Grantor such advance notice
as may be practicable under the circumstances), 10 days’ prior notice to such
Grantor of the time and place of any public sale or of the time after which any
private sale

 

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or other intended disposition is to take place shall be commercially reasonable
notification of such matters.  No notification need be given to any Grantor if
it has signed, after the occurrence of an Event of Default, a statement
renouncing or modifying (as permitted under Law) any right to notification of
sale or other intended disposition.

 

SECTION 8.3  Waiver of Notice and Claims.  Each Grantor hereby waives, to the
fullest extent permitted by applicable Law, notice or judicial hearing in
connection with the Collateral Agent’s taking possession or the Collateral
Agent’s disposition of any of the Collateral, including, without limitation, any
and all prior notice and hearing for any prejudgment remedy or remedies and any
such right which such Grantor would otherwise have under law, and each Grantor
hereby further waives, to the fullest extent permitted by applicable Law: 
(a) all damages occasioned by such taking of possession, (b) all other
requirements as to the time, place and terms of sale or other requirements with
respect to the enforcement of the Collateral Agent’s rights hereunder and
(c) all rights of redemption, appraisal, valuation, stay, extension or
moratorium now or hereafter in force under any applicable Law.  The Collateral
Agent shall not be liable for any incorrect or improper payment made pursuant to
this Article VIII in the absence of gross negligence or willful misconduct as
determined in a final, nonappealable judgment of a court of competent
jurisdiction.  Any sale of, or the grant of options to purchase, or any other
realization upon, any Collateral shall operate to divest all right, title,
interest, claim and demand, either at law or in equity, of the applicable
Grantor therein and thereto, and shall be a perpetual bar both at law and in
equity against such Grantor and against any and all Persons claiming or
attempting to claim the Collateral so sold, optioned or realized upon, or any
part thereof, from, through or under such Grantor.

 

SECTION 8.4  Certain Sales of Collateral.

 

(a)         Each Grantor recognizes that, by reason of certain prohibitions
contained in law, rules, regulations or orders of any Governmental Authority,
the Collateral Agent may be compelled, with respect to any sale of all or any
part of the Collateral, to limit purchasers to those who meet the requirements
of such Governmental Authority.  Each Grantor acknowledges that any such sales
may be at prices and on terms less favorable to the Collateral Agent than those
obtainable through a public sale without such restrictions, and, notwithstanding
such circumstances, agrees that any such restricted sale shall be deemed to have
been made in a commercially reasonable manner and that, except as may be
required by applicable Law, the Collateral Agent shall have no obligation to
engage in public sales.

 

(b)         Each Grantor recognizes that, by reason of certain prohibitions
contained in the Securities Act, and applicable state securities Laws, the
Collateral Agent may be compelled, with respect to any sale of all or any part
of the Securities Collateral and Investment Property, to limit purchasers to
Persons who will agree, among other things, to acquire such Securities
Collateral or Investment Property for their own account, for investment and not
with a view to the distribution or resale thereof.  Each Grantor acknowledges
that any such private sales may be at prices and on terms less favorable to the
Collateral Agent than those obtainable through a public sale without such
restrictions (including, without limitation, a public offering made pursuant to
a registration statement under the Securities Act), and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner and that the Collateral Agent shall
have no obligation to engage in public sales and no obligation to delay the sale
of any Securities Collateral or

 

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Investment Property for the period of time necessary to permit the issuer
thereof to register it for a form of public sale requiring registration under
the Securities Act or under applicable state securities Laws, even if such
issuer would agree to do so.

 

(c)          If the Collateral Agent determines to exercise its right to sell
any or all of the Securities Collateral or Investment Property, upon written
request, the applicable Grantor shall from time to time furnish to the
Collateral Agent all such information as the Collateral Agent may reasonably
request in order to determine the number of securities included in the
Securities Collateral or Investment Property which may be sold by the Collateral
Agent as exempt transactions under the Securities Act and the rules of the
Securities and Exchange Commission thereunder, as the same are from time to time
in effect.

 

(d)         Each Grantor further agrees that a breach of any of the covenants
contained in this Section 8.4 will cause irreparable injury to the Collateral
Agent and the other Secured Parties, that the Collateral Agent and the other
Secured Parties have no adequate remedy at law in respect of such breach and, as
a consequence, that each and every covenant contained in this Section 8.4 shall
be specifically enforceable against such Grantor, and such Grantor hereby waives
and agrees not to assert any defenses against an action for specific performance
of such covenants except for a defense that no Event of Default has occurred and
is continuing.

 

SECTION 8.5  No Waiver; Cumulative Remedies.

 

(a)         No failure on the part of the Collateral Agent to exercise, no
course of dealing with respect to, and no delay on the part of the Collateral
Agent in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right,
power or remedy hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or remedy; nor shall the Collateral Agent be
required to look first to, enforce or exhaust any other security, collateral or
guaranties.  The remedies herein provided are cumulative and are not exclusive
of any remedies provided by Law.

 

(b)         In the event that the Collateral Agent shall have instituted any
proceeding to enforce any right, power or remedy under this Security Agreement
by foreclosure, sale, entry or otherwise, and such proceeding shall have been
discontinued or abandoned for any reason or shall have been determined adversely
to the Collateral Agent, then and in every such case, the Grantors, the
Collateral Agent and each other Secured Party shall be restored to their
respective former positions and rights hereunder with respect to the Collateral,
and all rights, remedies and powers of the Collateral Agent and the other
Secured Parties shall continue as if no such proceeding had been instituted.

 

SECTION 8.6  Certain Additional Actions Regarding Intellectual Property.  If any
Event of Default shall have occurred and be continuing, upon the written demand
of the Collateral Agent, each Grantor shall execute and deliver to the
Collateral Agent an assignment or assignments of the registered Patents,
Trademarks and/or Copyrights and such other documents as are necessary or
appropriate to carry out the intent and purposes hereof to the extent such
assignment does not result in any loss of rights therein under applicable Law. 
Within five Business Days of written notice thereafter from the Collateral
Agent, each Grantor shall make available to the Collateral Agent, to the extent
within such Grantor’s power and authority, such

 

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personnel in such Grantor’s employ on the date of the Event of Default as the
Collateral Agent may reasonably designate to permit such Grantor to continue,
directly or indirectly, to produce, advertise and sell the products and services
sold by such Grantor under the registered Patents, Trademarks and/or Copyrights,
and such Persons shall be available to perform their prior functions on the
Collateral Agent’s behalf.

 

SECTION 8.7  Application of Proceeds.  The proceeds received by the Collateral
Agent in respect of any sale of, collection from or other realization upon all
or any part of the Collateral pursuant to the exercise by the Collateral Agent
of its remedies shall be applied, together with any other sums then held by the
Collateral Agent pursuant to this Security Agreement, in accordance with and as
set forth in Section 7.02 of the Credit Agreement.

 

SECTION 8.8  Third Party Agreements.  Pursuant to the Collateral Access
Agreements (as defined in the ABL Credit Agreement), DDA Notifications and
Credit Card Notifications, the Collateral Agent has the right to give notice to
certain Persons who are parties thereto or recipients thereof.  With respect to
each DDA Notification and Credit Card Notification, the Administrative Agent
hereby acknowledges and agrees that it will not deliver any notice instructing
the recipient thereof to transfer funds to any account other than the account
identified in such notice until after the occurrence and during the continuance
of an Event of Default.  Additionally, with respect to each Credit Card
Notification, the Administrative Agent hereby acknowledges and agrees that it
will not deliver any request for statements or other information until after the
occurrence and during the continuance of an Event of Default.  With respect to
each Collateral Access Agreement (as defined in the ABL Credit Agreement), the
Collateral Agent hereby acknowledges and agrees that it will not deliver any
notice to such Persons in connection with the exercise of its rights and
remedies under the Credit Agreement, this Security Agreement and the other Loan
Documents until after the occurrence and during the continuance of an Event of
Default.

 

ARTICLE IX
MISCELLANEOUS

 

SECTION 9.1  Concerning the Collateral Agent.

 

(a)         The Collateral Agent has been appointed as agent pursuant to the
Credit Agreement.  The actions of the Collateral Agent hereunder are subject to
the provisions of the Credit Agreement.  The Collateral Agent shall have the
right hereunder to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking action (including,
without limitation, the release or substitution of the Collateral), in
accordance with this Security Agreement and the Credit Agreement.  The
Collateral Agent may employ agents and attorneys-in-fact in connection herewith
and shall not be liable for the negligence or misconduct of any such agents or
attorneys-in-fact.  The Collateral Agent may resign and a successor Collateral
Agent may be appointed in the manner provided in the Credit Agreement.  Upon the
acceptance of any appointment as the Collateral Agent by a successor Collateral
Agent, that successor Collateral Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Collateral Agent under this Security Agreement, and the retiring Collateral
Agent shall thereupon be discharged from its duties and obligations under this
Security Agreement.  After any retiring Collateral Agent’s resignation, the
provisions hereof

 

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shall inure to its benefit as to any actions taken or omitted to be taken by it
under this Security Agreement while it was the Collateral Agent.

 

(b)         The Collateral Agent shall be deemed to have exercised reasonable
care in the custody and preservation of the Collateral in its possession if such
Collateral is accorded treatment substantially equivalent to that which the
Collateral Agent, in its individual capacity, accords its own property
consisting of similar instruments or interests, it being understood that neither
the Collateral Agent nor any of the other Secured Parties shall have
responsibility for, without limitation (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relating to any Securities Collateral, whether or not the Collateral Agent or
any other Secured Party has or is deemed to have knowledge of such matters or
(ii) taking any necessary steps to preserve rights against any Person with
respect to any Collateral.

 

(c)          The Collateral Agent shall be entitled to rely upon any written
notice, statement, certificate, order or other document or any telephone message
believed by it 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
Security Agreement and its duties hereunder, upon advice of counsel selected by
it.

 

(d)         If any item of Collateral also constitutes collateral granted to the
Collateral Agent under any other deed of trust, mortgage, security agreement,
pledge or instrument of any type, in the event of any conflict between the
provisions hereof and the provisions of such other deed of trust, mortgage,
security agreement, pledge or instrument of any type in respect of such
collateral, the Collateral Agent, in its sole discretion, shall select which
provision or provisions shall control.

 

SECTION 9.2  Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact.  If any Grantor shall fail to perform any covenants contained
in this Security Agreement or in the Credit Agreement (including, without
limitation, such Grantor’s covenants to (a) pay the premiums in respect of all
required insurance policies hereunder, (b) pay Claims, (c) make repairs,
(d) discharge Liens or (e) pay or perform any other obligations of such Grantor
with respect to any Collateral) or if any warranty on the part of any Grantor
contained herein shall be breached, the Collateral Agent may (but shall not be
obligated to) do the same or cause it to be done or remedy any such breach, and
may expend funds for such purpose; provided, that, the Collateral Agent shall in
no event be bound to inquire into the validity of any tax, lien, imposition or
other obligation which such Grantor fails to pay or perform as and when required
hereby.  Any and all amounts so expended by the Collateral Agent shall be paid
by the Grantors in accordance with the provisions of Section 9.3 hereof. 
Neither the provisions of this Section 9.2 nor any action taken by the
Collateral Agent pursuant to the provisions of this Section 9.2 shall prevent
any such failure to observe any covenant contained in this Security Agreement
nor any breach of warranty from constituting an Event of Default.  Each Grantor
hereby appoints the Collateral Agent its attorney-in-fact, with full authority
in the place and stead of such Grantor and in the name of such Grantor, or
otherwise, from time to time after the occurrence and during the continuation of
an Event of Default in the Collateral Agent’s discretion to take any action and
to execute any instrument consistent with the terms of the Credit Agreement and
the other Security Documents which the Collateral Agent may deem necessary to
accomplish the purposes

 

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hereof.  The foregoing grant of authority is a power of attorney coupled with an
interest and such appointment shall be irrevocable for the term hereof.  Each
Grantor hereby ratifies all that such attorney shall lawfully do or cause to be
done by virtue hereof.

 

SECTION 9.3  Expenses.  Each Grantor will upon demand pay to the Collateral
Agent the amount of any and all amounts required to be paid pursuant to
Section 9.05 of the Credit Agreement.

 

SECTION 9.4  Continuing Security Interest; Assignment.  This Security Agreement
shall create a continuing security interest in the Collateral and shall (a) be
binding upon the Grantors, their respective successors and assigns, and
(b) inure, together with the rights and remedies of the Collateral Agent
hereunder, to the benefit of the Collateral Agent and the other Secured Parties
and each of their respective successors, transferees and assigns.  No other
Persons (including, without limitation, any other creditor of any Grantor) shall
have any interest herein or any right or benefit with respect hereto.  Without
limiting the generality of the foregoing clause (b), any Secured Party may
assign or otherwise transfer any indebtedness held by it secured by this
Security Agreement to any other Person, and such other Person shall thereupon
become vested with all the benefits in respect thereof granted to such Secured
Party, herein or otherwise, subject, however, to the provisions of the Credit
Agreement.

 

SECTION 9.5  Termination; Release.

 

(a)         This Security Agreement, the Lien in favor of the Collateral Agent
(for the benefit of itself and the other Secured Parties) and all other security
interests granted hereby shall terminate with respect to all Secured
Obligations, and all rights to the Collateral shall revert to Grantors or any
other Person entitled thereto, when (i) the Commitments shall have expired or
been terminated and (ii) the principal of and interest on each Loan and all fees
and other Secured Obligations shall have been indefeasibly paid in full in cash;
provided, that, in connection with the termination of this Security Agreement,
the Collateral Agent may require such indemnities and collateral security as it
shall reasonably deem necessary or appropriate to protect the Secured Parties
against (A) loss on account of credits previously applied to the Secured
Obligations that may subsequently be reversed or revoked, (B) any obligations
that may thereafter arise with respect to the Bank Product Obligations and
(C) any Secured Obligations (other than contingent indemnification obligations
for which no claim has been asserted) that may thereafter arise under
Section 9.05 of the Credit Agreement.

 

(b)         (i) Upon the consummation of a transaction expressly permitted under
the Credit Agreement, which results in a Grantor ceasing to be a Subsidiary of
the Borrower, such Grantor shall be automatically released from its obligations
under this Security Agreement, the security interest granted hereby shall
terminate with respect to such Grantor and all rights to the Collateral of such
Grantor shall revert to such Grantor or any other Person entitled thereto.

 

(ii)          Upon any sale or other transfer by any Grantor of any Collateral
that is expressly permitted under the Credit Agreement (other than a sale or
other transfer to a Loan Party), or upon the effectiveness of any written
consent to the release of the security interest granted hereby in any Collateral
pursuant to Section 9.20 of the Credit Agreement, the security interest granted
hereby shall terminate with respect to such Collateral and all rights to the
Collateral shall revert to Grantors or any other Person entitled thereto.

 

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(iii)       At such time as any of the foregoing contained Sections 9.5(a),
9.5(b)(i) and 9.5(b)(ii) hereof, upon the Borrower’s written request and at the
sole cost and expense of the Grantors, the Collateral Agent will (A) assign,
transfer and deliver to the Grantors, against receipt and without recourse to or
warranty by the Collateral Agent, such of the Collateral to be released (in the
case of a release) or all of the Collateral (in the case of the satisfaction of
Sections 9.5(a), 9.5(b)(i) and 9.5(b)(ii) hereof) as may be in possession of the
Collateral Agent and as shall not have been sold or otherwise applied pursuant
to the terms hereof, and (B) with respect to any other Collateral, authorize the
filing of appropriate termination statements and other documents (including UCC
termination statements or releases) to terminate such security interests.

 

(c)          At any time that the respective Grantor desires that the Collateral
Agent take any action described in Section 9.5(b) hereof, such Grantor shall,
upon request of the Collateral Agent, deliver to the Collateral Agent an
officer’s certificate certifying that the release of the respective Collateral
is permitted pursuant to Sections 9.5(a) or 9.5(b) hereof.  The Collateral Agent
shall have no liability whatsoever to any other Secured Party as the result of
any release of Collateral by it as permitted (or which the Collateral Agent in
good faith believes to be permitted) by this Section 9.5.

 

SECTION 9.6  Modification in Writing.  No amendment, modification, supplement,
termination or waiver of or to any provision hereof, nor consent to any
departure by any Grantor therefrom, shall be effective unless the same shall be
made in accordance with the terms of the Credit Agreement and unless in writing
and signed by the Collateral Agent and the Grantors.  Any amendment,
modification or supplement of or to any provision hereof, any waiver of any
provision hereof and any consent to any departure by any Grantor from the terms
of any provision hereof shall be effective only in the specific instance and for
the specific purpose for which made or given.  Except where notice is
specifically required by this Security Agreement or any other document
evidencing the Secured Obligations, no notice to or demand on any Grantor in any
case shall entitle any Grantor to any other or further notice or demand in
similar or other circumstances.

 

SECTION 9.7  Notices.  Unless otherwise provided herein or in the Credit
Agreement, any notice or other communication herein required or permitted to be
given shall be given in the manner and become effective as set forth in the
Credit Agreement, as to any Grantor, addressed to it at the address of the
Borrower set forth in the Credit Agreement and as to the Collateral Agent,
addressed to it at the address set forth in the Credit Agreement, or in each
case at such other address as shall be designated by such party in a written
notice to the other parties hereto complying as to delivery with the terms of
this Section 9.7.

 

SECTION 9.8  GOVERNING LAW.  THIS SECURITY AGREEMENT AND ANY CLAIM, CONTROVERSY,
DISPUTE OR CAUSE OF ACTION (WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE)
BASED UPON, ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).

 

31

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SECTION 9.9  CONSENT TO JURISDICTION; SERVICE OF PROCESS; WAIVER OF JURY TRIAL.

 

(a)         EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE
COURT OR FEDERAL COURT OF THE UNITED STATES OF AMERICA SITTING IN NEW YORK
COUNTY, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH GRANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT.  EACH GRANTOR AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW.  NOTHING IN THIS SECURITY AGREEMENT SHALL AFFECT ANY
RIGHT THAT THE COLLATERAL AGENT OR ANY SECURED PARTY MAY OTHERWISE HAVE TO BRING
ANY ACTION OR PROCEEDING RELATING TO THIS SECURITY AGREEMENT AGAINST ANY GRANTOR
OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION IF REQUIRED TO REALIZE UPON
THE COLLATERAL OR ENFORCE ANY JUDGMENT.

 

(b)         EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS SECURITY AGREEMENT IN ANY COURT REFERRED TO IN
SECTION 9.9(a) HEREOF.  EACH GRANTOR HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH SUIT, ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(c)          EACH GRANTOR AND, EXCEPT AS PROVIDED IN THE LAST SENTENCE OF
SECTION 9.9(a) HEREOF, EACH SECURED PARTY, AGREES THAT ANY ACTION COMMENCED BY
ANY GRANTOR ASSERTING ANY CLAIM OR COUNTERCLAIM ARISING UNDER OR IN CONNECTION
WITH THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT SOLELY
IN A COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY OR ANY FEDERAL
COURT SITTING THEREIN AS THE COLLATERAL AGENT MAY ELECT IN ITS SOLE DISCRETION
AND CONSENTS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS WITH RESPECT TO ANY
SUCH ACTION.

 

(d)         EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE
MANNER PROVIDED FOR NOTICES IN SECTION 9.7 HEREOF EXCLUDING SERVICE OF PROCESS
BY MAIL.  NOTHING IN THIS SECURITY

 

32

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

 

AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

(e)          EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS SECURITY AGREEMENT.  EACH PARTY HERETO (i) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS SECURITY AGREEMENT BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.9.

 

SECTION 9.10  Severability of Provisions.  Any provision hereof which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.

 

SECTION 9.11  Execution in Counterparts; Effectiveness.  This Security Agreement
may be executed in any number of counterparts (and by different parties hereto
on different counterparts), each of which shall constitute an original, but all
of which when taken together shall constitute a single contract.  Delivery of an
executed counterpart of a signature page of this Security Agreement by facsimile
or other electronic transmission (including “.pdf” or “.tif”) shall be as
effective as delivery of a manually executed counterpart of this Security
Agreement.

 

SECTION 9.12  No Release.  Nothing set forth in this Security Agreement shall
relieve any Grantor from the performance of any term, covenant, condition or
agreement on such Grantor’s part to be performed or observed under or in respect
of any of the Collateral or from any liability to any Person under or in respect
of any of the Collateral or shall impose any obligation on the Collateral Agent
or any other Secured Party to perform or observe any such term, covenant,
condition or agreement on such Grantor’s part to be so performed or observed or
shall impose any liability on the Collateral Agent or any other Secured Party
for any act or omission on the part of such Grantor relating thereto or for any
breach of any representation or warranty on the part of such Grantor contained
in this Security Agreement, the Credit Agreement or the other Loan Documents, or
under or in respect of the Collateral or made in connection herewith or
therewith.  The obligations of each Grantor contained in this Section 9.12 shall
survive the termination hereof and the discharge of such Grantor’s other
obligations under this Security Agreement, the Credit Agreement and the other
Loan Documents.

 

SECTION 9.13  Obligations Absolute.  All obligations of each Grantor hereunder
shall be absolute and unconditional irrespective of:

 

(a)         any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of any Grantor;

 

(b)         any lack of validity or enforceability of the Credit Agreement or
any other Loan Document, or any other agreement or instrument relating thereto;

 

33

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

 

(c)          any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations, or any other amendment or
waiver of or any consent to any departure from the Credit Agreement or any other
Loan Document or any other agreement or instrument relating thereto;

 

(d)         any pledge, exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to any departure
from any guarantee, for all or any of the Secured Obligations;

 

(e)          any exercise, non-exercise or waiver of any right, remedy, power or
privilege under or in respect hereof, the Credit Agreement or any other Loan
Document except as specifically set forth in a waiver granted pursuant to the
provisions of Section 9.6 hereof; or

 

(f)           any other circumstances which might otherwise constitute a defense
available to, or a discharge of, any Grantor (other than the termination of this
Security Agreement in accordance with Section 9.5(a) hereof).

 

SECTION 9.14  Intercreditor Agreement.

 

(a)         This Security Agreement and the Liens granted to the Collateral
Agent pursuant to this Security Agreement or any other Loan Documents in any
Collateral and the exercise of any right or remedy with respect to any
Collateral hereunder or any other Loan Document are subject to the provisions of
the Intercreditor Agreement.  In the event of any inconsistency between the
terms of this Security Agreement and the terms of the Intercreditor Agreement,
the terms of the Intercreditor Agreement shall control.

 

(b)         Notwithstanding anything herein to the contrary, prior to the
Discharge of ABL Debt (as defined in the Intercreditor Agreement), (i) the
requirements of this Security Agreement to deliver Collateral, or control
thereof, to the Collateral Agent or register the Collateral Agent as the
registered owner of any Collateral shall be deemed satisfied by delivery of such
Collateral, or control thereof, to, or the registration of such Collateral in
the name of, the ABL Collateral Agent and (ii) the Collateral Agent may exercise
all remedies of the Collateral Agent hereunder in accordance with Section 3.1 of
the Intercreditor Agreement.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

34

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IN WITNESS WHEREOF, the Grantors and the Collateral Agent have caused this
Security Agreement to be duly executed and delivered by their duly authorized
officers as of the date first above written.

 

 

BORROWER

 

 

 

SUPERVALU INC.

 

 

 

 

By:

 

 

Name:

 Sherry M. Smith

 

Title:

Executive Vice President and Chief Financial Officer

 

 

 

ADVANTAGE LOGISTICS - SOUTHEAST, INC.

 

EASTERN REGION MANAGEMENT CORPORATION

 

FF ACQUISITION, L.L.C.

 

FOODARAMA LLC

 

RICHFOOD, INC.

 

RICHFOOD HOLDINGS, INC.

 

SHOP ‘N SAVE ST. LOUIS, INC.

 

SHOP ‘N SAVE WAREHOUSE FOODS, INC.

 

SHOPPERS FOOD WAREHOUSE CORP.

 

SUPER RITE FOODS, INC.

 

SUPERVALU HOLDINGS, INC.

 

SUPERVALU HOLDINGS - PA LLC

 

 

By: SUPERVALU Holdings, Inc., its sole member

 

SUPERVALU PHARMACIES, INC.

 

SUPERVALU TRANSPORTATION, INC.

 

SUPERVALU TTSJ, INC.

 

W. NEWELL & CO., LLC

 

 

 

 

By:

 

 

Name:

Sherry M. Smith

 

Title:

Vice President

 

 

 

CHAMPLIN 2005 L.L.C.

 

 

By: SUPERVALU INC., its sole member

 

 

 

 

By:

 

 

Name: 

Sherry M. Smith

 

Title:

Executive Vice President and Chief Financial Officer

 

Signature Page of Term Loan Security Agreement

 

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

 

 

MORAN FOODS, LLC

 

 

 

By:

 

 

Name:

Santiago Roces

 

Title:

Chief Executive Officer

 

Signature Page of Term Loan Security Agreement

 

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

 

 

SAVE-A-LOT TYLER GROUP, LLC

 

 

 

 

By:

 

 

Name: 

Sherry M. Smith

 

Title:

Senior Vice President, Finance, Treasurer

 

 

 

GUARANTORS:

 

 

 

BUTSON’S ENTERPRISES, INC.

 

RICHFOOD PROCUREMENT, L.L.C.

 

SCOTT’S FOOD STORES, INC.

 

SFW HOLDING CORP.

 

SFW LICENSING CORP.

 

SUPERMARKET OPERATORS OF AMERICA INC.

 

SVH REALTY, INC.

 

 

 

 

By:

 

 

Name: 

Sherry M. Smith

 

Title:

Vice President

 

Signature Page of Term Loan Security Agreement

 

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

 

 

GOLDMAN SACHS BANK USA, as Collateral Agent

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Signature Page of Term Loan Security Agreement

 

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

 

EXHIBIT 1

 

[Form of]

 

SECURITIES PLEDGE AMENDMENT

 

This Securities Pledge Amendment, dated as of                        , 201  , is
delivered pursuant to Section 5.1 of that certain Security Agreement (as
amended, amended and restated, restated, supplemented or otherwise modified from
time to time, the “Security Agreement;” capitalized terms used but not otherwise
defined herein shall have the meanings assigned to such terms in the Security
Agreement), dated as of March 21, 2013, made by SUPERVALU INC., a Delaware
corporation, as borrower (the “Borrower”), and the Guarantors party thereto from
time to time (the “Guarantors”), as pledgors, assignors and debtors (the
Borrower, together with the Guarantors, in such capacities and together with any
successors in such capacities, the “Grantors” and, each, a “Grantor”), in favor
of GOLDMAN SACHS BANK USA, having an office at 6031 Connection Drive, Irving,
Texas 75039, in its capacity as collateral agent for the Secured Parties, as
pledgee, assignee and secured party (in such capacities, and together with any
successors in such capacities, the “Collateral Agent”).  The undersigned hereby
agrees that this Securities Pledge Amendment may be attached to the Security
Agreement and that the Intercompany Notes listed on this Securities Pledge
Amendment shall be deemed to be and shall become part of the Collateral and
shall secure all Secured Obligations.

 

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

 

INTERCOMPANY NOTES

 

ISSUES

 

PRINCIPAL 
AMOUNT

 

DATE OF 
ISSUANCE

 

INTEREST 
RATE

 

MATURITY 
DATE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[                                                                    ],

 

 

as Grantor

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

AGREED TO AND ACCEPTED:

 

 

 

 

 

GOLDMAN SACHS BANK USA, as Collateral Agent

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

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

 

SCHEDULE I

 

Intercompany Notes

 

ISSUER

 

PRINCIPAL 
AMOUNT

 

DATE OF 
ISSUANCE

 

INTEREST 
RATE

 

MATURITY 
DATE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

SCHEDULE 3.3

 

Filings, Registrations and Recordings

 

Name of Company

 

UCC-1 Financing 
Statement Filing 
Office

 

Intellectual Property 
Security Interests
Filing Office

SUPERVALU INC.

 

Delaware

 

TBD

Advantage Logistics - Southeast, Inc.

 

Alabama

 

TBD

Butson’s Enterprises, Inc.

 

New Hampshire

 

TBD

Champlin 2005 L.L.C.

 

Delaware

 

TBD

Eastern Region Management Corporation

 

Virginia

 

TBD

FF Acquisition, L.L.C.

 

Virginia

 

TBD

Foodarama LLC

 

Delaware

 

TBD

Moran Foods, LLC

 

Missouri

 

TBD

Richfood Holdings, Inc.

 

Delaware

 

TBD

Richfood, Inc.

 

Virginia

 

TBD

Richfood Procurement, L.L.C.

 

Virginia

 

TBD

Save-A-Lot Tyler Group, LLC

 

Missouri

 

TBD

Scott’s Food Stores, Inc.

 

Indiana

 

TBD

SFW Holding Corp.

 

Delaware

 

TBD

SFW Licensing Corp.

 

Delaware

 

TBD

Shop ‘N Save St. Louis, Inc.

 

Missouri

 

TBD

Shop ‘N Save Warehouse Foods, Inc.

 

Missouri

 

TBD

Shoppers Food Warehouse Corp.

 

Ohio

 

TBD

Super Rite Foods, Inc.

 

Delaware

 

TBD

Supermarket Operators of America Inc.

 

Delaware

 

TBD

 

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

 

Name of Company

 

UCC-1 Financing 
Statement Filing 
Office

 

Intellectual Property 
Security Interests
Filing Office

SUPERVALU Holdings, Inc.

 

Missouri

 

TBD

SUPERVALU Holdings-PA LLC

 

Pennsylvania

 

TBD

SUPERVALU Pharmacies, Inc.

 

Minnesota

 

TBD

Supervalu Transportation, Inc.

 

Minnesota

 

TBD

Supervalu TTSJ, Inc.

 

Delaware

 

TBD

SVH Realty, Inc.

 

Delaware

 

TBD

W. Newell & Co., LLC

 

Delaware

 

TBD

 

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

 

SCHEDULE 3.4(a)

 

Instruments

 

Name of Company

 

Issuer of Instrument

 

Principal Amount 
of Instrument

 

Maturity Date

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

SCHEDULE 4.3(a)

 

Other Legal and Fictitious Names, Mergers, Consolidations, Acquisitions

 

I. Legal and Fictitious Names.  During the past three years, each Company has
used the following trade name(s) and/or trade style(s):

 

Company

 

Trade Name/Divisions

 

 

 

 

 

 

 

 

 

 

II. Changes in Names, Jurisdiction of Organization or Corporate Structure. 
Except as set forth below, no Company has changed its name, jurisdiction of
organization or its corporate structure in any way (e.g. by merger,
consolidation, change in corporate form, change in jurisdiction of organization
or otherwise) within the past three years:

 

Date of Change

 

Description of Change

 

 

 

 

 

 

 

 

 

 

III. Acquisitions of Equity Interests or Assets.  Except as set forth below, no
Company has acquired the controlling equity interests of another entity or
substantially all the assets of another entity within the past three years:

 

Date of Acquisition

 

Description of Acquisition

 

 

 

 

 

 

 

 

 

 

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

 

ANNEX 1 TO SECURITY AGREEMENT

FORM OF JOINDER

 

JOINDER NO.         , dated as of                                (this
“Joinder”), to that certain Security Agreement, dated as of March 21, 2013 (as
amended, amended and restated, supplemented, or otherwise modified from time to
time, the “Security Agreement”), by SUPERVALU INC., a Delaware corporation
having an office at 7075 Flying Cloud Drive, Eden Prairie, MN, as borrower (the
“Borrower”), and the guarantors listed on the signature pages thereto (the
“Original Guarantors”) and the other guarantors thereafter party thereto by
execution of a joinder agreement (the “Additional Guarantors” and, together with
the Original Guarantors, the “Guarantors”), as pledgors, assignors and debtors
(the Borrower, together with the Guarantors, in such capacities and together
with any successors in such capacities, collectively, the “Grantors” and, each,
a “Grantor”), in favor of GOLDMAN SACHS BANK USA, in its capacity as collateral
agent for the Secured Parties, as pledgee, assignee and secured party (in such
capacities, and together with any successors in such capacities, the “Collateral
Agent”).

 

W I T N E S S E T H:

 

WHEREAS, pursuant to that certain Term Loan Credit Agreement, dated as of
March 21, 2013 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower, the
Guarantors party thereto, the Lenders party thereto and the Collateral Agent,
the Lenders have agreed to make certain financial accommodations available to
the Borrower from time to time pursuant to the terms and conditions thereof; and

 

WHEREAS, initially capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Security Agreement
or, if not defined therein, in the Credit Agreement; and

 

WHEREAS, Grantors have entered into the Security Agreement in order to induce
the Lenders to make certain financial accommodations to the Borrower; and

 

WHEREAS, pursuant to Section 5.12 of the Credit Agreement and Section 4.12 of
the Security Agreement, certain Subsidiaries of the Grantors, must execute and
deliver certain Loan Documents, including the Security Agreement, and the
joinder to the Security Agreement by the undersigned new Grantor or Grantors
(collectively, the “New Grantors”) may be accomplished by the execution of this
Joinder in favor of the Collateral Agent, for the benefit of the Collateral
Agent and the Secured Parties; and

 

WHEREAS, each New Grantor (a) is a direct or indirect Subsidiary of [Name of
Loan Party] and, as such, will benefit by virtue of the financial accommodations
extended to the Borrower by the Secured Parties and (b) by becoming a Loan Party
will benefit from certain rights granted to the Loan Parties pursuant to the
terms of the Loan Documents.

 

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

 

NOW, THEREFORE, for and in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each New Grantor hereby agrees as follows:

 

SECTION 1.         In accordance with Section 4.12 of the Security Agreement,
each New Grantor, by its signature below, becomes a “Grantor” under the Security
Agreement with the same force and effect as if originally named therein as a
“Grantor” and each New Grantor hereby (a) agrees to all of the terms and
provisions of the Security Agreement applicable to it as a “Grantor” thereunder
and (b) represents and warrants that the representations and warranties made by
it as a “Grantor” thereunder are true and correct in all material respects
(except that such materiality qualifier shall not be applicable to any
representations and warranties that are already qualified or modified by
materiality in the text thereof) on and as of the date hereof.  In furtherance
of the foregoing, each New Grantor does hereby unconditionally grant, assign,
and pledge to the Collateral Agent, for the benefit of the Secured Parties, to
secure the Secured Obligations, a continuing security interest in and to all of
such New Grantor’s right, title and interest in and to the Collateral.  The
Schedules attached hereto supplement the Schedules previously delivered by the
Existing Grantors and shall be deemed a part thereof for all purposes of the
Security Agreement.  Each reference to a “Grantor” in the Security Agreement
shall be deemed to include each New Grantor.  The Security Agreement is
incorporated herein by reference.  Each New Grantor authorizes the Collateral
Agent at any time and from time to time to file, transmit, or communicate, as
applicable, financing statements and amendments thereto (a) describing the
Collateral that contain any information required by part 5 of Article 9 of the
UCC for the sufficiency or filing office acceptance.  Each New Grantor also
hereby ratifies any and all financing statements or amendments previously filed
by the Collateral Agent in any jurisdiction in connection with the Loan
Documents.

 

SECTION 2.         Each New Grantor represents and warrants to the Collateral
Agent, the Secured Parties that this Joinder has been duly executed and
delivered by such New Grantor and constitutes its legal, valid, and binding
obligation, enforceable against it in accordance with its terms, except as
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium, or other similar laws affecting creditors’
rights generally and general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).

 

SECTION 3.         This Joinder is a Loan Document.  This Joinder may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same Joinder.  Delivery of an executed counterpart of this Joinder by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Joinder.  Any
party delivering an executed counterpart of this Joinder by telefacsimile or
other electronic method of transmission also shall deliver an original executed
counterpart of this Joinder but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Joinder.

 

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

 

SECTION 4.         The Security Agreement, as supplemented hereby, shall remain
in full force and effect.

 

SECTION 5.         THE VALIDITY OF THIS JOINDER, THE
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF, AND THE RIGHTS OF THE
PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO
SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.

 

SECTION 6.         EACH NEW GRANTOR IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT
REFERRED TO IN SECTION 7.  EACH NEW GRANTOR HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM
TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT

 

SECTION 7.         EACH NEW GRANTOR AGREES THAT ANY ACTION COMMENCED BY ANY NEW
GRANTOR ASSERTING ANY CLAIM OR COUNTERCLAIM ARISING UNDER OR IN CONNECTION WITH
THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT SOLELY IN A
COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY OR ANY FEDERAL COURT
SITTING THEREIN AS THE COLLATERAL AGENT MAY ELECT IN ITS SOLE DISCRETION AND
CONSENTS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS WITH RESPECT TO ANY SUCH
ACTION.

 

SECTION 8.         TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE
COLLATERAL AGENT AND EACH NEW GRANTOR HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
JOINDER OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT
CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS.  THE COLLATERAL AGENT AND EACH NEW GRANTOR REPRESENT THAT EACH
HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  IN THE EVENT OF
LITIGATION, A COPY OF THIS JOINDER MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL
BY THE COURT.

 

[Signature Pages Follow]

 

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

 

IN WITNESS WHEREOF, the parties hereto have caused this Joinder to the Security
Agreement to be executed and delivered as of the day and year first above
written.

 

NEW GRANTORS:

[NAME OF NEW GRANTOR]

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

[NAME OF NEW GRANTOR]

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

 

COLLATERAL AGENT:

GOLDMAN SACHS BANK USA

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

F-1

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

 

Exhibit G
to the Credit Agreement

 

FORM OF FACILITY GUARANTY

 

(See attached)

 

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

 

EXECUTION COPY

 

TERM LOAN GUARANTY

 

TERM LOAN GUARANTY (this “Guaranty”), dated as of March 21, 2013, by each of the
Subsidiaries of the Borrower listed on the signature pages hereto (each such
Person, individually, a “Guarantor” and, collectively, the “Guarantors”) in
favor of (a) Goldman Sachs Bank USA, as administrative (in such capacity,
together with its successors and assigns, the “Administrative Agent”) for its
own benefit and the benefit of the other Secured Parties and (b) the Secured
Parties.

 

W I T N E S S E T H

 

WHEREAS, reference is made to that certain Term Loan Credit Agreement, dated as
of March 21, 2013 (as amended, modified, supplemented or restated hereafter, the
“Credit Agreement”), among SUPERVALU Inc., a Delaware corporation (the
“Borrower”), the Guarantors, the Lenders party thereto (the “Lenders”) and the
Administrative Agent.  Capitalized terms used herein and not defined herein
shall have the meanings assigned to such terms in the Credit Agreement.

 

WHEREAS, the Lenders have agreed to make Loans to the Borrower pursuant to, and
upon the terms and subject to the conditions specified in, the Credit Agreement.

 

WHEREAS, each Guarantor acknowledges that it is an integral part of a
consolidated enterprise and that it will receive direct and indirect benefits
from the availability of the credit facility provided for in the Credit
Agreement and from the making of the Loans by the Lenders.

 

WHEREAS, the obligations of the Lenders to make Loans are conditioned upon,
among other things, the execution and delivery by the Guarantors of a guaranty
in the form hereof.  As consideration therefor, and in order to induce the
Lenders to make Loans, the Guarantors are willing to execute this Guaranty.

 

Accordingly, each Guarantor hereby agrees as follows:

 

SECTION 1.                            Guaranty.  Each Guarantor irrevocably and
unconditionally guaranties, jointly with the other Guarantors and severally, as
a primary obligor and not merely as a surety, the due and punctual payment when
due (whether at the stated maturity, by required prepayment, by acceleration or
otherwise) and performance by the Borrower of all Obligations (collectively, the
“Guaranteed Obligations”), including all such Guaranteed Obligations which shall
become due but for the operation of the Bankruptcy Code.  Each Guarantor further
agrees that the Guaranteed Obligations may be extended or renewed, in whole or
in part, without notice to or further assent from it, and that it will remain
bound upon this Guaranty notwithstanding any extension or renewal of any
Guaranteed Obligation.

 

SECTION 2.                            Guaranteed Obligations Not Affected.  To
the fullest extent permitted by applicable Law, each Guarantor waives
presentment to, demand of payment from, and protest to, any Loan Party of any of
the Guaranteed Obligations, and also waives notice of acceptance of this
Guaranty, notice of protest for nonpayment and all other notices of any kind. 
To the fullest extent permitted by applicable Law, the obligations of each
Guarantor hereunder shall not be affected by (a) the failure of Administrative
Agent or any other Secured Party to assert any claim or demand or to enforce or
exercise any right or remedy against any Loan Party under the provisions of the
Credit Agreement, any other Loan Document or otherwise or against any other
party with respect to any of the Guaranteed Obligations, (b) any rescission,
waiver, amendment or modification of, or any release from, any of the terms or
provisions of this Guaranty, any other Loan Document or any other agreement,
with respect to any Loan

 

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Party or with respect to the Guaranteed Obligations, (c) the failure to perfect
any security interest in, or the release of, any of the Collateral held by or on
behalf of the Administrative Agent or any other Secured Party or (d) the lack of
legal existence of any Loan Party or legal obligation to discharge any of the
Guaranteed Obligations by any Loan Party for any reason whatsoever, including,
without limitation, in any insolvency, bankruptcy or reorganization of any Loan
Party.

 

SECTION 3.                            Security.  Each of the Guarantors hereby
acknowledges and agrees that the Administrative Agent and each of the other
Secured Parties may (a) take and hold security for the payment of this Guaranty
and the Guaranteed Obligations and exchange, enforce, waive and release any such
security, (b) apply such security and direct the order or manner of sale thereof
as they in their sole discretion may determine and (c) release or substitute any
one or more endorsees, the Borrower, other Guarantors or other obligors, in each
case without affecting or impairing in any way the liability of any Guarantor
hereunder.

 

SECTION 4.                            Guaranty of Payment.  Each of the
Guarantors further agrees that this Guaranty constitutes a guaranty of payment
and performance when due of all Guaranteed Obligations and not of collection
and, to the fullest extent permitted by applicable Law, waives any right to
require that any resort be had by the Administrative Agent or any other Secured
Party to any of the Collateral or other security held for payment of the
Guaranteed Obligations or to any balance of any deposit account or credit on the
books of the Administrative Agent or any other Secured Party in favor of any
Loan Party or any other Person or to any other guarantor of all or part of the
Guaranteed Obligations.  Any payment required to be made by the Guarantors
hereunder may be required by the Administrative Agent or any other Secured Party
on any number of occasions and shall be payable to the Administrative Agent, for
the benefit of the Administrative Agent and the other Secured Parties, in the
manner provided in the Credit Agreement.

 

SECTION 5.                            No Discharge or Diminishment of Guaranty. 
The obligations of each Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Guaranteed Obligations), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or set-off,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of the Guaranteed Obligations or otherwise. 
Without limiting the generality of the foregoing, the Guaranteed Obligations of
each Guarantor hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Administrative Agent or any other Secured Party
to assert any claim or demand or to enforce any remedy under this Guaranty, the
Credit Agreement, any other Loan Document or any other agreement, by any waiver
or modification of any provision of any thereof, by any default, failure or
delay, willful or otherwise, in the performance of the Guaranteed Obligations,
or by any other act or omission that may or might in any manner or to any extent
vary the risk of any Guarantor or that would otherwise operate as a discharge of
any Guarantor as a matter of law or equity (other than the indefeasible payment
in full in cash of the Guaranteed Obligations).

 

SECTION 6.                            Defenses of Loan Parties Waived.  To the
fullest extent permitted by applicable Law, each of the Guarantors waives any
defense based on or arising out of any defense of any Loan Party or the
unenforceability of the Guaranteed Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of any Loan Party, other
than the indefeasible payment in full in cash of the Guaranteed Obligations. 
Each Guarantor hereby acknowledges that the Administrative Agent and the other
Secured Parties may, at their election, foreclose on any security held by one or
more of them by one or more judicial or nonjudicial sales, accept an assignment
of any such security in lieu of foreclosure, compromise or adjust any part of
the Guaranteed Obligations, make any other accommodation with any Loan Party, or
exercise any other right or remedy available to them against any Loan Party,
without affecting or impairing in any way the liability of any Guarantor
hereunder except to the extent that the

 

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Guaranteed Obligations have been indefeasibly paid in full in cash. Pursuant to,
and to the extent permitted by, applicable Law, each of the Guarantors waives
any defense arising out of any such election and waives any benefit of and right
to participate in any such foreclosure action, even though such election
operates, pursuant to applicable Law, to impair or to extinguish any right of
reimbursement or subrogation or other right or remedy of such Guarantor against
any Loan Party, as the case may be, or any security.  Each Guarantor agrees that
it shall not assert any claim in competition with the Administrative Agent or
any other Secured Party in respect of any payment made hereunder in any
bankruptcy, insolvency, reorganization or any other proceeding.

 

SECTION 7.                            Agreement to Pay; Subordination.  In
furtherance of the foregoing and not in limitation of any other right that the
Administrative Agent or any other Secured Party has at law or in equity against
any Guarantor by virtue hereof, upon the failure of any Loan Party to pay any
Guaranteed Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will forthwith pay, or cause to be paid, to
the Administrative Agent or such other Secured Party as designated thereby in
cash the amount of such unpaid Guaranteed Obligations.  Upon payment by any
Guarantor of any sums to the Administrative Agent or any other Secured Party as
provided above, all rights of such Guarantor against any Loan Party arising as a
result thereof by way of right of subrogation, contribution, reimbursement,
indemnity or otherwise shall in all respects be subordinate and junior in right
of payment to the prior indefeasible payment in full in cash of all the
Guaranteed Obligations.  In addition, any indebtedness of the Borrower or any
other Loan Party now or hereafter held by any Guarantor is hereby subordinated
in right of payment to the prior indefeasible payment in full in cash of all of
the Guaranteed Obligations.  Notwithstanding the foregoing, prior to the
occurrence of an Event of Default, the Borrower or any other Loan Party may make
payments to any Guarantor on account of any such indebtedness. After the
occurrence and during the continuance of an Event of Default, none of the
Guarantors will demand, sue for, or otherwise attempt to collect any such
indebtedness until the indefeasible payment in full in cash of the Guaranteed
Obligations and termination or expiration of the Commitments.  If any amount
shall erroneously be paid to any Guarantor on account of (a) such subrogation,
contribution, reimbursement, indemnity or similar right or (b) any such
indebtedness of any Loan Party, such amount shall be held in trust for the
benefit of the Secured Parties and shall forthwith be paid to the Administrative
Agent to be credited against the payment of the Guaranteed Obligations, whether
matured or unmatured, in accordance with the terms of the Credit Agreement.

 

SECTION 8.                            Limitation on Guaranty of Guaranteed
Obligations.

 

(a)         In any action or proceeding with respect to any Guarantor involving
any state corporate law, the Bankruptcy Code or any other state or federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, including, without limitation, the Uniform Fraudulent
Conveyance Act, Uniform Fraudulent Transfer Act or any similar foreign, federal
or state law to the extent applicable to the guaranty set forth herein and the
obligations of each Guarantor hereunder, if the obligations of such Guarantor
under Section 1 hereof would otherwise be determined to be void, invalid or
unenforceable, or subordinated to the claims of any other creditors, in such
action or proceeding on account of the amount of its liability under Section 1,
then, notwithstanding any other provision hereof to the contrary, the amount of
such liability shall, without any further action by such Guarantor, any Lender,
Administrative Agent or any other Person, be automatically limited and reduced
to the highest amount which is valid and enforceable and not subordinated to the
claims of other creditors as determined in such action or proceeding.

 

(b)         In such circumstances, to effectuate the foregoing, the amount of
the liability of each Guarantor hereunder shall be determined, unless such
Guarantor is a borrower under the ABL Facility, after taking into account such
Guarantor’s liability under the ABL Facility based on the fraction, the

 

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numerator of which is the then outstanding total liability under the ABL
Facility and the denominator of which is the sum of the then outstanding total
liability under the ABL Facility and the then outstanding total liability under
the Term Facility as of the applicable date of determination.  To the fullest
extent permitted by applicable Law, this Section 8(b) hereof shall be for the
benefit solely of creditors and representatives of creditors of each Guarantor
and not for the benefit of such Guarantor or the holders of any Equity Interest
in such Guarantor.  Each Guarantor agrees that Obligations may at any time and
from time to time be incurred or permitted in an amount exceeding the maximum
liability of such Guarantor under this Section 8 without impairing the guaranty
contained in Section 1 hereof or affecting the rights and remedies of any
Secured Party hereunder.

 

SECTION 9.                            Information.  Each of the Guarantors
assumes all responsibility for being and keeping itself informed of each Loan
Party’s financial condition and assets, and of all other circumstances bearing
upon the risk of nonpayment of the Guaranteed Obligations and the nature, scope
and extent of the risks that such Guarantor assumes and incurs hereunder, and
agrees that none of the Administrative Agent or the other Secured Parties will
have any duty to advise any of the Guarantors of information known to it or any
of them regarding such circumstances or risks.

 

SECTION 10.                     Termination; Release.

 

(a)         This Guaranty (i) shall terminate upon termination of the
Commitments and payment in full of the Guaranteed Obligations (other than
contingent, unasserted indemnification obligations) and (ii) shall continue to
be effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of any Guaranteed Obligation is rescinded or must otherwise be
restored by any Secured Party or any Guarantor upon the bankruptcy or
reorganization of any Loan Party or otherwise.

 

(b)         A Guarantor shall be released from its obligations under this
Guaranty if such Person ceases to be a Subsidiary as a result of a transaction
permitted under the Loan Documents.

 

SECTION 11.                     Binding Effect; Several Agreement; Assignments. 
Whenever in this Guaranty any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of such party,
and all covenants, promises and agreements by or on behalf of the Guarantors
that are contained in this Guaranty shall bind and inure to the benefit of each
of the Guarantors and its respective successors and assigns.  This Guaranty
shall be binding upon each of the Guarantors and their respective successors and
assigns, and shall inure to the benefit of the Administrative Agent and the
other Secured Parties, and their respective successors and assigns, except that
no Guarantor shall have the right to assign or transfer its rights or
obligations hereunder or any interest herein (and any such attempted assignment
or transfer shall be void), except as expressly permitted by this Guaranty or
the Credit Agreement.  This Guaranty shall be construed as a separate agreement
with respect to each Guarantor and may be amended, modified, supplemented,
waived or released with respect to any Guarantor without the approval of any
other Guarantor and without affecting the obligations of any other Guarantor
hereunder.

 

SECTION 12.                     Waivers; Amendment.

 

(a)         The rights, remedies, powers, privileges, and discretions of the
Administrative Agent hereunder and under applicable Law (herein, the
“Administrative Agent’s Rights and Remedies”) shall be cumulative and not
exclusive of any rights or remedies which they would otherwise have.  No delay
or omission by the Administrative Agent in exercising or enforcing any of the
Administrative Agent’s Rights and Remedies shall operate as, or constitute, a
waiver thereof.  No waiver by the Administrative Agent of any Event of Default
or of any default under any other agreement shall operate as a waiver of any
other default hereunder or under any other agreement.  No single or partial
exercise of any of the Administrative Agent’s Rights or Remedies, and no express
or implied agreement or transaction of

 

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

 

whatever nature entered into between the Administrative Agent and any Person, at
any time, shall preclude the other or further exercise of the Administrative
Agent’s Rights and Remedies.  No waiver by the Administrative Agent of any of
the Administrative Agent’s Rights and Remedies on any one occasion shall be
deemed a waiver on any subsequent occasion, nor shall it be deemed a continuing
waiver.  The Administrative Agent’s Rights and Remedies may be exercised at such
time or times and in such order of preference as the Administrative Agent may
determine. The Administrative Agent’s Rights and Remedies may be exercised
without resort or regard to any other source of satisfaction of the Guaranteed
Obligations.  No waiver of any provisions of this Guaranty or any other Loan
Document or consent to any departure by any Guarantor therefrom shall in any
event be effective unless the same shall be permitted by Section 12(b) hereof,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given.  No notice to or demand on any Guarantor in
any case shall entitle such Guarantor or any other Guarantor to any other or
further notice or demand in the same, similar or other circumstances.

 

(b)         Neither this Guaranty nor any provision hereof may be waived,
amended or modified except pursuant to a written agreement entered into between
the Administrative Agent and a Guarantor or the Guarantors with respect to whom
such waiver, amendment or modification is to apply, subject to any consent
required in accordance with Section 9.08 of the Credit Agreement.

 

SECTION 13.                     Copies and Facsimiles.  This instrument and all
documents which have been or may be hereinafter furnished by the Guarantors to
the Administrative Agent may be reproduced by the Administrative Agent by any
photographic, microfilm, xerographic, digital imaging, or other process. Any
such reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made in the regular course of
business). Any facsimile or other electronic transmission which bears proof of
transmission shall be binding on the party which or on whose behalf such
transmission was initiated and likewise so admissible in evidence as if the
original of such facsimile or other electronic transmission had been delivered
to the party which or on whose behalf such transmission was received.

 

SECTION 14.                     Governing Law.  THIS GUARANTY AND ANY CLAIM,
CONTROVERSY, DISPUTE OR OTHER CAUSE OF ACTION (WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS GUARANTY AND
THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).

 

SECTION 15.                     Notices.  All communications and notices
hereunder shall (except as otherwise expressly permitted herein) be in writing
and given as provided in Section 9.01 of the Credit Agreement; provided, that
communications and notices to the Guarantors may be delivered to the Borrower on
behalf of each of the Guarantors.

 

SECTION 16.                     Survival of Agreement; Severability.

 

(a)         All covenants, agreements, indemnities, representations and
warranties made by the Guarantors herein and in the certificates or other
instruments delivered in connection with or pursuant to this Guaranty, the
Credit Agreement or any other Loan Document shall be considered to have been
relied upon by the Administrative Agent and the other Secured Parties and shall
survive the execution and delivery of this Guaranty, the Credit Agreement and
the other Loan Documents and the making of any Loans by the Lenders, regardless
of any investigation made by the Administrative Agent or any other

 

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

 

Secured Party or on their behalf and notwithstanding that the Administrative
Agent or other Secured Party may have had notice or knowledge of any Default or
Event of Default or incorrect representation or warranty at the time any credit
is extended, and shall continue in full force and effect until terminated as
provided in Section 10 hereof.

 

(b)         Any provision of this Guaranty held to be invalid, illegal or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity, illegality or unenforceability without
affecting the validity, legality and enforceability of the remaining provisions
hereof, and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.

 

SECTION 17.                     Counterparts.  This Guaranty may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together shall
constitute a single contract.  Delivery of an executed signature page to this
Guaranty by facsimile transmission or by other electronic transmission
(including “.pdf” or “.tif”) shall be as effective as delivery of a manually
signed counterpart of this Guaranty.

 

SECTION 18.                     Rules of Interpretation.  The rules of
interpretation specified in Section 1.02 of the Credit Agreement shall be
applicable to this Guaranty.

 

SECTION 19.                     Jurisdiction; Consent to Service of Process.

 

(a)         Each of the Guarantors hereby irrevocably and unconditionally
submits, for itself and its property, to the exclusive jurisdiction of any New
York State court or Federal court of the United States of America sitting in New
York County, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Guaranty or the other Loan
Documents, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent permitted by law, in such Federal court.  Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.  Nothing in this Guaranty shall
affect any right that the Administrative Agent, the Collateral Agent or any
other Secured Party may otherwise have to bring any action or proceeding
relating to this Guaranty or the other Loan Documents against a Guarantor or its
properties in the courts of any jurisdiction if required to realize upon the
Collateral as determined in good faith by the Person bringing such action or
proceeding.

 

(b)         Each of the Guarantors hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Guaranty or the other
Loan Documents in any New York State or Federal court.  Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.

 

(c)          Each party to this Guaranty irrevocably consents to service of
process in the manner provided for notices in Section 17 hereof.  Nothing in
this Guaranty will affect the right of any party to this Guaranty to serve
process in any other manner permitted by law.

 

SECTION 20.                     Waiver of Jury Trial.  EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY.  EACH PARTY HERETO

 

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(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT THE IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
GUARANTY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 20.

 

 [Signature Pages Follow]

 

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IN WITNESS WHEREOF, the Guarantors have duly executed this Guaranty as of the
day and year first above written.

 

GUARANTORS:

 

[                                ]

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

[                                ]

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

[                                ]

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

Signature Page to Term Loan Guaranty

 

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ACKNOWLEDGED AND AGREED

 

as of the date first above written:

 

 

 

 

 

GOLDMAN SACHS BANK USA,

 

as Administrative Agent

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

G-1

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Exhibit H
to the Credit Agreement

 

FORM OF MORTGAGE

 

(See attached)

 

1

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

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING13

 

from

 

[NAME OF MORTGAGOR], Mortgagor

 

to

 

GOLDMAN SACHS BANK USA,

 

as collateral agent, Mortgagee

 

DATED AS OF                            , 2013

 

EFFECTIVE AS OF                            , 2013

 

After recording, please return to:

 

Latham & Watkins LLP
885 Third Ave.
New York, NY 10022

 

ATTN:  Mark Leskiw (049646-0118)

 

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13  This form’s riders contain provisions to be included in the mortgage if the
mortgage is with respect to a leasehold.

 

2

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

 

[INSERT STATE]

 

THIS14 MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE
FILING, dated as of                          , 2013, and effective as of
                         , 2013, is made by [NAME OF MORTGAGOR], a [INSERT STATE
OF ORGANIZATION AND TYPE OF ENTITY OF MORTGAGOR] (“Mortgagor”), whose address is
c/o SUPERVALU INC., 7075 Flying Cloud Drive, Eden Prairie, Minnesota 55344,
Attention:  Vice President, Business Law, to GOLDMAN SACHS BANK USA, as
collateral agent (in such capacity and together with its successors in such
capacity, “Mortgagee”), whose address is [c/o Goldman Sachs Group, Inc., 6031
Connection Drive, Irving, Texas 75039].  References to this “Mortgage” shall
mean this instrument and any and all renewals, modifications, amendments,
supplements, extensions, consolidations, substitutions, spreaders, and
replacements of this instrument.

 

Background

 

A.                                    SUPERVALU INC., a Delaware corporation
(“Borrower”), and certain of its Affiliates (including Mortgagor) have entered
into the Term Loan Credit Agreement dated as of March 21, 2013 (as the same may
be amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), with several banks and other financial institutions from time to
time parties thereto (the “Lenders”) and Mortgagee.  Capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in the Credit
Agreement.

 

B.                                    Mortgagor has, pursuant to that certain
Term Loan Guaranty (defined as the Facility Guaranty in the Credit Agreement)
dated as of March 21, 2013 (as the same may be amended, supplemented or
otherwise modified from time to time, the “Guaranty”), among other things,
unconditionally guaranteed the Guaranteed Obligations (as defined in the
Guaranty).15

 

 

C.                                    Pursuant and subject to the Credit
Agreement, the Lenders have made, severally and not jointly, certain Loans to
Borrower, and Borrower has agreed to cause Mortgagor to execute and deliver this
Mortgage in connection therewith.

 

Granting Clauses

 

For ten dollars ($10) and other good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged, Mortgagor agrees that to
secure the payment and performance of the following obligations (collectively,
the “Secured Obligations”):

 

(a)                                 the Obligations (as defined in the Credit
Agreement), including, without limitation, (i) the aggregate principal amount of
$1,500,000,000 plus any Incremental Loans made pursuant to Section 2.01(b) of
the Credit Agreement for a total aggregate principal amount including such
Incremental Loans of $1,750,000,000, or so much thereof as may be advanced by
the Lenders as Loans pursuant to the Credit Agreement and as is outstanding from
time to time, together with interest thereon as provided by the Credit Agreement
(including, without limitation, if and to the extent provided by the

 

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14  For a leasehold mortgage, insert Rider A here.

15  For a leasehold mortgage, insert Rider B here as recital “C,” and move the
current recital “C” to a new recital “D.”

 

Property #[      ], [      ] County, [      ]

 

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

 

Credit Agreement, interest accruing after the maturity of the Loans made by each
Lender and interest accruing after the filing of any petition in bankruptcy, or
the commencement of any insolvency, reorganization or like proceeding, relating
to Mortgagor, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding), as evidenced by the Credit Agreement and, if
requested by any Lender as provided by the Credit Agreement, certain promissory
notes (as the same may be amended, supplemented or otherwise modified from time
to time, the “Notes”), (ii) the Guaranteed Obligations, and (iii) all Protective
Advances (as defined below); and

 

(b)                                 the performance and observance of each
obligation, term, covenant and condition to be performed or observed by
Mortgagor under, in connection with or pursuant to the provisions of this
Mortgage;

 

MORTGAGOR HEREBY GRANTS TO MORTGAGEE A LIEN UPON AND A SECURITY INTEREST IN, AND
HEREBY MORTGAGES, GRANTS, ASSIGNS, TRANSFERS, HYPOTHECATES, PLEDGES, CONVEYS AND
SETS OVER TO MORTGAGEE WITH MORTGAGE COVENANTS (TOGETHER WITH POWER OF SALE
THEREOF), all of the following property and rights and interests now owned or
held or subsequently acquired by Mortgagor (collectively, the “Mortgaged
Property”):

 

(A)                               16the parcel(s) of real property described on
Exhibit A attached hereto and made a part hereof (the “Land”), together with all
of the buildings, improvements, and structures now located thereon (the
“Improvements”);

 

(B)                               all the estate, right, title, interest, claim
or demand whatsoever of Mortgagor, in possession or expectancy, in and to the
Land or Improvements or any part thereof;

 

(C)                               all right, title, estate and interest of
Mortgagor in, to and under all easements, rights of way, strips and gores of
land, streets, ways, alleys, passages, sewer rights, waters, water courses,
water and riparian rights, development rights, air rights, mineral rights and
all estates, rights, titles, interests, privileges, licenses, tenements,
hereditaments and appurtenances belonging, relating or appertaining to the
Premises (as defined below), and any reversions, remainders, rents, issues,
profits and revenue thereof and all land lying in the bed of any street, road or
avenue, in front of or adjoining the Premises to the center line thereof;

 

(D)                               all right, title, estate and interest of
Mortgagor in and to all buildings, improvements, structures, additions, and
concessions to, the Land or Improvements, and substitutes and replacements
thereof, subsequently acquired by or released to Mortgagor or constructed,
assembled or placed by Mortgagor on the Land or Improvements, immediately upon
such acquisition, release, construction, assembling or placement, including,
without limitation, any and all building materials whether stored at the Land or
offsite, and, in each such case, without any further mortgage, conveyance,
assignment or

 

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16  For a leasehold mortgage, insert Rider C here, and move the current
subclause “A” to “B,” and shift all subsequent paragraph lettering down
accordingly.

 

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other act by Mortgagor (collectively, the property and rights and interests
described in the foregoing clauses (A) through (D)17, the “Premises”);

 

(E)                                all right, title, estate and interest of
Mortgagor in and to all of the “fixtures” (as defined in the Code, as defined
below) from time to time attached to or contained in the Premises (but only
while attached to or contained in the Premises), including without limitation,
screens, awnings, shades, blinds, curtains, draperies, carpets, rugs, and other
floor coverings, storm doors and windows, heating, electrical, and mechanical
equipment, lighting, switchboards, plumbing, ventilating, air conditioning and
air-cooling apparatus, refrigeration systems, and incinerating equipment,
shelving, escalators, elevators, docks, loading and unloading equipment and
systems, stoves, ranges, laundry equipment, cleaning systems (including window
cleaning apparatus), telephones, communication systems (including satellite
dishes and antennae), computers, sprinkler systems and other fire prevention and
extinguishing apparatus and materials, security systems, motors, engines,
machinery, pipes, pumps, tanks, conduits, appliances, and fittings (together
with, in each case, attachments, components, parts and accessories);

 

(F)                                 all right, title, estate and interest of
Mortgagor in and to all substitutes and replacements of, and all additions,
improvements and concessions to, the aforementioned fixtures, subsequently
acquired by Mortgagor or constructed, assembled or placed by Mortgagor on the
Premises or subsequently attached thereto, immediately upon such acquisition,
construction, attachment, assembling or placement at the Premises (but only
while attached to or contained in the Premises), without any further mortgage,
conveyance, assignment or other act by Mortgagor (all of the foregoing property
described in clauses (E) and (F),18 while attached to or contained in the
Premises, being referred to as the “Fixtures”);

 

(G)                               all right, title, estate and interest of
Mortgagor in, to and under all leases, subleases, underlettings, occupancy
agreements, concession agreements, management agreements, licenses and other
agreements entitling third parties to use or occupy the Premises or any part
thereof, now existing or subsequently entered into by Mortgagor and whether
written or oral and any guaranties of any of the foregoing (collectively, as any
of the foregoing may be amended, restated, extended, renewed or modified from
time to time, the “Leases”), and all rights of Mortgagor in respect of security
deposits thereunder and the right to receive and collect the revenues, income,
rents, issues and profits thereof, together with all other rents, royalties,
issues, profits, revenue, income and other benefits arising from the use and
enjoyment of the Mortgaged Property (collectively, the “Rents”);

 

(H)                              all right, title, estate and interest of
Mortgagor in and to (i) all contracts from time to time executed by Mortgagor or
any manager or agent on its behalf relating to the ownership, construction,
maintenance, repair, operation, management, occupancy, sale, leasing or
financing of the Premises or Fixtures or any part thereof, all agreements
relating to Mortgagor’s sale or lease of any portion of the Premises, and all
agreements

 

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17  For a leasehold mortgage, replace “(D)” with “(E).”

18  For a leasehold mortgage, replace “(E) and (F)” with “(F) and (G).”

 

3

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relating to Mortgagor’s purchase or lease, or option to purchase or lease, of
any property which is adjacent or peripheral to the Premises together with the
right to exercise any such option, and all leases of Fixtures (collectively, the
“Contracts”); (ii) all consents, licenses, permits, variances, building permits,
certificates of occupancy and other governmental approvals relating to
construction, completion, occupancy, use or operation of the Premises or any
part thereof (collectively, the “Permits”); and (iii) all drawings, plans,
specifications and similar or related items relating to the Premises
(collectively, the “Plans”);

 

(I)                                   all right, title, estate and interest of
Mortgagor in and to all books and records and documents relating to the
ownership, construction, maintenance, repair, operation, management, occupancy,
sale, or leasing of the Premises or Fixtures or any part thereof, whether
tangible or electronic, which contain any information relating to any of the
foregoing, to the extent necessary or desirable to sell, transfer or otherwise
realize on any of the other Mortgaged Property (collectively, the “Books and
Records”); and

 

(J)                                   all right, title, estate and interest of
Mortgagor in and to all proceeds (as defined in the Code) of the foregoing,
including without limitation, all proceeds, products, offspring, rents, profits
or receipts, in whatever form, arising from the other Mortgaged Property, and
including, without limitation, (i) cash, instruments and other property
received, receivable or otherwise distributed in respect of or in exchange for
any or all of the Mortgaged Property, (ii) any and all proceeds of the
collection, sale, lease, sublease, concession, exchange, assignment, licensing
or other disposition of, or realization upon, any item or portion of the
Mortgaged Property (including, without limitation, all claims of Mortgagor
against third parties for loss of, damage to, or destruction of, any of the
Mortgaged Property now existing or hereafter arising), (iii) any and all
proceeds of any insurance, indemnity, warranty or guaranty payable to Mortgagor
from time to time with respect to any of the Mortgaged Property, including all
right, title, estate and interest of Mortgagor in and to all unearned premiums
under insurance policies now or subsequently obtained by Mortgagor relating to
the Premises or Fixtures and Mortgagor’s interest in and to all proceeds of any
such insurance policies (including title insurance policies) including the right
to collect and receive such proceeds, subject to the provisions relating to
insurance generally set forth below, (iv) any and all payments (in any form
whatsoever) made or due and payable to Mortgagor from time to time in connection
with the requisition, confiscation, condemnation, seizure or forfeiture of all
or any part of the Mortgaged Property by any Governmental Authority (or any
Person acting under color of Governmental Authority), including all awards and
other compensation, including the interest payable thereon and the right to
collect and receive the same, made for the taking by eminent domain,
condemnation or otherwise, of all or any part of the Premises or any easement or
other right therein, and (v) any and all other amounts from time to time paid or
payable under or from any of the Mortgaged Property, both cash and noncash, of
the foregoing;

 

4

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PROVIDED, HOWEVER, that, notwithstanding anything to the contrary contained in
clauses (A) through (J)19 above, for the avoidance of doubt (and without
implication that such property would otherwise be included), the Lien, security
interest, mortgage, grant, assignment, transfer, hypothecation, pledge,
conveyance and set over created by this Mortgage is not intended to extend to,
shall not extend to, and the term “Mortgaged Property” shall not include, any
Excluded Assets (as defined below), and Mortgagor shall from time to time at the
request of Mortgagee give written notice to Mortgagee identifying in reasonable
detail the Excluded Assets and shall provide to Mortgagee such other information
regarding the Excluded Assets as Mortgagee may reasonably request.

 

For purposes hereof, “Excluded Assets” shall mean the following:

 

(i)                                     any rights or interests in any contract,
agreement, lease, permit, license, charter or license agreement, as such, if
under the terms of such contract, agreement, lease, permit, license, charter or
license agreement, or applicable Law with respect thereto, the valid grant of a
Lien therein to Mortgagee would constitute or result in a breach, termination or
default under such contract, agreement, lease, permit, license, charter or
license agreement and such breach, termination or default has not been or is not
waived or the consent of the other party to such contract, agreement, lease,
permit, license, charter or license agreement has not been or is not otherwise
obtained or under applicable Law such prohibition cannot be waived; provided,
the foregoing exclusion shall in no way be construed (i) to apply if any such
prohibition is unenforceable under Sections 9-406, 9-407 or 9-408 of the Code or
other applicable Law or (ii) so as to limit, impair or otherwise affect
Mortgagee’s unconditional continuing liens in any rights or interests of
Mortgagor in or to monies due or to become due under any such contract, lease,
permit, license, charter or license agreement;

 

(ii)                                  all ABL Priority Collateral; and

 

(iii)                               any checking, savings or other demand
deposit account maintained by any Loan Party and exclusively used (a) for
payroll, payroll taxes and other employee wage and benefit payments to or for
the benefit of any Loan Party’s employees, (b) for the receipt of Medicare and
Medicaid receivables of a Loan Party, (c) to hold proceeds of ABL Priority
Collateral, or (d) for the receipt and deposit of funds of a specific Person
other than a Loan Party, or which a Loan Party is holding in trust or as a
fiduciary for such Person, in each case in a manner permitted under the Credit
Agreement or the other Loan Documents.

 

Notwithstanding the foregoing definition of Excluded Assets, nothing contained
in this Mortgage shall affect the rights of Mortgagee or any other Lender with
respect to any or all of the Excluded Assets as provided for in any other Loan
Document.

 

TO HAVE AND TO HOLD the Mortgaged Property and the rights and privileges hereby
mortgaged unto Mortgagee, its permitted successors and assigns for the uses and
purposes set forth herein, until (i) the Commitments shall have expired or been
terminated, and (ii) the principal of and interest on each Loan and all fees and
other Secured Obligations (other than

 

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19  For a leasehold mortgage, replace “(J)” with “(K).”

 

5

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unasserted contingent indemnification Obligations) shall have been indefeasibly
performed and paid in full in cash.

 

Terms and Conditions

 

Mortgagor further represents, warrants, covenants, and agrees with Mortgagee as
follows:

 

1.                                      Warranty of Title.  Mortgagor warrants
the good and marketable title to the Premises, subject only to the matters that
are set forth in Schedule B of any title insurance policy or policies being
issued to Mortgagee to insure the Lien of this Mortgage and Permitted
Encumbrances under the Credit Agreement (collectively, the “Permitted
Exceptions”) and that Mortgagor has the full power, authority and right to
execute, deliver and perform its obligations under this Mortgage and to
encumber, mortgage, transfer, give, grant, bargain, sell, alienate, enfeoff,
convey, confirm, warrant, pledge, assign and hypothecate the same and that this
Mortgage is and will remain a valid and enforceable first Lien on and security
interest in the Mortgaged Property, subject only to the Permitted Exceptions. 
Mortgagor shall forever warrant, defend and preserve such title and the validity
and priority of the Lien of this Mortgage and shall forever warrant and defend
the same to Mortgagee against the claims of all Persons whomsoever.

 

2.                                      20Payment of Secured Obligations. 
Mortgagor shall pay and perform the Secured Obligations owing by it as and when
due.

 

3.                                      Requirements.  Mortgagor shall comply
with all provisions of the Credit Agreement regarding compliance with the
requirements of Laws, orders, writs, injunctions, and decrees applicable to it
or the Mortgaged Property.

 

4.                                      Payment of Taxes and Other Impositions. 
Mortgagor shall comply with all provisions of the Credit Agreement regarding
payment and discharge of Taxes, assessments, and governmental charges or levies
upon the Mortgaged Property, subject to Mortgagor’s right to contest the same as
set forth therein.

 

5.                                      Insurance.  (a)  Mortgagor shall
(i) maintain or shall cause to be maintained such insurance with respect to it
or the Mortgaged Property as is required pursuant to the Credit Agreement;
(ii) maintain such other insurance with respect to it or the Mortgaged Property
as may be required by applicable Law; and (iii) furnish to Mortgagee, upon
written request, information as to the insurance carried as provided in the
Credit Agreement.

 

(a)                                 Mortgagor promptly shall comply with and
conform to (i) all provisions of each such insurance policy, and (ii) all
requirements of the insurers applicable to Mortgagor or to any of the Mortgaged
Property or to the use, manner of use, occupancy, possession, operation,
maintenance, alteration, or repair of any of the Mortgaged Property.  Mortgagor
shall not use or permit the use of the Mortgaged Property in any manner which
would permit any insurer to cancel any insurance policy or void coverage
required to be maintained by this Mortgage.

 

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20  For leasehold mortgages, make this existing Section 3, insert Rider D here
as Section 2, and shift all subsequent section numbers down accordingly.

 

6

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(b)                                 If the Mortgaged Property, or any part
thereof, shall be destroyed or damaged, Mortgagor (or Borrower) shall give
immediate notice thereof to Mortgagee in accordance with, and to the extent
required by, Section 5.03(i) of the Credit Agreement.  All insurance proceeds
from the Mortgaged Property shall be paid to Mortgagee as and to the extent
required by the Credit Agreement.  Notwithstanding the preceding sentence,
provided that no Event of Default shall have occurred and be continuing,
Mortgagor shall have the right to adjust such loss, and the insurance proceeds
relating to such loss shall be paid over to Mortgagor as and to the extent
required by the Credit Agreement; provided that, Mortgagor shall, promptly after
any such damage, repair all such damage regardless of whether any insurance
proceeds have been received or whether such proceeds, if received, are
sufficient to pay for the costs of repair.  If an Event of Default shall have
occurred and be continuing, Mortgagee shall have the right to adjust such loss
and receive and apply the insurance proceeds to pay the Secured Obligations as
and to the extent required by the Credit Agreement or repair the Mortgaged
Property in its sole and absolute discretion.

 

6.                                      Restrictions on Liens and Encumbrances. 
Except for the Lien of this Mortgage and the Permitted Exceptions, and except as
expressly permitted by the Credit Agreement, Mortgagor shall not further
mortgage, nor otherwise encumber the Mortgaged Property nor create or suffer to
exist any Lien, charge or encumbrance on the Mortgaged Property, or any part
thereof, whether superior or subordinate to the Lien of this Mortgage and
whether recourse or non-recourse.

 

7.                                      Transfer Restrictions.  Mortgagor shall
not sell, transfer, convey, or assign all or any portion of, or any interest in,
the Mortgaged Property except as permitted under the Credit Agreement.

 

8.                                      Maintenance.  Mortgagor shall maintain
or cause to be maintained all the Improvements in good condition and repair,
ordinary wear and tear excepted, and shall not commit or suffer any waste of the
Improvements.  Mortgagor shall repair, restore, replace, or rebuild promptly any
part of the Premises which may be damaged or destroyed by any casualty
whatsoever.

 

9.                                      Condemnation/Eminent Domain.  Mortgagor
(or Borrower) shall notify Mortgagee of the pendency of the commencement of any
action or proceeding for the taking of any interest in the Mortgaged Property in
accordance with, and to the extent required by, Section 5.03(i) of the Credit
Agreement.  If an Event of Default shall have occurred and be continuing,
Mortgagee is hereby authorized and empowered by Mortgagor to settle or
compromise any claim in connection with such condemnation and to receive all
awards and proceeds thereof as provided by the Credit Agreement. 
Notwithstanding the preceding sentence, provided no Event of Default shall have
occurred and be continuing, but subject to the terms and provisions of the
Credit Agreement, Mortgagor shall, at its expense, diligently prosecute any
proceeding relating to such condemnation, settle or compromise any claims in
connection therewith and receive any awards or proceeds thereof.

 

10.                               Leases.  Except as expressly permitted under
the Credit Agreement, Mortgagor shall not lease, sublease, license, or
sublicense all or any portion of, or any interest in, the Mortgaged Property. 
Mortgagor may revise, modify, or amend any Lease without the

 

7

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consent of Mortgagee, provided that the Lease, as modified, is or would be
expressly permitted under the Credit Agreement.

 

11.                               Further Assurances.  Mortgagor agrees to
execute any and all further documents, financing statements, agreements and
instruments, and take all such further actions (including the filing and
recording of financing statements and other documents), that may be required
under any applicable Law, or which Mortgagee may reasonably request, to grant,
preserve, protect or perfect the Lien created or intended to be created by this
Mortgage or the validity or priority of such Lien, all at the expense of
Mortgagor.

 

12.                               Mortgagee’s Right to Perform.  If Mortgagor
fails to perform any of the covenants or agreements of Mortgagor hereunder
(other than with respect to the failure to maintain insurance as required
hereunder, in which case Mortgagee can immediately perform), and such failure
constitutes an Event of Default, without waiving or releasing Mortgagor from any
obligation or default under this Mortgage, Mortgagee may, at any time (but shall
be under no obligation to) pay or perform the same, and the amount or cost
thereof, with interest at the rate provided for in the Credit Agreement, shall
constitute Protective Advances secured by this Mortgage and shall be a Lien on
the Mortgaged Property prior to any right, title to, interest in or claim upon
the Mortgaged Property attaching subsequent to the Lien of this Mortgage.  No
payment or advance of money or performance rendered by Mortgagee under this
Section 1221 shall be deemed or construed to cure any default or Event of
Default or waive any right or remedy of Mortgagee.

 

13.                               Hazardous Material.  Mortgagor shall comply
with all provisions of the Credit Agreement regarding Hazardous Materials and
Environmental Laws with respect to itself and the Mortgaged Property.

 

14.                               Protective Advances.  All Protective Advances
shall:  (a) become part of the Secured Obligations and be secured by this
Mortgage; (b) bear interest at the rate provided for in the Credit Agreement
(commencing from the date that the funds are advanced by or on behalf of
Mortgagee and continuing until Mortgagor has actually repaid such advances in
full), the payment of which interest this Mortgage shall secure; and (c) be
repaid by Mortgagor immediately or upon demand, which obligation shall survive
repayment of all other Obligations or any foreclosure in connection with this
Mortgage.  As used herein, the term “Protective Advance” means any amount that
Mortgagee advances or expends in its sole and absolute discretion to cure or
seek to cure any default or in exercising any remedy of Mortgagee hereunder.

 

15.                               Events of Default.  The occurrence of an Event
of Default under the Credit Agreement shall constitute an Event of Default
hereunder.

 

16.                               Remedies.  (a)  To the extent permitted by
applicable Law, upon the occurrence and during the continuance of any Event of
Default, Mortgagee may, and at the direction of the Required Lenders, shall, in
addition to the other rights and remedies provided for herein, under applicable
Law, under the Credit Agreement and the other Loan Documents, or

 

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

21  For leasehold mortgages, change to “Section 12” to “Section 13.”

 

8

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otherwise available to it (including, to the extent permitted under the Credit
Agreement, declaring amounts secured by this Mortgage to be due and payable, in
whole or in part, whereupon the same shall immediately become due and payable),
immediately take such action, without notice or demand, as it deems advisable to
protect and enforce its rights against Mortgagor and in and to the Mortgaged
Property, including, but not limited to, the following actions, each of which
may be pursued concurrently or otherwise, at such time and in such manner as
Mortgagee may determine, in its sole discretion, without impairing or otherwise
affecting the other rights and remedies of Mortgagee:

 

(i)                                     Mortgagee may, to the extent permitted
by applicable Law, (A) take immediate possession of all of the Mortgaged
Property and take such action as Mortgagee, in its sole judgment, deems
necessary to protect and preserve the Mortgaged Property, (B) institute,
maintain and complete an action of mortgage foreclosure against all or any part
of the Mortgaged Property and cause the Mortgaged Property to be sold in total
or in parts, (C) purchase the Mortgaged Property at foreclosure sale,
(D) enforce any judgment received in connection with the exercise of remedies
under the Credit Agreement or other Loan Documents, (E) sell all or part of the
Mortgaged Property (Mortgagor expressly granting to Mortgagee the power of
sale), or (F) take any other action at law or in equity for the enforcement of
this Mortgage.  Mortgagee may proceed in any such action to final judgment and
execution thereon.

 

(ii)                                  Mortgagee may personally, or by its
agents, attorneys and employees and without regard to the adequacy or inadequacy
of the Mortgaged Property or any other Collateral as security for the Secured
Obligations, to the extent permitted by applicable Law, enter into and upon the
Mortgaged Property and each and every part thereof and exclude Mortgagor and its
agents and employees therefrom without liability for trespass, damage or
otherwise (Mortgagor hereby agreeing to surrender possession of the Mortgaged
Property to Mortgagee upon demand at any such time) and use, operate, manage,
maintain and control the Mortgaged Property and every part thereof.  Following
such entry and taking of possession, Mortgagee shall be entitled, without
limitation, to the extent permitted by applicable Law, (x) to lease all or any
part or parts of the Mortgaged Property for such periods of time and upon such
conditions as Mortgagee may, in its discretion, deem proper, (y) to enforce,
cancel or modify any Lease, and (z) generally to execute, do and perform any
other act, deed, matter or thing concerning the Mortgaged Property as Mortgagee
shall deem appropriate as fully as Mortgagor might do.

 

(iii)                               Mortgagee may, with respect to personal
property included in the Mortgaged Property, exercise all of the applicable
rights and remedies of a secured party under the Code in effect in the state in
which the Premises are located (the “State”).

 

(b)                                 In case of a foreclosure sale, the Premises
may be sold, at Mortgagee’s election, in one parcel or in more than one parcel
and Mortgagee is specifically empowered, (without being required to do so, and
in its sole and absolute discretion) to cause successive sales of portions of
the Mortgaged Property to be held.

 

9

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(c)                                  Except as expressly provided above in this
Section 1622 or elsewhere in this Mortgage, presentment, demand, and protest and
all other notices of any kind are hereby expressly waived.

 

17.                               Sale of the Properties; Application of
Proceeds.  Subject to the requirements of applicable Law, the proceeds or avails
of a foreclosure sale and all moneys received by Mortgagee pursuant to any right
given or action taken under the provisions of this Mortgage shall be applied in
accordance with, and subject to, Section 7.02 of the Credit Agreement.

 

18.                               Right of Mortgagee to Credit Sale.  Upon the
occurrence of any sale made under this Mortgage, whether made under the power of
sale or by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale, Mortgagee may bid for and acquire the Mortgaged Property
or any part thereof.  In lieu of paying cash therefor, Mortgagee may make
settlement for the purchase price by crediting upon the Secured Obligations or
other sums secured by this Mortgage the net sales price after deducting
therefrom the expenses of sale and the cost of the action and any other sums
which Mortgagee is authorized to deduct under this Mortgage.  In such event,
this Mortgage, the Credit Agreement, any Note, the Facility Guaranty and
documents evidencing expenditures secured hereby may be presented to the Person
conducting the sale in order that the amount so used or applied may be credited
upon the Secured Obligations as having been paid.

 

19.                               Appointment of Receiver.  Upon the occurrence
and during the continuance of any Event of Default, Mortgagee may, and at the
direction of the Required Lenders, shall, in addition to the other rights and
remedies provided for herein, under applicable Law or otherwise available to it
as a matter of right and without notice to Mortgagor, unless otherwise required
by applicable Law, and without regard to the adequacy or inadequacy of the
Mortgaged Property or any other collateral as security for the Secured
Obligations or the interest of Mortgagor therein, apply to any court having
jurisdiction to appoint a receiver or receivers or other manager of the
Mortgaged Property, and Mortgagor hereby irrevocably consents to such
appointment and waives notice of any application therefor (except as may be
required by applicable Law).  Any such receiver or receivers shall have all the
usual powers and duties of receivers in like or similar cases and all the powers
and duties of Mortgagee in case of entry as provided in this Mortgage,
including, without limitation and to the extent permitted by applicable Law, the
right to enter into leases of all or any part of the Mortgaged Property, and
shall continue as such and exercise all such powers until the date of
confirmation of sale of the Mortgaged Property unless such receivership is
sooner terminated.

 

20.                               Extension, Release, etc.  (a)  Without
affecting the Lien or charge of this Mortgage upon any portion of the Mortgaged
Property not then or theretofore released as security for the full amount of the
Secured Obligations, Mortgagee may, from time to time and without notice,
release or reconvey, or cause to be released or reconveyed any parcel, portion
or all of the Mortgaged Property in accordance with, and subject to,
Section 9.20 of the Credit Agreement.  [If at any time this Mortgage shall
secure less than all of the principal amount of the Secured Obligations, it is
expressly agreed that any repayments of the principal amount of the

 

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22  For leasehold mortgages, change to “Section 16” to “Section 17.”

 

10

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Secured Obligations shall not reduce the amount of the Lien of this Mortgage
until the Lien amount shall equal the principal amount of the Secured
Obligations outstanding.]23

 

(b)                                 No recovery of any judgment by Mortgagee and
no levy of an execution under any judgment upon the Mortgaged Property or upon
any other property of Mortgagor shall affect the Lien of this Mortgage or any
Liens, rights, powers or remedies of Mortgagee hereunder, and such Liens,
rights, powers and remedies shall continue unimpaired until this Mortgage is
terminated or released in accordance with Section 39.

 

(c)                                  If Mortgagee shall have the right to
foreclose this Mortgage, Mortgagor authorizes Mortgagee at its option to
foreclose the Lien of this Mortgage subject to the rights of any tenants of the
Mortgaged Property.  The failure to make any such tenants parties defendant to
any such foreclosure proceeding and to foreclose their rights will not be
asserted by Mortgagor as a defense to any proceeding instituted by Mortgagee to
collect the Secured Obligations or to foreclose the Lien of this Mortgage.

 

(d)                                 Unless expressly provided otherwise, in the
event that ownership of this Mortgage and title to the Mortgaged Property or any
estate therein shall become vested in the same Person, this Mortgage shall not
merge in such title but shall continue as a valid Lien on the Mortgaged Property
for the amount secured hereby.

 

21.                               Security Agreement under Uniform Commercial
Code.  (a)  It is the intention of the parties hereto that this Mortgage shall
constitute a Security Agreement within the meaning of the Uniform Commercial
Code of the State (the “Code”).  Upon the occurrence and during the continuance
of any Event of Default, Mortgagee may, and at the direction of the Required
Lenders, shall, in addition to the other rights and remedies provided for
herein, under applicable Law or otherwise available to it under the Credit
Agreement and other Loan Documents at Mortgagee’s option either (i) proceed
under the Code and exercise such rights and remedies as may be provided to a
secured party by the Code with respect to all or any portion of the Mortgaged
Property which is personal property (including, without limitation, taking
possession of and selling such property) or (ii) treat such property as real
property and proceed with respect to both the real and personal property
constituting the Mortgaged Property in accordance with Mortgagee’s rights,
powers and remedies with respect to the real property (in which event the
default provisions of the Code shall not apply).  If Mortgagee shall elect to
proceed under the Code, then ten days’ notice of sale of the personal property
shall be deemed reasonable notice and the reasonable expenses of retaking,
holding, preparing for sale, selling and the like incurred by Mortgagee shall
include, but not be limited to, attorneys’ fees and legal expenses.  At
Mortgagee’s request, Mortgagor shall assemble the personal property and make it
available to Mortgagee at a place designated by Mortgagee which is reasonably
convenient to both parties.

 

(a)                                 Mortgagor and Mortgagee agree, to the extent
permitted by applicable Law, that: (i) this Mortgage upon recording or
registration in the real estate records of the proper office shall constitute a
financing statement filed as a “fixture filing” within the meaning of the Code;
(ii) [                      ] is the record owner of the Premises; (iii) the
addresses of Mortgagor

 

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

23  To be deleted in States where no mortgage recording tax is imposed.

 

11

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and Mortgagee are as set forth in the initial paragraph of this Mortgage; and
(iv) the organization identification number of Mortgagor is
[                                  ].

 

(b)                                 Mortgagor, upon request by Mortgagee from
time to time, shall execute, acknowledge and deliver to Mortgagee one or more
separate security agreements, in form reasonably satisfactory to Mortgagee,
covering all or any part of the Mortgaged Property and will further execute,
acknowledge and deliver, or cause to be executed, acknowledged and delivered,
any financing statement, affidavit, continuation statement or certificate or
other document as Mortgagee may reasonably request in order to perfect,
preserve, maintain, continue or extend the security interest under and the
priority of this Mortgage and any such security agreements.  Mortgagor further
agrees to pay to Mortgagee on demand all costs and expenses incurred by
Mortgagee in connection with the preparation, execution, recording, filing and
re-filing of any such document and all reasonable costs and expenses of any
record searches for financing statements Mortgagee shall reasonably require. 
Pursuant to the provisions of the Code, Mortgagor hereby authorizes Mortgagee to
file any such financing and continuation statements as required by the Credit
Agreement.  The filing of any financing or continuation statements in the
records relating to personal property or chattels shall not be construed as in
any way impairing the right of Mortgagee to proceed against any personal
property encumbered by this Mortgage as real property, as set forth above.

 

22.                               Assignment of Rents.  Mortgagor hereby assigns
to Mortgagee the Rents as further security for the payment and performance of
the Secured Obligations, and, to the extent permitted by applicable Law,
Mortgagor grants to Mortgagee the right to enter the Mortgaged Property for the
purpose of collecting the same and to let the Mortgaged Property or any part
thereof, and to apply the Rents on account of the Secured Obligations.  The
foregoing assignment and grant is present and absolute and shall continue in
effect until the Secured Obligations (other than unasserted contingent
indemnification Obligations) are paid in full, but Mortgagee hereby waives the
right to enter the Mortgaged Property for the purpose of collecting the Rents
and Mortgagor shall be entitled to collect, receive, use and retain the Rents
until the occurrence of an Event of Default under this Mortgage; such right of
Mortgagor to collect, receive, use and retain the Rents may be revoked by
Mortgagee upon the occurrence of any Event of Default under this Mortgage by
giving not less than five days’ written notice of such revocation to Mortgagor. 
In the event such notice is given, Mortgagor shall pay over to Mortgagee, or to
any receiver appointed to collect the Rents, any Lease security deposits. 
Mortgagor shall not accept prepayments of installments of Rent to become due for
a period of more than one month in advance (except for security deposits and
estimated payments of percentage rent, if any).

 

23.                               Notices.  All notices, requests, demands and
other communications hereunder shall be given in accordance with the provisions
of Section 9.01 of the Credit Agreement to Mortgagor in care of Borrower and to
Mortgagee at the address of the Collateral Agent as specified therein.

 

24.                               No Oral Modification.  This Mortgage may not
be amended, supplemented, or otherwise modified except in accordance with the
provisions of Section 9.08 of the Credit Agreement.  To the extent permitted by
applicable Law, any agreement made by

 

12

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Mortgagor and Mortgagee after the effective date of this Mortgage relating to
this Mortgage shall be superior to the rights of the holder of any intervening
or subordinate Lien or encumbrance.

 

25.                               Partial Invalidity.  In the event any one or
more of the provisions contained in this Mortgage should be held invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in
and of itself affect the validity of such provision in any other jurisdiction). 
The parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.  Notwithstanding anything to the contrary contained in
this Mortgage or in any provisions of the Loan Documents, the obligations of
Mortgagor and of any other obligor under the Loan Documents to repay the Secured
Obligations shall be subject to the limitation that Mortgagee shall not charge,
take or receive, nor shall Mortgagor or any other obligor be obligated to pay to
Mortgagee, any amounts constituting interest in excess of the maximum rate
permitted by Law to be charged by Mortgagee, as provided by Section 9.09 of the
Credit Agreement.

 

26.                               Mortgagor’s Waiver of Rights.  To the fullest
extent permitted by applicable Law, Mortgagor waives the benefit of all Laws now
existing or that may subsequently be enacted providing for (i) any appraisement
before sale of any portion of the Mortgaged Property, (ii) any extension of the
time for the enforcement of the collection of the Secured Obligations or the
creation or extension of a period of redemption from any sale, and
(iii) exemption of the Mortgaged Property from attachment, levy or sale under
execution or exemption from civil process.  To the fullest extent Mortgagor may
do so, Mortgagor agrees that Mortgagor will not at any time insist upon, plead,
claim or take the benefit or advantage of any Law now or hereafter in force
providing for any appraisement, valuation, stay, exemption, extension or
redemption, or requiring foreclosure of this Mortgage before exercising any
other remedy granted hereunder and Mortgagor, for Mortgagor and its successors
and assigns, and for any and all Persons ever claiming any interest in the
Mortgaged Property, to the extent permitted by applicable Law, hereby waives and
releases all rights of redemption, valuation, appraisement, stay of execution,
notice of election to mature or declare due the whole of the secured
indebtedness and marshalling in the event of foreclosure of the Liens hereby
created.

 

27.                               Remedies Not Exclusive.  In addition to any
rights and remedies that Mortgagee may have under the Credit Agreement and the
other Loan Documents, Mortgagee shall be entitled to exercise all rights and
powers under this Mortgage or under any applicable Laws now or hereafter in
force with respect hereto, notwithstanding that some or all of the Secured
Obligations may now or hereafter be otherwise secured, whether by mortgage,
security agreement, pledge, Lien, assignment or otherwise.  Neither the
acceptance of this Mortgage nor its enforcement, shall prejudice or in any
manner affect Mortgagee’s right to realize upon or enforce any other security
now or hereafter held by Mortgagee, it being agreed that Mortgagee shall not be
required to look first to, enforce or exhaust any other security, collateral or
guaranties and that Mortgagee shall be entitled to enforce this Mortgage and any
other security now or hereafter held by Mortgagee in such order and manner as
Mortgagee may determine in its absolute discretion.  No remedy herein conferred
upon or reserved to Mortgagee is intended to be

 

13

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exclusive of any other remedy herein or by Law provided or permitted, but each
shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute.  Every
power or remedy given by any of the Loan Documents to Mortgagee or to which
Mortgagee is otherwise entitled may be exercised concurrently or independently
from time to time and as often as may be deemed expedient by Mortgagee in
accordance therewith.  In no event shall Mortgagee, in the exercise of the
remedies provided in this Mortgage (including, without limitation, in connection
with the assignment of Rents to Mortgagee, or the appointment of a receiver and
the entry of such receiver on to all or any part of the Mortgaged Property), be
deemed a “mortgagee in possession,” and Mortgagee shall not in any way be made
liable for any act, either of commission or omission, in connection with the
exercise of such remedies.

 

28.                               Multiple Security.  If (a) the Premises shall
consist of one or more parcels, whether or not contiguous and whether or not
located in the same county, or (b) in addition to this Mortgage, Mortgagee shall
now or hereafter hold one or more additional mortgages, Liens, deeds of trust or
other security (directly or indirectly) for the Secured Obligations upon other
property in the State (whether or not such property is owned by Mortgagor or by
others) or (c) both the circumstances described in clauses (a) and (b) shall be
true, then to the fullest extent permitted by applicable Law, Mortgagee may, at
its election, commence or consolidate in a single foreclosure action all
foreclosure proceedings against all such collateral securing the Secured
Obligations (including the Mortgaged Property), which action may be brought or
consolidated in the courts of any county in the State in which any of such
collateral is located.  Mortgagor acknowledges that the right to maintain a
consolidated foreclosure action in the State is a specific inducement to
Mortgagee to extend the Secured Obligations, and Mortgagor expressly and
irrevocably waives any objections to the commencement or consolidation of the
foreclosure proceedings in a single action and any objections to the laying of
venue or based on the grounds of forum non conveniens which it may now or
hereafter have.  Mortgagor further agrees that if Mortgagee shall be prosecuting
one or more foreclosure or other proceedings against a portion of the Mortgaged
Property or against any collateral other than the Mortgaged Property, which
collateral directly or indirectly secures the Secured Obligations, or if
Mortgagee shall have obtained a judgment of foreclosure and sale or similar
judgment against such collateral, then, whether or not such proceedings are
being maintained or judgments were obtained in or outside the State, Mortgagee
may commence or continue foreclosure proceedings and exercise its other remedies
granted in this Mortgage against all or any part of the Mortgaged Property and
Mortgagor waives any objections to the commencement or continuation of a
foreclosure of this Mortgage or exercise of any other remedies hereunder based
on such other proceedings or judgments, and waives any right to seek to dismiss,
stay, remove, transfer or consolidate either any action under this Mortgage or
such other proceedings on such basis.  Neither the commencement nor continuation
of proceedings to foreclose this Mortgage nor the exercise of any other rights
hereunder nor the recovery of any judgment by Mortgagee in any such proceedings
shall prejudice, limit or preclude Mortgagee’s right to commence or continue one
or more foreclosure or other proceedings or obtain a judgment against any other
collateral (either in or outside the State) which directly or indirectly secures
the Secured Obligations, and Mortgagor expressly waives any objections to the
commencement of, continuation of, or entry of a judgment in such other
proceedings or exercise of any remedies in such proceedings based upon any
action or judgment connected to this Mortgage, and Mortgagor also waives any
right to

 

14

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seek to dismiss, stay, remove, transfer or consolidate either such other
proceedings or any action under this Mortgage on such basis.  It is expressly
understood and agreed that to the fullest extent permitted by applicable Law,
Mortgagee may, at its election, cause the sale of all collateral which is the
subject of a single foreclosure action in the State at either a single sale or
at multiple sales conducted simultaneously and take such other measures as are
appropriate in order to effect the agreement of the parties to dispose of and
administer all collateral securing the Secured Obligations (directly or
indirectly) in the most economical and least time-consuming manner.

 

29.                               Successors and Assigns.  Whenever in this
Mortgage any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party as permitted by the
Credit Agreement; and all covenants, promises and agreements by or on behalf of
Mortgagor or Mortgagee that are contained in this Mortgage shall run with the
Premises and bind and inure to the benefit of their respective successors and
assigns.

 

30.                               No Waivers, etc.  Mortgagee may release,
regardless of consideration and without the necessity for any notice to or
consent by the holder of any subordinate Lien on the Mortgaged Property, any
part of the security held for the obligations secured by this Mortgage without,
as to the remainder of the security, in anywise impairing or affecting the Lien
of this Mortgage or the priority of such Lien over any subordinate Lien.  No
failure or delay of Mortgagee in exercising any power or right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power.  No waiver of any provision of this
Mortgage or consent to any departure by Mortgagor therefrom shall in any event
be effective unless the same shall be permitted as provided in Section 24,24 and
then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given.  No notice or demand on Mortgagor in any case
shall entitle Mortgagor to any other or further notice or demand in similar or
other circumstances.

 

31.                               Governing Law, etc.  The provisions of this
Mortgage regarding the creation, perfection, priority, and enforcement of the
Liens and security interests granted herein shall be governed by and construed
under the Laws of the State.  All other provisions of this Mortgage and the
rights and obligations of Mortgagor and Mortgagee, including the provisions of
the Credit Agreement and any other Loan Document incorporated or referenced
herein shall be governed by, and construed and enforced in accordance with, the
Laws of the State of New York, without regard to the conflict of laws principles
thereof that would result in the application of any Law other than the Law of
the State of New York.

 

32.                               Certain Definitions.  The word “Mortgagor”
shall be construed as if it reads “Mortgagors” whenever the sense of this
Mortgage so requires and if there shall be more than one Mortgagor, the
obligations of Mortgagors shall be joint and several.  Unless the context
clearly indicates a contrary intent or unless otherwise specifically provided
herein, words used in this Mortgage shall be used interchangeably in singular or
plural form and the word “Mortgagor” shall mean “each Mortgagor or any
subsequent owner or owners of the Mortgaged Property or any part thereof or
interest therein,” the word “Mortgagee” shall mean “Mortgagee

 

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

24  For leasehold mortgages, change to “Section 24” to “Section 25.”

 

15

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or any successor Collateral Agent or other permitted agent for the Lenders
permitted by the Credit Agreement,” and the words “Mortgaged Property” shall
include any portion of the Mortgaged Property or interest therein.  Whenever the
context may require, any pronouns used herein shall include the corresponding
masculine, feminine or neuter forms, and the singular form of nouns and pronouns
shall include the plural and vice versa.  The captions in this Mortgage are for
convenience or reference only and in no way limit or amplify the provisions
hereof.

 

33.                               Consent to Jurisdiction and Service of
Process; Waiver of Jury Trial.  (a)  MORTGAGOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND THE MORTGAGED PROPERTY, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, TO THE NON-EXCLUSIVE JURISDICTION OF ANY COURT OF
THE STATE OR OF ANY NEW YORK STATE COURT OR FEDERAL COURT OF THE UNITED STATES
OF AMERICA SITTING IN NEW YORK COUNTY, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
MORTGAGE, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND MORTGAGOR
HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN THE AFORESAID COURTS. 
MORTGAGOR AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS MORTGAGE SHALL AFFECT ANY
RIGHT THAT MORTGAGEE MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS MORTGAGE AGAINST MORTGAGOR OR THE MORTGAGED PROPERTY IN THE
COURTS OF ANY JURISDICTION IF REQUIRED TO REALIZE UPON THE MORTGAGED PROPERTY OR
ENFORCE ANY JUDGMENT.

 

(b)                                 MORTGAGOR FURTHER IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT,
ACTION, OR PROCEEDING ARISING OUT OF OR RELATING TO THIS MORTGAGE IN ANY OF THE
AFORESAID COURTS IN CLAUSE (a) ABOVE.  MORTGAGOR HEREBY IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH SUIT, ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(c)                                  TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, MORTGAGOR IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE
MANNER PROVIDED FOR NOTICES IN SECTION 23,25 EXCLUDING SERVICE OF PROCESS BY
MAIL.  NOTHING IN THIS MORTGAGE WILL AFFECT THE RIGHT OF MORTGAGOR OR MORTGAGEE
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

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

25  For leasehold mortgages, change to “SECTION 23” to “SECTION 24.”

 

16

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(d)                                 MORTGAGOR, AND MORTGAGEE, BY ACCEPTANCE
HEREOF, EACH HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY
OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS MORTGAGE. 
MORTGAGOR (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS MORTGAGE BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN SECTION 9.11 OF THE
CREDIT AGREEMENT.

 

34.                               Future Advances.  This Mortgage is given to
secure the Secured Obligations and shall secure not only obligations with
respect to presently existing indebtedness but also any and all other
obligations that may hereafter be owing to the Collateral Agent and the Lenders
under the Loan Documents, however incurred, whether interest, discount or
otherwise, and whether the same shall be deferred, accrued or capitalized,
including future advances, re-advances, and Protective Advances (collectively,
“Future Advances”), in each case pursuant to the Credit Agreement or the other
Loan Documents, including with respect to any Incremental Loans made pursuant to
Section 2.01(b) of the Credit Agreement, whether such Future Advances are
obligatory or to be made at the option of the Collateral Agent, the
Administrative Agent, the Lenders, or otherwise, to the same extent as if such
Future Advances were made on the date of the execution of this Mortgage.  The
Lien of this Mortgage shall be valid as to all Secured Obligations secured
hereby, including Future Advances, from the time of delivery hereof by Mortgagor
to Mortgagee.  This Mortgage is intended to and shall be valid and have priority
over all subsequent Liens and encumbrances, including statutory Liens, excepting
solely taxes and assessments levied on the Premises and Permitted Exceptions. 
Although this Mortgage is given to secure all Future Advances made by Mortgagee
or the other Lenders to or for the benefit of Borrower, Mortgagor, or the
Mortgaged Property, pursuant to this Mortgage or in connection with the
Mortgaged Property, the Credit Agreement or other Loan Documents, whether
obligatory or optional, Mortgagor and Mortgagee acknowledge and agree that
Mortgagee and the Lenders are obligated by the terms of the Loan Documents to
make certain Future Advances, subject to the fulfillment of the relevant
conditions set forth in the Loan Documents.

 

17

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35.                               Mortgagee as Agent; Successor Agents.  (a) 
Mortgagee has been appointed to act as agent hereunder by the other Secured
Parties pursuant to the Credit Agreement.  Mortgagee shall have the right
hereunder to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action (including,
without limitation, the release or substitution of the Mortgaged Property) in
accordance with the Credit Agreement, any related agency agreement among the
Loan Parties, Mortgagee and the other Secured Parties (collectively, as amended,
amended and restated, supplemented or otherwise modified or replaced from time
to time, the “Agency Documents”) and this Mortgage.  Mortgagor and all other
Persons shall be entitled to rely on releases, waivers, consents, approvals,
notifications and other acts of Mortgagee, without inquiry into the existence of
required consents or approvals of the Secured Parties therefor.

 

(b)                                 Mortgagee shall at all times be the same
Person that is the Collateral Agent or other permitted agency role under the
Agency Documents.  Mortgagee may resign and a successor agent may be appointed
in the manner provided in the Credit Agreement, and written notice of
resignation by the Collateral Agent or other permitted agent pursuant to the
Agency Documents shall also constitute notice of resignation as Mortgagee under
this Mortgage.  Removal of the Collateral Agent or other permitted agent
pursuant to any provision of the Agency Documents shall also constitute removal
as Mortgagee under this Mortgage.  Appointment of a successor Collateral Agent
or other permitted agent pursuant to the Agency Documents shall also constitute
appointment of a successor Mortgagee under this Mortgage.  Upon the acceptance
of any appointment as Collateral Agent or other permitted agent by a successor
Collateral Agent or other permitted agent under the Agency Documents, that
successor Collateral Agent or other permitted agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring or removed Collateral Agent or other permitted agent as Mortgagee under
this Mortgage, and the retiring or removed Mortgagee shall promptly (i) assign
and transfer to such successor Mortgagee all of its right, title and interest in
and to this Mortgage and the Mortgaged Property, and (ii) execute and deliver to
such successor Mortgagee such assignments and amendments and take such other
actions, as may be necessary or appropriate in connection with the assignment to
such successor Mortgagee of the Liens and security interests created hereunder,
whereupon such retiring or removed Mortgagee shall be discharged from its duties
and obligations under this Mortgage.  After any retiring or removed Mortgagee’s
resignation or removal hereunder as Mortgagee, the provisions of this Mortgage
and the Agency Documents shall inure to such Mortgagee’s benefit as to any
actions taken or omitted to be taken by it under this Mortgage while it was
Mortgagee hereunder.

 

36.                               Intercreditor Agreement.  This Mortgage and
the Liens granted to the Mortgagee pursuant to this Mortgage or any other Loan
Documents in any Mortgaged Property and the exercise of any right or remedy with
respect to any Mortgaged Property hereunder or any other Loan Document are
subject to the provisions of the Intercreditor Agreement by and between
Mortgagee and Wells Fargo Bank, National Association, as Administrative Agent
(as the same may be amended, supplemented or otherwise modified from time to
time, the “Intercreditor Agreement”).  In the event of any inconsistency between
the terms of this Mortgage and the terms of the Intercreditor Agreement, the
terms of the Intercreditor Agreement shall control.

 

18

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37.                               Addendum.  The terms and conditions set forth
in the Addendum attached hereto are made an integral part hereof and are
incorporated in this Mortgage as though fully set forth in the body of this
Mortgage.  If any conflict exists between the terms and provisions contained in
the body of this Mortgage and the terms and provisions set forth in the
Addendum, the terms and provisions set forth in the Addendum shall control.

 

38.                               Incorporation of Credit Agreement; No
Conflicts.  The terms of the Credit Agreement are incorporated by reference
herein as though set forth in full detail.  In the event of any conflict between
the terms and provisions of this Mortgage relating to the creation, perfection,
priority, and enforcement of the real property Liens and the terms and
provisions of the Credit Agreement, the terms and provisions of this Mortgage
shall control; in the event of a conflict between any other term or provision of
this Mortgage (other than Section 3126) and the Credit Agreement, the terms and
provisions of the Credit Agreement shall control.

 

 

39.                               Termination; Release.  This Mortgage, the
Liens in favor of Mortgagee and all other security interests granted hereby
shall terminate with respect to all Secured Obligations when (i) the Commitments
shall have expired or been terminated, and (ii) the principal of and interest on
each Loan and all fees and other Secured Obligations (other than unasserted
contingent indemnification Obligations) shall have been indefeasibly performed
and paid in full in cash.  In addition, the Mortgaged Property or any portion
thereof shall be released from the Liens of this Mortgage in accordance with the
provisions of the Credit Agreement.  Upon any such termination or release of
this Mortgage, the Liens in favor of Mortgagee or other security interests
granted hereby, at Mortgagor’s cost and expense, Mortgagee shall file a
satisfaction and release of this Mortgage, in full or in part as the case may
be, in the proper real estate records.

 

40.                               27[Maximum Secured Amount.  Notwithstanding
anything contained herein to the contrary, with respect to this Mortgage on
properties located in [              ], the maximum amount secured hereby
(including Mortgagor’s obligation to reimburse Protective Advances) is
$                      .  Notwithstanding any provision herein to the contrary,
the amount secured by this Mortgage shall be limited as follows:
                .]28

 

 [ADDENDUM IMMEDIATELY FOLLOWS]

 

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26  For leasehold mortgages, change to “Section 31” to “Section 32.”

27  Local counsel to advise if required.

28 If the Mortgaged Property includes any “Operating Property” under the SVU
Indenture as then in effect, then mutually agreeable [] language will be added
in such Mortgage limiting the amount of the Secured Obligations secured thereby
so that such Mortgage does not trigger any equal and ratable security provisions
thereunder.

 

19

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ADDENDUM TO MORTGAGE

 

A.                                    [insert State-specific provisions]

 

[SIGNATURE PAGE IMMEDIATELY FOLLOWS]

 

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This Mortgage has been duly executed and delivered to Mortgagee by Mortgagor and
is effective as of the effective date first above written.

 

 

 

MORTGAGOR:

 

 

 

[                                                ],

 

a [                            ] [                          ]

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

[Signature block subject to review and comment by local counsel]

 

[APPROPRIATE NOTARY BLOCK]

 

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

 

Exhibit A

 

Description of the Land

 

[Attach Legal Description of all parcels]

 

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

 

RIDER FOR LEASEHOLD MORTGAGE FORM

 

Rider A:

 

LEASEHOLD

 

Rider B:

 

WHEREAS, Mortgagor is the holder of leasehold title in and to all of the Land
(as defined below), pursuant to the [Lease Agreement] dated as of
                         ,              by and between [LANDLORD], a
[                      ], as lessor (“Lessor”) and Mortgagor, as lessee,
(“Lessee”), a memorandum of which is recorded in Book                 ,
Page                    with the Clerk of                                County,
                              , [as amended by that certain
                                          , dated as of                     
    ,               ], which Premises (as defined below) forms a portion of the
Mortgaged Property described below;

 

Rider C:

 

that certain lease described in Recital C above, as the same has been and may be
in the future amended, restated, renewed or extended in compliance with this
Mortgage, including any options to purchase, extend or renew provided for in
such lease (collectively, the “Subject Lease”) and any nondisturbance,
attornment and recognition agreement benefiting Mortgagor with respect to the
Subject Lease, together with all credits, deposits, privileges, rights, estates,
title and interest of Mortgagor as tenant under the Subject Lease (including all
rights of Mortgagor to treat the Subject Lease as terminated under
Section 365(h) (a “365(h) Election”) of the Bankruptcy Code, or any other Debtor
Relief Laws, or any comparable right provided under any other Debtor Relief Law,
together with all rights, remedies and privileges related thereto), and all
books and records that contain records of payments of rent or security made
under the Subject Lease and all of Mortgagor’s claims and rights to the payment
of damages that may arise from Lessor’s failure to perform under the Subject
Lease, or rejection of the Subject Lease under any Debtor Relief Law (a “Lease
Damage Claim”), Mortgagee having the right, at any time and from time to time,
to notify Lessor of the rights of Mortgagee hereunder;

 

Rider D:

 

Subject Lease.  (a)  Mortgagor represents, warrants and agrees as follows:

 

(i)             Mortgagor has delivered to Mortgagee a true, correct and
complete copy of the Subject Lease, including all amendments and modifications,
existing as of the date hereof.

 

(ii)          Mortgagor has not executed or entered into any modifications or
amendments of the Subject Lease, either orally or in writing, other than written
amendments that have been disclosed to Mortgagee in writing.  Except as
expressly permitted under the Credit Agreement, Mortgagor shall not enter into
any new leases of all or any portion of the Mortgaged Property or any
modifications or amendments of the

 

H-1

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Subject Lease except with Mortgagee’s prior written consent which consent shall
not be unreasonably withheld or delayed.

 

(iii)                               The Subject Lease is in full force and
effect, and Mortgagor is in no default of its obligations under the Subject
Lease that, with the giving of notice or the passage of time or both, would
entitle Lessor to terminate the Subject Lease or avoid its obligations
thereunder.  To Mortgagor’s knowledge, no other event has occurred that, with
the giving of notice or the passage of time or both, would entitle Lessor to
terminate the Subject Lease or avoid its obligations thereunder.  Mortgagor has
no knowledge of any material default of Lessor’s obligations under the Subject
Lease or the occurrence of any event that, with the giving of notice or the
passage of time or both, would constitute such a default or entitle Mortgagor to
terminate the Subject Lease or avoid its obligations thereunder.

 

(iv)                              Except for Permitted Exceptions, Mortgagor has
not executed any assignment or pledge of the Subject Lease or of Mortgagor’s
right, title or interest in the same.

 

(v)                                 This Mortgage has been granted in conformity
with the Subject Lease, does not constitute a violation or default under the
Subject Lease, and shall at all times constitute a valid Lien (subject only to
matters permitted by this Mortgage) on Mortgagor’s interests in the Subject
Lease.

 

(vi)                              Mortgagor shall pay, when due and payable, the
rentals, additional rentals, and other charges required to be paid by Mortgagor
under the terms of the Subject Lease.

 

(vii)                           Mortgagor shall perform and observe all terms,
covenants, and conditions that Mortgagor is required to perform and observe as
lessee under the Subject Lease (including maintenance of insurance as required
thereby and under the Credit Agreement), and will not do or suffer to be done
anything the doing of which, or refrain from doing anything the omission of
which, will impair the security of this Mortgage.  Mortgagor will enforce the
obligations of the Lessor under the Subject Lease, to the end that Mortgagor may
enjoy all of the rights granted to it as lessee under the Subject Lease. 
Mortgagor shall furnish to Mortgagee any and all documentary evidence received
by it or in its possession showing compliance by Mortgagor with the provisions
of the Subject Lease that Mortgagee may reasonably request from time to time.

 

(viii)                        Mortgagor shall promptly deliver to Mortgagee a
copy of any written notice of default or termination under the Subject Lease
that it receives from the Lessor.  Mortgagor shall promptly notify Mortgagee of
any request that either party to the Subject Lease makes for arbitration
pursuant to the Subject Lease and the guidelines of the institution of any such
arbitration.  Mortgagor shall promptly deliver to Mortgagee a copy of the
arbitrators’ determination in each such arbitration.  Mortgagee may participate
in any such arbitration in such manner as Mortgagee shall determine appropriate,
including, during the continuance of an Event of Default, to the exclusion of
Mortgagor if so determined by Mortgagee in its reasonable discretion.

 

H-2

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(ix)                              Mortgagor shall not, without Mortgagee’s
consent, consent or refuse to consent to any action that the Lessor or any third
party takes or desires to take pursuant to the terms and provisions of such
Subject Lease if such action has a material adverse effect on the Subject Lease
or Mortgagor’s rights thereunder.

 

(x)                                 Mortgagor’s obligations under this Mortgage
are independent of and in addition to Mortgagor’s obligations under the Subject
Lease.  Nothing in this Mortgage shall be construed to require Mortgagor or
Mortgagee to take or omit to take any action that would cause a default under
the Subject Lease.

 

(b)                                 Treatment of Subject Lease in Bankruptcy. 
(i)  If the Lessor rejects or disaffirms, or seeks or purports to reject or
disaffirm, the Subject Lease pursuant to any Debtor Relief Law, then Mortgagor
shall not suffer or permit the termination of any Lease by exercise of the
365(h) Election or otherwise without Mortgagee’s consent.  Mortgagor
acknowledges that because the Subject Lease is a primary element of Mortgagee’s
security for the Secured Obligations, it is not anticipated that Mortgagee would
consent to termination of the Subject Lease.  If Mortgagor makes any
365(h) Election in violation of this Mortgage, then such 365(h) Election shall
be void and of no force or effect.

 

(ii)                                  Mortgagor hereby assigns to Mortgagee the
365(h) Election with respect to the Subject Lease until the earlier of
(i) satisfaction in full of the Secured Obligations (other than unasserted
contingent indemnification Obligations), and (ii) release of Mortgagee’s
security interest in the Subject Lease.  Mortgagor acknowledges and agrees that
the foregoing assignment of the 365(h) Election and related rights is one of the
rights that Mortgagee may use at any time to protect and preserve Mortgagee’s
other rights and interests under this Mortgage.  Mortgagor further acknowledges
that exercise of the 365(h) Election in favor of terminating the Subject Lease
would constitute waste prohibited by this Mortgage.  Mortgagor acknowledges and
agrees that the 365(h) Election is in the nature of a remedy available to
Mortgagor under the Subject Lease, and is not a property interest that Mortgagor
can separate from the Subject Lease as to which it arises.  Therefore, Mortgagor
agrees and acknowledges that exercise of the 365(h) Election in favor of
preserving the right to possession under the Subject Lease shall not be deemed
to constitute Mortgagee’s taking or sale of the Land (or any element thereof)
and shall not entitle Mortgagor to any credit against the Secured Obligations
secured hereunder or otherwise impair Mortgagee’s remedies.

 

(iii)                               Mortgagor acknowledges that if the
365(h) Election is exercised in favor of Mortgagor’s remaining in possession
under the Subject Lease, then Mortgagor’s resulting occupancy rights, as
adjusted by the effect of Section 365 of the Bankruptcy Code, shall then be part
of the Mortgaged Property and shall be subject to the Lien of this Mortgage.

 

(iv)                              If the Lessor rejects or disaffirms the
Subject Lease or purports or seeks to disaffirm such Subject Lease pursuant to
any Debtor Relief Law, and the

 

H-3

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365(h) Election is exercised in favor of Mortgagor’s remaining in possession
under the Subject Lease, then:

 

(1)                                 Mortgagor shall remain in possession of the
Land demised under the Subject Lease and shall perform all acts necessary for
Mortgagor to remain in such possession for the unexpired term of such Subject
Lease (including all renewals), whether the then existing terms and provisions
of such Subject Lease require such acts or otherwise; and

 

(2)                                 All the terms and provisions of this
Mortgage and the Lien created by this Mortgage shall remain in full force and
effect and shall extend automatically to all of Mortgagor’s rights and remedies
arising at any time under, or pursuant to, Section 365(h) of the Bankruptcy
Code, including all of Mortgagor’s rights to remain in possession of the Land.

 

(c)                                  Assignment of Claims to Mortgagee. 
Mortgagor, immediately upon learning that the Lessor has failed to perform any
material term or provision under the Subject Lease (including by reason of a
rejection or disaffirmance or purported rejection or disaffirmance of such
Subject Lease pursuant to any Debtor Relief Law), shall notify Mortgagee of any
such material failure to perform.  Mortgagor unconditionally assigns, transfers,
and sets over to Mortgagee any and all Lease Damage Claims.  This assignment
constitutes a present, irrevocable, and unconditional assignment of the Lease
Damage Claims, and shall continue in effect until the earlier of
(i) satisfaction in full of the Secured Obligations (other than unasserted
contingent indemnification Obligations), and (ii) release of Mortgagee’s
security interest in the Subject Lease.  So long as no Event of Default exists,
Mortgagee grants Mortgagor a revocable license to exercise, collect and receive
any sums arising in connection with any Lease Damage Claims (the “Lease
Damages”).  While any Event of Default exists, Mortgagee may (x) revoke such
license, with or without notice (“Revocation of License”), or (y) collect all
Lease Damages directly under the foregoing absolute assignment of all Lease
Damage Claims to Mortgagee.  Upon any Revocation of License, Mortgagor promptly
shall pay to Mortgagee all Lease Damages paid to Mortgagor to the extent that
the same are allocable to any period from and after such Revocation of License,
and Mortgagor shall hold in trust all Lease Damages (to be applied as required
pursuant to the terms and provisions of the Credit Agreement).

 

(d)                                 Offset by Mortgagor.  If pursuant to
Section 365(h)(2) of the Bankruptcy Code or any other similar Debtor Relief Law,
Mortgagor seeks to offset against any rent under the Subject Lease the amount of
any Lease Damage Claim, then Mortgagor shall notify Mortgagee of its intent to
do so at least 20 days before effecting such offset.  Such notice shall set
forth the amounts proposed to be so offset and the basis for such offset.  If
Mortgagee reasonably objects to all or any part of such offset, then Mortgagor
shall not effect any offset of the amounts to which Mortgagee reasonably
objects.  If Mortgagee approves such offset, then Mortgagor may effect such
offset as set forth in Mortgagor’s notice.  Neither Mortgagee’s failure to
object, nor any objection or other communication between Mortgagee and Mortgagor
that relates to such offset, shall

 

H-4

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constitute Mortgagee’s approval of any such offset.  Mortgagor shall indemnify
Mortgagee against any offset by Mortgagor against the rent reserved in the
Subject Lease.

 

(e)                                  Mortgagor’s Acquisition of Interest in
Leased Parcel.  If Mortgagor acquires the fee or any other interest in any Land
or Improvements originally subject to the Subject Lease, then, such acquired
interest shall immediately become subject to the Lien of this Mortgage as fully
and completely, and with the same effect, as if Mortgagor now owned it and as if
this Mortgage specifically described it, without need for the delivery and/or
recording of a supplement to this Mortgage or any other instrument.  In the
event of any such acquisition, the fee and leasehold interests in such Land or
Improvements, unless Mortgagee elects otherwise in writing, remain separate and
distinct and shall not merge, notwithstanding any principle of law to the
contrary.

 

(f)                                   New Lease Issued to Mortgagee.  If the
Subject Lease is for any reason whatsoever terminated before the expiration of
its term, Mortgagor acknowledges that Mortgagee or its designee may enter into
with Lessor a new lease of the relevant leased premises, and Mortgagor shall
have no right, title or interest in or to such new lease or the estate created
thereby.

 

H-5

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Exhibit I
to the Credit Agreement

 

FORM OF INTERCREDITOR AGREEMENT

 

(See attached)

 

1

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

 

EXECUTION

 

 

 

INTERCREDITOR AGREEMENT

 

dated as of

 

March 21, 2013

 

among

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,
as ABL Agent

 

and

 

GOLDMAN SACHS BANK USA,
as Term Loan Agent

 

 

2

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

 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

Section 1.

Definitions; Interpretation

1

 

 

 

1.1

Definitions

1

1.2

Terms Generally

12

 

 

 

Section 2.

Lien Priorities

13

 

 

 

2.1

Acknowledgment of Liens

13

2.2

Relative Priorities

13

2.3

Prohibition on Contesting Liens

15

2.4

New Liens

15

 

 

 

Section 3.

Enforcement

15

 

 

 

3.1

Exercise of Rights and Remedies

15

3.2

Release of Second Priority Liens

19

3.3

Insurance and Condemnation Awards

21

 

 

 

Section 4.

Payments

22

 

 

 

4.1

Application of Proceeds

22

4.2

Payments Over

23

 

 

 

Section 5.

Bailee for Perfection

23

 

 

 

5.1

Each Agent as Bailee

23

5.2

Transfer of Pledged Collateral

24

 

 

 

Section 6.

Insolvency Proceedings

26

 

 

 

6.1

General Applicability

26

6.2

Use of Cash Collateral; Bankruptcy Financing

26

6.3

Relief from the Automatic Stay

29

6.4

Adequate Protection

29

6.5

Reorganization Securities

32

6.6

Separate Grants of Security and Separate Classes

32

6.7

Asset Dispositions

32

6.8

Certain Waivers as to Section 1111(b)(2) of Bankruptcy Code

33

6.9

Avoidance Issues

33

6.10

Other Bankruptcy Laws

33

6.11

Post-Petition Claims

34

 

 

 

Section 7.

Term Loan Lenders’ Purchase Option

34

 

 

 

7.1

Exercise of Option

34

7.2

Pro Rata Offer

34

7.3

Purchase and Sale

34

7.4

Payment of Purchase Price

35

7.5

Representations Upon Purchase and Sale

36

7.6

Notice from ABL Agent Prior to Enforcement Action

36

 

i

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Section 8.

ABL Lenders’ Purchase Option

36

 

 

 

8.1

Exercise of Option

36

8.2

Pro Rata Offer

36

8.3

Purchase and Sale

37

8.4

Payment of Purchase Price

37

8.5

Representations Upon Purchase and Sale

38

8.6

Notice from ABL Agent Prior to Enforcement Action

38

 

 

 

Section 9.

Access and Use of Term Loan Priority Collateral

38

 

 

 

9.1

Access and Use Rights of ABL Agent

38

9.2

Responsibilities of ABL Secured Parties

39

9.3

Grantor Consent

40

 

 

 

Section 10.

Reliance; Waivers; Etc.

40

 

 

 

10.1

Reliance

40

10.2

No Warranties or Liability

40

10.3

No Waiver of Lien Priorities

41

10.4

Obligations Unconditional

42

10.5

Amendments to ABL Documents

42

10.6

Amendments to Term Loan Documents

43

 

 

 

Section 11.

Miscellaneous

44

 

 

 

11.1

Conflicts

44

11.2

Continuing Nature of this Agreement; Severability

44

11.3

Refinancing

45

11.4

Amendments; Waivers

46

11.5

Subrogation

46

11.6

Notices

46

11.7

Further Assurances

47

11.8

Consent to Jurisdiction; Waiver of Jury Trial

47

11.9

Governing Law

47

11.10

Binding on Successors and Assigns

48

11.11

Specific Performance

48

11.12

Section Titles; Time Periods

48

11.13

Counterparts

48

11.14

Authorization

48

11.15

No Third Party Beneficiaries

48

11.16

Additional Grantors

48

 

ii

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

 

INTERCREDITOR AGREEMENT

 

THIS INTERCREDITOR AGREEMENT (“Agreement”), dated as of March 21, 2013, is by
and among Wells Fargo Bank, National Association in its capacity as ABL Agent
(as hereinafter defined) pursuant to the ABL Agreement (as hereinafter defined)
acting for and on behalf of the ABL Secured Parties (as hereinafter defined),
and Goldman Sachs Bank USA in its capacity as Term Loan Agent (as hereinafter
defined) pursuant to the Term Loan Agreement (as hereinafter defined) acting for
and on behalf of the Term Loan Secured Parties (as hereinafter defined).

 

W I T N E S S E T H:

 

WHEREAS, SUPERVALU Inc., a Delaware corporation (the “Company”), and certain
wholly-owned subsidiaries of the Company as set forth on Exhibit A hereto, as
borrowers, have entered into a secured revolving credit facility with ABL Agent
and the lenders and other parties for whom it is acting as agent as set forth in
the ABL Agreement (as hereinafter defined) pursuant to which such lenders have
made and from time to time may make loans and provide other financial
accommodations to such borrowers which are guaranteed by certain other
subsidiaries of the Company  and secured by certain of the assets of such
borrowers and other subsidiaries (collectively, “Grantors” as hereinafter
further defined);

 

WHEREAS, the Company, as borrower, and the other Grantors, as guarantors, have
entered into a secured term loan facility with Term Loan Agent and the lenders
and other parties for whom it is acting as agent as set forth in the Term Loan
Agreement (as hereinafter defined) pursuant to which such lenders have made term
loans to the Company which are guaranteed by the other Grantors and secured by
certain of the assets of Grantors; and

 

WHEREAS, ABL Agent, for itself and on behalf of the other ABL Secured Parties,
and Term Loan Agent, for itself and on behalf of the other Term Loan Secured
Parties, desire to enter into this Intercreditor Agreement to (i) confirm the
relative priority of the security interests of ABL Agent and Term Loan Agent in
the assets and properties of Grantors, (ii) provide for the orderly sharing
among the ABL Secured Parties and the Term Loan Secured Parties, in accordance
with such priorities, of proceeds of such assets and properties upon any
foreclosure thereon or other disposition thereof and (iii) address related
matters.

 

NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and
obligations herein set forth and for other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

 

Section 1.              Definitions; Interpretation

 

1.1      Definitions.  As used in this Agreement, the following terms have the
meanings specified below:

 

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

 

“ABL Agent” shall mean Wells Fargo Bank, National Association, and its
successors and assigns in its capacity as administrative agent pursuant to the
ABL Documents acting for and on behalf of the other ABL Secured Parties and any
successor or replacement agent.

 

“ABL Agreement” shall mean the Amended and Restated Credit Agreement, dated of
even date herewith, by and among Grantors, ABL Agent and ABL Lenders, as the
same now exists or may hereafter be amended, modified, supplemented, extended,
renewed, restated, refinanced or otherwise replaced in accordance with the terms
of this Agreement.

 

“ABL Cap” shall mean $1,100,000,000, plus the amount of the increase in the
commitments of the ABL Lenders under the ABL Agreement from time to time, not to
exceed $250,000,000 in the aggregate.

 

“ABL Cash Collateral” shall have the meaning set forth in Section 6.2 hereof.

 

“ABL Debt” shall mean all “Obligations” as such term is defined in the ABL
Agreement, including, without limitation, obligations, liabilities and
indebtedness of every kind, nature and description owing by any Grantor to any
ABL Secured Party, including principal, interest, charges, fees, premiums,
indemnities and expenses, however evidenced, whether as principal, surety,
endorser, guarantor or otherwise, arising under any of the ABL Documents, Bank
Product Obligations owing to an ABL Secured Party and Commercial LC Facility
Obligations owing to an ABL Secured Party, in each case whether now existing or
hereafter arising, whether arising before, during or after the initial or any
renewal or replacement term of the ABL Documents or after the commencement of
any case with respect to any Grantor under the Bankruptcy Code or any other
Bankruptcy Law or any other Insolvency Proceeding (and including, without
limitation, any principal, interest, fees, costs, expenses and other amounts
which would accrue and become due but for the commencement of such case, whether
or not such amounts are allowed or allowable in whole or in part in such case or
similar proceeding), whether direct or indirect, absolute or contingent, joint
or several, due or not due, primary or secondary, liquidated or unliquidated,
secured or unsecured; provided, that, Excess ABL Debt shall not constitute ABL
Debt.

 

“ABL DIP Financing” shall have the meaning set forth in Section 6.2 hereof.

 

“ABL Documents” shall mean, collectively, the ABL Agreement and all agreements,
documents and instruments at any time executed and/or delivered by any Grantor
or any other person to, with or in favor of any ABL Secured Party in connection
therewith or related thereto, as all of the foregoing now exist or may hereafter
be amended, modified, supplemented, extended, renewed, restated, refinanced,
replaced or restructured (in whole or in part and including any agreements with,
to or in favor of any other lender or group of lenders, or agent of any such
other lender or group of lenders, that at any time refinances, replaces or
succeeds to all or any portion of the ABL Debt) in accordance with the terms of
this Agreement.

 

“ABL Event of Default” shall mean any “Event of Default” as defined in the ABL
Agreement.

 

“ABL Lenders” shall mean, collectively, any person party to the ABL Documents as
lender (and including any other lender or group of lenders that at any time
refinances, replaces or

 

2

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

 

succeeds to all or any portion of the ABL Debt or is otherwise party to the ABL
Documents as a lender); sometimes being referred to herein individually as a
“ABL Lender”.

 

“ABL Priority Collateral” shall mean the Collateral described on Annex A hereto.

 

“ABL Purchase Event” shall have the meaning set forth in Section 8.1 hereof.

 

“ABL Secured Parties” shall mean, collectively, (a) ABL Agent, (b) the ABL
Lenders, (c) the issuing bank or banks of letters of credit or similar or
related instruments under the ABL Agreement, (d) each other person to whom any
of the ABL Debt (including ABL Debt constituting Bank Product Obligations or
Commercial LC Facility Obligations) is owed and (e) the successors, replacements
and assigns of each of the foregoing; sometimes being referred to herein
individually as a “ABL Secured Party”.

 

“Affiliate” shall mean, with respect to any Person, (a) another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled (as each such term is defined in the ABL Agreement) by or is under
common Control with the Person specified, (b) any director, officer, managing
member, partner, trustee, or beneficiary of that Person, but excluding such
Persons as to any ABL Lender (or in the case of an ABL Lender that is an
Approved Fund (as defined in the ABL Agreement), the entity that administers or
manages such Approved Fund), (c) any other Person directly or indirectly holding
ten percent (10%) or more of any class of the Equity Interests (as defined in
the ABL Agreement) of that Person, except in the case of an ABL Lender (or in
the case of an ABL Lender that is an Approved Fund, the entity that administers
or manages such Approved Fund),any other Person directly or indirectly holding
thirty-five percent (35%) or more of any class of the Equity Interests of such
Person, and (d) any other Person ten percent (10%) or more of any class of whose
Equity Interests is held directly or indirectly by that Person, except in the
case of an ABL Lender (or in the case of an ABL Lender that is an Approved Fund,
the entity that administers or manages such Approved Fund), any other Person
thirty-five percent (35%) or more of any class of whose Equity Interests is held
directly or indirectly by such Person.

 

“Agents” shall mean, collectively, ABL Agent and Term Loan Agent, sometimes
being referred to herein individually as an “Agent”.

 

“Agreement” shall mean this Intercreditor Agreement, as the same now exists or
may hereafter be amended, amended and restated, modified, supplemented,
extended, renewed, restated or replaced from time to time in accordance with the
terms hereof.

 

“Bank Product Obligations” shall mean any obligation on account of (a) any Cash
Management Services furnished to any of the Grantors or any of their
Subsidiaries and/or (b) any transaction with any Person that is an ABL Lender or
any of its Affiliates on the date hereof or, if such transaction is established
later, on the date such transaction is established, which arises out of any Bank
Product entered into with any Grantor and any such Person, as each may be
amended from time to time; provided, that, (i) by the later of (A) the date
hereof or (B) on or about the date that such Cash Management Services or Bank
Products are established or the party providing them becomes an ABL Lender (or
is an Affiliate), but in any event in the case of either clause (A) or clause
(B) within ten (10) Business Days thereafter, ABL Agent shall have

 

3

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

 

received a written notice, in form and substance satisfactory to ABL Agent, from
Company and the ABL Lender that is providing (or whose Affiliate is providing)
such Cash Management Services or Bank Product that such obligations thereunder
constitute “Bank Product Obligations” for purposes of the ABL Agreement and the
other ABL Documents, and in the case of any Affiliate of an ABL Lender, such
Affiliate shall have entered into an agreement to be bound by the provisions of
Article IX of the ABL Agreement as though such Affiliate were a party to the ABL
Agreement in form and substance reasonably satisfactory to ABL Agent, (ii) such
ABL Lender (or such Affiliate, as the case may be) may at any time thereafter
notify ABL Agent in writing that such obligations have ceased to constitute Bank
Product Obligations, in which case, such obligations shall no longer be deemed
to be “Bank Product Obligations” for purposes of the ABL Agreement and the other
ABL Documents, and (iii) if at any time an ABL Lender ceases to be a lender
under the ABL Agreement (or an Affiliate of an ABL Lender ceases to be an
Affiliate), then, from and after the date on which it ceases to be a lender
under the ABL Agreement, any Cash Management Services or any Bank Product
provided by it or its Affiliates shall continue to give rise to Bank Product
Obligations, so long as (A) such Person is, and at all times remains, in
compliance with the provisions of Section 9.17(b) of the ABL Agreement and
(B) agrees in writing (1) that the ABL Agent and the other ABL Secured Parties
shall have no duty to such Person (other than the payment of any amounts to
which such Person may be entitled under Section 8.03 of the ABL Agreement) and
acknowledges that the ABL Agent and the other ABL Secured Parties may deal with
the Grantors and the Collateral as they deem appropriate (including the release
of any Grantor or all or any portion of the Collateral) without notice or
consent from such Person, whether or not such action impairs the ability of such
Person to be repaid Bank Product  Obligations owing to it) and (2) to be bound
by Section 9.17(b) of the ABL Agreement.

 

“Bank Products” shall mean any services or facilities provided to any Grantor by
any person that is an ABL Lender or its Affiliates on the date hereof or, if
such services or facilities are established later, on the date such services or
facilities are established (but excluding Cash Management Services), in each
case approved by Company, including, without limitation, on account of (a) Swap
Contracts, and (b) supply chain finance services including, without limitation,
trade payable services and supplier accounts receivable purchases, but excluding
any factoring services.

 

“Bankruptcy Code” shall mean the United States Bankruptcy Code, being Title 11
of the United States Code, as the same now exists or may from time to time
hereafter be amended, modified, recodified or supplemented.

 

“Bankruptcy Law” shall mean the Bankruptcy Code and any similar Federal, state
or foreign law for the relief of debtors.

 

“Borrowers” shall mean, collectively, (a) the Company, and (b) for purposes of
the ABL Agreement, the subsidiaries of the Company set forth on Exhibit A
hereto, (c) any other person that at any time after the date hereof becomes a
party to the ABL Agreement or the Term Loan Agreement as a Borrower, and
(d) their respective successors and assigns; sometimes being referred to herein
individually as a “Borrower”.

 

4

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“Business Day” shall mean any day other than a Saturday, a Sunday or a day that
is a legal holiday under the laws of the State of New York or on which banking
institutions in the State of New York are required or authorized by law or other
governmental action to close.

 

“Cash Management Services” shall mean any one or more of the following types or
services or facilities provided to any Grantor by any Person that is an ABL
Lender or its Affiliates on the date hereof or, if such services or facilities
are established later, on the date such services or facilities are established,
in each case as selected by Company, after notice to ABL Agent (and with the
approval of ABL Agent in its Permitted Discretion (as defined in the ABL
Agreement): (a) ACH transactions, (b) cash management services, including,
without limitation, controlled disbursement services, treasury, depository,
overdraft, and electronic funds transfer services, (c) foreign exchange
facilities, (d) credit or debit cards, (e) credit card processing services, and
(f) purchase cards.

 

“Collateral” shall mean all of the property and interests in property, real or
personal, tangible or intangible, now owned or hereafter acquired by any Grantor
in or upon which a Lien has been granted (or has been purported to be granted)
to secure any ABL Debt or Term Loan Debt.

 

“Commercial LC Facility” means a letter of credit facility provided to any
Grantor by any Person that is an ABL Lender or its Affiliates on the date hereof
or, if such letter of credit facility is established later, on the date such
letter of credit facility is established, in each case approved by the Company
and used for the issuance of letters of credit (as defined in the UCC) for the
purpose of providing the primary payment mechanism in connection with the
purchase of any materials, goods or services by a Grantor in the ordinary course
of business of such Grantor, provided, that, all obligations thereunder shall be
unsecured except to the extent of the Lien of the ABL Agent under the ABL Loan
Documents as provided for therein. In no event shall any letter of credit issued
under or pursuant to such letter of credit facility be deemed to be a Letter of
Credit (as defined in the ABL Agreement) or give rise to any obligations of any
ABL Lender or other ABL Secured Party to make any payment to the ABL Lender (or
its Affiliate) that is providing such facility.

 

“Commercial LC Facility Obligations” means any obligation on account of any
Commercial LC Facility owing by any of the Grantors; provided, that, (a) by the
later of (i) the date hereof or (ii) on or about the date that such Commercial
LC Facility is established or the party providing them becomes an ABL Lender (or
is an Affiliate), but in any event in the case of either clause (i) or clause
(ii), within ten (10) Business Days thereafter, the ABL Agent shall have
received (A) a written notice, in form and substance satisfactory to the ABL
Agent, from the Company and the ABL Lender that is providing (or whose Affiliate
is providing) such Commercial LC Facility that such obligations thereunder
constitute “Commercial LC Facility Obligations” for purposes of the ABL
Agreement and the other ABL Loan Documents, and in the case of any Affiliate of
an ABL Lender, such Affiliate shall have entered into an agreement to be bound
by the provisions of Article IX of the ABL Agreement as though such Affiliate
were a party to the ABL Agreement in form and substance reasonably satisfactory
to the ABL Agent, and (B) the ABL Agent shall have entered into an agreement, in
form and substance satisfactory to the ABL Agent, with the ABL Lender (or its
Affiliate) that is providing such Commercial LC Facility, as acknowledged and
agreed to by the Grantors, providing for the delivery to ABL

 

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Agent by such ABL Lender (or Affiliate) of information with respect to the
amount of such obligations and providing for the other rights of the ABL Agent
and such ABL Lender (or Affiliate) in connection with such arrangements,
(b) such ABL Lender (or such Affiliate, as the case may be) may at any time
thereafter notify ABL Agent in writing that such obligations have ceased to
constitute Commercial LC Facility Obligations, in which case, such obligations
shall no longer be deemed to be “Commercial LC Facility Obligations” for
purposes of the ABL Agreement and the other ABL Loan Documents, (c) if at any
time an ABL Lender ceases to be an ABL Lender under the ABL Agreement (or an
Affiliate of a Lender ceases to be an Affiliate), then, from and after the date
on which it ceases to be an ABL Lender hereunder, any Commercial LC Facility
provided by it or its Affiliates shall continue to give rise to Commercial LC
Facility Obligations, so long as (i) such Person is, and at all times remains,
in compliance with the provisions of Section 9.17(b) of the ABL Agreement and
(ii) agrees in writing (A) that the ABL Agent and the other ABL Secured Parties
shall have no duty to such Person (other than the payment of any amounts to
which such Person may be entitled under Section 8.03 of the ABL Agreement) and
acknowledges that the ABL Agent and the other ABL Secured Parties may deal with
the Grantors and the Collateral as they deem appropriate (including the release
of any Grantor or all or any portion of the Collateral) without notice or
consent from such Person, whether or not such action impairs the ability of such
Person to be repaid Commercial LC Facility Obligations owing to it) and (B) to
be bound by Section 9.17(b) of the ABL Agreement.

 

“Company” shall mean SUPERVALU Inc., a Delaware corporation, and its successors
and assigns.

 

“Discharge of ABL Debt” shall mean, subject to Sections 6.9 and 11.3 hereof:

 

(a)  the payment in full in cash of the principal and interest (including any
interest which would accrue and become due but for the commencement of an
Insolvency Proceeding, whether or not such amounts are allowed or allowable in
whole or in part in such case) constituting ABL Debt;

 

(b)  the payment in full in cash of all other ABL Debt that is due and payable
or otherwise accrued and owing at or prior to the time such principal and
interest are paid (including any such amounts which would accrue and become due
but for the commencement of an Insolvency Proceeding, whether or not such
amounts are allowed or allowable in whole or in part in such case), other than
obligations described in clause (c) below;

 

(c) (i) the delivery to ABL Agent, or at ABL Agent’s option, each LC Issuer (as
defined in the ABL Agreement) of cash collateral, or at ABL Agent’s option, the
delivery to ABL Agent (or at its option, each LC Issuer) of a letter of credit
payable to ABL Agent (or at ABL Agent’s option, such LC Issuer) issued by a bank
reasonably acceptable to ABL Agent (or if issued to such LC Issuer, a bank
reasonably acceptable to such LC Issuer) in form and substance reasonably
satisfactory to ABL Agent (or if issued to such LC Issuer, in form and substance
reasonably acceptable to such LC Issuer), in either case in respect of letters
of credit, banker’s acceptances or similar or related instruments issued under
the ABL Documents (in such amount as required by the ABL Documents but not to
exceed one hundred three percent (103%) of the amount of such letters of credit,
banker’s acceptances or similar or related instruments, other than obligations
with respect to the foregoing denominated in a currency other than US

 

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Dollars, in which case one hundred fifteen percent (115%) of the amount
thereof), (ii) the delivery of cash collateral in respect of Bank Product
Obligations owing to any ABL Secured Party (or, at the option of the ABL Secured
Party with respect to such Bank Product Obligations, the termination of the
applicable Swap Contracts or cash management or other arrangements and the
payment in full in cash of the ABL Debt due and payable in connection with such
termination), (iii) the delivery of cash collateral in respect of Commercial LC
Facility Obligations owing to any ABL Secured Party (or, at the option of the
ABL Secured Party with respect to such Commercial LC Facility Obligations, the
termination of the applicable Commercial LC Facility and the payment in full in
cash of the ABL Debt due and payable in connection with such termination), and
(iv) the delivery of cash collateral to the ABL Agent, or at ABL Agent’s option,
the delivery to ABL Agent of a letter of credit payable to ABL Agent issued by a
bank reasonably acceptable to ABL Agent in form and substance reasonably
satisfactory to ABL Agent, in respect of continuing obligations of ABL Agent and
ABL Lenders under control agreements and other contingent ABL Debt for which a
claim or demand for payment has been made at such time or in respect of matters
or circumstances known to an ABL Secured Party at the time, of which such ABL
Secured Party has informed the ABL Agent and which are reasonably expected to
result in any loss, cost, damage or expense (including attorneys’ fees and legal
expenses) to any ABL Secured Party for which such ABL Secured Party is entitled
to indemnification by any Grantor; and

 

(d)  the termination of the commitments of the ABL Lenders and the financing
arrangements provided by ABL Agent and the ABL Lenders to Grantors under the ABL
Documents.

 

“Discharge of Term Loan Debt” shall mean, subject to Sections 6.9 and 11.3
hereof:

 

(a)  the payment in full in cash of the principal and interest (including any
interest which would accrue and become due but for the commencement of an
Insolvency Proceeding, whether or not such amounts are allowed or allowable in
whole or in part in such case) constituting Term Loan Debt;

 

(b)  the payment in full in cash of all other Term Loan Debt that is due and
payable or otherwise accrued and owing at or prior to the time such principal
and interest are paid (including any such amounts which would accrue and become
due but for the commencement of an Insolvency Proceeding, whether or not such
amounts are allowed or allowable in whole or in part in such case), other than
obligations described in clause (c) below;

 

(c)  the delivery to Term Loan Agent of cash collateral, or at Term Loan Agent’s
option, the delivery to Term Loan Agent of a letter of credit payable to Term
Loan Agent issued by a bank reasonably acceptable to Term Loan Agent and in form
and substance reasonably satisfactory to Term Loan Agent, in either case in
respect of contingent Term Loan Debt for which a claim or demand for payment has
been made at such time or in respect of matters or circumstances known to a Term
Loan Secured Party at the time, of which such Term Loan Secured Party has
informed the Term Loan Agent and which are reasonably expected to result in any
loss, cost, damage or expense (including attorneys’ fees and legal expenses) to
any Term Loan Secured Party for which such Term Loan Secured Party is entitled
to indemnification by any Grantor; and

 

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(d)  the termination of the commitments of the Term Loan Lenders and the
financing arrangements provided by Term Loan Agent and the Term Loan Lenders to
Grantors under the Term Loan Documents.

 

“Disposition” shall mean any sale, transfer, license, lease or other disposition
(including any sale and leaseback transaction) of any property by any Person,
including any sale, assignment, transfer or other disposal, with or without
recourse, of any notes or accounts receivable or any rights and claims
associated therewith.

 

“Enforcement Expenses” shall mean all costs, expenses or fees (including fees
incurred by any Agent or any attorneys or other agents or consultants retained
by such Agent) that any Agent or any other Secured Party (in the case of any
other Secured Party, to the extent such costs, expenses or fees are
reimburseable under the terms of the ABL Agreement or the Term Loan Agreement,
as applicable) may suffer or incur after the occurrence of an Event of Default
on account or in connection with (a) the repossession, storage, repair,
appraisal, insuring, completion of the manufacture of, preparing for sale,
advertising for sale, selling, collecting or otherwise preserving or realizing
upon any Collateral, (b) the settlement or satisfaction of any prior Lien or
other encumbrance upon any Collateral or (c) the enforcement of any of the ABL
Documents or the Term Loan Documents, as the case may be.

 

“Event of Default” shall mean, an ABL Event of Default or a Term Loan Event of
Default, as the case may be.

 

“Excess ABL Debt” shall mean the amount equal to: (a) the sum of: (i) the
portion of the principal amount of the loans outstanding under the ABL
Agreement, plus (ii) the undrawn amount of all outstanding letters of credit
issued pursuant to the ABL Agreement, plus (iii) the unreimbursed amount of all
draws under such letters of credit that, in the aggregate for amounts described
in clauses (i), (ii) and (iii), is in excess of the ABL Cap, plus (b) without
duplication, the portion of accrued and unpaid interest and fees on account of
such portion of the loans and letters of credit described in clause (a);
provided, that, any Enforcement Expenses shall not constitute Excess ABL Debt
regardless of whether such amounts are added to the principal balance of the
loans pursuant to the ABL Documents and in no event shall the term Excess ABL
Debt be construed to include Commercial LC Facility Obligations or Bank Product
Obligations.

 

“Excess Term Loan Debt” shall mean the amount equal to (a) the portion of the
principal amount of the loans outstanding under the Term Loan Agreement that is
in excess of the Term Loan Cap, plus (b) without duplication, the portion of
accrued and unpaid interest on account of such portion of the loans described in
clause (a); provided, that, any Enforcement Expenses shall not constitute Excess
Term Loan Debt regardless of whether such amounts are added to the principal
balance of the loans pursuant to the Term Loan Documents.

 

“Exigent Circumstance” shall mean an event or circumstance that materially and
imminently threatens the ability of ABL Agent or the Term Loan Agent, as the
case may be, to realize upon all or a material portion of the ABL Priority
Collateral or the Term Loan Priority Collateral, as the case may be, such as,
without limitation, fraudulent removal, concealment, destruction (other than to
the extent covered by insurance), material waste or abscondment thereof.

 

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“Grantors” shall mean, collectively, the Company and each Subsidiary of the
Company that shall have granted a Lien on any of its assets to secure any ABL
Debt or Term Loan Debt, together with their respective successors and assigns;
sometimes being referred to herein individually as a “Grantor”.

 

“Guarantors” shall mean, collectively, (a) the subsidiaries of the Company set
forth on Exhibit B hereto, (b) any other person that at any time after the date
hereof becomes a party to a guarantee in favor of ABL Agent or the other ABL
Secured Parties in respect of any of the ABL Debt or in favor of Term Loan Agent
or the other Term Loan Secured Parties in respect of any of the Term Loan Debt,
and (c) their respective successors and assigns; sometimes being referred to
herein individually as a “Guarantor”.

 

“Insolvency Proceeding” shall mean (a) any voluntary or involuntary case or
proceeding under any Bankruptcy Law with respect to any Grantor, (b) any other
voluntary or involuntary insolvency, reorganization or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding with respect to any Grantor or with respect to any of their
respective assets, (c) any proceeding seeking the appointment of any trustee,
receiver, liquidator, custodian or other insolvency official with similar powers
with respect to any Grantor or any or all of its assets or properties, (d) any
liquidation, dissolution, reorganization or winding up of any Grantor whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy
or (e) any assignment for the benefit of creditors or any other marshalling of
assets and liabilities of any Grantor.

 

“Lien” shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, security interest, encumbrance (including, but
not limited to, easements, rights of way and the like), lien (statutory or
other), security agreement or transfer intended as security, including without
limitation, any conditional sale or other title retention agreement, the
interest of a lessor under a capital lease or any financing lease having
substantially the same economic effect as any of the foregoing.

 

“Person” or “person” shall mean any individual, sole proprietorship,
partnership, corporation (including, without limitation, any corporation which
elects subchapter S status under the Internal Revenue Code of 1986, as amended),
limited liability company, limited liability partnership, business trust,
unincorporated association, joint stock company, trust, joint venture, or other
entity or any government or any agency or instrumentality or political
subdivision thereof.

 

“Pledged Collateral” shall have the meaning set forth in Section 5.1 hereof.

 

“Proceeds” or “proceeds” shall mean all “proceeds” as defined in Article 9 of
the UCC, and in any event, shall include, without limitation, (a) whatever is
receivable or received when Collateral or proceeds are sold, exchanged,
collected or otherwise disposed of, whether such disposition is voluntary or
involuntary and (b) any payment or distribution made in respect of Collateral in
an Insolvency Proceeding.

 

“Purchasing ABL Secured Parties” shall have the meaning set forth in Section 8.1
hereof.

 

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“Purchasing Term Loan Secured Parties” shall have the meaning set forth in
Section 7.1 hereof.

 

“Recovery” shall have the meaning set forth in Section 6.9 hereof.

 

“Refinance” or “refinance” shall mean, in respect of any of indebtedness, to
refinance, replace, refund or repay, or to issue other indebtedness or enter
into alternative financing arrangements, in exchange or replacement for, such
indebtedness in whole or in part, including by adding or replacing lenders,
creditors, agents, borrowers and/or guarantors, and including in each case, but
not limited to, after the original instrument giving rise to such indebtedness
has been terminated.  “Refinanced” or “refinanced” and “Refinancing” or
“refinancing” shall have correlative meanings.

 

“Secured Parties” shall mean, collectively, the ABL Secured Parties and the Term
Loan Secured Parties; sometimes being referred to herein individually as a
“Secured Party”.

 

“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person.  Unless otherwise specified, all references herein to a
“Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of
the Company.

 

“SVU Indenture” the Indenture, dated as of July 1, 1987, between the Company and
Deutsche Bank Trust Company (formerly Bankers Trust Company), as trustee, as
supplemented by the First Supplemental Indenture dated as of August 1, 1990, the
Second Supplemental indenture dated as of October 1, 1992, the Third
Supplemental Indenture dated as of September 1, 1995, the Fourth Supplemental
Indenture dated as of August 4, 1999, and the Fifth Supplemental Indenture dated
as of September 17, 1999, as further amended, supplemented or otherwise modified
in accordance with the terms of the ABL Agreement and the Term Loan Agreement.

 

“SVU Operating Property” shall mean “Operating Property” as such term is defined
in the SVU Indenture as in effect on the date hereof.

 

“Swap Contracts” shall mean (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and ii) any and all transactions
of any kind, and the related confirmations, which are subject to the terms

 

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and conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a “Master Agreement”), including
any such obligations or liabilities under any Master Agreement.

 

“Term Loan Agent” shall mean Goldman Sachs Bank USA and its successors and
assigns in its capacity as administrative and collateral agent pursuant to the
Term Loan Documents acting for and on behalf of the other Term Loan Secured
Parties and any successor or replacement agent.

 

“Term Loan Agreement” shall mean the Term Loan Credit Agreement, dated of even
date herewith, by and among the Company, the administrative agent party thereto,
Term Loan Agent and Term Loan Lenders, as the same now exists or may hereafter
be amended, modified, supplemented, extended, renewed, restated, refinanced or
otherwise replaced in accordance with the terms of this Agreement.

 

“Term Loan Cap” shall mean $1,650,000,000, plus the amount of the additional
term loans under the Term Loan Agreement from time to time, not to exceed
$250,000,000 in the aggregate.

 

“Term Loan Cash Collateral” shall have the meaning set forth in Section 6.2
hereof.

 

“Term Loan Debt” shall mean all “Obligations” as such term is defined in the
Term Loan Agreement, including, without limitation, obligations, liabilities and
indebtedness of every kind, nature and description owing by any Grantor to any
Term Loan Secured Party, including principal, interest, charges, fees, premiums,
indemnities and expenses, however evidenced, whether as principal, surety,
endorser, guarantor or otherwise, arising under any of the Term Loan Documents,
whether now existing or hereafter arising, whether arising before, during or
after the initial or any renewal or replacement term of the Term Loan Documents
or after the commencement of any case with respect to any Grantor under the
Bankruptcy Code or any other Bankruptcy Law or any other Insolvency Proceeding
(and including, without limitation, any principal, interest, fees, costs,
expenses and other amounts which would accrue and become due but for the
commencement of such case, whether or not such amounts are allowed or allowable
in whole or in part in such case or similar proceeding), whether direct or
indirect, absolute or contingent, joint or several, due or not due, primary or
secondary, liquidated or unliquidated, secured or unsecured; provided, that,
Excess Term Loan Debt shall not constitute Term Loan Debt.

 

“Term Loan DIP Financing” shall have the meaning set forth in Section 6.2
hereof.

 

“Term Loan Documents” shall mean, collectively, the Term Loan Agreement and all
agreements, documents and instruments at any time executed and/or delivered by
any Grantor or any other person to, with or in favor of any Term Loan Secured
Party in connection therewith or related thereto, as all of the foregoing now
exist or may hereafter be amended, modified, supplemented, extended, renewed,
restated, refinanced, replaced or restructured (in whole or in part and
including any agreements with, to or in favor of any other lender or group of
lenders, or

 

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agent of any such other lender or group of lenders, that at any time refinances,
replaces or succeeds to all or any portion of the Term Loan Debt) in accordance
with the terms of this Agreement.

 

“Term Loan Event of Default” shall mean any “Event of Default” as defined in the
Term Loan Agreement.

 

“Term Loan Lenders” shall mean, collectively, any person party to the Term Loan
Documents as lender (and including any other lender or group of lenders that at
any time refinances, replaces or succeeds to all or any portion of the Term Loan
Debt or is otherwise party to the Term Loan Documents as a lender); sometimes
being referred to herein individually as a “Term Loan Lender”.

 

“Term Loan Priority Collateral” shall mean the Collateral described on Annex B
hereto.

 

“Term Loan Purchase Event” shall have the meaning set forth in Section 7.1
hereof.

 

“Term Loan Secured Parties” shall mean, collectively, (a) Term Loan Agent,
(b) the Term Loan Lenders, (c) each other person to whom any of the Term Loan
Debt is owed, (d) the administrative agent under the Term Loan Documents and
(e) the successors, replacements and assigns of each of the foregoing; sometimes
being referred to herein individually as a “Term Loan Secured Party”.

 

“Third Party Purchaser” shall have the meaning set forth in Section 9.1 hereof.

 

“Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code as
from time to time in effect in the State of New York; provided, that, if by
reason of mandatory provisions of law, perfection, or the effect of perfection
or non-perfection, of a security interest in any Collateral or the availability
of any remedy hereunder is governed by the Uniform Commercial Code as in effect
in a jurisdiction other than the State of New York, “Uniform Commercial Code” or
“UCC” means the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such perfection or effect of
perfection or non-perfection or availability of such remedy, as the case may be.

 

1.2      Terms Generally.  The definitions of terms herein shall apply equally
to the singular and plural forms of the terms defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes” and “including” shall be deemed
to be followed by the phrase “without limitation”.  The word “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 limitations thereon set forth
herein, (b) any reference herein to any Person shall be construed to include
such Person’s successors and assigns, and as to any Borrower, any Guarantor or
any other Grantor shall be deemed to include a receiver, trustee or
debtor-in-possession on behalf of any of such person or on behalf of any such
successor or assign, (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)

 

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all references herein to Sections shall be construed to refer to Sections of
this Agreement and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

 

Section 2.              Lien Priorities

 

2.1      Acknowledgment of Liens.

 

(a)   ABL Agent, on behalf of itself and each other ABL Secured Party, hereby
acknowledges that Term Loan Agent, acting for and on behalf of itself and the
other Term Loan Secured Parties, has been granted Liens upon all of the
Collateral pursuant to the Term Loan Documents to secure the Term Loan Debt and
the Excess Term Loan Debt.

 

(b)   Term Loan Agent, on behalf of itself and each other Term Loan Secured
Party, hereby acknowledges that ABL Agent, acting for and on behalf of itself
and the ABL Secured Parties, has been granted Liens upon all of the Collateral
pursuant to the ABL Documents to secure the ABL Debt and the Excess ABL Debt;
provided, that, prior to the Discharge of Term Loan Debt, Term Loan Agent, on
behalf of itself and each other Term Loan Secured Party, hereby acknowledges,
and the ABL Agent, on behalf of itself and each other ABL Secured Party, hereby
agrees, that, as of the date hereof, the ABL Agent does not have a Lien on the
SVU Operating Property and the SVU Operating Property does not and will not
secure ABL Debt or Excess ABL Debt or constitute ABL Priority Collateral (except
as otherwise expressly provided for in the ABL Agreement as in effect on the
date hereof or as amended in accordance with this Agreement).

 

2.2      Relative Priorities.

 

(a)   Notwithstanding the date, manner or order of grant, attachment or
perfection of any Liens granted to ABL Agent or the other ABL Secured Parties or
Term Loan Agent or the other Term Loan Secured Parties and notwithstanding any
provision of the UCC, or any applicable law or any provisions of the ABL
Documents or the Term Loan Documents or any defect or deficiencies in, or
failure to grant or perfect, any Liens or the failure of such Liens to attach or
any other circumstance whatsoever, the Term Loan Agent, on behalf of itself and
the other Term Secured Parties, and the ABL Agent, on behalf of itself and the
other ABL Secured Parties, hereby agree that:

 

(i)        any Lien on the ABL Priority Collateral securing the ABL Debt now or
hereafter held by or for the benefit or on behalf of any ABL Secured Party or
any agent or trustee therefor shall be senior in right, priority, operation,
effect and in all other respects to any Lien on the ABL Priority Collateral
securing the Term Loan Debt now or hereafter held by or for the benefit or on
behalf of any Term Loan Secured Party or any agent or trustee therefor and any
Lien on the ABL Priority Collateral securing any of the Term Loan Debt now or
hereafter held by or for the benefit or on behalf of any Term Loan Secured Party
or any agent or trustee therefor regardless of how acquired, whether by grant,
statute, operation of law, subrogation or otherwise, shall be junior and
subordinate in all respects to all Liens on the ABL Priority Collateral securing
any ABL Debt;

 

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(ii)       any Lien on the Term Loan Priority Collateral securing the Term Loan
Debt now or hereafter held by or for the benefit or on behalf of any Term Loan
Secured Party or any agent or trustee therefor shall be senior in right,
priority, operation, effect and in all other respects to any Lien on the Term
Loan Priority Collateral securing the ABL Debt now or hereafter held by or for
the benefit or on behalf of any ABL Secured Party or any agent or trustee
therefor and any Lien on the Term Loan Priority Collateral securing any of the
ABL Debt now or hereafter held by or for the benefit or on behalf of any ABL
Secured Party or any agent or trustee therefor regardless of how acquired,
whether by grant, statute, operation of law, subrogation or otherwise, shall be
junior and subordinate in all respects to all Liens on the Term Loan Priority
Collateral securing any Term Loan Debt;

 

(iii)      any Lien on the ABL Priority Collateral securing Excess ABL Debt now
or hereafter held by or for the benefit or on behalf of any ABL Secured Party or
any agent or trustee therefor shall be junior and subordinate in right,
priority, operation, effect and in all other respects to any Lien on the ABL
Priority Collateral securing Term Loan Debt now or hereafter held by or for the
benefit or on behalf of any Term Loan Secured Party or any agent or trustee
therefor and any Lien on the ABL Priority Collateral securing any of the Term
Loan Debt now or hereafter held by or for the benefit or on behalf of any Term
Loan Secured Party or any agent or trustee therefor regardless of how acquired,
whether by grant, statute, operation of law, subrogation or otherwise, shall be
senior in all respects to all Liens on the ABL Priority Collateral securing any
Excess ABL Debt;

 

(iv)     any Lien on the Term Loan Priority Collateral securing Excess Term Loan
Debt now or hereafter held by or for the benefit or on behalf of any Term Loan
Secured Party or any agent or trustee therefor shall be junior and subordinate
in right, priority, operation, effect and in all other respects to any Lien on
the Term Loan Priority Collateral securing ABL Debt now or hereafter held by or
for the benefit or on behalf of any ABL Secured Party or any agent or trustee
therefor and any Lien on the Term Loan Priority Collateral securing any of the
ABL Debt now or hereafter held by or for the benefit or on behalf of any ABL
Secured Party or any agent or trustee therefor regardless of how acquired,
whether by grant, statute, operation of law, subrogation or otherwise, shall be
senior in all respects to all Liens on the Term Loan Priority Collateral
securing any Excess Term Loan Debt;

 

(v)      any Lien on the ABL Priority Collateral securing Excess ABL Debt now or
hereafter held by or for the benefit or on behalf of any ABL Secured Party or
any agent or trustee therefor shall be senior in right, priority, operation,
effect and in all other respects to any Lien on the ABL Priority Collateral
securing Excess Term Loan Debt now or hereafter held by or for the benefit or on
behalf of any Term Loan Secured Party or any agent or trustee therefor and any
Lien on the ABL Priority Collateral securing any of the Excess Term Loan Debt
now or hereafter held by or for the benefit or on behalf of any Term Loan
Secured Party or any agent or trustee therefor regardless of how acquired,
whether by grant, statute, operation of law, subrogation or otherwise, shall be
junior and subordinate in all respects to all Liens on the ABL Priority
Collateral securing any Excess ABL Debt; and

 

(vi)     any Lien on the Term Loan Priority Collateral securing Excess Term Loan
Debt now or hereafter held by or for the benefit or on behalf of any Term Loan
Secured Party or any agent or trustee therefor shall be senior in right,
priority, operation, effect and in all other

 

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respects to any Lien on the Term Loan Priority Collateral securing Excess ABL
Debt now or hereafter held by or for the benefit or on behalf of any ABL Secured
Party or any agent or trustee therefore and any Lien on the Term Loan Priority
Collateral securing any of the Excess ABL Debt now or hereafter held by or for
the benefit or on behalf of any ABL Secured Party or any agent or trustee
therefor regardless of how acquired, whether by grant, statute, operation of
law, subrogation or otherwise, shall be junior and subordinate in all respects
to all Liens on the Term Loan Priority Collateral securing any Excess Term Loan
Debt.

 

(b)   As between ABL Secured Parties and Term Loan Secured Parties, the terms of
this Agreement, including the priorities set forth above, shall govern even if
part or all of the ABL Debt or Term Loan Debt or the Liens securing payment and
performance thereof are not perfected or are subordinated, avoided, disallowed,
set aside or otherwise invalidated in any judicial proceeding or otherwise.

 

2.3      Prohibition on Contesting Liens.  Each of ABL Agent, for itself and on
behalf of the other ABL Secured Parties, and Term Loan Agent, for itself and on
behalf of the other Term Loan Secured Parties, agrees that it shall not (and
hereby waives any right to) contest or support any other Person in contesting,
in any proceeding (including any Insolvency Proceeding), the perfection,
priority, validity or enforceability of a Lien held, or purported to be held, by
or for the benefit or on behalf of any Term Loan Secured Party in any Collateral
or by or on behalf of any ABL Secured Party in any Collateral, as the case may
be; provided, that, nothing in this Agreement shall be construed to prevent or
impair the rights of any ABL Secured Party or Term Loan Secured Party to enforce
this Agreement.

 

2.4      New Liens.  The parties hereto agree that it is their intention that
the Collateral securing the Term Loan Debt and the ABL Debt be identical, except
for the SVU Operating Property, which shall, prior to the Discharge of Term Loan
Debt, secure only the Term Loan Debt (except as otherwise expressly provided for
in the ABL Agreement as in effect on the date hereof or as amended in accordance
with this Agreement).  In furtherance of the foregoing, the parties hereto
agree, subject to the other provisions of this Agreement, upon request by the
ABL Agent or the Term Loan Agent, to cooperate in good faith (and to direct
their counsel to cooperate in good faith) from time to time in order to
determine the specific items included in the ABL Priority Collateral and the
Term Loan Priority Collateral and the steps taken to perfect their respective
Liens thereon and the identity of the respective parties obligated under the
Term Loan Documents and the ABL Loan Documents.

 

Section 3.              Enforcement

 

3.1      Exercise of Rights and Remedies.

 

(a)   So long as the Discharge of ABL Debt has not occurred, whether or not any
Insolvency Proceeding has been commenced by or against any Grantor, Term Loan
Agent, for itself and on behalf of the other Term Loan Secured Parties:

 

(i)        will not enforce or exercise, or seek to enforce or exercise, any
rights or remedies (including any right of setoff or notification of account
debtors) with respect to any ABL Priority Collateral (including the enforcement
of any right under any lockbox agreement,

 

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account control agreement, landlord waiver or bailee’s letter or any similar
agreement or arrangement, in each case relating to ABL Priority Collateral, to
which the Term Loan Agent or any other Term Loan Secured Party is a party) or
commence or join with any Person (other than ABL Agent with its consent) in
commencing, or filing a petition for, any action or proceeding with respect to
such rights or remedies (including any foreclosure action, provided, that, Term
Loan Agent or any other Term Loan Secured Party may commence or join with any
Person in commencing, or filing, a petition for any Insolvency Proceeding);

 

(ii)       will not contest, protest or object to any foreclosure action or
proceeding brought by ABL Agent or any other ABL Secured Party, or any other
enforcement or exercise by any ABL Secured Party of any rights or remedies
relating solely to the ABL Priority Collateral, so long as the Liens of Term
Loan Agent attach to the Proceeds thereof subject to the relative priorities set
forth in Section 2.1 and such actions or proceedings are being pursued in good
faith;

 

(iii)      will not object to the forbearance by ABL Agent or the other ABL
Secured Parties from commencing or pursuing any foreclosure action or proceeding
or any other enforcement or exercise of any rights or remedies with respect to
any of the ABL Priority Collateral;

 

(iv)     will not, so long as the Discharge of ABL Debt has not occurred and
except for actions permitted under Section 3.1(a)(i), take or receive any ABL
Priority Collateral, or any Proceeds thereof or payment with respect thereto, in
connection with the exercise of any right or remedy (including any right of
setoff) with respect to any ABL Priority Collateral (it being understood and
agreed that payments made by any Grantor in respect of the Term Loan Debt with
proceeds of loans or advances under the ABL Documents shall not constitute a
breach of this Section 3.1(a)(iv));

 

(v)      agrees that no covenant, agreement or restriction contained in any Term
Loan Document shall be deemed to restrict in any way the rights and remedies of
ABL Agent or the other ABL Secured Parties with respect to the ABL Priority
Collateral as set forth in this Agreement and the ABL Documents;

 

(vi)     will not object to the manner in which ABL Agent or any other ABL
Secured Party may seek to enforce or collect the ABL Debt or the Liens of such
ABL Secured Party on any ABL Priority Collateral, regardless of whether any
action or failure to act by or on behalf of ABL Agent or any other ABL Secured
Party is, or could be, adverse to the interests of the Term Loan Secured
Parties, and will not assert, and hereby waive, to the fullest extent permitted
by law, any right to demand, request, plead or otherwise assert or claim the
benefit of any marshalling, appraisal, valuation or other similar right that may
be available under applicable law with respect to the ABL Priority Collateral or
any other rights a junior secured creditor may have under applicable law with
respect to the matters described in this clause (vi); and

 

(vii)    will not attempt, directly or indirectly, whether by judicial
proceeding or otherwise, to challenge or question the validity or enforceability
of any ABL Debt or any Lien of ABL Agent or this Agreement, or the validity or
enforceability of the priorities, rights or obligations established by this
Agreement.

 

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(b)   So long as the Discharge of Term Loan Debt has not occurred, whether or
not any Insolvency Proceeding has been commenced by or against any Grantor, ABL
Agent, for itself and on behalf of the other ABL Secured Parties:

 

(i)        will not enforce or exercise, or seek to enforce or exercise, any
rights or remedies (including any right of setoff with respect to any deposit
accounts used exclusively for identifiable proceeds of Term Loan Priority
Collateral) with respect to any Term Loan Priority Collateral (including the
enforcement of any right under any lockbox agreement, account control agreement,
landlord waiver or bailee’s letter or any similar agreement or arrangement, in
each case relating to Term Loan Priority Collateral, to which the ABL Agent or
any other ABL Secured Party is a party) or commence or join with any Person
(other than Term Loan Agent with its consent) in commencing, or filing a
petition for, any action or proceeding with respect to such rights or remedies
(including any foreclosure action, provided, that, ABL Agent or any other ABL
Secured Party may commence or join with any Person in commencing, or filing, a
petition for any Insolvency Proceeding);

 

(ii)       will not contest, protest or object to any foreclosure action or
proceeding brought by Term Loan Agent or any other Term Loan Secured Party, or
any other enforcement or exercise by any Term Loan Secured Party of any rights
or remedies relating solely to the Term Loan Priority Collateral, so long as the
Liens of ABL Agent attach to the Proceeds thereof subject to the relative
priorities set forth in Section 2.1 and such actions or proceedings are being
pursued in good faith;

 

(iii)      will not object to the forbearance by Term Loan Agent or the other
Term Loan Secured Parties from commencing or pursuing any foreclosure action or
proceeding or any other enforcement or exercise of any rights or remedies with
respect to any of the Term Loan Priority Collateral;

 

(iv)     will not, so long as the Discharge of Term Loan Debt has not occurred
and except for actions permitted under Section 3.1(b)(i), take or receive any
Term Loan Priority Collateral, or any Proceeds thereof or payment with respect
thereto, in connection with the exercise of any right or remedy (including any
right of setoff) with respect to any Term Loan Priority Collateral (it being
understood and agreed that payments made by any Grantor in respect of the ABL
Debt with proceeds of loans or advances under the Term Loan Documents shall not
constitute a breach of this Section 3.1(b)(iv));

 

(v)      agrees that no covenant, agreement or restriction contained in any ABL
Document shall be deemed to restrict in any way the rights and remedies of Term
Loan Agent or the other Term Loan Secured Parties with respect to the Term Loan
Priority Collateral as set forth in this Agreement and the Term Loan Documents;

 

(vi)     will not object to the manner in which Term Loan Agent or any other
Term Loan Secured Party may seek to enforce or collect the Term Loan Debt or the
Liens of such Term Loan Secured Party on any Term Loan Priority Collateral,
regardless of whether any action or failure to act by or on behalf of Term Loan
Agent or any other Term Loan Secured Party is, or could be, adverse to the
interests of the ABL Secured Parties, and will not assert, and hereby waive, to
the fullest extent permitted by law, any right to demand, request, plead or
otherwise

 

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assert or claim the benefit of any marshalling, appraisal, valuation or other
similar right that may be available under applicable law with respect to the
Term Loan Priority Collateral or any other rights a junior secured creditor may
have under applicable law with respect to the matters described in this clause
(vi); and

 

(vii)    will not attempt, directly or indirectly, whether by judicial
proceeding or otherwise, to challenge or question the validity or enforceability
of any Term Loan Debt or any Lien of Term Loan Agent or this Agreement, or the
validity or enforceability of the priorities, rights or obligations established
by this Agreement.

 

(c)   Until the Discharge of ABL Debt has occurred, whether or not any
Insolvency Proceeding has been commenced by or against any Grantor, subject to
Section 3.1(a)(i) hereof, the ABL Secured Parties shall have the exclusive right
to commence, and maintain the exercise of their rights and remedies with respect
to the ABL Priority Collateral, including, without limitation, the exclusive
right, to the extent provided for in the ABL Documents or under applicable law,
to appoint an administrator, receiver or trustee in respect of the ABL Priority
Collateral, to take or retake control or possession of such Collateral and to
hold, prepare for sale, process, and sell, lease, dispose of, or liquidate such
ABL Priority Collateral, without any consultation with or the consent of any
Term Loan Secured Party; provided, that, the Lien securing the Term Loan Debt
shall continue as to the Proceeds of such Collateral released or disposed of
subject to the relative priorities described in Section 2 hereof.  In exercising
enforcement rights and remedies with respect to the ABL Priority Collateral, the
ABL Secured Parties may enforce the provisions of the ABL Documents with respect
to the ABL Priority Collateral and exercise remedies thereunder, all in such
order and in such manner as they may determine in the exercise of their sole
discretion.  Such exercise and enforcement shall include the rights of an agent
appointed by them to sell or otherwise realize on or dispose of any ABL Priority
Collateral upon foreclosure, to incur expenses in connection with such sale or
other realization or disposition, and to exercise all of the rights and remedies
of a secured creditor under the UCC and of a secured creditor under the
Bankruptcy Laws of any applicable jurisdiction.  Term Loan Secured Parties shall
not have any right to direct any ABL Secured Party to exercise any right, remedy
or power with respect to the ABL Priority Collateral and each Term Loan Secured
Party shall have no right to consent to any exercise of remedies under the ABL
Documents or applicable law in respect of any of the ABL Priority Collateral.

 

(d)   Until the Discharge of Term Loan Debt has occurred, whether or not any
Insolvency Proceeding has been commenced by or against any Grantor, subject to
Section 3.1(b)(i) hereof, the Term Loan Secured Parties shall have the exclusive
right to commence, and maintain the exercise of their rights and remedies with
respect to the Term Loan Priority Collateral, including, without limitation, the
exclusive right, to the extent provided for in the Term Loan Documents or under
applicable law, to appoint an administrator, receiver or trustee in respect of
the Term Loan Priority Collateral, to take or retake control or possession of
such Collateral and to hold, prepare for sale, process, and sell, lease, dispose
of, or liquidate such Term Loan Priority Collateral, without any consultation
with or the consent of any ABL Secured Party; provided, that, the Lien securing
the ABL Debt shall continue as to the Proceeds of such Collateral released or
disposed of subject to the relative priorities described in Section 2 hereof. 
In exercising enforcement rights and remedies with respect to the Term Loan
Priority Collateral, the Term Loan Secured Parties may enforce the provisions of
the Term Loan Documents with

 

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respect to the Term Loan Priority Collateral and exercise remedies thereunder,
all in such order and in such manner as they may determine in the exercise of
their sole discretion.  Such exercise and enforcement shall include the rights
of an agent appointed by them to sell or otherwise realize on or dispose of any
Term Loan Priority Collateral upon foreclosure, to incur expenses in connection
with such sale or other realization or disposition, and to exercise all of the
rights and remedies of a secured creditor under the UCC and of a secured
creditor under the Bankruptcy Laws of any applicable jurisdiction.  ABL Secured
Parties shall not have any right to direct any Term Loan Secured Party to
exercise any right, remedy or power with respect to the Term Loan Priority
Collateral and each ABL Secured Party shall have no right to consent to any
exercise of remedies under the Term Loan Documents or applicable law in respect
of any of the Term Loan Priority Collateral.

 

(e)   Notwithstanding the foregoing, each of the Term Loan Agent and the ABL
Agent may:

 

(i)        file a claim or statement of interest with respect to the ABL Debt,
Excess ABL Debt, Term Loan Debt or Excess Term Loan Debt, as the case may be, in
an Insolvency Proceeding that has been commenced by or against any Grantor;

 

(ii)       in the case of the Term Loan Agent, take any action in order to
create, perfect, preserve or protect (but not, prior to the Discharge of ABL
Debt, enforce) its Lien on any of the ABL Priority Collateral, and in the case
of the ABL Agent, take any action in order to create, perfect, preserve or
protect (but not, prior to the Discharge of Term Loan Debt, enforce) its Lien on
any of the Term Loan Priority Collateral;

 

(iii)      file any necessary responsive or defensive pleadings in opposition to
any motion, claim, adversary proceeding or other pleading made by any Person
objecting to or otherwise seeking the disallowance of the claims of the ABL
Secured Parties or Term Loan Secured Parties, including any claims secured by
the Collateral, if any, or otherwise make any agreements or file any motions or
objections pertaining to the claims of such Secured Parties, in each case in
accordance with the terms of this Agreement;

 

(iv)     file any pleadings, objections, motions or agreements which assert
rights or interests that are available to unsecured creditors of the Grantors,
including, without limitation, the commencement of an Insolvency Proceeding
against any Grantor, in each case, in accordance with applicable law and in a
manner not inconsistent with the terms of this Agreement (including, but not
limited to, any of the provisions of Section 6 hereof); and

 

(v)      vote on any plan of reorganization, file any proof of claim, make other
filings and make any arguments and motions that are, in each case, not
inconsistent with the terms of this Agreement.

 

3.2      Release of Second Priority Liens.

 

(a)   If the Agent with the senior Lien on any Collateral releases its Liens on
any part of such Collateral in connection with either any Disposition of any
Collateral permitted under the terms of the ABL Documents and the terms of the
Term Loan Documents or the exercise by the Agent with the senior Lien on any
Collateral of its enforcement remedies in respect of such

 

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Collateral, and including any Disposition of such Collateral by or on behalf of
any Grantor that is approved or consented to by the Agent with the senior Lien
therein at any time after an ABL Event of Default, in the case of ABL Priority
Collateral, or a Term Loan Event of Default, in the case of Term Loan Priority
Collateral, has occurred and is continuing, then effective upon the consummation
of any such Disposition or exercise of enforcement remedies, the Agent with the
junior Lien on any such Collateral shall:

 

(i)        be deemed to have automatically and without further action released
and terminated any Liens it may have on such Collateral; provided, that, (A) the
Liens of the Agent with such senior Lien on the Collateral so sold or disposed
of are released at the same time, and (B) such junior Lien shall remain in place
with respect to any Proceeds of such sale, transfer or other disposition under
this clause (a)(i) that are not applied to the repayment of ABL Debt (in the
case of ABL Priority Collateral) or the repayment of Term Loan Debt (in the case
of Term Loan Priority Collateral); and

 

(ii)       be deemed to have authorized the Agent with the senior Lien on such
Collateral to file UCC amendments and terminations and mortgage releases (as
applicable) covering the Collateral so sold or otherwise disposed of with
respect to the UCC financing statements and mortgage releases (as applicable)
between any Grantor and the Agent with the junior Lien thereon to evidence such
release and termination; and

 

(iii)      promptly upon the request of the Agent with the senior Lien thereon,
execute and deliver such other release documents and confirmations of the
authorization to file UCC amendments and terminations and mortgage releases (as
applicable) provided for herein, in each case as the Agent with the senior Lien
thereon may require in connection with such sale or other Disposition by such
Agent, such Agent’s agents or any Grantor with the consent of such Agent to
evidence and effectuate such termination and release; provided, that, any such
release or UCC amendment or termination by or on behalf of the Agent with the
junior Lien thereon shall not extend to or otherwise affect any of the rights,
if any, of such Agent with the junior Lien to the Proceeds from any such sale or
other Disposition of Collateral upon the payment and satisfaction in full in
cash of the ABL Debt or the Term Loan Debt, as the case may be, whichever is
secured by the senior Lien on such Collateral.

 

(b)   Each Agent, for itself and on behalf of the other Secured Parties for whom
such Agent is acting, hereby irrevocably constitutes and appoints the other
Agent and any officer or agent of such Agent, with full power of substitution,
as its true and lawful attorney-in-fact with full irrevocable power and
authority in the place and stead of such Agent with the junior Lien or such
holder or in the Agent’s own name, from time to time in such Agent’s (holding
the senior Lien) discretion, for the purpose of carrying out the terms of this
Section 3.2, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Section 3.2, including any termination statements, endorsements
or other instruments of transfer or release.  Nothing contained in this
Agreement shall be construed to modify the obligation of the Agent with the
senior Lien to act in a commercially reasonable manner in the exercise of its
rights to sell, lease, license, exchange, transfer or otherwise dispose of any
Collateral.

 

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3.3      Insurance and Condemnation Awards.

 

(a)   So long as the Discharge of ABL Debt has not occurred, ABL Agent and the
other ABL Secured Parties shall have the sole and exclusive right, subject to
the rights of Grantors under the ABL Documents, to settle and adjust claims in
respect of the ABL Priority Collateral under policies of insurance and to
approve any award granted in any condemnation or similar proceeding, or any deed
in lieu of condemnation in respect of the ABL Priority Collateral.  So long as
the Discharge of ABL Debt has not occurred, all Proceeds of any such policy and
any such award, or any payments with respect to a deed in lieu of condemnation,
shall (i) first, up to an amount not to exceed the ABL Debt, be paid to ABL
Agent for the benefit of the ABL Secured Parties to the extent required under
the ABL Documents, (ii) second, up to an amount not to exceed the Term Loan
Debt, be paid to Term Loan Agent for the benefit of the Term Loan Secured
Parties to the extent required under the applicable Term Loan Documents,
(iii) third, up to an amount not to exceed the Excess ABL Debt, be paid to ABL
Agent for the benefit of the ABL Secured Parties to the extent required under
the ABL Documents, (iv) fourth, up to an amount not to exceed the Excess Term
Loan Debt, be paid to Term Loan Agent for the benefit of the Term Loan Secured
Parties to the extent required under the applicable Term Loan Documents and
(v) fifth, if no Excess Term Loan Debt is outstanding, be paid to the owner of
the subject property or as a court of competent jurisdiction may otherwise
direct or may otherwise be required by applicable law.  Until the Discharge of
ABL Debt, if Term Loan Agent or any other Term Loan Secured Party shall, at any
time, receive any Proceeds of any such insurance policy or any such award or
payment, it shall pay such Proceeds over to ABL Agent in accordance with the
terms of Section 4.2.

 

(b)   So long as the Discharge of Term Loan Debt has not occurred, Term Loan
Agent and the other Term Loan Secured Parties shall have the sole and exclusive
right, subject to the rights of Grantors under the Term Loan Documents, to
settle and adjust claims in respect of the Term Loan Priority Collateral under
policies of insurance and to approve any award granted in any condemnation or
similar proceeding, or any deed in lieu of condemnation in respect of the Term
Loan Priority Collateral.  So long as the Discharge of Term Loan Debt has not
occurred, all Proceeds of any such policy and any such award, or any payments
with respect to a deed in lieu of condemnation, shall (i) first, up to an amount
not to exceed the Term Loan Debt, be paid to Term Loan Agent for the benefit of
the Term Loan Secured Parties to the extent required under the Term Loan
Documents, (ii) second, up to an amount not to exceed the ABL Debt, be paid to
ABL Agent for the benefit of the ABL Secured Parties to the extent required
under the applicable ABL Documents, (iii) third, up to an amount not to exceed
the Excess Term Loan Debt, be paid to Term Loan Agent for the benefit of the
Term Loan Secured Parties to the extent required under the Term Loan Documents,
(iv) fourth, up to an amount not to exceed the Excess ABL Debt, be paid to ABL
Agent for the benefit of the ABL Secured Parties to the extent required under
the applicable ABL Documents and (v) fifth,  if no Excess ABL Debt is
outstanding, be paid to the owner of the subject property or as a court of
competent jurisdiction may otherwise direct or may otherwise be required by
applicable law.  Until the Discharge of Term Loan Debt, if ABL Agent or any
other ABL Secured Party shall, at any time, receive any Proceeds of any such
insurance policy or any such award or payment, it shall pay such Proceeds over
to Term Loan Agent in accordance with the terms of Section 4.2.

 

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Section 4.              Payments

 

4.1      Application of Proceeds.

 

(a)   So long as the Discharge of ABL Debt or the repayment in full in cash of
the Excess ABL Debt has not occurred, the ABL Priority Collateral or Proceeds
thereof received in connection with any Disposition of, or collection on, such
ABL Priority Collateral, shall be applied in the following order of priority:

 

(i)        first, to the ABL Debt until the Discharge of ABL Debt has occurred;

 

(ii)       second, to the Term Loan Debt until the Discharge of Term Loan Debt 
has occurred;

 

(iii)      third, to the Excess ABL Debt until such obligations are paid in full
in cash;

 

(iv)     fourth, to the Excess Term Loan Debt until such obligations are paid in
full in cash;

 

(v)      fifth, to the applicable Grantor or as otherwise required by applicable
law.

 

(b)   So long as the Discharge of Term Loan Debt or the repayment in full in
cash of the Excess Term Loan Debt has not occurred, the Term Loan Priority
Collateral or Proceeds thereof received in connection with the Disposition of,
or collection on, such Term Loan Priority Collateral shall be applied in the
following order of priority:

 

(i)        first, to the Term Loan Debt until the Discharge of Term Loan Debt
has occurred;

 

(ii)       second, to the ABL Debt until the Discharge of ABL Debt  has
occurred;

 

(iii)      third, to the Excess Term Loan Debt until such obligations are paid
in full in cash;

 

(iv)     fourth, to the Excess ABL Debt until such obligations are paid in full
in cash;

 

(v)      fifth, to the applicable Grantor or as otherwise required by applicable
law.

 

(c)   The provisions of this Section 4.1 are intended solely to govern the
respective Lien priorities as between Term Loan Agent and ABL Agent and shall
not impose on any Agent or any other Secured Party any obligations in respect of
the disposition of Proceeds of foreclosure on any Collateral which would
conflict with prior perfected claims therein in favor of any other person or any
order or decree of any court or other governmental authority or any applicable
law.

 

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4.2      Payments Over.

 

(a)   At all times (i) prior to the Discharge of ABL Debt or (ii) after both the
Discharge of ABL Debt and the Discharge of Term Loan Debt, but prior to the
payment in full in cash of the Excess ABL Debt, in any case, whether or not any
Insolvency Proceeding has been commenced by or against any Grantor, Term Loan
Agent agrees, for itself and on behalf of the other Term Loan Secured Parties,
that any ABL Priority Collateral or Proceeds thereof (including any ABL Priority
Collateral or Proceeds thereof subject to Liens that have been avoided or
otherwise invalidated) or payment with respect thereto received by Term Loan
Agent or any other Term Loan Secured Party (including any right of set-off), and
including in connection with any insurance policy claim or any condemnation
award (or deed in lieu of condemnation), shall be segregated and held in trust
and promptly transferred or paid over to ABL Agent for the benefit of the ABL
Secured Parties in the same form as received, with any necessary endorsements or
assignments or as a court of competent jurisdiction may otherwise direct.  ABL
Agent is hereby authorized to make any such endorsements or assignments as agent
for Term Loan Agent.  This authorization is coupled with an interest and is
irrevocable.  Any payments made by Grantors in respect of the Term Loan Debt
with proceeds of loans or advances under the ABL Documents shall not be required
to be transferred or paid over to ABL Agent for the benefit of the ABL Secured
Parties.

 

(b)   At all times (i) prior to the Discharge of Term Loan Debt or (ii) after
both the Discharge of ABL Debt and the Discharge of Term Loan Debt, but prior to
the payment in full in cash of the Excess Term Loan Debt, in any case, whether
or not any Insolvency Proceeding has been commenced by or against any Grantor,
ABL Agent agrees, for itself and on behalf of the other ABL Secured Parties,
that any Term Loan Priority Collateral or Proceeds thereof (including any Term
Loan Priority Collateral or Proceeds thereof subject to Liens that have been
avoided or otherwise invalidated) or payment with respect thereto received by
ABL Agent or any other ABL Secured Party (including any right of set-off), and
including in connection with any insurance policy claim or any condemnation
award (or deed in lieu of condemnation), shall be segregated and held in trust
and promptly transferred or paid over to Term Loan Agent for the benefit of the
Term Loan Secured Parties in the same form as received, with any necessary
endorsements or assignments or as a court of competent jurisdiction may
otherwise direct. Term Loan Agent is hereby authorized to make any such
endorsements or assignments as agent for ABL Agent.  This authorization is
coupled with an interest and is irrevocable.

 

Section 5.              Bailee for Perfection

 

5.1      Each Agent as Bailee.

 

(a)   Each Agent agrees to hold any Collateral that is in the possession or
control of such Agent (or its agents or bailees), to the extent that possession
or control thereof is effective to perfect a Lien thereon under the Uniform
Commercial Code (such Collateral being referred to herein as the “Pledged
Collateral”), as bailee and agent for and on behalf of the other Agent solely
for the purpose of perfecting the Lien granted to the other Agent in such
Pledged Collateral (including as to any securities or any deposit accounts or
securities accounts, if any, for purposes of satisfying the requirements of
Sections 8-106(d)(3), 8-301(a)(2) and 9-313(c) of the UCC) pursuant to the ABL
Documents or Term Loan Documents, as applicable, subject to the terms and
conditions of this Section 5.

 

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(b)   Until the Discharge of ABL Debt has occurred, ABL Agent shall be entitled
to deal with the Pledged Collateral constituting ABL Priority Collateral in
accordance with the terms of the ABL Documents. The rights of Term Loan Agent to
such Pledged Collateral shall at all times be subject to the terms of this
Agreement and to ABL Agent’s rights under the ABL Documents.  Until the
Discharge of Term Loan Debt has occurred, Term Loan Agent shall be entitled to
deal with the Pledged Collateral constituting Term Loan Priority Collateral in
accordance with the terms of the Term Loan Documents.  The rights of ABL Agent
to such Pledged Collateral shall at all times be subject to the terms of this
Agreement and to Term Loan Agent’s rights under the Term Loan Documents.

 

(c)   Each Agent shall have no obligation whatsoever to the other Agent or any
other Secured Party to assure that the Pledged Collateral is genuine or owned by
any of the Grantors or to preserve rights or benefits of any Person except as
expressly set forth in this Section 5. The duties or responsibilities of each
Agent under this Section 5 shall be limited solely to holding the Pledged
Collateral as bailee and agent for and on behalf of the other Agent for purposes
of perfecting the Lien held by the other Agent.

 

(d)   Each Agent shall not have by reason of the ABL Documents, the Term Loan
Documents or this Agreement or any other document or otherwise in connection
with the transactions contemplated by this Agreement, the ABL Documents and the
Term Loan Documents a fiduciary relationship in respect of the other Agent or
any of the other Secured Parties and shall not have any liability to the other
Agent or any other Secured Party in connection with its holding the Pledged
Collateral.  Each Agent hereby waives any claims against the other Agent for any
breach or alleged breach of fiduciary duty.

 

5.2      Transfer of Pledged Collateral.

 

(a)   Upon the Discharge of ABL Debt, to the extent permitted under applicable
law, upon the request of Term Loan Agent:

 

(i)        ABL Agent shall, without recourse or warranty, transfer the
possession and control of the Pledged Collateral, if any, then in its possession
or control to Term Loan Agent, except in the event and to the extent (A) ABL
Agent or any other ABL Secured Party has retained or otherwise acquired such
Collateral in full or partial satisfaction of any of the ABL Debt, (B) such
Collateral is sold or otherwise disposed of by ABL Agent or any other ABL
Secured Party or by a Grantor as provided herein or (C) it is otherwise required
by any order of any court or other governmental authority or applicable law or
would result in the risk of liability of ABL Secured Party to any third party.

 

(ii)       In connection with any transfer described herein to Term Loan Agent,
ABL Agent agrees to take reasonable actions in its power (with all costs and
expenses in connection therewith to be for the account of Term Loan Agent and to
be paid by Grantors) as shall be reasonably requested by Term Loan Agent to
permit Term Loan Agent to obtain, for the benefit of the Term Loan Secured
Parties, a first priority security interest in the Pledged Collateral, including
in connection with the terms of any Collateral Access Agreement (as defined in
the ABL Agreement), whether with a landlord, processor, warehouse or other third
party or any Deposit Account Control Agreement (as defined in the ABL
Agreement), with respect to any

 

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such agreement delivered on or after the date hereof, ABL Agent shall notify the
other parties thereto that it is no longer the “Secured Party Representative”,
“Agent Representative”, “Lender Representative” or otherwise entitled to act
under such agreement and shall confirm to such parties that Term Loan Agent is
thereafter the “Secured Party Representative”, “Agent Representative”, “Lender
Representative” as any of such terms are used in any such agreement and is
otherwise entitled to the rights of the secured party under such agreement.

 

(iii)      The foregoing provision shall not impose on ABL Agent or any other
ABL Secured Party any obligations which would conflict with prior perfected
claims therein in favor of any other person or any order or decree of any court
or other governmental authority or any applicable law.

 

(b)   Upon the Discharge of Term Loan Debt, to the extent permitted under
applicable law, upon the request of ABL Agent, Term Loan Agent shall, without
recourse or warranty, transfer the possession and control of the Pledged
Collateral, if any, then in its possession or control to ABL Agent, except in
the event and to the extent (i) Term Loan Agent or any other Term Loan Secured
Party has retained or otherwise acquired such Collateral in full or partial
satisfaction of any of the Term Loan Debt, (ii) such Collateral is sold or
otherwise disposed of by Term Loan Agent or any other Term Loan Secured Party or
by a Grantor as provided herein or (iii) it is otherwise required by any order
of any court or other governmental authority or applicable law or would result
in the risk of liability of Term Loan Secured Party to any third party.  In
connection with any transfer described herein to ABL Agent, Term Loan Agent
agrees to take reasonable actions in its power (with all costs and expenses in
connection therewith to be for the account of ABL Agent and to be paid by
Grantors) as shall be reasonably requested by ABL Agent to permit ABL Agent to
obtain, for the benefit of the ABL Secured Parties, a first priority security
interest in the Pledged Collateral. The foregoing provision shall not impose on
Term Loan Agent or any other Term Loan Secured Party any obligations which would
conflict with prior perfected claims therein in favor of any other person or any
order or decree of any court or other governmental authority or any applicable
law.

 

(c)   After both the Discharge of ABL Debt and the Discharge of Term Loan Debt,
but prior to the payment in full in cash of the Excess ABL Debt, Term Loan Agent
shall take the same actions set out in Section 5.2(a) above to be taken by the
ABL Agent upon the Discharge of ABL Debt so as to transfer the possession and
control and related rights to the Pledged Collateral back to ABL Agent.  After
the payment in full in cash of the Excess ABL Debt, ABL Agent shall take the
same actions set out in Section 5.2(a) above to be taken by the ABL Agent upon
the Discharge of ABL Debt so as to transfer the possession and control and
related rights to the Pledged Collateral back to Term Loan Agent.

 

(d)   After both the Discharge of Term Loan Debt and the Discharge of ABL Debt,
but prior to the payment in full in cash of the Excess Term Loan Debt, ABL Agent
shall take the same actions set out in Section 5.2(b) above to be taken by the
Term Loan Agent upon the Discharge of Term Loan Debt so as to transfer the
possession and control and related rights to the Pledged Collateral back to Term
Loan Agent. After the payment in full in cash of the Excess Term Loan Debt, Term
Loan Agent shall take the same actions set out in Section 5.2(b) above to be
taken by the Term Loan Agent upon the Discharge of Term Loan Debt so as to
transfer the possession and control and related rights to the Pledged Collateral
back to ABL Agent.

 

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(e)   Each Grantor acknowledges and agrees to the delivery or transfer of
control by ABL Agent to Term Loan Agent, and by Term Loan Agent to ABL Agent, of
any such Collateral and waives and releases ABL Agent and the other ABL Secured
Parties, and Term Loan Agent and the other Term Loan Secured Parties, from any
liability as a result of such action.  Each Grantor shall take such further
actions as are reasonably required to effectuate the transfer contemplated in
this Section 5.2 and shall indemnify the Agent having the first priority Lien
prior to such transfer for loss or damage suffered by such Agent as a result of
such transfer, except to the extent resulting from such Agent’s own gross
negligence or willful misconduct as determined pursuant to a final,
non-appealable order of a court of competent jurisdiction.

 

Section 6.              Insolvency Proceedings

 

6.1      General Applicability.  This Agreement shall be applicable both before
and after the institution of any Insolvency Proceeding involving any Grantor,
including, without limitation, the filing of any petition by or against any
Grantor under the Bankruptcy Code or under any other Bankruptcy Law and all
converted or subsequent cases in respect thereof, and all references herein to
any Grantor shall be deemed to apply to the trustee for such Grantor and such
Grantor as debtor-in-possession.  The relative rights of the ABL Secured Parties
and the Term Loan Secured Parties in or to any distributions from or in respect
of any Collateral or Proceeds shall continue after the commencement of any
Insolvency Proceeding involving any Grantor, including, without limitation, the
filing of any petition by or against any Grantor under the Bankruptcy Code or
under any other Bankruptcy Law and all converted cases and subsequent cases, on
the same basis as prior to the date of such commencement, subject to any court
order approving the financing of, or use of ABL Cash Collateral or Term Loan
Cash Collateral by, any Grantor as debtor-in-possession, or any other court
order affecting the rights and interests of the parties hereto not in conflict
with this Agreement.  This Agreement shall constitute a subordination agreement
for the purposes of Section 510(a) of the Bankruptcy Code and shall be
enforceable in any Insolvency Proceeding in accordance with its terms.

 

6.2      Use of Cash Collateral; Bankruptcy Financing.

 

(a)   If any Grantor becomes subject to any Insolvency Proceeding, and if ABL
Agent or the ABL Secured Parties shall seek to provide a Grantor with, or
consent to a third party providing, any post-petition financing under
Section 364 of the Bankruptcy Code, or any comparable provision of any other
Bankruptcy Law (an “ABL DIP Financing”), or the ABL Agent or the ABL Secured
Parties consent to the use of any ABL Priority Collateral constituting cash
collateral under Section 363 of the Bankruptcy Code, or any comparable provision
of any other Bankruptcy Law (“ABL Cash Collateral”), until the Discharge of ABL
Debt has occurred, Term Loan Agent, for itself and on behalf of the other Term
Loan Secured Parties, agrees that each Term Loan Secured Party (i) will raise no
objection to, nor support any other Person objecting to, and will be deemed to
have consented to, the use of any ABL Cash Collateral, or ABL DIP Financing,
(ii) will not request or accept adequate protection or any other relief in
connection with the use of such ABL Cash Collateral or such ABL DIP Financing
except as set forth in Section 6.4 below, and (iii) will subordinate (and will
be deemed hereunder to have subordinated) the Liens on ABL Priority Collateral
granted to Term Loan Agent or any other Term Loan Secured Parties pursuant to
such ABL DIP Financing on the same terms as such Liens are subordinated
hereunder to the Liens granted with respect to such ABL DIP Financing

 

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(and such subordination will not alter in any manner the terms of this
Agreement), to any adequate protection provided to the ABL Secured Parties and
to any “carve-out” or other similar administrative priority expense or claim
consented to in writing by ABL Agent to be paid prior to the Discharge of ABL
Debt, provided, that:

 

(A)      the aggregate principal amount of the ABL DIP Financing plus the
aggregate outstanding principal amount of ABL Debt under the ABL Agreement plus
the aggregate face amount of any letters of credit issued and not reimbursed
under the ABL Agreement shall not exceed the ABL Cap,

 

(B)      the Term Loan Secured Parties retain a Lien on the Collateral
(including Proceeds thereof arising after the commencement of such proceeding)
with the same priority relative to the Liens on such Collateral of ABL Agent as
existed prior to the commencement of the case under the Bankruptcy Code or other
Bankruptcy Law (junior in priority to the Liens securing such ABL DIP Financing
and the existing Liens in favor of the ABL Agent on the ABL Priority Collateral
but senior to the Liens of the ABL Agent and the Liens securing such ABL DIP
Financing on the Term Loan Priority Collateral to the same extent as provided
under Section 2.2),

 

(C)      Term Loan Agent receives additional or replacement Liens on all
post-petition assets of any Grantor which are subject to an additional or
replacement Lien to secure the ABL DIP Financing with same priority relative to
the Liens of ABL Agent as existed prior to such Insolvency Proceeding to the
extent Term Loan Agent seeks such Liens and is entitled to such additional or
replacement Liens under the Bankruptcy Code or other applicable Bankruptcy Law
as determined by the Bankruptcy Court having jurisdiction over the case,

 

(D)      such ABL DIP Financing or use of ABL Cash Collateral is subject to the
terms of this Agreement,

 

(E)      the Term Loan Agent retains the right to object to any agreements or
arrangements regarding the use of ABL Cash Collateral or the ABL DIP Financing
that require a specific treatment of a claim in respect of the Term Loan Debt
for purposes of a plan of reorganization or contravene the terms of this
Agreement in any material respect, and

 

(F)      as a condition of such ABL DIP Financing or use of ABL Cash Collateral,
until the Discharge of Term Loan Debt, (1) all proceeds of the Term Loan
Priority Collateral shall either (x) be remitted to the Term Loan Agent for
application in accordance with Section 4.1 hereof or (y) only be used by
Borrowers subject to terms and conditions reasonably acceptable to the Term Loan
Agent, and (2) no portion of the Term Loan Priority Collateral shall be used to
repay the ABL Loan Debt outstanding as of the date of the commencement of any
Insolvency Proceeding or any ABL Loan Debt incurred thereafter pursuant to any
such ABL DIP Financing or use of ABL Cash Collateral.

 

(b)   If any Grantor becomes subject to any Insolvency Proceeding, and if Term
Loan Agent or the Term Loan Secured Parties shall seek to provide a Grantor
with, or consent to a third party providing, any post-petition financing under
Section 364 of the Bankruptcy Code, or any comparable provision of any other
Bankruptcy Law (a “Term Loan DIP Financing”), or the

 

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Term Loan Agent or the Term Loan Secured Parties consent to the use of any Term
Loan Priority Collateral constituting cash collateral under Section 363 of the
Bankruptcy Code, or any comparable provision of any other Bankruptcy Law (“Term
Loan Cash Collateral”), until the Discharge of Term Loan Debt has occurred, ABL
Agent, for itself and on behalf of the other ABL Secured Parties, agrees that
each ABL Secured Party (i) will raise no objection to, nor support any other
Person objecting to, and will be deemed to have consented to, the use of any
Term Loan Cash Collateral, or Term Loan DIP Financing, (ii) will not request or
accept adequate protection or any other relief in connection with the use of
such Term Loan Cash Collateral or such Term Loan DIP Financing except as set
forth in Section 6.4 below, and (iii) will subordinate (and will be deemed
hereunder to have subordinated) the Liens on Term Loan Priority Collateral
granted to ABL Agent or any other ABL Secured Parties pursuant to such Term Loan
DIP Financing on the same terms as such Liens are subordinated hereunder to the
Liens granted with respect to such Term Loan DIP Financing (and such
subordination will not alter in any manner the terms of this Agreement), to any
adequate protection provided to the Term Loan Secured Parties and to any
“carve-out” or other similar administrative priority expense or claim consented
to in writing by Term Loan Agent to be paid prior to the Discharge of Term Loan
Debt, provided, that:

 

(A)      the aggregate principal amount of the Term Loan DIP Financing plus the
aggregate outstanding principal amount of Term Loan Debt under the Term Loan
Agreement shall not exceed the Term Loan Cap,

 

(B)      the ABL Secured Parties retain a Lien on the Collateral (including
Proceeds thereof arising after the commencement of such proceeding) with the
same priority relative to the Liens on such Collateral of Term Loan Agent as
existed prior to the commencement of the case under the Bankruptcy Code or other
Bankruptcy Law (junior in priority to the Liens securing such Term Loan DIP
Financing and the existing Liens in favor of the Term Loan Agent on the Term
Loan Priority Collateral but senior to the Liens of the Term Loan Agent on the
ABL Priority Collateral to the same extent as provided under Section 2.2),

 

(C)      ABL Agent receives additional or replacement Liens on all post-petition
assets of any Grantor which are subject to an additional or replacement Lien to
secure the Term Loan DIP Financing with same priority relative to the Liens of
Term Loan Agent as existed prior to such Insolvency Proceeding to the extent ABL
Agent seeks such Liens and is entitled to such additional or replacement Liens
under the Bankruptcy Code or other applicable Bankruptcy Law as determined by
the Bankruptcy Court having jurisdiction over the case,

 

(D)      such Term Loan DIP Financing or use of Term Loan Cash Collateral is
subject to the terms of this Agreement,

 

(E)      the ABL Agent retains the right to object to any agreements or
arrangements regarding the use of Term Loan Cash Collateral or the Term Loan DIP
Financing that require a specific treatment of a claim in respect of the ABL
Debt for purposes of a plan of reorganization or contravene the terms of this
Agreement in any material respect, and

 

(F)      as a condition of such Term Loan DIP Financing or use of Term Loan Cash
Collateral, until the Discharge of ABL Debt, (1) all proceeds of the ABL
Priority Collateral

 

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shall either (x) be remitted to the ABL Agent for application in accordance with
Section 4.1 hereof or (y) only be used by Borrowers subject to terms and
conditions reasonably acceptable to the ABL Agent, and (2) no portion of the ABL
Priority Collateral shall be used to repay the Term Loan Debt outstanding as of
the date of the commencement of any Insolvency Proceeding or any Term Loan Debt
incurred thereafter pursuant to any such Term Loan DIP Financing or use of Term
Loan Cash Collateral.

 

(c)   No ABL Secured Party shall, directly or indirectly, provide, or seek to
provide, or support any other Person providing or seeking to provide, the use of
ABL Cash Collateral or ABL DIP Financing secured by Liens equal or senior in
priority to the Liens on the Term Loan Priority Collateral (including any assets
or property arising after the commencement of a case under the Bankruptcy Code)
of Term Loan Agent, without the prior written consent of Term Loan Agent.  No
Term Loan Secured Party shall, directly or indirectly, provide, or seek to
provide, or support any other Person providing or seeking to provide, the use of
Term Loan Cash Collateral or Term Loan DIP Financing secured by Liens equal or
senior in priority to the Liens on the ABL Priority Collateral (including any
assets or property arising after the commencement of a case under the Bankruptcy
Code) of ABL Agent, without the prior written consent of ABL Agent.  For
purposes hereof, all references to Collateral shall include any assets or
property of Grantors arising after the commencement of any Insolvency Proceeding
that are subject to the Liens of Agents.

 

6.3      Relief from the Automatic Stay.

 

(a)   The Term Loan Agent, for itself and on behalf of the other Term Loan
Secured Parties, agrees that, so long as the Discharge of ABL Debt has not
occurred, no Term Loan Secured Party shall, without the prior written consent of
the ABL Agent, seek or request relief from or modification of the automatic stay
or any other stay in any Insolvency or Liquidation Proceeding in respect of any
part of the ABL Priority Collateral, any Proceeds thereof or any Lien thereon
securing any of the Term Loan Debt.

 

(b)   The ABL Agent, for itself and on behalf of the other ABL Secured Parties,
agrees that, so long as the Discharge of Term Loan Debt has not occurred, no ABL
Secured Party shall, without the prior written consent of the Term Loan Agent,
seek or request relief from or modification of the automatic stay or any other
stay in any Insolvency or Liquidation Proceeding in respect of any part of the
Term Loan Priority Collateral, any Proceeds thereof or any Lien thereon securing
any of the ABL Debt.

 

6.4      Adequate Protection.

 

(a)   The Term Loan Agent, on behalf of itself and the other Term Loan Secured
Parties, agrees that none of them shall contest (or support any other Person
contesting):

 

(i)        any request by the ABL Agent or the other ABL Secured Parties for
adequate protection with respect to Liens on the ABL Priority Collateral; or

 

(ii)       any objection by the ABL Agent or the other ABL Secured Parties to
any motion, relief, action or proceeding based on the ABL Agent or the other ABL
Secured Parties

 

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claiming a lack of adequate protection with respect to Liens on the ABL Priority
Collateral to the extent not inconsistent with the other terms of this
Agreement.

 

(b)   The ABL Agent, on behalf of itself and the other ABL Secured Parties,
agrees that none of them shall contest (or support any other Person contesting):

 

(i)        any request by the Term Loan Agent or the other Term Loan Secured
Parties for adequate protection with respect to Liens on the Term Loan Priority
Collateral; or

 

(ii)       any objection by the Term Loan Agent or the other Term Loan Secured
Parties to any motion, relief, action or proceeding based on the Term Loan Agent
or the other Term Loan Secured Parties claiming a lack of adequate protection
with respect to Liens on the Term Loan Priority Collateral to the extent not
inconsistent with the other terms of this Agreement.

 

(c)   Notwithstanding anything to the contrary in Sections 6.4(a) and 6.4(b), in
any Insolvency Proceeding:

 

(i)        if any or all of the ABL Secured Parties are granted adequate
protection in the form of additional collateral or a super-priority claim in
connection with any use of ABL Cash Collateral or an ABL DIP Financing or in
connection with any Liens on the ABL Priority Collateral and such additional
collateral is the type of asset or property that would constitute ABL Priority
Collateral, then (A) the Term Loan Agent, on behalf of itself or any of the Term
Loan Secured Parties, may seek or request adequate protection in the form of a
Lien or super-priority claim on such additional collateral, which Lien or claim
will be subordinated to the Liens securing the ABL Debt and such use of ABL Cash
Collateral or ABL DIP Financing (and all obligations relating thereto) on the
same basis as the other Liens on ABL Priority Collateral securing the Term Loan
Debt are so subordinated to the Liens on ABL Priority Collateral securing the
ABL Debt under this Agreement and (B) subject to clause (ii) below, the ABL
Agent, on behalf of itself and the other ABL Secured Parties, agrees that none
of them shall contest (or support any other Person contesting) (1) any request
by the Term Loan Agent or any other Term Loan Secured Party for adequate
protection pursuant to the preceding clause (A) or (2) any objection to any
motion, relief, action or proceeding in support of a request for adequate
protection pursuant to the preceding clause (A);

 

(ii)       in the event the Term Loan Agent, on behalf of itself or any other
Term Loan Secured Parties, seeks or requests adequate protection in respect of
Term Loan Debt and such adequate protection is granted in the form of additional
collateral or super-priority claims of a type of asset or property that would
constitute ABL Priority Collateral, then the Term Loan Agent, on behalf of
itself and the other Term Loan Secured Parties, agrees that it will support any
request by the ABL Agent to also be granted a Lien or super-priority claim on
such additional collateral as security for the ABL Debt and for any use of ABL
Cash Collateral or ABL DIP Financing and that any Lien or claim on such
additional collateral securing the applicable Term Loan Debt shall be
subordinated to the Lien on such collateral securing the ABL Debt and any such
use of ABL Cash Collateral or ABL DIP Financing (and all obligations relating
thereto) and to any other Liens granted to the ABL Secured Parties as adequate
protection on the same basis as the other Liens on ABL Priority Collateral
securing the Term

 

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Loan Debt are so subordinated to the Liens on ABL Priority Collateral securing
the ABL Debt under this Agreement;

 

(iii)      if any or all of the Term Loan Secured Parties are granted adequate
protection in the form of additional collateral or a super-priority claim in
connection with any use of Term Loan Cash Collateral or a Term Loan DIP
Financing or in connection with any Liens on the Term Loan Priority Collateral
and such additional collateral is the type of asset or property that would
constitute Term Loan Priority Collateral, then (A) the ABL Agent, on behalf of
itself or any of the ABL Secured Parties, may seek or request adequate
protection in the form of a Lien or super-priority claim on such additional
collateral, which Lien or claim will be subordinated to the Liens securing the
Term Loan Debt and such use of Term Loan Cash Collateral or Term Loan DIP
Financing (and all obligations relating thereto) on the same basis as the other
Liens on Term Loan Priority Collateral securing the ABL Debt are so subordinated
to the Liens on Term Loan Priority Collateral securing the Term Loan Debt under
this Agreement and (B) subject to clause (iv) below, the Term Loan Agent, on
behalf of itself and the other Term Loan Secured Parties, agrees that none of
them shall contest (or support any other Person contesting) (1) any request by
the ABL Agent or any other ABL Secured Party for adequate protection pursuant to
the preceding clause (A) or (2) any objection to any motion, relief, action or
proceeding in support of a request for adequate protection pursuant to the
preceding clause (A);

 

(iv)     in the event the ABL Agent, on behalf of itself or any other ABL
Secured Parties, seeks or requests adequate protection in respect of ABL Debt
and such adequate protection is granted in the form of additional collateral or
super-priority claims of a type of asset or property that would constitute Term
Loan Priority Collateral, then the ABL Agent, on behalf of itself and the other
ABL Secured Parties, agrees that it will support any request by the Term Loan
Agent to also be granted a Lien or super-priority claim on such additional
collateral as security for the Term Loan Debt and for any use of Term Loan Cash
Collateral or Term Loan DIP Financing and that any Lien or claim on such
additional collateral securing the applicable ABL Debt shall be subordinated to
the Lien on such collateral securing the Term Loan Debt and any such use of Term
Loan Cash Collateral or Term Loan DIP Financing (and all obligations relating
thereto) and to any other Liens granted to the Term Loan Secured Parties as
adequate protection on the same basis as the other Liens on Term Loan Priority
Collateral securing the ABL Debt are so subordinated to the Liens on Term Loan
Priority Collateral securing the Term Loan Debt under this Agreement; and

 

(v)      except as otherwise expressly set forth in Section 6.2 or in connection
with the exercise of remedies with respect to the ABL Priority Collateral,
nothing herein shall limit the rights of the Term Loan Agent or the other Term
Loan Secured Parties from seeking adequate protection with respect to their
rights in the Term Loan Priority Collateral in any Insolvency Proceeding
(including adequate protection in the form of a cash payment, periodic cash
payments or otherwise).  Except as otherwise expressly set forth in Section 6.2
or in connection with the exercise of remedies with respect to the Term Loan
Priority Collateral, nothing herein shall limit the rights of the ABL Agent or
the other ABL Secured Parties from seeking adequate protection with respect to
their rights in the ABL Priority Collateral in any Insolvency Proceeding
(including adequate protection in the form of a cash payment, periodic cash
payments or otherwise).

 

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(d)   Except as otherwise provided in this Section 6.4, (i) no ABL Secured Party
may seek or assert any right it may have for adequate protection of its interest
in the Term Loan Priority Collateral without the prior written consent of the
Term Loan Secured Parties, and (ii) no Term Loan Secured Party may seek or
assert any right it may have for adequate protection of its interest in the ABL
Priority Collateral without the written consent of the ABL Secured Parties.

 

6.5      Reorganization Securities.  If, in any Insolvency Proceeding, debt
obligations of any reorganized Grantor secured by Liens upon any property of
such reorganized Grantor are distributed, pursuant to a plan of reorganization,
on account of both the ABL Debt and the Term Loan Debt, then, to the extent the
debt obligations distributed on account of the ABL Debt and on account of the
Term Loan Debt are secured by Liens upon the same assets or property, the
provisions of this Agreement will survive the distribution of such debt
obligations pursuant to such plan and will apply with like effect to the Liens
securing such debt obligations.

 

6.6      Separate Grants of Security and Separate Classes.  Each of the parties
hereto irrevocably acknowledges and agrees that (a) the claims and interests of
the ABL Secured Parties and the Term Loan Secured Parties are not “substantially
similar” within the meaning of Section 1122 of the Bankruptcy Code, or any
comparable provision of any other Bankruptcy Law, (b) the grants of the Liens to
secure the ABL Debt and the grants of the Liens to secure the Term Loan Debt
constitute two separate and distinct grants of Liens, (c) the ABL Secured
Parties’ rights in the Collateral are fundamentally different from the Term Loan
Secured Parties’ rights in the Collateral and (d) as a result of the foregoing,
among other things, the ABL Debt and the Term Loan Debt must be separately
classified in any plan of reorganization proposed or adopted in any Insolvency
Proceeding.

 

6.7      Asset Dispositions.

 

(a)   Until the Discharge of ABL Debt has occurred, the Term Loan Agent, for
itself and on behalf of the other Term Loan Secured Parties, agrees that, in the
event of any Insolvency Proceeding, the Term Loan Secured Parties will not
object or oppose (or support any Person in objecting or opposing) a motion for
any Disposition of any ABL Priority Collateral free and clear of the Liens of
Term Loan Agent and the other Term Loan Secured Parties or other claims under
Sections 363, 365 or 1129 of the Bankruptcy Code, or any comparable provision of
any Bankruptcy Law (and including any motion for bid procedures or other
procedures related to the Disposition that is the subject of such motion), and
shall be deemed to have consented to any such Disposition of any ABL Priority
Collateral under Section 363(f) of the Bankruptcy Code that has been consented
to by the ABL Agent; provided, that, the Proceeds of such Disposition of any
Collateral to be applied to the ABL Debt or the Term Loan Debt are applied in
accordance with Sections 4.1 and 4.2.

 

(b)   Until the Discharge of Term Loan Debt has occurred, the ABL Agent, for
itself and on behalf of the other ABL Secured Parties, agrees that, in the event
of any Insolvency Proceeding, the ABL Secured Parties will not object or oppose
(or support any Person in objecting or opposing) a motion to any Disposition of
any Term Loan Priority Collateral free and clear of the Liens of ABL Agent and
the other ABL Secured Parties or other claims under Sections 363, 365 or 1129 of
the Bankruptcy Code, or any comparable provision of any Bankruptcy Law (and
including any motion for bid procedures or other procedures related to the

 

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Disposition that is the subject of such motion), and shall be deemed to have
consented to any such Disposition of any Term Loan Priority Collateral under
Section 363(f) of the Bankruptcy Code that has been consented to by the Term
Loan Agent; provided, that, the Proceeds of such Disposition of any Collateral
to be applied to the ABL Debt or the Term Loan Debt are applied in accordance
with Sections 4.1 and 4.2.

 

(c)   The Term Loan Secured Parties agree that the ABL Secured Parties shall
have the right to credit bid under Section 363(k) of the Bankruptcy Code with
respect to any Disposition of, the ABL Priority Collateral and the ABL Secured
Parties agree that the Term Loan Secured Parties shall have the right to credit
bid under Section 363(k) of the Bankruptcy Code with respect to any Disposition
of the Term Loan Priority Collateral; provided, that, the Secured Parties shall
not be deemed to have agreed to any credit bid by other Secured Parties in
connection with the Disposition of Collateral consisting of both Term Loan
Priority Collateral and ABL Priority Collateral.  The Term Loan Agent, for
itself and on behalf of the other Term Loan Secured Parties, agrees that, so
long as the Discharge of ABL Debt has not occurred, no Term Loan Secured Party
shall, without the prior written consent of the ABL Agent, credit bid under
Section 363(k) of the Bankruptcy Code with respect to the ABL Priority
Collateral.  The ABL Agent, for itself and on behalf of the other ABL Secured
Parties, agrees that, so long as the Discharge of Term Loan Debt has not
occurred, no ABL Secured Party shall, without the prior written consent of the
Term Loan Agent, credit bid under Section 363(k) of the Bankruptcy Code with
respect to the Term Loan Priority Collateral.

 

6.8      Certain Waivers as to Section 1111(b)(2) of Bankruptcy Code.  Term Loan
Agent, for itself and on behalf of the other Term Loan Secured Parties, waives
any claim any Term Loan Secured Party may hereafter have against any ABL Secured
Party arising out of the election by any ABL Secured Party of the application of
Section 1111(b)(2) of the Bankruptcy Code, or any comparable provision of any
other Bankruptcy Law.  ABL Agent, for itself and on behalf of the other ABL
Secured Parties, waives any claim any ABL Secured Party may hereafter have
against any Term Loan Secured Party arising out of the election by any Term Loan
Secured Party of the application of Section 1111(b)(2) of the Bankruptcy Code or
any comparable provision of any other Bankruptcy Law.

 

6.9      Avoidance Issues.  If any ABL Secured Party is required in any
Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate
of any Grantor or any other person any amount (a “Recovery”), then the ABL Debt
shall be reinstated to the extent of such Recovery and the ABL Secured Parties
shall be entitled to a Discharge of ABL Debt with respect to all such recovered
amounts.  If any Term Loan Secured Party is required in any Insolvency
Proceeding or otherwise to turn over or otherwise pay to the estate of any
Grantor or any other person any Recovery, then the Term Loan Debt shall be
reinstated to the extent of such Recovery and the Term Loan Secured Parties
shall be entitled to a Discharge of Term Loan Debt with respect to all such
recovered amounts.  If this Agreement shall have been terminated prior to any
Recovery, this Agreement shall be reinstated in full force and effect, and such
prior termination shall not diminish, release, discharge, impair or otherwise
affect the obligations of the parties hereto from such date of reinstatement.

 

6.10   Other Bankruptcy Laws.  In the event that an Insolvency Proceeding is
filed in a jurisdiction other than the United States or is governed by any
Bankruptcy Law other than the

 

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Bankruptcy Code, each reference in this Agreement to a section of the Bankruptcy
Code shall be deemed to refer to the substantially similar or corresponding
provision of the Bankruptcy Law applicable to such Insolvency Proceeding, or, in
the absence of any specific similar or corresponding provision of Bankruptcy
Law, such other general Bankruptcy Law as may be applied in order to achieve
substantially the same result as would be achieved under each applicable section
of the Bankruptcy Code.

 

6.11   Post-Petition Claims.  Neither the ABL Agent nor any other ABL Secured
Party shall oppose or seek to challenge any claim by the Term Loan Agent or any
other Term Loan Secured Party for allowance in any Insolvency Proceeding of Term
Loan Debt consisting of post-petition interest, fees, costs, charges or expenses
to the extent of the value of any Term Loan Secured Party’s Lien.  Neither the
Term Loan Agent nor any other Term Loan Secured Party shall oppose or seek to
challenge any claim by the ABL Agent or any other ABL Secured Party for
allowance in any Insolvency Proceeding of ABL Debt consisting of post-petition
interest, fees, costs, charges or expenses to the extent of the value of any ABL
Secured Party’s Lien.

 

Section 7.              Term Loan Lenders’ Purchase Option

 

7.1      Exercise of Option  On or after the occurrence and during the
continuance of an ABL Event of Default and the acceleration of all of the ABL
Debt or the commencement of an Insolvency Proceeding as to Grantors (each a
“Term Loan Purchase Event”), one or more of the Term Loan Secured Parties (the
“Purchasing Term Loan Secured Parties”), shall have the option, subject to
Section 7.2, for a period of ten (10) Business Days after a Term Loan Purchase
Event to purchase all (but not less than all) of the ABL Debt from the ABL
Secured Parties and to assume all of the commitments and duties of the ABL
Secured Parties.  Notice of the exercise of such option shall be sent by Term
Loan Agent to ABL Agent within such ten (10) Business Day period and shall be
irrevocable.  The obligations of ABL Secured Parties hereunder to sell the ABL
Debt owing to them are several and not joint and several.  Each Grantor
irrevocably consents to such sale.

 

7.2      Pro Rata Offer.  The Term Loan Secured Parties agree, solely as among
themselves, that upon the occurrence of any Term Loan Purchase Event, the Term
Loan Agent shall send a notice to all Term Loan Secured Parties giving each Term
Loan Secured Party the option to purchase at least its pro rata share
(calculated based on the aggregate Term Loan Debt) of the ABL Debt.  No Term
Loan Secured Party shall be required to participate in any purchase offer
hereunder, and a purchase offer may be made by any or all of the Term Loan
Secured Parties, subject to the requirements of the preceding sentence.  The
provisions of this Section 7.2 are intended solely for the benefit of the Term
Loan Secured Parties and may be modified, amended or waived by them without the
approval of any Grantor, any ABL Secured Party, or otherwise.

 

7.3      Purchase and Sale.  On the date specified by Term Loan Agent in such
notice (which shall not be less than five (5) Business Days, nor more than ten
(10) Business Days, after the receipt by ABL Agent of the notice from Term Loan
Agent of its election to exercise such option), ABL Secured Parties shall,
subject to any required approval of any court or other regulatory or
governmental authority then in effect, if any, sell to such of the Purchasing
Term Loan Secured Parties as are specified in the notice from Term Loan Agent of
its election to

 

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exercise such option, and such Purchasing Term Loan Secured Parties shall
purchase from ABL Secured Parties, all of the ABL Debt.  Notwithstanding
anything to the contrary contained herein, in connection with any such purchase
and sale, ABL Secured Parties shall retain all rights under the ABL Documents to
be indemnified or held harmless by Grantors in accordance with the terms
thereof.  In connection with any such purchase and sale, each ABL Secured Party
and each Purchasing Term Loan Secured Party shall execute and deliver an
assignment and acceptance agreement, in form reasonably acceptable to all
parties thereto, pursuant to which, among other things, each ABL Lender shall
assign to the Purchasing Term Loan Secured Parties such ABL Lender’s pro rata
share of the commitments and ABL Debt.  Upon the consummation of such purchase
and sale, ABL Agent shall resign as the “Agent” under the ABL Documents and upon
the written request of Term Loan Agent, and at the expense of the Purchasing
Term Loan Secured Parties, shall execute and deliver all such documents and
instruments reasonably requested by Term Loan Agent and/or Purchasing Term Loan
Secured Parties to assign and transfer any Collateral, together with any and all
rights under deposit account control agreements and collateral access agreements
related to Collateral, to the applicable successor Agent under the ABL
Documents.

 

7.4      Payment of Purchase Price.

 

(a)   Upon the date of such purchase and sale, the Purchasing Term Loan Secured
Parties shall (i) pay to ABL Agent for the account of the ABL Secured Parties as
the purchase price therefor the full amount of all of the ABL Debt then
outstanding and unpaid (including principal, interest, fees and expenses, and
including reasonable attorneys’ fees and legal expenses), (ii) furnish cash
collateral to ABL Agent in such amounts as are required by the ABL Documents in
connection with any issued and outstanding letters of credit, banker’s
acceptances or similar or related instruments issued under the ABL Documents
(but not in any event in an amount greater than one hundred three percent (103%)
percent of the aggregate undrawn face amount of such letters of credit, banker’s
acceptances and similar or related instruments, other than obligations with
respect to the foregoing denominated in a currency other than US Dollars, in
which case one hundred fifteen percent (115%) of the applicable amount), Bank
Product Obligations (or at the option of the ABL Secured Party to whom such Bank
Product Obligations are owing, terminate the applicable Swap Contracts or cash
management or other arrangements and make all payments pursuant thereto, as
applicable), Commercial LC Facility Obligations and in respect of
indemnification obligations of Grantors under the ABL Documents as to matters or
circumstances known to ABL Secured Parties and disclosed in writing to Term Loan
Agent (unless such disclosure is not permitted under applicable law) at the time
of the purchase and sale which would reasonably be expected to result in any
loss, cost, damage or expense (including reasonable attorneys’ fees and legal
expenses) to ABL Secured Parties, and (iii) agree to indemnify and hold harmless
the ABL Secured Parties from and against any loss, liability, claim, damage or
expense (including reasonable fees and expenses of legal counsel) arising out of
any claim asserted by a third party in respect of the ABL Debt as a direct
result of any acts by Term Loan Agent or any other Term Loan Secured Party.

 

(b)   Such purchase price and cash collateral shall be remitted by wire transfer
in federal funds to such bank account of ABL Agent as ABL Agent may designate in
writing to Term Loan Agent for such purpose.  Interest shall be calculated to
but excluding the Business Day on which such purchase and sale shall occur if
the amounts so paid by the Purchasing Term

 

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Loan Secured Parties to the bank account designated by ABL Agent are received in
such bank account prior to 12:00 noon, New York City time and interest shall be
calculated to and including such Business Day if the amounts so paid by the
Purchasing Term Loan Secured Parties to the bank account designated by ABL Agent
are received in such bank account later than 12:00 noon, New York City time.

 

7.5      Representations Upon Purchase and Sale.  Such purchase and sale shall
be expressly made without representation or warranty of any kind by ABL Agent or
any other ABL Secured Party as to the ABL Debt or otherwise and without recourse
to the ABL Secured Parties; except, that, each ABL Secured Party that is
transferring such ABL Debt shall represent and warrant, severally as to it:
(a) the amount of the ABL Debt being purchased from it is as reflected in the
books and records of such ABL Secured Party (but without representation or
warranty as to the collectability, validity or enforceability thereof), (b) that
such ABL Secured Party owns the ABL Debt being sold by it free and clear of any
liens or encumbrances and (c) such ABL Secured Party has the right to assign the
ABL Debt being sold by it and the assignment is duly authorized.

 

7.6      Notice from ABL Agent Prior to Enforcement Action.  In the absence of
Exigent Circumstances, ABL Agent, for itself and on behalf of the ABL Secured
Parties, agrees that it will give Term Loan Agent five (5) Business Days’ prior
written notice of its intention to commence any foreclosure or other action to
sell or otherwise realize upon the ABL Priority Collateral. In the event that
during such five (5) Business Day period, Term Loan Agent shall send to ABL
Agent the irrevocable notice of the Term Loan Secured Parties’ intention to
exercise the purchase option given by the ABL Secured Parties to the Term Loan
Secured Parties under this Section 7, the ABL Secured Parties shall not commence
any foreclosure or other action to sell or otherwise realize upon the
Collateral, provided, that, the purchase and sale with respect to the ABL Debt
provided for herein shall have closed within five (5) Business Days after the
receipt by ABL Agent of the irrevocable notice from Term Loan Agent.

 

Section 8.              ABL Lenders’ Purchase Option

 

8.1      Exercise of Option  On or after the occurrence and during the
continuance of a Term Loan Event of Default and the acceleration of all of the
Term Loan Debt or the commencement of an Insolvency Proceeding as to Grantors
(each a “ABL Purchase Event”), one or more of the ABL Secured Parties (the
“Purchasing ABL Secured Parties”) shall have the option, subject to Section 8.2,
for a period of ten (10) Business Days after an ABL Purchase Event to purchase
all (but not less than all) of the Term Loan Debt from the Term Loan Secured
Parties and to assume all of the commitments and duties of the Term Loan Secured
Parties.  Notice of the exercise of such option shall be sent by ABL Agent to
Term Loan Agent within such ten (10) Business Day period and shall be
irrevocable. The obligations of Term Loan Secured Parties hereunder to sell the
Term Loan Debt owing to them are several and not joint and several.  Each
Grantor irrevocably consents to such sale.

 

8.2      Pro Rata Offer.  The ABL Secured Parties agree, solely as among
themselves, that upon the occurrence of any ABL Purchase Event, the ABL Agent
shall send a notice to all ABL Secured Parties giving each ABL Secured Party the
option to purchase at least its pro rata share (calculated based on the
aggregate ABL Debt) of the Term Loan Debt.  No ABL Secured Party

 

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shall be required to participate in any purchase offer hereunder, and a purchase
offer may be made by any or all of the ABL Secured Parties, subject to the
requirements of the preceding sentence.  The provisions of this Section 8.2 are
intended solely for the benefit of the ABL Secured Parties and may be modified,
amended or waived by them without the approval of any Grantor, any Term Loan
Secured Party, or otherwise.

 

8.3      Purchase and Sale.  On the date specified by ABL Agent in such notice
(which shall not be less than five (5) Business Days, nor more than ten
(10) Business Days, after the receipt by Term Loan Agent of the notice from ABL
Agent of its election to exercise such option), Term Loan Secured Parties shall,
subject to any required approval of any court or other regulatory or
governmental authority then in effect, if any, sell to such of the Purchasing
ABL Secured Parties as are specified in the notice from ABL Agent of its
election to exercise such option, and such Purchasing ABL Secured Parties shall
purchase from Term Loan Secured Parties, all of the Term Loan Debt. 
Notwithstanding anything to the contrary contained herein, in connection with
any such purchase and sale, Term Loan Secured Parties shall retain all rights
under the Term Loan Documents to be indemnified or held harmless by Grantors in
accordance with the terms thereof.  In connection with any such purchase and
sale, each Term Loan Secured Party and each Purchasing ABL Secured Party shall
execute and deliver an assignment and acceptance agreement, in form reasonably
acceptable to all parties thereto, pursuant to which, among other things, each
Term Loan Lender shall assign to the Purchasing ABL Secured Parties such Term
Loan Lender’s pro rata share of the commitments and Term Loan Debt.  Upon the
consummation of such purchase and sale, Term Loan Agent shall resign as the
“Collateral Agent” and Administrative Agent under the Term Loan Documents and
upon the written request of ABL Agent, and at the expense of the Purchasing ABL
Secured Parties, shall execute and deliver all such documents and instruments
reasonably requested by ABL Agent and/or Purchasing ABL Secured Parties to
assign and transfer any Collateral, together with any and all rights under
deposit account control agreements and collateral access agreements related to
Collateral, to the applicable successor Agent under the Term Loan Documents.

 

8.4      Payment of Purchase Price.

 

(a)   Upon the date of such purchase and sale, the Purchasing ABL Secured
Parties shall (i) pay to Term Loan Agent for the account of the Term Loan
Secured Parties as the purchase price therefor the full amount of all of the
Term Loan Debt then outstanding and unpaid (including principal, interest, fees
and expenses, and including reasonable attorneys’ fees and legal expenses),
(ii) furnish cash collateral to Term Loan Agent in respect of indemnification
obligations of Grantors under the Term Loan Documents as to matters or
circumstances known to Term Loan Secured Parties and disclosed in writing to ABL
Agent (unless such disclosure is not permitted under applicable law) at the time
of the purchase and sale which would reasonably be expected to result in any
loss, cost, damage or expense (including reasonable attorneys’ fees and legal
expenses) to Term Loan Secured Parties and (iii) agree to indemnify and hold
harmless the Term Loan Secured Parties from and against any loss, liability,
claim, damage or expense (including reasonable fees and expenses of legal
counsel) arising out of any claim asserted by a third party in respect of the
Term Loan Debt as a direct result of any acts by ABL Agent or any other ABL
Secured Party.

 

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(b)   Such purchase price and cash collateral shall be remitted by wire transfer
in federal funds to such bank account of Term Loan Agent as Term Loan Agent may
designate in writing to ABL Agent for such purpose.  Interest shall be
calculated to but excluding the Business Day on which such purchase and sale
shall occur if the amounts so paid by the Purchasing ABL Secured Parties to the
bank account designated by Term Loan Agent are received in such bank account
prior to 12:00 noon, New York City time and interest shall be calculated to and
including such Business Day if the amounts so paid by the Purchasing ABL Secured
Parties to the bank account designated by Term Loan Agent are received in such
bank account later than 12:00 noon, New York City time.

 

8.5      Representations Upon Purchase and Sale.  Such purchase and sale shall
be expressly made without representation or warranty of any kind by Term Loan
Agent or any Term Loan Secured Party as to the Term Loan Debt or otherwise and
without recourse to the Term Loan Secured Parties; except, that, each Term Loan
Secured Party that is transferring such Term Loan Debt shall represent and
warrant, severally as to it: (a) the amount of the Term Loan Debt being
purchased from it is as reflected in the books and records of such Term Loan
Secured Party (but without representation or warranty as to the collectability,
validity or enforceability thereof), (b) that such Term Loan Secured Party owns
the Term Loan Debt being sold by it free and clear of any liens or encumbrances
and (c) such Term Loan Secured Party has the right to assign the Term Loan Debt
being sold by it and the assignment is duly authorized.

 

8.6      Notice from ABL Agent Prior to Enforcement Action.  In the absence of
Exigent Circumstances, Term Loan Agent, for itself and on behalf of the Term
Loan Secured Parties, agrees that it will give ABL Agent five (5) Business Days’
prior written notice of its intention to commence any foreclosure or other
action to sell or otherwise realize upon the Term Loan Priority Collateral. In
the event that during such five (5) Business Day period, ABL Agent shall send to
Term Loan Agent the irrevocable notice of the ABL Secured Parties’ intention to
exercise the purchase option given by the Term Loan Secured Parties to the ABL
Secured Parties under this Section 8, the Term Loan Secured Parties shall not
commence any foreclosure or other action to sell or otherwise realize upon the
Collateral, provided, that, the purchase and sale with respect to the Term Loan
Debt provided for herein shall have closed within five (5) Business Days after
the receipt by Term Loan Agent of the irrevocable notice from ABL Agent.

 

Section 9.              Access and Use of Term Loan Priority Collateral

 

9.1      Access and Use Rights of ABL Agent.

 

(a)   In the event that Term Loan Agent shall acquire control or possession of
any of the Term Loan Priority Collateral or shall, through the exercise of
remedies under the Term Loan Documents or otherwise, sell any of the Term Loan
Priority Collateral to any third party (a “Third Party Purchaser”), Term Loan
Agent shall permit ABL Agent (or require as a condition of such sale to the
Third Party Purchaser that the Third Party Purchaser agree to permit the ABL
Agent), at ABL Agent’s option and in accordance with applicable law and subject
to the rights of any landlords under any real property leases, and at the
expense of the ABL Secured Parties: (i) to enter and use any or all of the Term
Loan Priority Collateral under such control or possession (or sold to a Third
Party Purchaser) consisting of real property and the improvements, structures,
buildings thereon and all related rights during normal business hours in order
to inspect, remove

 

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or take any action with respect to the ABL Priority Collateral or to enforce ABL
Agent’s rights with respect thereto, including, but not limited to, the
examination and removal of ABL Priority Collateral and the examination and
duplication of the books and records of any Grantor related to the ABL Priority
Collateral, or to otherwise handle, deliver, ship, transport, deal with or
dispose of any ABL Priority Collateral, such right to include, without limiting
the generality of the foregoing, the right to conduct one or more public or
private sales or auctions thereon and (ii) use any of the Term Loan Priority
Collateral under such control or possession (or sold to a Third Party Purchaser)
consisting of equipment (including computers or other data processing equipment
related to the storage or processing of records, documents or files pertaining
to the ABL Priority Collateral) to handle, deal with or dispose of any ABL
Priority Collateral pursuant to the rights of ABL Agent and the other ABL
Secured Parties as set forth in the ABL Documents, the UCC of any applicable
jurisdiction and other applicable law.

 

(b)   The rights of ABL Agent set forth in clause (a) above as to the Term Loan
Priority Collateral shall be irrevocable and without charge and shall continue
at ABL Agent’s option for a period of one hundred eighty (180) days as to any
such Term Loan Priority Collateral from the earlier of (i) the date on which
Term Loan Agent has notified ABL Agent that Term Loan Agent has acquired
possession or control of such Term Loan Priority Collateral and (ii) the date of
commencement by the ABL Agent of enforcement actions against the ABL Priority
Collateral using such Term Loan Priority Collateral.  The time periods set forth
herein shall be tolled during the pendency of any proceeding of a Grantor under
the Bankruptcy Code or any other Bankruptcy Law or other proceedings if and for
so long as ABL Agent is effectively stayed from enforcing its rights against the
ABL Priority Collateral.  In no event shall Term Loan Agent or any of the Term
Loan Secured Parties take any action to interfere, limit or restrict the rights
of ABL Agent set forth above or the exercise of such rights by ABL Agent
pursuant to this Section 9.1 prior to the expiration of such periods.

 

(c)   Nothing contained in this Agreement shall restrict the Disposition by Term
Loan Agent of any Term Loan Priority Collateral prior to the expiration of such
one hundred eighty (180) day period, subject to the provisions above regarding a
Third Party Purchaser.

 

9.2      Responsibilities of ABL Secured Parties.  The ABL Agent shall repair at
its expense any physical damage to any Term Loan Priority Collateral used by ABL
Agent as a direct result of the actions of the ABL Agent (or its
representatives) in exercising its access and use rights as provided in
Section 9.1 above (but shall not be responsible for any diminution in value of
the Term Loan Priority Collateral resulting from the ABL Agent so dealing with
any ABL Priority Collateral so long as the ABL Agent and the other ABL Secured
Parties leave the Term Loan Priority Collateral in the same condition as it was
prior to their actions with respect to the ABL Priority Collateral, except for
ordinary wear and tear resulting from the actions of the ABL Agent and the other
ABL Secured Parties contemplated by, and for the time periods specified under,
Section 9.1).  The ABL Agent and the other ABL Secured Parties shall indemnify
and hold harmless the Term Loan Agent and the other Term Loan Secured Parties
from any claim, loss, damage, cost or liability arising from any claim by a
third party against Term Loan Agent and the other Term Loan Secured Parties as a
direct result of any action by ABL Agent (or its representatives).  The Term
Loan Agent shall not have any responsibility or liability for the acts or
omissions of ABL Agent or any of the other ABL Secured Parties, and ABL Agent
and the other ABL Secured Parties shall not have any responsibility or liability
for the acts or omissions

 

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of Term Loan Agent, in each case arising in connection with such other Person’s
use and/or occupancy of any of the Term Loan Priority Collateral.  If the ABL
Agent conducts a public auction or private sale of the ABL Priority Collateral
at any of the real property constituting Term Loan Priority Collateral, the ABL
Agent shall provide the Term Loan Agent with reasonable advance notice and use
reasonable efforts to hold such auction or sale in a manner that would not
unduly disrupt the Term Loan Agent’s use of such real property.  Without
limiting the rights granted herein, to the extent such rights have been
exercised under this Agreement, the ABL Agent and the other ABL Secured Parties
shall reasonably cooperate with the Term Loan Agent and the other Term Loan
Secured Parties in connection with any Disposition efforts made by the Term Loan
Secured Parties with respect to the Term Loan Priority Collateral.

 

9.3      Grantor Consent.  The Grantors consent to the performance by the Term
Loan Agent of the obligations set forth in Section 9.1 and acknowledge and agree
that neither the Term Loan Agent (nor any other Term Loan Secured Party) shall
ever by accountable or liable for any action taken or omitted to be taken by the
ABL Agent or any other ABL Secured Party or its or any of their officers,
employees, agents, successors, assigns or representatives in connection
therewith or incidental thereto or in consequence thereof.

 

Section 10.            Reliance; Waivers; Etc.

 

10.1   Reliance.

 

(a)   The consent by the ABL Secured Parties to the execution and delivery of
the Term Loan Documents and the grant to Term Loan Agent on behalf of the Term
Loan Secured Parties of a Lien on the Collateral and all loans and other
extensions of credit made or deemed made on and after the date hereof by the ABL
Secured Parties to any Grantor shall be deemed to have been given and made in
reliance upon this Agreement.

 

(b)   The consent by the Term Loan Secured Parties to the execution and delivery
of the ABL Documents and the grant to ABL Agent on behalf of the ABL Secured
Parties of a Lien on the Collateral and all loans and other extensions of credit
made or deemed made on and after the date hereof by the Term Loan Secured
Parties to any Grantor shall be deemed to have been given and made in reliance
upon this Agreement.

 

10.2   No Warranties or Liability.

 

(a)   Term Loan Agent, for itself and on behalf of the other Term Loan Secured
Parties, acknowledges and agrees that each of ABL Agent and the other ABL
Secured Parties have made no express or implied representation or warranty,
including with respect to the execution, validity, legality, completeness,
collectability or enforceability of any of the ABL Documents, the ownership of
any Collateral or the perfection or priority of any Liens thereon. Term Loan
Agent agrees, for itself and on behalf of the other Term Loan Secured Parties,
that the ABL Secured Parties will be entitled to manage and supervise their
respective loans and extensions of credit under the ABL Documents in accordance
with law and as they may otherwise, in their sole discretion, deem appropriate,
and the ABL Secured Parties may manage their loans and extensions of credit
without regard to any rights or interests that Term Loan

 

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Agent or any of the other Term Loan Secured Parties have in the Collateral or
otherwise, except as otherwise provided in this Agreement. Neither ABL Agent nor
any of the other ABL Secured Parties shall have any duty to Term Loan Agent or
any of the other Term Loan Secured Parties to act or refrain from acting in a
manner which allows, or results in, the occurrence or continuance of an event of
default or default under any agreements with any Grantor (including the Term
Loan Documents), regardless of any knowledge thereof which they may have or with
which they may be charged.

 

(b)   ABL Agent, for itself and on behalf of the other ABL Secured Parties,
acknowledges and agrees that each of Term Loan Agent and the other Term Loan
Secured Parties have made no express or implied representation or warranty,
including with respect to the execution, validity, legality, completeness,
collectability or enforceability of any of the Term Loan Documents, the
ownership of any Collateral or the perfection or priority of any Liens thereon.
ABL Agent agrees, for itself and on behalf of the other ABL Secured Parties,
that the Term Loan Secured Parties will be entitled to manage and supervise
their respective loans and extensions of credit under the Term Loan Documents in
accordance with law and as they may otherwise, in their sole discretion, deem
appropriate, and the Term Loan Secured Parties may manage their loans and
extensions of credit without regard to any rights or interests that ABL Agent or
any of the other ABL Secured Parties have in the Collateral or otherwise, except
as otherwise provided in this Agreement.  Neither Term Loan Agent nor any of the
other Term Loan Secured Parties shall have any duty to ABL Agent or any of the
other ABL Secured Parties to act or refrain from acting in a manner which
allows, or results in, the occurrence or continuance of an event of default or
default under any agreements with any Grantor (including the ABL Documents),
regardless of any knowledge thereof which they may have or with which they may
be charged.

 

10.3   No Waiver of Lien Priorities.

 

(a)   No right of ABL Agent or any of the other ABL Secured Parties to enforce
any provision of this Agreement or any of the ABL Documents shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
any Grantor or by any act or failure to act by ABL Agent or any other ABL
Secured Party, or by any noncompliance by any Person with the terms, provisions
and covenants of this Agreement, any of the ABL Documents or any of the Term
Loan Documents, regardless of any knowledge thereof which ABL Agent or any of
the other ABL Secured Parties may have or be otherwise charged with.

 

(b)   No right of Term Loan Agent or any of the other Term Loan Secured Parties
to enforce any provision of this Agreement or any of the Term Loan Documents
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of any Grantor or by any act or failure to act by Term Loan
Agent or any other Term Loan Secured Party, or by any noncompliance by any
Person with the terms, provisions and covenants of this Agreement, any of the
Term Loan Documents or any of the ABL Documents, regardless of any knowledge
thereof which Term Loan Agent or any of the other Term Loan Secured Parties may
have or be otherwise charged with.

 

(c)   Term Loan Agent agrees not to assert and hereby waives, to the fullest
extent permitted by law, any right to demand, request, plead or otherwise assert
or otherwise claim the

 

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benefit of, any marshalling, appraisal, valuation or other similar right that
may otherwise be available under applicable law with respect to the Collateral
or any other similar rights a junior secured creditor may have under applicable
law.

 

(d)   ABL Agent agrees not to assert and hereby waives, to the fullest extent
permitted by law, any right to demand, request, plead or otherwise assert or
otherwise claim the benefit of, any marshalling, appraisal, valuation or other
similar right that may otherwise be available under applicable law with respect
to the Collateral or any other similar rights a junior secured creditor may have
under applicable law.

 

10.4   Obligations Unconditional.  All rights, interests, agreements and
obligations of the ABL Agent, the ABL Secured Parties, the Term Loan Agent and
the Term Loan Secured Parties hereunder shall remain in full force and effect
irrespective of:

 

(a)   any lack of validity or enforceability of any ABL Document or Term Loan
Document;

 

(b)   any change in the time, manner or place of payment of, or in any other
terms of, all or any of the ABL Debt or Term Loan Debt, or any amendment or
waiver or other modification, whether by course of conduct or otherwise, of the
terms of any ABL Document or Term Loan Document;

 

(c)   any exchange of any security interest in any Collateral or any other
collateral or any amendment, waiver or other modification, whether in writing or
by course of conduct or otherwise, of all or any of the ABL Debt or Term Loan
Debt or any guarantee thereof;

 

(d)   the commencement of any Insolvency Proceeding in respect of any Grantor;
or

 

(e)   any other circumstance that otherwise might constitute a defense available
to (i) any Grantor (other than the Discharge of ABL Debt or Discharge of Term
Loan Debt, as applicable, subject to Sections 6.9 and 11.3) or (ii) a junior
lienholder.

 

10.5   Amendments to ABL Documents.  The ABL Documents may be amended,
supplemented or otherwise modified in accordance with their terms and the ABL
Agreement may be refinanced, in each case, without notice to, or the consent of
the Term Loan Agent or the other Term Loan Secured Parties, all without
affecting the lien subordination or other provisions set forth in this Agreement
(even if any right of subrogation or other right or remedy of Term Loan Agent or
any other Term Loan Secured Party is affected, impaired or extinguished
thereby); provided, that:

 

(a)   the holders of the ABL Debt as so Refinanced bind themselves in a writing
addressed to the Term Loan Agent to the terms of this Agreement, and

 

(b)   without the prior written consent of the Term Loan Agent, any such
amendment, supplement, modification or refinancing shall not:

 

(i)        increase the maximum amount of the aggregate commitments under the
ABL Agreement to an amount greater than the ABL Cap; or

 

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(ii)       increase the “Applicable Margin” or similar component of the interest
rate by more than three percent (3%) per annum (excluding increases resulting
from the accrual of interest at the default rate or changes in the underlying
rate) or increase the amount, or frequency of payment, of any recurring fees
provided for in the ABL Agreement;

 

(iii)      shorten the scheduled maturity of the ABL Agreement (other than in
connection with an ABL Event of Default or the payment in full in cash of the
ABL Debt prior to the scheduled maturity thereof or by means of any other
shortening of the scheduled maturity as provided for under the ABL Agreement as
in effect on the date hereof) to a date prior to the scheduled maturity date of
the ABL Agreement as in effect on the date hereof or pursuant to any refinancing
thereof;

 

(iv)     modify (or have the effect of a modification of) the prepayment
provisions of the ABL Agreement that require mandatory prepayments in a manner
that increases the amount or frequency of such required prepayments, or requires
additional mandatory prepayments, limits the rights of Grantors with respect
thereto or changes the order and manner in which such prepayments are applied
against the ABL Debt, or changes to earlier dates any scheduled dates for the
payment of principal or interest with respect to the ABL Debt;

 

(v)      add or modify any restriction on payment or prepayment of the Term Loan
Debt;

 

(vi)     add any restriction on amendments, waivers or other modifications to
the Term Loan Documents;

 

(vii)    contravene the provisions of this Agreement; or

 

(viii)   with respect to the Credit Card Notifications (as defined in the ABL
Agreement), amend or modify such Credit Card Notifications if such amendment and
modification is or could be expected to be materially adverse to the interests
of the Term Loan Agent.

 

10.6   Amendments to Term Loan Documents.  The Term Loan Documents may be
amended, supplemented or otherwise modified in accordance with their terms and
the Term Loan Agreement may be refinanced, in each case, without notice to, or
the consent of the ABL Agent or the other ABL Secured Parties, all without
affecting the lien subordination or other provisions set forth in the
Intercreditor Agreement (even if any right of subrogation or other right or
remedy of ABL Agent or any other ABL Secured Party is affected, impaired or
extinguished thereby); provided, that,

 

(a)   the holders of the Term Loan Debt as so Refinanced bind themselves in a
writing addressed to the ABL Agent to the terms of this Agreement, and

 

(b)   without the prior written consent of the ABL Agent, any such amendment,
supplement, modification or refinancing shall not:

 

(i)        increase the sum of the then outstanding aggregate principal amount
of the loans under the Term Loan Agreement in excess of the Term Loan Cap;

 

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(ii)       increase the “Applicable Margin” or similar component of the interest
rate by more than three percent (3%) per annum (excluding increases resulting
from the accrual of interest at the default rate or changes in the underlying
rate) or increase the amount, or frequency of payment, of any recurring fees
provided for in the Term Loan Agreement;

 

(iii)      shorten the scheduled maturity of the Term Loan Agreement (other than
in connection with a Term Loan Event of Default or the payment in full in cash
of the Term Loan Debt prior to the scheduled maturity thereof or by means of any
other shortening of the scheduled maturity as provided for under the Term Loan
Agreement as in effect on the date hereof) to a date prior to the scheduled
maturity date of the Term Loan Agreement as in effect on the date hereof or
pursuant to any refinancing thereof;

 

(iv)     modify (or have the effect of a modification of) the prepayment
provisions of the Term Loan Agreement that require mandatory prepayments in a
manner that increases the amount or frequency of such required prepayments, or
requires additional mandatory prepayments, limits the rights of Grantors with
respect thereto or changes the order and manner in which such prepayments are
applied against the Term Loan Debt, or changes to earlier dates any scheduled
dates for the payment of principal or interest with respect to the Term Loan
Debt;

 

(v)      add or modify any restriction on payment or prepayment of the ABL Debt;

 

(vi)     add any restriction on amendments, waivers or other modifications to
the ABL Documents; or

 

(vii)    contravene the provisions of this Agreement.

 

Section 11.            Miscellaneous

 

11.1   Conflicts.  In the event of any conflict between the provisions of this
Agreement and the provisions of the ABL Documents or the Term Loan Documents,
the provisions of this Agreement shall govern.

 

11.2   Continuing Nature of this Agreement; Severability.  This Agreement shall
continue to be effective until the first to occur of (a) the Discharge of ABL
Debt and the payment in full in cash of the Excess ABL Debt or (b) the Discharge
of Term Loan Debt and the payment in full in cash of the Excess Term Loan Debt. 
This is a continuing agreement of lien subordination and the Secured Parties may
continue, at any time and without notice to the other Secured Parties, to extend
credit and other financial accommodations and lend monies to or for the benefit
of any Grantor constituting ABL Debt and/or Term Loan Debt (as applicable) in
reliance hereof.  Each of Term Loan Agent, for itself and on behalf of the Term
Loan Secured Parties, and ABL Agent, for itself and on behalf of the ABL Secured
Parties, hereby waives any right it may have under applicable law to revoke this
Agreement or any of the provisions of this Agreement.  The terms of this
Agreement shall survive, and shall continue in full force and effect, in any
Insolvency Proceeding. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.

 

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11.3   Refinancing.

 

(a)   Refinancing Permitted.  As an agreement among the Secured Parties only and
without prejudice to any rights of the Secured Parties under the ABL Documents
and Term Loan Documents, as applicable, and subject to the provisions of
Sections 10.5 and 10.6 of this Agreement, the ABL Debt and/or Term Loan Debt may
be refinanced in their entirety if the holders of such indebtedness, or a duly
authorized agent on their behalf, agree in writing to be bound by the terms of
this Agreement.  ABL Agent, for itself and on behalf of the ABL Secured Parties,
and Term Loan Agent, for itself and on behalf of the Term Loan Secured Parties,
agree, in connection with any refinancing of the ABL Debt and/or the Term Loan
Debt permitted by this Section 11.3(a), promptly to enter into such documents
and agreements (including amendments or supplements to this Agreement) as
Grantors may reasonably request to reflect such refinancing; provided, that, the
rights and powers of the Secured Parties contemplated hereby shall not be
affected thereby.

 

(b)   Effect of Refinancing.

 

(i)        If substantially contemporaneously with the Discharge of ABL Debt,
Grantors refinance indebtedness outstanding under the ABL Documents in
accordance with the provisions of Section 11.3(a), then after written notice to
Term Loan Agent, (A) the indebtedness and other obligations arising pursuant to
such refinancing of the then outstanding indebtedness under the ABL Documents
shall automatically be treated as ABL Debt for all purposes of this Agreement,
including for purposes of the Lien priorities and rights in respect of
Collateral set forth herein, (B) the credit agreement and the other loan
documents evidencing such new indebtedness shall automatically be treated as the
ABL Agreement and the ABL Documents for all purposes of this Agreement and
(C) the agent under the new ABL Agreement shall be deemed to be ABL Agent for
all purposes of this Agreement.  Upon receipt of notice of such refinancing
(including the identity of the new ABL Agent), Term Loan Agent shall promptly
enter into such documents and agreements (including amendments or supplements to
this Agreement) as Grantors or the new ABL Agent may reasonably request in order
to provide to the new ABL Agent the rights of ABL Agent contemplated hereby.

 

(ii)       If substantially contemporaneously with the Discharge of Term Loan
Debt, Grantors refinance indebtedness outstanding under the Term Loan Documents
in accordance with the provisions of Section 11.3(a), then after written notice
to ABL Agent, (A) the indebtedness and other obligations arising pursuant to
such refinancing of the then outstanding indebtedness under the Term Loan
Documents shall automatically be treated as Term Loan Debt for all purposes of
this Agreement, including for purposes of the Lien priorities and rights in
respect of Collateral set forth herein, (B) the credit agreement and the other
loan documents evidencing such new indebtedness shall automatically be treated
as the Term Loan Agreement and the Term Loan Documents for all purposes of this
Agreement and (C) the agent under the new Term Loan Agreement shall be deemed to
be Term Loan Agent for all purposes of this Agreement.  Upon receipt of notice
of such refinancing (including the identity of the new Term Loan Agent), ABL
Agent shall promptly enter into such documents and agreements (including
amendments or supplements to this Agreement) as Grantors or the new Term Loan
Agent may reasonably request in order to provide to the new Term Loan Agent the
rights of Term Loan Agent contemplated hereby.

 

45

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11.4   Amendments; Waivers.  No amendment or modification of any of the
provisions of this Agreement by Term Loan Agent or ABL Agent shall be deemed to
be made unless the same shall be in writing signed on behalf of both of the Term
Loan Agent and the ABL Agent (as directed pursuant to the applicable Term Loan
Documents or ABL Documents, as the case may be).  No waiver of any of the
provisions of this Agreement shall be deemed to be made unless the same shall be
in writing signed by the party making the same or its authorized agent and each
waiver, if any, shall be a waiver only with respect to the specific instance
involved and shall in no way impair the rights of the parties making such waiver
or the obligations of the other parties to such party in any other respect or at
any other time. The Grantors shall not have any right to consent to or approve
any amendment, modification or waiver of any provision of this Agreement except
to the extent their rights or obligations are directly adversely affected.

 

11.5   Subrogation.

 

(a)   Term Loan Agent, for itself and on behalf of the Term Loan Secured
Parties, hereby waives any rights of subrogation it may acquire as a result of
any payment hereunder until the Discharge of ABL Debt has occurred.

 

(b)   ABL Agent, for itself and on behalf of the ABL Secured Parties, hereby
waives any rights of subrogation it may acquire as a result of any payment
hereunder until the Discharge of Term Loan Debt has occurred.

 

11.6   Notices.  All notices to the Term Loan Secured Parties and the ABL
Secured Parties permitted or required under this Agreement may be sent to Term
Loan Agent and ABL Agent, respectively. Unless otherwise specifically provided
herein, any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, electronically mailed or
sent by courier service, facsimile transmission or U.S. mail and shall be deemed
to have been given when delivered in person or by courier service, upon receipt
of a facsimile transmission or electronic mail or four (4) Business Days after
deposit in the U.S. mail (registered or certified, with postage prepaid and
properly addressed). For the purposes hereof, the addresses of the parties
hereto shall be as set forth below, or, as to each party, at such other address
as may be designated by such party in a written notice to all of the other
parties.

 

ABL Agent:

 

Wells Fargo Bank, National Association

 

 

One Boston Place, 19th Floor

 

 

Boston, Massachusetts 02108

 

 

Attn: Portfolio Manager - SUPERVALU

 

 

Fax No.: (866) 617-3988

 

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Term Loan Agent:

 

Goldman Sachs Bank USA

 

 

c/o Goldman Sachs Group, Inc.

 

 

6031 Connection Drive

 

 

Irving, Texas 75039

 

 

Attn: Ken Moua

 

 

Telephone: 972-368-2746

 

 

Email: gs-sbdagency-borrowernotices@ny.email.gs.com

 

11.7   Further Assurances.

 

(a)   Term Loan Agent agrees that it shall, for itself and on behalf of the Term
Loan Secured Parties, take such further action and shall execute and deliver to
ABL Agent such additional documents and instruments (in recordable form, if
requested) as ABL Agent may reasonably request to effectuate the terms of and
the lien priorities contemplated by this Agreement.

 

(b)   ABL Agent agrees that it shall, for itself and on behalf of the ABL
Secured Parties, take such further action and shall execute and deliver to Term
Loan Agent such additional documents and instruments (in recordable form, if
requested) as Term Loan Agent may reasonably request to effectuate the terms of
and the lien priorities contemplated by this Agreement.

 

11.8   Consent to Jurisdiction; Waiver of Jury Trial.  EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY CONSENTS TO THE EXCLUSIVE JURISDICTION OF THE SUPREME
COURT OF THE STATE OF NEW YORK IN NEW YORK COUNTY AND THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND CONSENT THAT ALL SERVICE OF
PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED TO SUCH PARTY AS PROVIDED IN
SECTION 11.6 ABOVE FOR SUCH PARTY.  THE PARTIES HERETO WAIVE ANY OBJECTION TO
ANY ACTION INSTITUTED HEREUNDER BASED ON FORUM NON CONVENIENS, AND ANY OBJECTION
TO THE VENUE OF ANY ACTION INSTITUTED HEREUNDER.  EACH OF THE PARTIES HERETO
WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY COURSE OF CONDUCT, COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR
ACTION OF ANY PARTY HERETO.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL
JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER
PROVIDED BY LAW.  NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT THE TERM
LOAN AGENT, ANY OTHER TERM LOAN SECURED PARTY, THE ABL AGENT OR ANY OTHER ABL
SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO
THIS AGREEMENT AGAINST ANY GRANTOR OR ANY OF ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.

 

11.9   Governing Law.  The validity, construction and effect of this Agreement
shall be governed by the internal laws of the State of New York but excluding
any principles of conflicts

 

47

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of law or any other rule of law that would result in the application of the law
of any jurisdiction other than the laws of the State of New York.

 

11.10 Binding on Successors and Assigns.  This Agreement shall be binding upon
ABL Agent, the other ABL Secured Parties, Term Loan Agent, the other Term Loan
Secured Parties, Grantors and their respective permitted successors and assigns.

 

11.11 Specific Performance.

 

(a)   ABL Agent may demand specific performance of this Agreement. Term Loan
Agent, for itself and on behalf of the Term Loan Secured Parties, hereby
irrevocably waives any defense based on the adequacy of a remedy at law and any
other defense which might be asserted to bar the remedy of specific performance
in any action which may be brought by ABL Agent.

 

(b)   Term Loan Agent may demand specific performance of this Agreement. ABL
Agent, for itself and on behalf of the ABL Secured Parties, hereby irrevocably
waives any defense based on the adequacy of a remedy at law and any other
defense which might be asserted to bar the remedy of specific performance in any
action which may be brought by Term Loan Agent.

 

11.12 Section Titles; Time Periods.  The section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of this Agreement.

 

11.13 Counterparts.  This Agreement may be executed in one or more counterparts,
each of which shall be an original and all of which shall together constitute
one and the same document.  Delivery of an executed counterpart of a signature
page of this Agreement or any document or instrument delivered in connection
herewith by facsimile transmission or other electronic transmission (in pdf or
tif format) shall be effective as delivery of a manually executed counterpart of
this Agreement or such other document or instrument, as applicable.

 

11.14 Authorization.  By its signature, each Person executing this Agreement on
behalf of a party hereto represents and warrants to the other parties hereto
that it is duly authorized to execute this Agreement.

 

11.15 No Third Party Beneficiaries.  This Agreement and the rights and benefits
hereof shall inure to the benefit of each of the parties hereto and their
respective successors and assigns and shall inure to the benefit of each of the
holders of ABL Debt and Term Loan Debt. No other Person shall have or be
entitled to assert rights or benefits hereunder.

 

11.16 Additional Grantors.  Grantors shall cause each of their Subsidiaries that
becomes a Grantor to acknowledge and consent to the terms of this Agreement by
causing such Subsidiary to execute and deliver to the parties hereto a Grantor
Joinder, substantially in the form of Annex C hereto, pursuant to which such
Subsidiary shall agree to be bound by the terms of the attached Acknowledgment
and Agreement to the same extent as if it had executed and delivered same as of
the date hereof.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

 

 

ABL AGENT

TERM LOAN AGENT

 

 

WELLS FARGO BANK, NATIONAL
ASSOCIATION, as ABL Agent

GOLDMAN SACHS BANK USA, as Term
Loan Agent

 

 

 

 

 

By:

 

 

By:

 

Name:

Joseph Burt

 

Name:

 

Title:

Director

Title:

Authorized Signatory

 

Signature Page to Intercreditor Agreement

 

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

 

ACKNOWLEDGMENT AND AGREEMENT

 

Each of the undersigned hereby acknowledges and agrees to the terms and
provisions of the Intercreditor Agreement among Wells Fargo Bank, National
Association, in its capacity as administrative and collateral agent for the ABL
Secured Parties (in such capacity, the “ABL Agent”) and Goldman Sachs Bank USA,
in its capacity as collateral agent for the Term Loan Secured Parties (in such
capacity, “Term Loan Agent”), of which this Acknowledgment and Agreement is a
part.  By its signature below, the undersigned agrees that it will, together
with its successors and assigns, be bound by the provisions hereof to the extent
they purport to bind any Grantor.

 

Each of the undersigned agrees that (a) if either the ABL Agent or the Term Loan
Agent holds Collateral it does so as bailee (under the UCC) for the other and is
hereby authorized to and may turn over to such other Secured Party upon request
therefor any such Collateral, after all obligations and indebtedness of the
undersigned to the bailee Secured Party have been fully paid and performed, or
as otherwise provided in the Intercreditor Agreement, and (b) it will execute
any and all further documents, agreements and instruments, and take all such
further actions, that may be required under any applicable Law, or which any
Secured Party may reasonably request, to carry out the terms and conditions of
the foregoing Intercreditor Agreement.  Each of the undersigned agrees to
provide to the Term Loan Agent and the ABL Agent a copy of each Grantor Joinder
hereto executed and delivered pursuant to Section 11.16 of the Intercreditor
Agreement.

 

Each of the undersigned acknowledges and agrees that, although it may sign this
Agreement, it is not a party hereto and does not and will not receive any right,
benefit, priority or interest under or because of the existence of the foregoing
Agreement, a breach by the undersigned of any of its obligations under the
Intercreditor Agreement or this Acknowledgment and Agreement will constitute an
Event of Default under the terms of each of the ABL Agreement and the Term Loan
Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

1

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GRANTORS

 

 

 

SUPERVALU INC.

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

SUPERVALU PHARMACIES, INC.

 

W. NEWELL & CO., LLC

 

ADVANTAGE LOGISTICS - SOUTHEAST, INC.

 

SUPERVALU HOLDINGS, INC.

 

SUPERVALU HOLDINGS - PA, LLC

 

MORAN FOODS, LLC

 

SAVE-A-LOT TYLER GROUP, LLC

 

SHOP ‘N SAVE WAREHOUSE FOODS, INC.

 

SHOP ‘N SAVE ST. LOUIS, INC.

 

RICHFOOD, INC.

 

SHOPPERS FOOD WAREHOUSE CORP.

 

FF ACQUISITION, L.L.C.

 

FOODARAMA LLC

 

CHAMPLIN 2005 L.L.C.

 

RICHFOOD HOLDINGS, INC.

 

SUPER RITE FOODS, INC.

 

SUPERVALU TTSJ, INC.

 

SVH REALTY, INC.

 

SUPERMARKET OPERATORS OF AMERICA, INC.

 

SFW HOLDING CORP

 

SFW LICENSING CORP.

 

SCOTT’S FOOD STORES, INC.

 

BUTSON’S ENTERPRISES, INC.

 

RICHFOOD PROCUREMENT, LLC

 

EASTERN REGION MANAGEMENT CORPORATION

 

SUPERVALU TRANSPORTATION INC.

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Annex A-1

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Annex A
to
Intercreditor Agreement

 

ABL Priority Collateral

 

ABL Priority Collateral means (i)  accounts and other receivables (except to the
extent constituting identifiable proceeds of Term Loan Priority Collateral),
(ii) chattel paper (except to the extent constituting identifiable proceeds of
Term Loan Priority Collateral), (iii) deposit accounts (and all cash, checks and
other negotiable instruments, funds and other evidences of payment held therein,
except to the extent constituting identifiable proceeds of Term Loan Priority
Collateral), other than deposit accounts (and all cash, checks and other
negotiable instruments, funds and other evidences of payment held therein) used
exclusively for identifiable proceeds of Term Loan Priority Collateral, (iv) all
inventory, (v) all prescription files and related materials, (vi) to the extent
evidencing, governing, securing or otherwise reasonably related to any of the
foregoing and any of the other assets constituting ABL Priority Collateral, all
documents, general intangibles (including, but not limited to, trademarks,
patents, copyrights and other intellectual property, but only to the extent
necessary or desirable to sell, transfer or otherwise realize on any of the
other ABL Priority Collateral, and excluding any other intellectual property),
instruments, investment property, commercial tort claims, letters of credit,
supporting obligations and letter of credit rights, provided, that, if any of
the foregoing also evidence, govern, secure or otherwise reasonably relate to
Term Loan Priority Collateral only the portion evidencing, governing, securing
or primarily relating to ABL Priority Collateral shall constitute ABL Priority
Collateral, (vii) all books, records and documents related to the foregoing
(including databases, customer lists and other records, whether tangible or
electronic, which contain any information relating to any of the foregoing);
provided, that, if any of the foregoing also relate to Term Loan Priority
Collateral only the portion primarily relating to ABL Priority Collateral shall
constitute ABL Priority Collateral and (viii) all proceeds and products of any
or all of the foregoing in whatever form received, including proceeds of
business interruption and other insurance and claims against third parties.

 

Extraordinary receipts solely to the extent constituting proceeds of judgments
relating to any of the property referred to in clauses (i) — (viii) above,
insurance proceeds and condemnation awards in respect of any such property,
indemnity payments in respect of any such property and purchase price
adjustments in connection with any such property shall constitute ABL Priority
Collateral; it being understood and agreed that to the extent such receipts
constitute proceeds of both ABL Priority Collateral and Term Loan Priority
Collateral, only that portion attributable to ABL Priority Collateral shall
constitute ABL Priority Collateral.  Proceeds of Excluded Assets (as defined in
the ABL Documents as in effect on the date hereof) that would otherwise
constitute ABL Priority Collateral shall be deemed ABL Priority Collateral.

 

Annex A-2

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Annex B
to
Intercreditor Agreement

 

Term Loan Priority Collateral

 

Term Loan Priority Collateral means all Collateral other than the ABL Priority
Collateral, including, without limitation, (i) the Real Estate Collateral
Properties (as defined in the Term Loan Agreement as in effect on the date
hereof), (ii) all equipment and fixtures located on the Real Estate Collateral
Properties and the Material Related Collateral Locations, (iii) all deposit
accounts (and all cash, checks and other negotiable instruments, funds and other
evidences of payment held therein) used exclusively for identifiable proceeds of
Term Loan Priority Collateral, (iv) all existing and after-acquired Equity
Interests (as defined in the Term Loan Agreement as in effect on the date
hereof) in Moran Foods, LLC owned by the Grantors, (v) all intellectual property
other than the intellectual property that is ABL Priority Collateral, (vi) the
Grantors’ rights under the Acquisition Agreement (as defined in the Term Loan
Agreement as in effect on the date hereof), to the extent permitted under the
terms of the Acquisition Agreement, and the escrow agreement (the “Escrow
Agreement”) contemplated thereby, (vii) to the extent evidencing, securing,
governing, or otherwise reasonably related to the assets described in the
foregoing and any of the other assets constituting Term Loan Priority
Collateral, all existing and after-acquired general intangibles, investment
property, documents, instruments, supporting obligations, and letters of credit
and letter of credit rights of the Grantors (except that if any of the foregoing
also evidence, secure, govern or otherwise reasonably relate to the ABL Priority
Collateral, only the portion evidencing securing, governing or otherwise
primarily relating to the Term Loan Priority Collateral shall constitute Term
Loan Priority Collateral), (viii) all existing and after-acquired books, records
and documents related to the foregoing (including databases, customer lists and
other records, whether tangible or electronic, which contain any information
relating to any of the foregoing) of the Grantors (except that if any of the
foregoing also evidence, secure, govern or otherwise reasonably relate to the
ABL Priority Collateral, only the portion evidencing securing, governing or
otherwise primarily relating to the Term Loan Priority Collateral shall
constitute Term Loan Priority Collateral), and (ix) all proceeds and products of
any or all of the foregoing property in whatever form received, including
proceeds of insurance and claims against third parties related to the foregoing.

 

Extraordinary receipts solely to the extent constituting proceeds of judgments
relating to any of the property referred to in clauses (i) — (ix) above,
insurance proceeds and condemnation awards in respect of any such property,
indemnity payments in respect of any such property and purchase price
adjustments in connection with any such property shall constitute Term Loan
Priority Collateral; it being understood and agreed that to the extent such
receipts constitute proceeds of both ABL Priority Collateral and Term Loan
Priority Collateral, only that portion attributable to Term Loan Priority
Collateral shall constitute Term Loan Priority Collateral.  Proceeds of Excluded
Assets (as defined in the Term Loan Documents as in effect on the date hereof)
that would otherwise constitute Term Loan Priority Collateral shall be deemed
Term Loan Priority Collateral.

 

Annex B-1

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

 

Annex C
to
Intercreditor Agreement

 

Form of Grantor Joinder

 

Reference is made to that certain Intercreditor Agreement, dated as of March 21,
2013 (as amended, amended and restated, renewed, extended, supplemented or
otherwise modified from time to time in accordance with the terms thereof, the
“Intercreditor Agreement”), among Wells Fargo Bank, National Association, in its
capacity as administrative and collateral agent for the ABL Secured Parties (in
such capacity, the “ABL Agent”) and Goldman Sachs Bank USA, in its capacity as
administrative and collateral agent for the Term Loan Secured Parties (in such
capacity, “Term Loan Agent”).  Capitalized terms used herein without definition
shall have the meaning assigned thereto in the Intercreditor Agreement.

 

This Grantor Joinder, dated as of                     , 20     (this “Grantor
Joinder”), is being delivered pursuant to Section 10.17 of the Intercreditor
Agreement.

 

The undersigned,                     , a                      (the “Additional
Grantor”), hereby agrees to become a party to the Intercreditor Agreement as a
Grantor thereunder, for all purposes thereof on the terms set forth therein, and
to be bound by the terms of the Intercreditor Agreement as fully as if the
Additional Grantor had executed and delivered the Intercreditor Agreement as of
the date thereof.

 

This Grantor Joinder may be executed in two or more counterparts, each of which
shall constitute an original but all of which when taken together shall
constitute one contract.

 

THIS GRANTOR JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.

 

The provisions of Section 10 of the Intercreditor Agreement shall apply with
like effect to this Grantor Joinder.

 

[Signature Pages Follow]

 

Annex C-1

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

 

IN WITNESS WHEREOF, the Additional Grantor has caused this Grantor Joinder to be
duly executed by its authorized representative as of the day and year first
above written.

 

 

[ADDITIONAL GRANTOR]

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

Annex C-2

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

 

Exhibit A
to
Intercreditor Agreement

 

Subsidiary Borrowers

 

SUPERVALU Pharmacies, Inc.
W. Newell & Co., LLC
Advantage Logistics - Southeast, Inc.
SUPERVALU Holdings, Inc.
SUPERVALU Holdings - PA LLC
Moran Foods, LLC
Save-A-Lot Tyler Group, LLC
Shop ‘N Save Warehouse Foods, Inc.
Shop ‘N Save St. Louis, Inc.
Richfood, Inc.
Shoppers Food Warehouse Corp.
FF Acquisition, L.L.C.
Foodarama LLC
Champlin 2005 L.L.C.
Richfood Holdings, Inc.
Super Rite Foods, Inc.
Supervalu TTSJ, Inc.
Eastern Region Management Corporation
SUPERVALU Transportation Inc.

 

Exhibit A-1

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

 

Exhibit B
to
Intercreditor Agreement

 

Subsidiary Guarantors

 

SVH Realty, Inc.
Supermarket Operators of America Inc.
SFW Holding Corp.
SFW Licensing Corp.
Scott’s Food Stores, Inc.
Butson’s Enterprises, Inc.
Richfood Procurement, L.L.C.

 

I-1

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

 

Exhibit J
to the Credit Agreement

 

FORM OF PROMISSORY NOTE

 

THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT
IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO
BELOW.  TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE
RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE
TERMS OF SUCH CREDIT AGREEMENT.

 

[        ], 20[  ]

 

FOR VALUE RECEIVED, the undersigned (the “Borrower”), hereby promises to pay to
[                                          ] or registered and permitted assigns
(the “Lender”), in accordance with the provisions of the Credit Agreement (as
hereinafter defined), the principal amount of the Loan from time to time made by
the Lender to the Borrower under that certain Term Loan Credit Agreement, dated
as of March 21, 2013 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the “Credit Agreement”; the terms defined
therein being used herein as therein defined), among SUPERVALU Inc., the
Borrower, the Guarantors party thereto, the Lenders from time to time party
thereto and Goldman Sachs Bank USA, as Administrative Agent.

 

The Borrower promises to pay interest on the unpaid principal amount of the Loan
made by the Lender from the date of such Loan until such principal amount is
paid in full, at such interest rates and at such times as provided in the Credit
Agreement.  All payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in Dollars in immediately
available funds to the Agent Payment Account of the Administrative Agent.  If
any amount is not paid in full when due hereunder, such unpaid amount shall bear
interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per annum
rate set forth in the Credit Agreement.

 

This promissory note (this “Note”) is entitled to the benefits of the Credit
Agreement and may be prepaid in whole or in part subject to the terms and
conditions provided therein.  This Note is also entitled to the benefits of the
Security Agreement and the Facility Guaranty and is secured by the Collateral. 
Upon the occurrence and continuation of an Event of Default specified in the
Credit Agreement, all amounts then remaining unpaid on this Note shall become,
or may be declared to be, immediately due and payable all as provided in the
Credit Agreement.  The Loan made by the Lender shall be evidenced by one or more
loan accounts or records maintained by the Lender in the ordinary course of
business.  The Lender may also attach schedules to this Note and endorse thereon
the date, amount and maturity of its Loans and payments with respect thereto. 
Notwithstanding the foregoing, the failure of the Lender to so evidence the Loan
or to attach such schedules shall not in any manner affect the obligation of the
Borrower to make payments of principal and interest in accordance with the terms
of this Note and the Credit Agreement.

 

J-1

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

 

This Note is one of the promissory notes referred to in the Credit Agreement,
which, among other things, contains provisions for the acceleration of the
maturity hereof upon the happening of certain events, for optional and mandatory
prepayment of the principal hereof prior to the maturity hereof and for the
amendment or waiver of certain provisions of the Credit Agreement, all upon the
terms and conditions therein specified.

 

The Borrower, for itself, its successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Note.

 

J-2

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

 

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.

 

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT
AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 9.04 OF THE CREDIT AGREEMENT.

 

 

SUPERVALU INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

J-3

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

 

LOANS AND PAYMENTS WITH RESPECT THERETO

 

Date

 

Type of Loan
Made

 

Amount of
Loan Made

 

End of
Interest
Period

 

Amount of
Principal or
Interest Paid
This Date

 

Outstanding
Principal
Balance This
Date

 

Notation
Made By

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

J-4

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

 

The Lenders and the Administrative Agent

March 21, 2013

 

Exhibit K
to the Credit Agreement

 

FORM OF OPINION OF DORSEY & WHITNEY LLP

 

(See attached)

 

1

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

 

March 21, 2013

 

The Lenders and Goldman Sachs Bank USA,
as Administrative Agent and Collateral Agent

c/o Goldman Sachs Bank USA

6031 Connection Drive

Irving, Texas 75039

Attention: Ken Moua

 

Re:  $1,500,000,000 Secured Credit Facility

 

Ladies and Gentlemen:

 

We have acted as special counsel to SUPERVALU INC., a Delaware corporation (the
“Company”) and each of the subsidiaries of the Company listed on Schedule 1
attached hereto (together with the Company, the “Loan Parties”), in connection
with the documents listed on Schedule 2 attached hereto (collectively the
“Transaction Documents”).  This opinion is being delivered to you at the request
of the Loan Parties.  Capitalized terms defined in this opinion and in the
schedules and exhibits hereto are used herein and therein as so defined. 
Capitalized terms used in this opinion and in the schedules and exhibits hereto
that are not defined herein or therein shall have the meanings given such terms
in the Credit Agreement (as defined on Schedule 2).

 

In connection with this opinion, we have examined the Transaction Documents, the
documents listed on Schedule 3 attached hereto (collectively, the “Constitutive
Documents”), the legal opinions listed on Schedule 4 attached hereto
(collectively, the “Other Opinions”) and the documents and instruments listed on
Schedule 5 hereto (collectively, the “Reviewed Documents”).

 

We have also examined such other documents, and have reviewed such questions of
law, as we have considered necessary and appropriate for the purposes of this
opinion.  In addition, as to questions of fact material to the opinions
hereinafter expressed, we have, when relevant facts were not independently
established by us, relied upon certificates of officers of each of the Loan
Parties and of public officials, and we have assumed that all such facts are
true and correct as of the date of this opinion.  We have not independently
examined the records of any court or public office in any jurisdiction, and our
opinion is subject to matters which examination of such records would reveal. 
Without limiting the generality of the foregoing, we have relied, as to factual
matters, upon certificates of officers of each Loan Party referenced in
Schedule 3 hereto

 

2

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

 

and the representations contained therein, and we have assumed that all such
representations are true and correct as of the date of this opinion.  We have
also relied on the Other Opinions.

 

Our opinions expressed below as to certain factual matters are qualified as
being limited “to our actual knowledge” or by other words to the same or similar
effect.  Such words, as used herein, mean that prior to or during the course of
this firm’s representation of the Companies in connection with the specific
transactions contemplated by the Transaction Documents, no contrary information
came to the attention of Gary Tygesson, Thomas Kelly, Cassandra Headrick, John
Seymour, Laura Dietrich, Erik Detlefsen, John Norton, Jessica Birnbaum or
William Hughes, the attorneys in our firm who have principally represented the
Companies in connection with the transactions contemplated by the Transaction
Documents and the preparation of this opinion.

 

In rendering the opinions expressed below, we have assumed, without
verification, that:

 

(A)                               Each of the parties to the Transaction
Documents, other than the Delaware Loan Parties and the Minnesota Loan Parties,
is validly existing and in good standing in its respective state of
incorporation or formation, as applicable.

 

(B)                               Each of the parties to the Transaction
Documents, other than the Delaware Loan Parties and the Minnesota Loan Parties,
has the requisite corporate or limited liability company, as applicable, power
and authority to enter into and perform its respective obligations described in
the Transaction Documents.

 

(C)                               The Transaction Documents have been executed
and delivered by the appropriate parties thereto, other than the Delaware Loan
Parties and the Minnesota Loan Parties, and all necessary steps have been taken
to authorize the execution, delivery and performance by such parties, other than
the Delaware Loan Parties and the Minnesota Loan Parties, of the Transaction
Documents.

 

(D)                               The representations and warranties of each of
the Loan Parties contained in the Transaction Documents with respect to factual
matters are true and correct as of the date of this opinion and all other
statements of fact contained in the Transaction Documents are true, but no
statements as to law or conclusions of law in the Transaction Documents which
are expressly addressed by this opinion are assumed to be true.

 

(E)                                All signatures on the Transaction Documents
are genuine, all documents submitted to us as originals, if any, are authentic
and all copies submitted to us conform to original documents which are
themselves authentic original documents.

 

3

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

 

(F)                                 Each Transaction Document constitutes the
valid, binding and enforceable obligations of each of the parties thereto, other
than the Loan Parties.

 

(G)                               All natural persons executing and delivering
the Transaction Documents have the legal capacity for all purposes relevant
hereto to do so.

 

(H)                              The execution and delivery of the Transaction
Documents, the performance of its obligations described therein, and compliance
with the terms and observance of the conditions thereof will not conflict with,
result in a breach or violation of, constitute a default under, or violate any
of the terms, provisions or conditions of (i) the articles of incorporation or
other similar constitution document of any party thereto, other than the
Delaware Loan Parties and the Minnesota Loan Parties, or (ii) any indenture,
mortgage, deed of trust, lease, document, agreement or other instrument to which
any party thereto, is a party, or by which any of them or their properties are
bound, including, without limitation, the documents, agreements and other
instruments relating to any financing transaction to which any party thereto is
a party; provided, that, the foregoing shall not apply to any Reviewed
Documents.

 

(I)                                   All conditions precedent to the
effectiveness of the Transaction Documents have been satisfied or waived.

 

(J)                                   The Secured Parties have given value
pursuant to the Transaction Documents and each of the Loan Parties has rights in
its respective “Collateral” (as defined in the Security Agreement, the
“Collateral”).

 

(K)                              Each Financing Statement contains (i) the
current address of the Administrative Agent from which information concerning
the Administrative Agent’s security interest in the Collateral can be obtained,
and (ii) a current mailing address of such debtor.

 

(L)                                The Loans were not sold on an agency basis by
a broker-dealer or any of its affiliates.

 

Based upon the foregoing and upon such investigation as we have deemed
necessary, and subject to the qualifications set forth below, we are of the
opinion that:

 

1.                                      Based solely on the Good Standing
Certificate of each of the Delaware Corporate Loan Parties, each of the Delaware
Corporate Loan Parties is a corporation that is validly existing and in good
standing under the laws of the State of Delaware.  Based solely on the Good
Standing Certificate of each of the Delaware LLC Loan Parties, each Delaware LLC
Loan Party is a limited liability company that is validly existing and in good
standing under the laws of the State of Delaware.  Based solely on the Good
Standing Certificate of each of the Minnesota Loan Parties, each of the
Minnesota Loan Parties is a corporation that is validly existing and in good
standing under the laws of the State of Minnesota.

 

4

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

 

2.                                      Each Delaware Loan Party and each
Minnesota Loan Party has the requisite corporate or limited liability company,
as applicable, power and authority to execute, deliver and perform its
obligations under the Transaction Documents executed by it, and has taken all
requisite corporate or limited liability company action to authorize the
execution and delivery of the Transaction Documents executed by it.  Each
Transaction Document to which it is a party has been executed and delivered by
such Delaware Loan Party or Minnesota Loan Party.

 

3.                                      The execution and delivery by each
Delaware Loan Party of the Transaction Documents to which each Delaware Loan
Party is a party, the performance of its obligations described therein and the
compliance with the terms and conditions thereof, including, but not limited to,
the borrowing and repayment of debt, the use of proceeds thereof as required by
the Credit Agreement, and providing of security for such borrowing pursuant to
such Transaction Documents, will not violate or cause a breach of (i) the
Delaware General Corporation Law or the Delaware Limited Liability Company Act,
as applicable or (ii) any provision of such Delaware Loan Party’s Constitutive
Documents.

 

4.                                      The execution and delivery by each
Minnesota Loan Party of the Transaction Documents to which each Minnesota Loan
Party is a party, the performance of its obligations described therein and the
compliance with the terms and conditions thereof, including, but not limited to,
the borrowing and repayment of debt, the use of proceeds thereof as required by
the Credit Agreement, and providing of security for such borrowing pursuant to
such Transaction Documents, will not violate or cause a breach of (i) the
Minnesota Business Corporation Act or (ii) any provision of such Minnesota Loan
Party’s Constitutive Documents.

 

5.                                      The execution and delivery of the
Transaction Documents to which each Loan Party is a party by such Loan Party and
the borrowing and repayment of debt, the use of proceeds thereof as required by
the Credit Agreement, and providing of security for such borrowing pursuant to
such Transaction Documents will not violate or cause a breach of any statute of
the United States or the State of New York, or any rule or regulation of any
governmental authority or regulatory body of the United States or the State of
New York (including without limitation, Regulations T, U or X of the Board of
Governors of the Federal Reserve System). The execution and delivery of the
Transaction Documents to which each Loan Party is a party by such Loan Party and
the borrowing and repayment of debt, the use of proceeds thereof as required by
the Credit Agreement, and providing of security for such borrowing pursuant to
such Transaction Documents will not violate or cause a breach of any of the
judgments, orders or decrees identified on Schedule 6 attached hereto, which the
Loan Parties have informed us are the only judgments, orders or decrees
applicable to the Loan Parties of any court, governmental authority or
arbitrator. The execution and delivery of the Transaction Documents to which
each Loan Party is a party by such Loan Party, the borrowing and repayment of
debt, the providing of security and guaranties for such borrowing, the use of
proceeds thereof as required by the Credit Agreement, the performance of its
obligations described therein, and the compliance with the terms and conditions
thereof, will not (i) violate or cause a breach of the Reviewed Documents,
(ii) require any Loan Party to provide a Lien to any holder of Indebtedness
governed thereby, (iii) require any Loan Party to provide a guaranty

 

5

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

 

to any holder of Indebtedness governed thereby, (iv) trigger any “Change of
Control” offer or similar offer under any of the Reviewed Documents, or
(v) trigger any of the consolidation, merger, conveyance, transfer or lease of
assets provisions of any of the Reviewed Documents.

 

6.                                      No consent, approval, authorization of,
or registration or filing with or under the laws of the State of Delaware that
are generally applicable to transactions of a similar type or nature with
respect to the Delaware Loan Parties, or the laws of the State of Minnesota that
are generally applicable to transactions of this type or nature or the Minnesota
Business Corporation Act with respect to the Minnesota Loan Parties, is required
to be obtained or made by any such Loan Party to make valid the execution,
delivery and performance by such Loan Party of its agreements under the
Transaction Documents to which such Loan Party is a party, except such as have
been obtained or made, which includes the filing of the Delaware Loan Party
Financing Statements and the Minnesota Loan Party Financing Statements filed in
connection with the Security Agreement.

 

7.                                      No consent, approval, authorization of,
or registration or filing with, any State of New York or federal governmental
authority is required to be obtained or made by any Loan Party to make valid the
execution, delivery and performance by such Loan Party of its agreements under
the Transaction Documents to which such Loan Party is a party.

 

8.                                      The Transaction Documents executed by
each of the Loan Parties constitute its valid and binding obligations,
enforceable against it in accordance with their respective terms.

 

9.                                      The Security Agreement creates in favor
of the Administrative Agent for the benefit of the Secured Parties a valid
security interest in the Collateral (as defined in the Security Agreement) to
the extent of the rights of Advantage Logistics in such Collateral.  Under
Article 9 of the Uniform Commercial Code (“UCC”) as enacted in the State of New
York (the “UCC-New York”) and Article 9 of the UCC as enacted in the State of
Alabama (the “UCC-Alabama”), the State of Alabama is the proper jurisdiction in
which to file a financing statement to perfect the Administrative Agent’s
security interest in the rights of Advantage Logistics in the Collateral.

 

10.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of each Delaware Loan
Party in such Collateral.  Under Article 9 of the UCC-New York and Article 9 of
the Uniform Commercial Code as enacted in the State of Delaware (the
“UCC-Delaware”), the State of Delaware is the proper jurisdiction in which to
file a financing statement to perfect the Administrative Agent’s security
interest in the rights of each Delaware Loan Party in the Collateral.

 

11.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of Scott’s in such
Collateral.  Under Article 9 of the UCC-New York and Article 9 of the Uniform
Commercial Code as enacted in the State of Indiana (the “UCC-Indiana”), the
State of Indiana is the proper jurisdiction in which to file a financing
statement to perfect the Administrative Agent’s security interest in the rights
of Scott’s in the Collateral.

 

6

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

 

12.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of each Minnesota Loan
Party in such Collateral.  Under Article 9 of the UCC-New York and Article 9 of
the Uniform Commercial Code as enacted in the State of Minnesota (the
“UCC-Minnesota”), the State of Minnesota is the proper jurisdiction in which to
file a financing statement to perfect the Administrative Agent’s security
interest in the rights of each Minnesota Loan Party in the Collateral.

 

13.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of each Missouri Loan
Party in such Collateral.  Under Article 9 of the UCC-New York and Article 9 of
the Uniform Commercial Code as enacted in the State of Missouri (the
“UCC-Missouri”), the State of Missouri is the proper jurisdiction in which to
file a financing statement to perfect the Administrative Agent’s security
interest in the rights of each Missouri Loan Party in the Collateral.

 

14.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of Butson’s in such
Collateral.  Under Article 9 of the UCC-New York and Article 9 of the Uniform
Commercial Code as enacted in the State of New Hampshire (the “UCC-New
Hampshire”), the State of New Hampshire is the proper jurisdiction in which to
file a financing statement to perfect the Administrative Agent’s security
interest in the rights of Butson’s in the Collateral.

 

15.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of SFW in such
Collateral.  Under Article 9 of the UCC-New York and Article 9 of the Uniform
Commercial Code as enacted in the State of Ohio (the “UCC-Ohio”), the State of
Ohio is the proper jurisdiction in which to file a financing statement to
perfect the Administrative Agent’s security interest in the rights of SFW in the
Collateral.

 

16.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of SVH-PA in such
Collateral.  Under Article 9 of the UCC-New York and Article 9 of the Uniform
Commercial Code as enacted in the State of Pennsylvania (the
“UCC-Pennsylvania”), the State of Pennsylvania is the proper jurisdiction in
which to file a financing statement to perfect the Administrative Agent’s
security interest in the rights of SVH-PA in the Collateral.

 

17.                               The Security Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a valid security
interest in the Collateral to the extent of the rights of each Virginia Loan
Party in such Collateral.  Under Article 9 of the UCC-New York and Article 9 of
the Uniform Commercial Code as enacted in the State of Virginia (the
“UCC-Virginia”), the State of Virginia is the proper jurisdiction in which to
file a financing statement to perfect the Administrative Agent’s security
interest in the rights of each Virginia Loan Party in the Collateral.

 

7

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18.                               The Advantage Logistics Financing Statement is
sufficient in form for filing with the Alabama Secretary of State and perfects
the Administrative Agent’s security interest in the Collateral described therein
to the extent a security interest in the Collateral may be perfected under the
UCC-Alabama by filing financing statements with the Alabama Secretary of State.

 

19.                               Each Delaware Financing Statement is
sufficient in form for filing with the Delaware Secretary of State and perfects
the Administrative Agent’s security interest in the Collateral described therein
to the extent a security interest in the Collateral may be perfected under the
UCC-Delaware by filing financing statements with the Delaware Secretary of
State.

 

20.                               The Scott’s Financing Statement is sufficient
in form for filing with the Indiana Secretary of State and perfects the
Administrative Agent’s security interest in the Collateral described therein to
the extent a security interest in the Collateral may be perfected under the
UCC-Indiana by filing financing statements with the Indiana Secretary of State.

 

21.                               Each Minnesota Financing Statement is
sufficient in form for filing with the Minnesota Secretary of State and perfects
the Administrative Agent’s security interest in the Collateral described therein
to the extent a security interest in the Collateral may be perfected under the
UCC-Minnesota by filing financing statements with the Minnesota Secretary of
State.

 

22.                               Each Missouri Financing Statement is
sufficient in form for filing with the Missouri Secretary of State and perfects
the Administrative Agent’s security interest in the Collateral described therein
to the extent a security interest in the Collateral may be perfected under the
UCC- Missouri by filing financing statements with the Missouri Secretary of
State.

 

23.                               The Butson’s Financing Statement is sufficient
in form for filing with the New Hampshire Secretary of State and perfects the
Administrative Agent’s security interest in the Collateral described therein to
the extent a security interest in the Collateral may be perfected under the
UCC-New Hampshire by filing financing statements with the New Hampshire
Secretary of State.

 

24.                               The SFW Financing Statement is sufficient in
form for filing with the Ohio Secretary of State and perfects the Administrative
Agent’s security interest in the Collateral described therein to the extent a
security interest in the Collateral may be perfected under the UCC-Ohio by
filing financing statements with the Ohio Secretary of State.

 

25.                               The SVH-PA Financing Statement is sufficient
in form for filing with the Pennsylvania Secretary of State and perfects the
Administrative Agent’s security interest in the Collateral described therein to
the extent a security interest in the Collateral may be perfected under the
UCC-Pennsylvania by filing financing statements with the Pennsylvania Secretary
of State.

 

26.                               Each Virginia Financing Statement is
sufficient in form for filing with the Virginia Secretary of State and perfects
the Administrative Agent’s security interest in the Collateral described therein
to the extent a security interest in the

 

8

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Collateral may be perfected under the UCC-Virginia by filing financing
statements with the Virginia Secretary of State.

 

27.                               None of the Loan Parties (other than the
Company) is an “investment company” or a company controlled by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

 

28.                               The Company is not an “investment company” as
such term is defined in the Investment Company Act of 1940, as amended, and to
our knowledge, based solely on our review of the statements of beneficial
ownership of the Company’s stock filed as of the date hereof with the Securities
and Exchange Commission and in reliance upon certificates of officers of the
Company, the Company is not “controlled” by an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.

 

SCOPE OF OPINION

 

Our opinions set forth above are further subject to the following additional
qualifications:

 

(a)                                 Our opinions expressed above are limited to
the law of the States of Minnesota, New York and Delaware, the federal laws of
the United States of America and, with respect to our opinions set forth (i) in
Paragraphs 9 and 18 above, the UCC-Alabama, (ii) in Paragraphs 11 and 20 above,
the UCC-Indiana, (iii) in Paragraphs 13 and 22 above, the UCC-Missouri, (iv) in
Paragraphs 14 and 23 above, the UCC-New Hampshire, (v) in Paragraphs 15 and 24
above, the UCC-Ohio, (vi) in Paragraphs 16 and 25 above, the UCC-Pennsylvania,
and (vii) in Paragraphs 17 and 26 above, the UCC-Virginia, in each case as
compiled in the CCH Secured Transactions Guide as of the date hereof and as
updated through February 12, 2013.  No opinion is given with respect to
(A)(I) the constitution or the statutes of the State of Alabama other than the
UCC-Alabama, (II) the cases decided under the UCC-Alabama or other laws of the
State of Alabama or (III) with respect to any provision of the UCC-Alabama that
has been amended subsequent to, or differs from, the compilations thereof in the
CCH Secured Transactions Guide as of the date hereof and as updated through
February 12, 2013; (B)(I) the constitution or the statutes of the State of
Indiana other than the UCC-Indiana, (II) the cases decided under the UCC-Indiana
or other laws of the State of Indiana or (III) with respect to any provision of
the UCC-Indiana that has been amended subsequent to, or differs from, the
compilations thereof in the CCH Secured Transactions Guide as of the date hereof
and as updated through February 12, 2013; (C)(I) the constitution or the
statutes of the State of Missouri other than the UCC-Missouri, (II) the cases
decided under the UCC-Missouri or other laws of the State of Missouri or
(III) with respect to any provision of the UCC-Missouri that has been amended
subsequent to, or differs from, the compilations thereof in the CCH Secured
Transactions Guide as of the date hereof and as updated through February 12,
2013; (D)(I) the constitution or the statutes of the State of New Hampshire
other than the UCC-New Hampshire, (II) the cases decided under the UCC-New
Hampshire or other laws of the State of New Hampshire or (III) with respect to
any provision of the UCC-New Hampshire that has been amended subsequent to, or
differs from, the compilations thereof in the CCH Secured Transactions Guide as
of the date hereof and as updated through February 12, 2013; (E)(I) the
constitution or the statutes of the State of Ohio other than the UCC-

 

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Ohio, (II) the cases decided under the UCC-Ohio or other laws of the State of
Ohio or (III) with respect to any provision of the UCC-Ohio that has been
amended subsequent to, or differs from, the compilations thereof in the CCH
Secured Transactions Guide as of the date hereof and as updated through
February 12, 2013; (F)(I) the constitution or the statutes of the Commonwealth
of Pennsylvania other than the UCC-Pennsylvania, (II) the cases decided under
the UCC-Pennsylvania or other laws of the Commonwealth of Pennsylvania or
(III) with respect to any provision of the UCC-Pennsylvania that has been
amended subsequent to, or differs from, the compilations thereof in the CCH
Secured Transactions Guide as of the date hereof and as updated through
February 12, 2013; (G)(I) the constitution or the statutes of the Commonwealth
of Virginia other than the UCC-Virginia, (II) the cases decided under the
UCC-Virginia or other laws of the Commonwealth of Virginia or (III) with respect
to any provision of the UCC-Virginia that has been amended subsequent to, or
differs from, the compilations thereof in the CCH Secured Transactions Guide as
of the date hereof and as updated through February 12, 2013.  We assume no
responsibility as to the applicability to this transaction, or the effect
thereon, of the laws of any other jurisdiction.

 

(b)                                 Our opinions are subject to the effect of
bankruptcy, insolvency, reorganization, arrangement, moratorium, fraudulent
transfer, statutes of limitation, or other similar laws and judicial decisions
affecting or relating to the rights of creditors generally, and are further
subject to the effect of general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing, estoppel, election of remedies and other similar doctrines affecting
the enforcement of agreements generally (regardless of whether enforcement is
considered in a proceeding at law or in equity).  In addition, the availability
of specific performance, injunctive relief, the appointment of a receiver,
marshalling of assets, stay or other equitable remedies is subject to the
discretion of the tribunal before which any proceeding therefor may be brought,
unless such discretion is limited by an applicable statute.

 

(c)                                  Our opinions are further subject to other
laws and judicial decisions affecting the rights of creditors and secured
creditors generally, including, without limitation, that the enforceability of
the remedies, covenants or other provisions of the Transaction Documents and the
availability of equitable remedies may be limited where the enforcement of
specific rights under a Transaction Document may require a judgment or decree of
a court of competent jurisdiction after prior notice to any Loan Party and an
opportunity for such entity to be heard by an appropriate tribunal.

 

(d)                                 We express no opinion as to the
enforceability of provisions of the Transaction Documents to the extent they
contain:

 

(i)                                     choice of law or forum selection
provisions, or any provision which purports to confer jurisdiction upon any
court or other tribunal, other than the choice of New York laws to govern the
Transaction Documents, on which our opinion is rendered in reliance upon
Section 5-1401 of the General Obligations Law of New York and is subject to the
qualifications that such enforceability may be limited by public policy
considerations of any jurisdiction other than the courts of the State of New
York in which

 

10

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enforcement of such provisions, or of a judgment upon an agreement containing
such provisions, is sought;

 

(ii)                                  waivers by any Loan Party of any statutory
or constitutional rights, defenses or remedies, or the right to recover certain
types of damages, or the right to impose counterclaims, or of statutes of
limitation or the tolling thereof;

 

(iii)                               cumulative remedies to the extent such
cumulative remedies purport to compensate, or would have the effect of
compensating, the party entitled to the benefits thereof in an amount in excess
of the actual loss suffered by such party;

 

(iv)                              provisions requiring any Loan Party to pay any
default interest rate, early termination fee or other form of liquidated
damages, if the payment of such interest rate, fee or damages may be construed
as unreasonable in relation to actual damages or disproportionate to actual
damages suffered by the Secured Parties as a result of such prepayment, default
or termination;

 

(v)                                 provisions requiring any Loan Party to pay a
prepayment premium upon payment in full of the indebtedness after an
acceleration thereof for default or in connection with the payment of any amount
due in redemption;

 

(vi)                              provisions which purport to render prohibited
transfers null and void;

 

(vii)                           provisions to the effect that the terms of any
document may not be waived or modified orally or by course of conduct;

 

(viii)                        provisions which purport to establish evidentiary
standards;

 

(ix)                              provisions which purport to grant powers of
attorney to any Person (as such term is defined in the Credit Agreement);

 

(x)                                 provisions which excuse any Person or entity
from liability for, or require any Person or entity to indemnify any other
Person or entity against, the indemnified Person’s or entity’s breach of
contract, negligence, or willful misconduct, or any other indemnification
agreement which may be contrary to public policy; or

 

(xi)                              provisions permitting forcible entry or
removal or the exercise of other self-help remedies by any Person.

 

(e)                                  The enforceability of the remedies,
covenants or other provisions of the Transaction Documents and the availability
of equitable remedies may be limited where:

 

(i)                                     the grant of a security interest in
Collateral under the Transaction Documents or the transfer of rights in such
security interest or Collateral may, in some instances, require or be
conditioned upon receipt of consent of third parties, but such requirements or
conditions may not be effective as to assignments or grants of security

 

11

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interests in certain types of Collateral, including accounts, chattel paper,
payment intangibles, promissory notes, leasehold or landlord’s residual
interests, certain general intangibles and letter of credit rights, as provided
in Sections 9-404 through 9-409 of the UCC-New York;

 

(ii)                                  restrictions in the Transaction Documents
on the voluntary or involuntary transfer of a Person’s rights in such Person’s
assets may be limited as provided in Section 9-401 of the UCC-New York;

 

(iii)                               the rights of debtors, guarantors and
secured parties to receive notices under Section 9-602 of the UCC-New York may
not be varied or waived subject to Section 9-624 of the UCC-New York; and

 

(iv)                              notwithstanding any language of the
Transaction Documents to the contrary, the Secured Parties may be limited to
recovery of only reasonable expenses, including, without limitation, reasonable
attorneys’ fees and legal expenses, with respect to the retaking, holding,
preparing for sale, selling, pledging, hypothecating or otherwise transferring
of Collateral or any other property.

 

(f)                                   Each of our opinions in Paragraphs 9
through 30, above, as to the creation, validity and perfection of the security
interest of the Administrative Agent, on behalf of the Secured Parties, in the
Collateral is further subject to the following additional qualifications:

 

(i)                                     we express no opinion as to Collateral
which consists of or will consist of consumer goods or accounts resulting from
the sale thereof, beneficial interests in a trust or decedent’s estate,
commercial tort claims, letters of credit or letter of credit rights, goods
subject to certificates of title (including, without limitation, motor
vehicles), fixtures, agricultural liens, timber to be cut, as-extracted
collateral, or items which are subject to a statute or treaty of the United
States which provides for a national or international certificate of title for
the perfection of a security interest therein or which specifies a place of
filing different from that specified in the UCC-Alabama with respect to
Advantage Logistics, the UCC-Delaware with respect to the Delaware Loan Parties,
the UCC-Indiana with respect to the Indiana Loan Parties, the UCC-Minnesota with
respect to SUPERVALU Pharmacies, the UCC-Missouri with respect to the Missouri
Loan Parties, the UCC-NH with respect to Butson’s, the UCC-Ohio with respect to
the Ohio Loan Parties, the UCC-Pennsylvania with respect to SVH-PA and the
UCC-Virginia with respect to the Virginia Loan Parties, for filing to perfect
such security interest (e.g., aircraft);

 

(ii)                                  we express no opinion as to matters
excluded from Article 9 of the Uniform Commercial Code by Section 9-109 of the
Uniform Commercial Code as in effect in the applicable jurisdiction;

 

(iii)                               we express no opinion as to the effect of
Sections 9-315 and 9-320 of the Uniform Commercial Code as in effect in the
applicable jurisdiction;

 

12

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(iv)                              the requirement that continuation statements
with respect to each Financing Statement be filed within six months prior to the
fifth, tenth, fifteenth, etc. anniversaries of the original filing of such
Financing Statement;

 

(v)                                 the security interest of the Administrative
Agent in the Collateral may become unperfected if any Loan Party changes its
name, jurisdiction of formation or its status therein, or identity or entity
structure;

 

(vi)                              we express no opinion as to the creation,
validity or perfection of any security interest purported to be granted in that
portion of the Collateral that constitutes an interest or claim in or under a
policy of insurance (except as provided in Section 9-315 of the Uniform
Commercial Code as in effect in the applicable jurisdiction with respect to
proceeds), a right represented by a judgment, a right of setoff, a claim arising
out of tort or an interest in any consumer deposit account (except as provided
in Section 9-315 of the Uniform Commercial Code as in effect in the applicable
jurisdiction with respect to proceeds);

 

(vii)                           we express no opinion with respect to the
validity, perfection or priority of the Administrative Agent’s security interest
in any portion of the property of any Loan Party to the extent the Security
Agreement does not describe such property specifically, but references to types
of collateral that are defined in Section 9-102 of the UCC-New York are
sufficiently specific;

 

(viii)                        we express no opinion with respect to the
perfection of the Administrative Agent’s security interest in any Collateral
which may only be perfected by “control” or “possession” within the meaning
given to such term in the UCC-New York; and

 

(ix)                              we note that the enforcement of, and certain
other matters affecting, security interests are subject to applicable
bankruptcy, insolvency and similar laws affecting creditors’ rights generally
and to general principles of equity.  Our opinions are subject to the effect of
11 U.S.C. §§363, 364, 506(a), 506(c), 506(d), 510(c), 544, 547, 548, 552, 553,
725, 1129(b)(2)(A) and 1141(c), and to any order, process or judgment issued
under 11 U.S.C. §105(a).

 

(g)                                  We express no opinion concerning any Loan
Party’s rights in or title to, or the priority of any security interest, pledge,
lien, or other similar interest in, any personal property, or the creation,
perfection or priority of any lien, mortgage or other similar interest in any
real property.

 

(h)                                 Our opinions in clause (i) of Paragraph 5
and in Paragraph 7 are limited to (x) to our actual knowledge, if any, of the
specifically regulated business activities and properties of each respective
Company based solely upon an officer’s certificate in respect of such matters
and without any independent investigation or verification on our part and
(y) laws and regulations normally applicable to transactions of the type
contemplated in the Transaction Documents and do not extend to licenses, permits
and approvals necessary for the conduct of the such

 

13

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Company’s business.  In addition and without limiting the previous sentence, we
express no opinion herein, in Paragraphs 5 or 7 or otherwise, with respect to
the effect of any state or federal securities laws, land use, safety, hazardous
material, environmental or similar law, or any local or regional law.  In
rendering such opinions, we have not conducted any independent investigation of
the Companies or consulted with other attorneys in our firm with respect to the
matters covered thereby.  No inference as to our knowledge with respect to the
factual matters upon which we have so qualified our opinions should be drawn
from the fact of our representation of the Companies.

 

(i)                                     Except as set forth in clause (i) of
each of Paragraphs 3, 4 and 5, and as set forth in Paragraphs 6 and 7, we
express no opinion as to compliance or the effect of noncompliance by any Loan
Party with any laws or regulations applicable to such entity in connection with
the transactions described in the Transaction Documents.

 

(j)                                    We express no opinion as to compliance or
the effect of noncompliance by the Secured Parties with any state or federal
laws or regulations applicable to the Secured Parties in connection with the
transactions described in the Transaction Documents.

 

(k)                                 Our opinion in Paragraph 8 as to the
Guaranty is subject to the defenses available to a guarantor under applicable
law, but the waivers of such defenses set forth in the Guaranty are enforceable,
subject to the other exceptions set forth herein.

 

(l)                                     Section 290.371, subd. 4, of the
Minnesota Statutes provides that any corporation required to file a Notice of
Business Activities Report does not have a cause of action upon which it may
bring suit under Minnesota law unless the corporation has filed a Notice of
Business Activities Report and that the use of the courts of the State of
Minnesota for all contracts executed and all causes of actions that arose before
the end of any period for which a corporation failed to file a required report
is precluded.  Insofar as the foregoing opinion may relate to the enforceability
of any agreement under Minnesota law or in a Minnesota court, we have assumed
that any party seeking to enforce the agreement has at all times been, and will
continue at all times to be, exempt from the requirement of filing a Notice of
Business Activities Report or, if not exempt, has duly filed, and will continue
to duly file, all Notice of Business Activities Reports.

 

(m)                             In rendering our opinion in Paragraphs 6 and 7,
we are only opining as to consents, approvals, authorizations, registrations,
declarations and filings necessary for any Loan Party to execute, deliver and
perform its obligations under the Transaction Documents, and we express no
opinion with respect to any consent, approval, authorization from, or any
registration, declaration or filing with, any governmental authority or agency
required generally in connection with the day-to-day business or operations of
such entity.

 

This opinion is solely for the benefit of the Administrative Agent, each other
Secured Party, their respective successors and assigns, and any assignee
pursuant to Section 9.04(b) of the Credit Agreement, in connection with the
transaction described in this letter, may not be relied upon for any other
purpose, and may not be relied upon or used by, nor may copies hereof

 

14

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be delivered to, any other person or entity, except that copies may be delivered
to any prospective assignee that has agreed to the confidentiality provisions of
Section 9.16 of the Credit Agreement and to the confidentiality and non-reliance
provisions of this paragraph, or as may be required by any court or other
governmental or regulatory authority, without our prior written consent;
provided, however, that no use of or reliance on this opinion by any party,
including, without limitation, the Secured Parties, shall establish or imply an
attorney-client relationship between such party and this firm with respect to
the Transaction Documents or the transactions contemplated by the Transaction
Documents, and such party by using or relying on our opinion disclaims any such
attorney-client relationship with respect to the Transaction Documents or the
transactions contemplated by the Transaction Documents for any purpose without
our prior written approval.  We disclaim any obligation to update this opinion
letter for events occurring or coming to our attention, or any changes in the
law taking effect, after the date hereof.

 

 

Very truly yours,

 

TOK/SK

 

Attachments:                    Schedule 1 — Loan Parties

Schedule 2 — Transaction Documents

Schedule 3 — Corporate Documents

Schedule 4 — Uniform Commercial

Schedule 5 — Reviewed Documents

Schedule 6 — Judgments, Orders and Decrees

Exhibit A-1 — SUPERVALU Financing Statement

Exhibit A-2 — Advantage Logistics — Southeast, Inc. Financing Statement

Exhibit A-3 — Butson’s Enterprises, Inc. Financing Statement

Exhibit A-4 — Champlin 2005 L.L.C. Financing Statement

Exhibit A-5 — Eastern Region Management Corporation Financing Statement

Exhibit A-6 — FF Acquisition, L.L.C. Financing Statement

Exhibit A-7 — Foodarama LLC Financing Statement

Exhibit A-8 — Moran Foods, LLC Financing Statement

Exhibit A-9 — Richfood Holdings, Inc. Financing Statement

Exhibit A-10 — Richfood, Inc. Financing Statement

Exhibit A-11 — Richfood Procurement, L.L.C. Financing Statement

Exhibit A-12 — Save-A-Lot Tyler Group, LLC Financing Statement

Exhibit A-13 — Scott’s Food Stores, Inc. Financing Statement

Exhibit A-14 — SFW Holding Corp. Financing Statement

Exhibit A-15 — SFW Licensing Corp. Financing Statement

Exhibit A-16 — Shop ‘N Save St. Louis, Inc. Financing Statement

Exhibit A-17 — Shop ‘N Save Warehouse Foods, Inc. Financing Statement

Exhibit A-18 — Shoppers Food Warehouse Corp. Financing Statement

Exhibit A-19 — Super Rite Foods, Inc. Financing Statement

Exhibit A-20 — Supermarket Operators of America, Inc. Financing Statement

Exhibit A-21 — SUPERVALU Holdings, Inc. Financing Statement

Exhibit A-22 — SUPERVALU Holdings-PA LLC Financing Statement

 

15

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Exhibit A-23 — SUPERVALU Pharmacies, Inc. Financing Statement

Exhibit A-24 — SUPERVALU Transportation, Inc. Financing Statement

Exhibit A-25 — SUPERVALU TTSJ, INC. Financing Statement

Exhibit A-26 — SVH Realty, Inc. Financing Statement

Exhibit A-27 — W. Newell & Co., LLC Financing Statement

 

16

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Schedule 1
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Loan Parties (other than the Company)

 

1.                                      Advantage Logistics - Southeast, Inc.,
an Alabama corporation (“Advantage Logistics”).

 

2.                                      Butson’s Enterprises, Inc., a New
Hampshire corporation (“Butson’s”).

 

3.                                      Champlin 2005 L.L.C., a Delaware limited
liability company (“Champlin”).

 

4.                                      Eastern Region Management Corporation, a
Virginia corporation (“Eastern”).

 

5.                                      FF Acquisition, L.L.C., a Virginia
limited liability company (“FFA”).

 

6.                                      Foodarama LLC, a Delaware limited
liability company (“Foodarama”).

 

7.                                      Moran Foods, LLC, a Missouri limited
liability company (“Moran”).

 

8.                                      Richfood Holdings, Inc., a Delaware
corporation (“RHI”).

 

9.                                      Richfood, Inc., a Virginia corporation
(“Richfood”).

 

10.                               Richfood Procurement, L.L.C., a Virginia
limited liability company (“Richfood LLC”; together with Eastern, FFA and
Richfood, the “Virginia Loan Parties”).

 

11.                               Save-A-Lot Tyler Group, LLC, a Missouri
limited liability company (“SAL-Tyler”).

 

12.                               Scott’s Food Stores, Inc., an Indiana
corporation (“Scott’s”).

 

13.                               SFW Holding Corp., a Delaware corporation
(“SFW Holding”).

 

14.                               SFW Licensing Corp., a Delaware corporation
(“SFW Licensing”).

 

15.                               Shop ‘N Save St. Louis, Inc., a Missouri
corporation (“SNS-STL”).

 

16.                               Shop ‘N Save Warehouse Foods, Inc., a Missouri
corporation (“SNSW”).

 

17.                               Shoppers Food Warehouse Corp., an Ohio
Corporation (“SFW”).

 

18.                               Super Rite Foods, Inc., a Delaware corporation
(“Super Rite”).

 

19.                               Supermarket Operators of America Inc., a
Delaware corporation (“SOA”).

 

20.                               SUPERVALU Holdings, Inc., a Missouri
corporation (“SVH”; together with Moran, SAL-Tyler, SNS-STL and SNSW, the
“Missouri Loan Parties”).

 

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

 

21.                               SUPERVALU Holdings-PA LLC, a Pennsylvania
limited liability company (“SVH-PA”).

 

22.                               SUPERVALU Pharmacies, Inc., a Minnesota
corporation (“Pharmacies”).

 

23.                               SUPERVALU Transportation, Inc., a Minnesota
corporation (“Transportation”; together with Pharmacies, the “Minnesota Loan
Parties”).

 

24.                               SUPERVALU TTSJ, INC., a Delaware corporation
(“TTSJ”).

 

25.                               SVH Realty, Inc., a Delaware corporation
(“SVHR”; together with the Company, RHI, SFW Holding, SFW Licensing, Super Rite,
SOA, and TTSJ, the “Delaware Corporate Loan Parties”).

 

26.                               W. Newell & Co., LLC, a Delaware limited
liability company (“Newell”; together with Champlin and Foodarama, the “Delaware
LLC Loan Parties”; and together with the Delaware Corporate Loan Parties, the
“Delaware Loan Parties”).

 

The Loan Parties listed on this Schedule 1 are herein referred to as the
“Guarantors”.

 

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Schedule 2
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Transaction Documents

 

1.                                      Credit Agreement, dated as of March 21,
2013, by and between the Company, the other Loan Parties, Goldman Sachs Bank
USA, as Administrative Agent (in such capacity, the “Administrative Agent”), the
lenders and other secured parties thereto (together with the Administrative
Agent, the “Secured Parties”) (the “Credit Agreement”).

 

2.                                      Security Agreement, dated as of
March 21, 2013, by the Loan Parties, in favor of the Administrative Agent (the
“Security Agreement”).

 

3.                                      Guaranty, dated as of March 21, 2013, by
the Guarantors in favor of the Administrative Agent.

 

4.                                      Fee Letter, dated as of January 10,
2013, by and between the Company and Goldman Sachs Bank USA, Credit Suisse
Securities (USA) LLC, Credit Suisse AG, Cayman Islands Branch, Morgan Stanley
Senior Funding, Inc., Barclays, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, and Bank of America, N.A.

 

5.                                      Intercreditor Agreement, dated as of
March 21, 2013, by and between the Administrative Agent and Wells Fargo Bank,
National Association, as ABL Agent, as acknowledged and agreed by the Loan
Parties.

 

6.                                      Trademark security agreement for:

 

a.                            FF Acquisition, L.L.C.

b.                            Foodarama LLC

c.                             Moran Foods, LLC

d.                            Richfood, Inc.

e.                             SFW Licensing Corp.

f.                              Super Rite Foods, Inc.

g.                             SUPERVALU Holdings, Inc.

h.                            SUPERVALU INC.

i.                                SUPERVALU Pharmacies, Inc.

j.                               W. Newell & Co., LLC

 

7.                                      Copyright security agreement for:

 

a.                                      Shop ‘N Save Warehouse Foods, Inc.

b.                                      SUPERVALU INC.

 

8.                                      Patent security agreements for:

 

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

 

a.                                      SUPERVALU INC.

 

9.                                      Intercompany Subordination Agreement,
dated as of March 21, 2013, by and among Wells Fargo Bank, National Association,
as ABL Creditor Agent, Goldman Sachs Bank USA, as Term Loan Creditor Agent, and
certain subsidiaries of the Company thereto.

 

10.                               Collateral Assignment of Purchase Agreement
and Escrow Agreement, dated as of March 21, 2013, by and among the Company and
Goldman Sachs Bank USA, as administrative agent and collateral agent.

 

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Schedule 3
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Corporate Documents

 

I. Constitutive Documents

 

1.                              A copy of the certificate of incorporation of
the Company certified as of March 4, 2013, as a true copy by the Delaware
Secretary of State, and a copy of the bylaws of Company certified as of
March 21, 2013, as a true copy by the Secretary of Company (collectively, the
“Company Constitutive Documents”);

 

2.                              A copy of the articles of incorporation of
Advantage Logistics certified as of March 4, 2013, as a true copy by the Alabama
Secretary of State, and a copy of the bylaws of Acme certified as of March 21,
2013, as a true copy by the Secretary of Advantage Logistics (collectively, the
“Advantage Logistics Constitutive Documents”);

 

3.                              A copy of the certificate of incorporation of
Butson’s certified as of March 5, 2013, as a true copy by the New Hampshire
Secretary of State, and a copy of the bylaws of  Butson’s certified as of
March 21, 2013, as a true copy by the Secretary of Butson’s (collectively, the
“Butson’s Constitutive Documents”);

 

4.                              A copy of the certificate of formation of
Champlin certified as of March 4, 2013, as a true copy by the Delaware Secretary
of State, and a copy of the operating agreement of Champlin certified as of
March 21, 2013, as a true copy by the Secretary of Champlin (collectively, the
“Champlin Constitutive Documents”);

 

5.                              A copy of the certificate of incorporation of
Eastern certified as of March 5, 2013, as a true copy by the Virginia Secretary
of State, and a copy of the bylaws of Eastern certified as of March 21, 2013, as
a true copy by the Secretary of Eastern (collectively, the “Eastern Constitutive
Documents”);

 

6.                              A copy of the articles of organization of FFA
certified as of March 5, 2013, as a true copy by the Virginia Secretary of
State, and a copy of the operating agreement of FFA certified as of March 21,
2013, as a true copy by the Secretary of FFA (collectively, the “FFA
Constitutive Documents”);

 

7.                              A copy of the certificate of formation of
Foodarama certified as of March 4, 2013, as a true copy by the Delaware
Secretary of State, and a copy of the operating agreement of Foodarama certified
as of March 21, 2013, as a true copy by the Secretary of Foodarama
(collectively, the “Foodarama Constitutive Documents”);

 

8.                              A copy of the articles of organization of Moran
certified as of March 4, 2013, as a true copy by the Ohio Secretary of State,
and a copy of the operating agreement of Moran certified as of March 21, 2013,
as a true copy by the Secretary of Moran (collectively, the “Moran Constitutive
Documents”);

 

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

 

9.                              A copy of the certificate of incorporation of
RHI certified as of March 4, 2013, as a true copy by the Delaware Secretary of
State, and a copy of the bylaws of RHI certified as of March 21, 2013, as a true
copy by the Secretary of RHI (collectively, the “RHI Constitutive Documents”);

 

10.                       A copy of the articles of incorporation of Richfood
certified as of March 5, 2013, as a true copy by the Virginia Secretary of
State, and a copy of the bylaws of Richfood certified as of March 21, 2013, as a
true copy by the Secretary of Richfood (collectively, the “Richfood Constitutive
Documents”);

 

11.                       A copy of the articles of organization of Richfood LLC
certified as of March 5, 2013, as a true copy by the Virginia Secretary of
State, and a copy of the operating agreement of Richfood LLC certified as of
March 21, 2013, as a true copy by the Secretary of Richfood LLC (collectively,
the “Richfood LLC Constitutive Documents”);

 

12.                       A copy of the articles of organization of SAL-Tyler
certified as of March 4, 2013, as a true copy by the Missouri Secretary of
State, and a copy of the operating agreement of SAL-Tyler certified as of
March 21, 2013, as a true copy by the Secretary of SAL-Tyler (collectively, the
“SAL-Tyler Constitutive Documents”);

 

13.                       A copy of the certificate of incorporation of Scott’s
certified as of March 4, 2013, as a true copy by the Indiana Secretary of State,
and a copy of the bylaws of Scott’s certified as of March 21, 2013, as a true
copy by the Secretary of Scott’s (collectively, the “Scott’s Constitutive
Documents”);

 

14.                       A copy of the certificate of incorporation of SFW
Holding certified as of March 4, 2013, as a true copy by the Delaware Secretary
of State, and a copy of the bylaws of SFW Holding certified as of March 21,
2013, as a true copy by the Secretary of SFW Holding (collectively, the “SFW
Holding Constitutive Documents”);

 

15.                       A copy of the certificate of incorporation of SFW
Licensing certified as of March 4, 2013, as a true copy by the Delaware
Secretary of State, and a copy of the bylaws of SFW Licensing certified as of
March 21, 2013, as a true copy by the Secretary of SFW Licensing (collectively,
the “SFW Licensing Constitutive Documents”);

 

16.                       A copy of the articles of incorporation of SNS-STL
certified as of March 4, 2013, as a true copy by the Missouri Secretary of
State, and a copy of the bylaws of SNS-STL certified as of March 21, 2013, as a
true copy by the Secretary of SNS-STL (collectively, the “SNS-STL Constitutive
Documents”);

 

17.                       A copy of the articles of incorporation of SNSW
certified as of March 4, 2013, as a true copy by the Missouri Secretary of
State, and a copy of the bylaws of SNSW certified as of March 21, 2013, as a
true copy by the Secretary of SNSW (collectively, the “SNSW Constitutive
Documents”);

 

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

 

18.                       A copy of the articles of incorporation of SFW
certified as of March 6, 2013, as a true copy by the Ohio Secretary of State,
and a copy of the bylaws of SFW certified as of March 21, 2013, as a true copy
by the Secretary of SFW (collectively, the “SFW Constitutive Documents”);

 

19.                       A copy of the certificate of incorporation of Super
Rite certified as of March 4, 2013, as a true copy by the Delaware Secretary of
State, and a copy of the bylaws of Super Rite certified as of March 21, 2013, as
a true copy by the Secretary of Super Rite (collectively, the “Super Rite
Constitutive Documents”);

 

20.                       A copy of the certificate of incorporation of SOA
certified as of March 4, 2013, as a true copy by the Delaware Secretary of
State, and a copy of the bylaws of SOA certified as of March 21, 2013, as a true
copy by the Secretary of SOA (collectively, the “SOA Constitutive Documents”);

 

21.                       A copy of the articles of incorporation of SVH
certified as of March 4, 2013, as a true copy by the Missouri Secretary of
State, and a copy of the bylaws of SVH certified as of March 21, 2013, as a true
copy by the Secretary of SVH (collectively, the “SVH Constitutive Documents”);

 

22.                       A copy of the articles of organization of SVH-PA
certified as of March 4, 2013, as a true copy by the Pennsylvania Secretary of
State, and a copy of the operating agreement of SVH-PA certified as of March 21,
2013, as a true copy by the Secretary of SVH-PA (collectively, the “SVH-PA
Constitutive Documents”);

 

23.                       A copy of the articles of incorporation of Pharmacies
certified as of March 18, 2013, as a true copy by the Minnesota Secretary of
State, and a copy of the bylaws of Pharmacies certified as of March 21, 2013, as
a true copy by the Secretary of Pharmacies (collectively, the “Pharmacies
Constitutive Documents”);

 

24.                       A copy of the certificate of incorporation of
Transportation certified as of March 18, 2013, as a true copy by the Minnesota
Secretary of State, and a copy of the bylaws of Transportation, certified as of
March 21, 2013, as a true copy by the Secretary of Transportation (collectively,
the “Transportation Constitutive Documents”);

 

25.                       A copy of the certificate of incorporation of TTSJ
certified as of February 25, 2013, as a true copy by the Delaware Secretary of
State, and a copy of the bylaws of TTSJ certified as of March 21, 2013, as a
true copy by the Secretary of TTSJ (collectively, the “TTSJ Constitutive
Documents”);

 

26.                       A copy of the certificate of incorporation of SVHR
certified as of March 4, 2013, as a true copy by the Delaware Secretary of
State, and a copy of the bylaws of SVHR certified as of March 21, 2013, as a
true copy by the Secretary of SVHR (collectively, the “SVHR Constitutive
Documents”);

 

27.                       A copy of the certificate of formation of Newell
certified as of March 8, 2013, as a true copy by the Delaware Secretary of
State, and a copy of the operating agreement of

 

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

 

Newell certified as of March 21, 2013, as a true copy by the Secretary of Newell
(collectively, the “Newell Constitutive Documents”);

 

II. Good Standing Certificates

 

1.                              A certificate of good standing concerning the
Company from the Delaware Secretary of State issued March 4, 2013 (the “Company
Good Standing Certificate”);

 

2.                              A certificate of good standing concerning
Advantage Logistics from the Alabama Secretary of State issued March 4, 2013
(the “Advantage Logistics Good Standing Certificate”);

 

3.                              A certificate of good standing concerning
Butson’s from the New Hampshire Secretary of State issued March 5, 2013 (the
“Butson’s Good Standing Certificate”);

 

4.                              A certificate of good standing concerning
Champlin from the Delaware Secretary of State issued March 4, 2013 (the
“Champlin Good Standing Certificate”);

 

5.                              A certificate of good standing concerning
Eastern from the Virginia Secretary of State issued March 5, 2013 (the “Eastern
Good Standing Certificate”);

 

6.                              A certificate of good standing concerning FFA
from the Virginia Secretary of State issued March 5, 2013 (the “FFA Good
Standing Certificate”);

 

7.                              A certificate of good standing concerning
Foodarama from the Delaware Secretary of State issued March 4, 2013 (the
“Foodarama Good Standing Certificate”);

 

8.                              A certificate of good standing concerning Moran
from the Missouri Secretary of State issued March 4, 2013 (the “Moran Good
Standing Certificate”);

 

9.                              A certificate of good standing concerning RHI
from the Delaware Secretary of State issued March 5, 2013 (the “RHI Good
Standing Certificate”);

 

10.                       A certificate of good standing concerning Richfood
from the Virginia Secretary of State issued March 5, 2013 (the “Richfood Good
Standing Certificate”);

 

11.                       A certificate of good standing concerning Richfood LLC
from the Virginia Secretary of State issued March 5, 2013 (the “Richfood LLC
Good Standing Certificate”);

 

12.                       A certificate of good standing concerning SAL-Tyler
from the Missouri Secretary of State issued March 4, 2013 (the “SAL-Tyler Good
Standing Certificate”);

 

13.                       A certificate of good standing concerning Scott’s from
the Indiana Secretary of State issued March 4, 2013 (the “Scott’s Good Standing
Certificate”);

 

14.                       A certificate of good standing concerning SFW Holding
from the Delaware Secretary of State issued March 4, 2013 (the “SFW Holding Good
Standing Certificate”);

 

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

 

15.                       A certificate of good standing concerning SFW
Licensing from the Delaware Secretary of State issued March 5, 2013 (the “SFW
Licensing Good Standing Certificate”);

 

16.                       A certificate of good standing concerning SNS-STL from
the Missouri Secretary of State issued March 4, 2013 (the “SNS-STL Good Standing
Certificate”);

 

17.                       A certificate of good standing concerning SNSW from
the Missouri Secretary of State issued March 4, 2013 (the “SNSW Good Standing
Certificate”);

 

18.                       A certificate of good standing concerning SFW from the
Ohio Secretary of State issued March 4, 2013 (the “SFW Good Standing
Certificate”);

 

19.                       A certificate of good standing concerning Super Rite
from the Delaware Secretary of State issued March 4, 2013 (the “Super Rite Good
Standing Certificate”);

 

20.                       A certificate of good standing concerning SOA from the
Delaware Secretary of State issued March 4, 2013 (the “SOA Good Standing
Certificate”);

 

21.                       A certificate of good standing concerning SVH from the
Missouri Secretary of State issued March 4, 2013 (the “SVH Good Standing
Certificate”);

 

22.                       A certificate of good standing concerning SVH-PA from
the Pennsylvania Secretary of State issued March 4, 2013 (the “SVH-PA Good
Standing Certificate”);

 

23.                       A certificate of good standing concerning Pharmacies
from the Minnesota Secretary of State issued March 4, 2013 (the “Pharmacies Good
Standing Certificate”);

 

24.                       A certificate of good standing concerning
Transportation from the Minnesota Secretary of State issued March 4, 2013 (the
“Transportation Good Standing Certificate”);

 

25.                       A certificate of good standing concerning TTSJ from
the Delaware Secretary of State issued March 8, 2013 (the “TTSJ Good Standing
Certificate”);

 

26.                       A certificate of good standing concerning SVHR from
the Delaware Secretary of State issued March 4, 2013 (the “SVHR Good Standing
Certificate”);

 

27.                       A certificate of good standing concerning Newell from
the Delaware Secretary of State issued March 8, 2013 (the “Newell Good Standing
Certificate”);

 

III.  Certificates

 

1.                              A certificate of an officer of the Company,
dated as of March 21, 2013, certifying as to a copy of resolutions of the Board
of Directors of Company, incumbency with respect to officers of the Company and
certain other matters;

 

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

 

2.                              A certificate of an officer of Advantage
Logistics, dated as of March 21, 2013, certifying as to a copy of resolutions of
the Board of Directors of Advantage Logistics, incumbency with respect to
officers of Advantage Logistics and certain other matters;

 

3.                              A certificate of an officer of Butson’s, dated
as of March 21, 2013, certifying as to a copy of resolutions of the Board of
Directors of Butson’s, incumbency with respect to officers of Butson’s and
certain other matters;

 

4.                              A certificate of an officer of Champlin, dated
as of March 21, 2013, certifying as to a copy of resolutions of the Members of
Champlin, incumbency with respect to officers of Champlin and certain other
matters;

 

5.                              A certificate of an officer of Eastern, dated as
of March 21, 2013, certifying as to a copy of resolutions of the Board of
Directors of Eastern, incumbency with respect to officers of Eastern and certain
other matters;

 

6.                              A certificate of an officer of FFA, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Managers
of FFA, incumbency with respect to officers of FFA and certain other matters;

 

7.                              A certificate of an officer of Foodarama, dated
as of March 21, 2013, certifying as to a copy of resolutions of the Member of
Foodarama, incumbency with respect to officers of Foodarama and certain other
matters;

 

8.                              A certificate of an officer of Moran, dated as
of March 21, 2013, certifying as to a copy of resolutions of the Board of
Managers of Moran, incumbency with respect to officers of Moran and certain
other matters;

 

9.                              A certificate of an officer of RHI, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of RHI, incumbency with respect to officers of RHI and certain other matters;

 

10.                       A certificate of an officer of Richfood, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of Richfood, incumbency with respect to officers of Richfood and certain other
matters;

 

11.                       A certificate of an officer of Richfood LLC, dated as
of March 21, 2013, certifying as to a copy of resolutions of the board of
managers of Richfood LLC, incumbency with respect to officers of Richfood LLC
and certain other matters;

 

12.                       A certificate of an officer of SAL-Tyler, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Managers
of SAL-Tyler, incumbency with respect to officers of SAL-Tyler and certain other
matters;

 

13.                       A certificate of an officer of Scott’s, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of Scott’s, incumbency with respect to officers of Scott’s and certain other
matters;

 

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

 

14.                       A certificate of an officer of SFW Holding, dated as
of March 21, 2013, certifying as to a copy of resolutions of the Board of
Directors of SFW Holding, incumbency with respect to officers of SFW Holding and
certain other matters;

 

15.                       A certificate of an officer of SFW Licensing, dated as
of March 21, 2013, certifying as to a copy of resolutions of the Board of
Directors of SFW Licensing, incumbency with respect to officers of SFW Licensing
and certain other matters;

 

16.                       A certificate of an officer of SNS-STL dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of SNS-STL, incumbency with respect to officers of SNS-STL and certain other
matters;

 

17.                       A certificate of an officer of SNSW, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of SNSW, incumbency with respect to officers of SNSW and certain other matters;

 

18.                       A certificate of an officer of SFW, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of SFW, incumbency with respect to officers of SFW and certain other matters;

 

19.                       A certificate of an officer of Super Rite, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of Super Rite, incumbency with respect to officers of Super Rite and certain
other matters;

 

20.                       A certificate of an officer of SOA, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of SOA, incumbency with respect to officers of SOA and certain other matters;

 

21.                       A certificate of an officer of SVH, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of SVH, incumbency with respect to officers of SVH and certain other matters;

 

22.                       A certificate of an officer of SVH-PA, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Member of SVH-PA,
incumbency with respect to officers of SVH-PA and certain other matters;

 

23.                       A certificate of an officer of Pharmacies, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of Pharmacies, incumbency with respect to officers of Pharmacies and certain
other matters;

 

24.                       A certificate of an officer of Transportation, dated
as of March 21, 2013, certifying as to a copy of resolutions of the Board of
Directors of Transportation, incumbency with respect to officers of
Transportation and certain other matters;

 

25.                       A certificate of an officer of TTSJ, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of TTSJ, incumbency with respect to officers of TTSJ and certain other matters;

 

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

 

26.                       A certificate of an officer of SVHR, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Directors
of SVHR, incumbency with respect to officers of SVHR and certain other matters;

 

27.                       A certificate of an officer of Newell, dated as of
March 21, 2013, certifying as to a copy of resolutions of the Board of Managers
of Newell, incumbency with respect to officers of Newell and certain other
matters;

 

IV. Financing Statements

 

A copy of each of the Uniform Commercial Code Financing Statements attached as
Exhibits A-1 through A-27 hereto (the “Financing Statements”).

 

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

 

Schedule 4
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Opinions

 

1.                              The opinion of Jeffrey J. Steinle, Esq., Vice
President, Business Law of the Company, dated as of the date hereof.

 

2.                              The opinion of Shook, Hardy & Bacon L.L.P.,
special local counsel to the Missouri Loan Parties, dated as of the date hereof.

 

3.                              The opinion of Baker & Hostetler LLP, special
local counsel to SFW, dated as of the date hereof.

 

4.                              The opinion of Kaufman & Canoles, P.C., special
local counsel to the Virginia Loan Parties, dated as of the date hereof.

 

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

 

Schedule 5
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Reviewed Documents

 

1.                              Indenture, dated as of May 1, 1995, between ASC
and Wells Fargo Bank, National Association (as successor to The First National
Bank of Chicago), as amended, supplemented or otherwise modified as of the
Closing Date or in accordance with the terms hereof (the “ASC Indenture”).

 

2.                              Indenture, dated as of May 1, 1992, between New
Albertson’s, Inc., a Delaware corporation, and U.S. Bank National Association,
as trustee, as supplemented by Supplemental Indenture No. 1 dated as of May 7,
2004, as supplemented by Supplemental Indenture No. 2 dated as of June 1, 2006,
as supplemented by Supplemental Indenture No. 3, dated as of December 29, 2008
(the “NAI Indenture”).

 

3.                              Indenture, dated as of July 1, 1987, between the
Company and Deutsche Bank Trust Company (formerly Bankers Trust Company), as
trustee, as supplemented by the First Supplemental Indenture dated as of
August 1, 1990, the Second Supplemental indenture dated as of October 1, 1992,
the Third Supplemental Indenture dated as of September 1, 1995, the Fourth
Supplemental Indenture dated as of August 4, 1999, and the Fifth Supplemental
Indenture dated as of September 17, 1999 (the “Company Indenture”).

 

4.                              Second Amended and Restated Receivables Purchase
Agreement, dated as of November 30, 2011, by and among Supervalu Receivables
Funding Corporation, as seller, the Company, as servicer, the banks and other
financial institutions party thereto, as purchasers and Coöperatieve Centrale
Raiffeisen-Boerenleenbank B.A., “Rabobank Nederland”, New York Branch, as agent.

 

5.                              The 7.50% Senior Notes due 2014, issued by the
Company pursuant to the Company Indenture.

 

6.                              The 8.000% Senior Notes due 2016, issued by the
Company pursuant to the Company Indenture.

 

7.                              The 7.90% Debenture due May 1, 2017, issued by
ASC pursuant to the ASC Indenture.

 

8.                              The 8% Debentures due June 1, 2026, issued by
ASC pursuant to the ASC Indenture.

 

9.                              The Medium-Term Notes, Series B, due March 30,
2018, issued by ASC pursuant to the ASC Indenture.

 

10.                       The 7.25% Senior Notes due May 1, 2013, issued by NAI
pursuant to the NAI Indenture.

 

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

 

11.                       The 7.75% Debentures due June 15, 2026, issued by NAI
pursuant to the NAI Indenture.

 

12.                       The 7.45% Senior Debentures due August 1, 2029, issued
by NAI pursuant to the NAI Indenture.

 

13.                       The 8.70% Senior Debentures due May 1, 2030, issued by
NAI pursuant to the NAI Indenture.

 

14.                       The 8.00% Senior Debentures due May 1, 2031, issued by
NAI pursuant to the NAI Indenture.

 

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

 

Schedule 6
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Judgments, Orders and Decrees

 

1)                             Gazzerro-Langford v. Supervalu, Inc. d/b/a Acme
Markets, Docket No. 11-13587, Court of Common Please, Chester County, PA

 

2)                             Scott Perry v. SuperValu Inc, Case Number RIC
10017756, Superior Court of California, County of Riverside

 

3)                             EEOC v. SUPERVALU INC., American Drug Stores LLL,
Jewel Food Stores, Inc., Consent Decree, Case No. 1:09 CV 05637, United States
District Court, Northern District of Illinois, Eastern Division

 

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

 

Exhibit A-1
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Company Financing Statement

 

See attached.

 

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

 

Exhibit A-2
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Advantage Logistics — Southeast, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-3
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Butson’s Enterprises, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-4
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Champlin 2005 L.L.C. Financing Statement

 

See attached.

 

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

 

Exhibit A-5
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Eastern Region Management Corporation Financing Statement

 

See attached.

 

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

 

Exhibit A-6
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

FF Acquisition L.L.C. Financing Statement

 

See attached.

 

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

 

Exhibit A-7
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Foodarama LLC Financing Statement

 

See attached.

 

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

 

Exhibit A-8
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Moran Foods, LLC Financing Statement

 

See attached.

 

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

 

Exhibit A-9
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Richfood Holdings, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-10
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Richfood, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-11
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Richfood Procurement, L.L.C. Financing Statement

 

See attached.

 

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

 

Exhibit A-12
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Save-A-Lot Tyler Group, LLC Financing Statement

 

See attached.

 

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

 

Exhibit A-13
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Scott’s Food Stores, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-14
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SFW Holding Corp. Financing Statement

 

See attached.

 

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

 

Exhibit A-15
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SFW Licensing Corp. Financing Statement

 

See attached.

 

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

 

Exhibit A-16
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Shop ‘N Save St. Louis, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-17
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Shop ‘N Save Warehouse Foods, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-18
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Shoppers Food Warehouse Corp. Financing Statement

 

See attached.

 

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

 

Exhibit A-19
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Super Rite Foods, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-20
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

Supermarket Operators of America Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-21
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SUPERVALU Holdings, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-22
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SUPERVALU Holdings-PA LLC Financing Statement

 

See attached.

 

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

 

Exhibit A-23
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SUPERVALU Pharmacies, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-24
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SUPERVALU Transportation, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-25
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SUPERVALU TTSJ, INC. Financing Statement

 

See attached.

 

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

 

Exhibit A-26
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

SVH Realty, Inc. Financing Statement

 

See attached.

 

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

 

Exhibit A-27
Opinion of Dorsey & Whitney LLP
March 21, 2013

 

W. Newell & Co., LLC Financing Statement

 

See attached.

 

K-1

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

 

Exhibit L
to the Credit Agreement

 

FORM OF DDA NOTIFICATION

 

PREPARE ON BORROWER LETTERHEAD - ONE FOR EACH DEPOSITORY

 

[DATE]

 

To:                             [Name and Address of Bank]

 

Re:                             [                                            ]

The Account Numbers referenced on Exhibit A annexed hereto

 

Dear Sir/Madam:

 

This letter relates to the Account Numbers referenced on Exhibit A annexed
hereto and any other depository account(s) (collectively the “Account”) which
[                            ], a [                                ] with an
address at [                                   ] (the “Borrower”), now or
hereafter maintains with you.  The term “Account” shall also mean any
certificates of deposit, investments, or other evidence of indebtedness
heretofore or hereafter issued by you to or for the account of the Borrower.

 

The Borrower and certain of its affiliates have entered into separate financing
agreements with each of (a) Wells Fargo Bank, National Association, with an
office at One Boston Place, 18th Floor, Boston, Massachusetts 02108-4407, as
administrative and collateral agent (in such capacity, together with its
successors and assigns, and any replacement agent pursuant to a replacement
asset-based revolving credit financing, the “Revolving Loan Agent”) for its own
benefit and the benefit of a syndicate of revolving lenders and certain other
credit parties (together with their successors and assigns, and any replacement
lenders pursuant to a replacement asset-based revolving credit financing, the
“Revolving Credit Parties”), which are making loans or furnishing other
financial accommodations to [                      ]; and (b) Goldman Sachs Bank
USA, with an office at 6031 Connection Drive, Irving, Texas 75039, c/o Goldman
Sachs Group, Inc., as administrative and collateral agent (in such capacity,
together with its successors and assigns, and any replacement agent pursuant to
a replacement term loan credit financing, the “Term Loan Agent”) for its own
benefit and the benefit of a syndicate of term lenders (together with their
successors and assigns, and any replacement lenders pursuant to a replacement
term loan credit financing, the “Term Credit Parties”), which are making term
loans to the Borrower and certain of its affiliates.

 

For purposes of this letter, the term “Lender Representative” as used herein
shall mean Revolving Loan Agent until such time as Revolving Loan Agent notifies
you in writing (at your address above) that the Lender Representative shall be
Term Loan Agent, and on and after

 

L-1

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

 

delivery of such notice from Revolving Loan Agent to you, the term “Lender
Representative” shall mean Term Loan Agent.

 

The Borrower has granted to the Revolving Loan Agent (for its own benefit and
the benefit of the Revolving Credit Parties) and to the Term Loan Agent (for its
own benefit and the benefit of the Term Credit Parties) security interests in
and to, among other things, the Borrower’s accounts, accounts receivable,
inventory, and proceeds therefrom, including, without limitation, the proceeds
now or hereafter deposited in the Account or evidenced thereby.  Consequently,
the present and all future contents of the Account constitute the collateral of
Revolving Loan Agent and Term Loan Agent.

 

Until you receive written notification from the Lender Representative that the
interest of the Revolving Loan Agent, the other Revolving Credit Parties, the
Term Loan Agent and the Term Credit Parties in the Accounts has been terminated,
all funds from time to time on deposit in each of the Accounts, net of such
minimum balance, not to exceed $[                    ], shall be transferred [on
each business day] [lesser frequency for remote accounts to be determined] as
follows:

 

(a)                                 By ACH, Depository Transfer Check, or
Electronic Depository Transfer to:

 

[Blocked Account Details]

ABA #                                          

Account No.                                 

Re:                                                

 

or

 

(b)                                 As you may be otherwise instructed from time
to time in writing by an officer of the Lender Representative.

 

Upon request of the Lender Representative, a copy of each statement issued with
respect to the Account should be provided to the Revolving Loan Agent and Term
Loan Agent at the following addresses (which address may be changed upon seven
(7) days’ written notice given to you by the Revolving Loan Agent or Term Loan
Agent, as applicable):

 

If to Revolving Loan Agent:

 

Wells Fargo Bank, National Association

One Boston Place, 18th Floor

Boston, Massachusetts 02108-4407

Attn: Portfolio Manager - Supervalu

Fax No.: (866) 617-3988

 

If to Term Loan Agent:

 

Goldman Sachs Bank USA

c/o Goldman Sachs Group, Inc.

 

L-2

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

 

6031 Connection Drive

Irving, Texas 75039

Attention: Ken Moua

Telephone: 972-368-2746

Email: gs-sbdagency-borrowernotices@ny.email.gs.com

 

You shall be fully protected in acting on any order or direction by the Lender
Representative given in accordance with terms of this DDA Notification
respecting the Accounts without making any inquiry whatsoever as to the Lender
Representative’s right or authority to give such order or direction or as to the
application of any payment made pursuant thereto.  Nothing contained herein is
intended to, nor shall it be deemed to, modify the rights and obligations of the
Borrower and the Revolving Loan Agent or Term Loan Agent under the terms of the
respective loan arrangement and the loan documents executed in connection
therewith between, among others, the Borrower and Revolving Loan Agent, and the
Borrower and Term Loan Agent.

 

This letter may be amended only by notice in writing signed by the Borrower and
an officer of the Revolving Loan Agent and Term Loan Agent.  The letter may be
terminated solely by written notice signed by an officer of the Revolving Loan
Agent and Term Loan Agent.

 

[signature page follows]

 

L-3

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

 

 

Very truly yours,

 

 

 

 

 

[                                        ], as Borrower

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

cc:

 

Wells Fargo Bank, National Association, as Revolving Loan Agent
Goldman Sachs Bank USA, as Term Loan Agent

 

L-4

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

 

Exhibit A

 

Accounts

 

[see attached]

 

L-5

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

 

Exhibit M
to the Credit Agreement

 

FORM OF CREDIT CARD NOTIFICATION

 

[SUPERVALU INC. Letterhead]

 

                             , 2012

 

BY CERTIFIED MAIL — RETURN RECEIPT REQUESTED & UPS NEXT DAY AIR

 

To:                             [                      ]

                                                [                      ]

                                                [                      ]

(the “Processor”)

 

Re:                             [                      ]29

Merchant Account Number:                               

 

Dear Sir/Madam:

 

[                      ]30, a                                        with its
principal executive offices at 7075 Flying Cloud Drive, Eden Prairie, Minnesota
(the “Company”), among others, has entered into separate financing agreements
with each of (a) WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking
association, with offices at One Boston Place, 18th Floor, Boston, Massachusetts
02108, as administrative agent and collateral agent (in such capacity herein,
together with its successors and assigns, and any replacement agent pursuant to
a replacement asset-based revolving credit financing, the “Revolving Loan
Agent”) for its own benefit and the benefit of a syndicate of revolving lenders
and certain other credit parties (together with their successors and assigns,
and any replacement lenders pursuant to a replacement asset-based revolving
credit financing, the “Revolving Loan Credit Parties”) which are making loans or
furnishing other financial accommodations to the Company and certain of its
affiliates, and (b) GOLDMAN SACHS BANK USA, having an office at 6031 Connection
Drive, Irving, Texas 75039, c/o Goldman Sachs Group, Inc., as administrative and
collateral agent (in such capacity herein, together with its successors and
assigns, and any replacement agent pursuant to a replacement term loan credit
financing, the “Term Loan Agent”) for its own benefit and the benefit of a
syndicate of term lenders and certain other credit parties (together with their
successors and assigns, and any replacement credit parties pursuant to a
replacement term loan credit financing, the “Term Loan Credit Parties”) which
are making loans to SUPERVALU INC. (the “Lead Borrower”), pursuant to which
agreements the Company, among others, has granted

 

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

29                                      Insert applicable Supervalu company

 

30                                      Insert applicable Supervalu company

 

M-6

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

 

to the Revolving Loan Agent, for its own benefit and the benefit of the other
Revolving Loan Credit Parties, and to the Term Loan Agent, for its own benefit
and the benefit of the other Term Loan Credit Parties, a security interest in
and to, among other things, certain of the assets of the Company (the
“Collateral”), including, without limitation, all credit and debit card charges
submitted by the Company to the Processor for processing and all amounts which
the Processor owes to the Company on account thereof (the “Credit Card
Proceeds”).

 

The Processor has entered into arrangements pursuant to which Processor acts as
credit card processing service provider to the Company and certain of its
subsidiaries and affiliates in connection with sales by the Company and such
subsidiaries and affiliates to their customers using credit cards and debit
cards as set forth in the                                                   , by
and between Processor and the Company (together with any replacement agreement
thereto, the “Card Processing Agreement”).

 

For purposes of this Credit Card Notification, the term “Lender Representative”
as used herein shall mean Revolving Loan Agent until such time as Revolving Loan
Agent notifies the Processor in writing (at the Processor’s address above) that
the Lender Representative shall be Term Loan Agent, and on and after delivery of
such notice from Revolving Loan Agent to the undersigned, the term “Lender
Representative” shall mean Term Loan Agent.

 

Notwithstanding anything to the contrary contained in the Card Processing
Agreement or any prior instructions which may have been given to the Processor,
unless and until Processor receives written instructions from the Lender
Representative to the contrary, effective as of the date hereof, all amounts as
may become due from time to time from the Processor to the Company pursuant to
the Card Processing Agreement or otherwise shall be transferred only as follows:

 

a.                                      By [Wire Transfer] [ACH (for American
Express only)] to one of the deposit accounts described on Schedule I hereto, as
such Schedule may be supplemented from time to time in writing by an officer of
the Company and confirmed in writing by an officer of the Lender Representative:

or

 

b.                                      As the Processor may be otherwise
instructed from time to time in writing by an officer of the Revolving Loan
Agent.

 

Upon the request of the Revolving Loan Agent or the Term Loan Agent, a copy of
each periodic statement provided or made available by the Processor to the
Company shall be provided to the Lender Representative at the following address
(which address may be changed upon seven (7) days written notice given to the
Processor by the Revolving Loan Agent or the Term Loan Agent, as applicable):

 

M-7

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

 

If to Revolving Loan Agent:

 

Wells Fargo Bank, National Association
One Boston Place, 18th Floor
Boston, MA 02108
Attention:  Portfolio Manager - Supervalu
Facsimile: 866.617.3988
Re:  Supervalu

 

If to Term Loan Agent:

 

Goldman Sachs Bank USA
c/o Goldman Sachs Group, Inc.
6031 Connection Drive
Irving, Texas 75039
Attention: Ken Moua
Telephone: 972-368-2746
Email: gs-sbdagency-borrowernotices@ny.email.gs.com

 

The Processor shall be fully protected in acting on any order or direction by
the Lender Representative given in accordance with the terms of this Credit Card
Notification respecting the Credit Card Proceeds without making any inquiry
whatsoever as to the Revolving Loan Agent’s or the Term Loan Agent’s right or
authority to give such order or direction or as to the application of any
payment made pursuant thereto.

 

This Credit Card Notification may be amended only by a written notice executed
by the Company and the Lender Representative, and may be terminated solely by
written notice signed by an officer of the Lender Representative.  The Company
shall not have any right to terminate this Credit Card Notification or, except
as provided in this Credit Card Notification, amend it.

 

This Credit Card Notification may be executed and delivered by telecopier or
other method of electronic transmission with the same force and effect as if it
were a manually executed and delivered counterpart.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

M-8

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

 

THIS CREDIT CARD NOTIFICATION AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES.

 

 

Very truly yours,

 

 

 

[                      ]31

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

cc:                                Wells Fargo Bank, National Association, as
Revolving Loan Agent

Goldman Sachs Bank USA, as Term Loan Agent

 

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

31                                  Insert applicable Supervalu company

 

M-9

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

 

Schedule I

to

Credit Card Notification

 

Deposit Accounts

 

Bank

 

ABA #

 

Name on Account

 

Account #

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

M-10

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

 

Exhibit N
to the Credit Agreement

 

CLOSING DATE COLLATERAL LIST

 

(See attached)

 

[**]

 

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

** Denotes confidential information that has been omitted from the exhibit and
filed separately, accompanied by a confidential treatment request, with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.

 

N-1

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

 

Exhibit O
to the Credit Agreement

 

FORM OF UNITED STATES TAX COMPLIANCE CERTIFICATE32

 

Reference is made to that certain Term Loan Credit Agreement, dated as of
March 21, 2013 (as amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among SUPERVALU Inc., a
Delaware corporation (the “Borrower”), the Guarantors party thereto, the Lenders
parties thereto and Goldman Sachs Bank USA, as Administrative Agent (in such
capacity, including any successor thereto, the “Administrative Agent”) and
Collateral Agent for the Secured Parties.  [NAME OF FOREIGN LENDER] (the
“Foreign Lender”) provides this certificate pursuant to Section 2.20(e) of the
Credit Agreement (together with any other documentation required to be provided
by it pursuant to Section 2.20(e)), in respect of Loans made to the Borrower. 
Terms defined in the Credit Agreement and not otherwise defined herein shall
have the meanings defined for them in the Credit Agreement.  The Foreign Lender
hereby represents and warrants that:

 

1.              The Foreign Lender is the sole beneficial owner of the Loans in
respect of which it is providing this certificate.

 

2.              The Foreign Lender is not a “bank” within the meaning of
Section 881(c)(3)(A) of the Code.

 

3.              The Foreign Lender is not a “10-percent shareholder” of any Loan
Party within the meaning of Section 871(h)(3)(B) of the Code.

 

4.              The Foreign Lender is not a “controlled foreign corporation”
related to any Loan Party within the meaning of Section 864(d)(4) of the Code.

 

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

32                                      If the Foreign Lender is an
intermediary, a foreign partnership or other flow-through entity, the following
adjustments shall be made:

 

A.            The following representations shall be provided as applied to the
partners or the members claiming the portfolio interest exemption:

 

·                  the status in Clause 1;

·                  the status in Clause 3; and

·                  the status in Clause 4.

 

B.            The following representation shall be provided as applied to the
Foreign Lender as well as the members/ beneficial owners claiming the portfolio
interest exemption.

 

·                  The status in Clause 2.

 

C.            The Foreign Lender shall provide an Internal Revenue Service
Form W-8IMY (with W-8BENs/ W-9s from each of its partners/ members).

 

D.            Appropriate adjustments shall be made in the case of tiered
intermediaries or tiered partnerships/ flow-through entities.

 

O-1

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

 

IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

 

 

 

[NAME OF FOREIGN LENDER]

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

Date:

 

 

O-2

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

 

Exhibit P
to the Credit Agreement

 

Exhibit P
to the Credit Agreement

 

FORM OF RELATED COLLATERAL SECURITY AGREEMENT

 

(See attached)

 

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

 

 

 

RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT

 

dated as of

 

[                    ], 20[    ]

 

by

 

THE LOAN PARTY LISTED ON THE SIGNATURE PAGES HERETO

 

in favor of

 

GOLDMAN SACHS BANK USA,
as Collateral Agent

 

 

 

2

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

 

Table of Contents

 

ARTICLE I DEFINITIONS AND INTERPRETATION

1

 

 

 

SECTION 1.1 Definitions

1

 

SECTION 1.2 Interpretation

3

 

SECTION 1.3 Perfection Certificate

3

 

 

 

ARTICLE II GRANT OF SECURITY AND SECURED OBLIGATIONS

3

 

 

 

SECTION 2.1 Pledge; Grant of Security Interest

3

 

SECTION 2.2 Secured Obligations

4

 

SECTION 2.3 Security Interest

4

 

SECTION 2.4 [Limitation on Secured Obligations

4

 

 

 

ARTICLE III PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES; USE OF COLLATERAL

4

 

 

 

SECTION 3.1 Financing Statements and Other Filings; Maintenance of Perfected
Security Interest

4

 

SECTION 3.2 Supplements; Further Assurances

5

 

SECTION 3.3 Grant of License

5

 

 

 

ARTICLE IV REPRESENTATIONS, WARRANTIES AND COVENANTS

6

 

 

 

SECTION 4.1 Title

6

 

SECTION 4.2 Limitation on Liens; Defense of Claims; Transferability of
Collateral

6

 

SECTION 4.3 Chief Executive Office; Change of Name; Jurisdiction of Organization

6

 

SECTION 4.4 No Conflicts, Consents, etc.

7

 

SECTION 4.5 Collateral

7

 

SECTION 4.6 Insurance

7

 

SECTION 4.7 Payment of Taxes; Compliance with Laws; Contested Liens; Claims

7

 

 

 

ARTICLE V REMEDIES

8

 

 

 

SECTION 5.1 Remedies

8

 

SECTION 5.2 Notice of Sale

9

 

SECTION 5.3 Waiver of Notice and Claims

9

 

SECTION 5.4 Certain Sales of Collateral

10

 

SECTION 5.5 No Waiver; Cumulative Remedies

10

 

SECTION 5.6 Application of Proceeds

10

 

SECTION 5.7 Third Party Agreements

10

 

 

 

ARTICLE VI MISCELLANEOUS

11

 

 

 

SECTION 6.1 Concerning the Collateral Agent

11

 

SECTION 6.2 Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact

11

 

SECTION 6.3 Expenses

12

 

SECTION 6.4 Continuing Security Interest; Assignment

12

 

SECTION 6.5 Termination; Release

12

 

SECTION 6.6 Modification in Writing

13

 

i

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

 

 

SECTION 6.7 Notices

13

 

SECTION 6.8 GOVERNING LAW

13

 

SECTION 6.9 CONSENT TO JURISDICTION; SERVICE OF PROCESS; WAIVER OF JURY TRIAL

14

 

SECTION 6.10 Severability of Provisions

15

 

SECTION 6.11 Execution in Counterparts; Effectiveness

15

 

SECTION 6.12 No Release

15

 

SECTION 6.13 Obligations Absolute

15

 

SECTION 6.14 Intercreditor Agreement

16

 

ii

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

 

EXHIBIT 1

 

[Mortgaged Property][Material Related Collateral Location]

 

 

 

SCHEDULE 3.2

 

Filings, Registrations and Recordings

SCHEDULE 4.3(a)

 

Other Legal and Fictitious Names, Mergers, Consolidations, Acquisitions

 

iii

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

 

RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT

 

RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT, dated as of
[                    ], 20[    ] (as amended, amended and restated, supplemented
or otherwise modified from time to time in accordance with the provisions
hereof, this “Related Real Estate Collateral Security Agreement”) made by the
Loan Party listed on the signature pages hereto, as pledgor, assignor and debtor
(in such capacities and together with any successors in such capacities, the
“Grantor”), in favor of GOLDMAN SACHS BANK USA, having an office at
[                ], in its capacity as collateral agent for the Secured Parties,
as pledgee, assignee and secured party (in such capacities and together with any
successors in such capacities, the “Collateral Agent”).

 

R E C I T A L S :

 

A.            The Borrower, the Collateral Agent, the Guarantors party thereto
and the Lenders party thereto have, in connection with the execution and
delivery of this Related Real Estate Collateral Security Agreement, entered into
that certain Term Loan Credit Agreement, dated as of March 21, 2013 (as amended,
amended and restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”).

 

B.            Pursuant to the terms of the Credit Agreement, the Grantor which
is [the Borrower] [or] [a Guarantor] under the Credit Agreement, agreed to
execute and deliver [a Mortgage granting a Lien on the Mortgaged Property and]
this Related Real Estate Collateral Security Agreement.

 

C.            The Grantor received substantial benefits from the execution,
delivery and performance of the Credit Agreement and is, therefore, willing to
enter into this Related Real Estate Collateral Security Agreement.

 

D.            This Related Real Estate Collateral Security Agreement is given by
the Grantor in favor of the Collateral Agent for the benefit of the Secured
Parties to secure the payment and performance of all of the Secured Obligations
(as hereinafter defined).

 

A G R E E M E N T :

 

NOW THEREFORE, in consideration of the foregoing premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Grantor and the Collateral Agent hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS AND INTERPRETATION

 

SECTION 1.1  Definitions.

 

(a)           Unless otherwise defined herein or in the Credit Agreement,
capitalized terms used herein that are defined in the UCC shall have the
meanings assigned to them in the UCC.

 

1

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

 

(b)           Capitalized terms used but not otherwise defined herein that are
defined in the Credit Agreement shall have the meanings assigned to them in the
Credit Agreement.

 

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

 

“ABL Priority Collateral” shall have the meaning assigned to such term in the
Intercreditor Agreement.

 

“Claims” shall mean any and all property taxes and other taxes, assessments and
special assessments, levies, fees and all governmental charges imposed upon or
assessed against, and all claims (including, without limitation, landlords’,
carriers’, mechanics’, workmen’s, repairmen’s, laborers’, materialmen’s,
suppliers’ and warehousemen’s Liens and other claims arising by operation of
law) against, all or any portion of the Collateral.

 

“Collateral” shall have the meaning assigned to such term in Section 2.1 hereof.

 

“Collateral Agent” shall have the meaning assigned to such term in the Preamble
hereof.

 

“Credit Agreement” shall have the meaning assigned to such term in Recital A
hereof.

 

“Excluded Assets” shall mean the following:

 

(a)   any rights or interests in any contract, agreement, lease, permit,
license, charter or license agreement, as such, if under the terms of such
contract, agreement, lease, permit, license, charter or license agreement, or
applicable law with respect thereto, the valid grant of a Lien therein to the
Collateral Agent would constitute or result in a breach, termination or default
under such contract, agreement, lease, permit, license, charter or license
agreement and such breach, termination or default has not been or is not waived
or the consent of the other party to such contract, agreement, lease, permit,
license, charter or license agreement has not been or is not otherwise obtained
or under applicable law such prohibition cannot be waived; provided, that, the
foregoing exclusion shall in no way be construed (i) to apply if any such
prohibition is unenforceable under Sections 9-406, 9-407 or 9-408 of the UCC or
other applicable law or (ii) so as to limit, impair or otherwise affect the
Collateral Agent’s unconditional continuing Liens in any rights or interests of
the Grantor in or to monies due or to become due under any such contract, lease,
permit, license, charter or license agreement;

 

(b)   ABL Priority Collateral.

 

“Grantor” shall have the meaning assigned to such term in the Preamble hereof.

 

“Intellectual Property” shall mean “Patents,” “Trademarks,” “Copyrights,”
“Licenses” and “Goodwill” (each as defined in the Security Agreement) of the
Grantor.

 

[“Material Related Collateral Location” means the Material Related Collateral
Location of the Grantor described in Exhibit 1 hereto.]

 

2

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

 

[“Mortgage” shall mean the [mortgage or deed of trust] of even date herewith
made by the Grantor in favor of the Collateral Agent and covering the Mortgaged
Property, as the same may be amended, supplemented, restated or otherwise
modified and in effect from time to time.]

 

[“Mortgaged Property” means the real property described in Exhibit 1 hereto.]

 

“Perfection Certificate” shall mean that certain Perfection Certificate, dated
as of the Closing Date, executed and delivered by the Grantor in favor of the
Collateral Agent for the benefit of the Secured Parties, as the same may be
amended, supplemented, restated or otherwise modified and in effect from time to
time in accordance with the Credit Agreement.

 

“Secured Obligations” shall mean the Obligations and the Guaranteed Obligations
(as defined in the Facility Guaranty)[, subject to the limitations set forth in
Section 2.4].

 

“Related Real Estate Collateral Security Agreement” shall have the meaning
assigned to such term in the Preamble hereof.

 

“Specified Fixed Asset Collateral” shall mean all Equipment owned by any Grantor
from time to time located on the [Mortgaged Property (but only while located on
the Mortgaged Property)] [Material Related Collateral Location (but only while
located on the Material Related Collateral Location)], other than (a) rolling
stock and (b) air or automobile equipment, information technology equipment and
leasehold improvements located on operating lease sites (but including all other
fixtures).

 

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of New York; provided, that, (a) if a term is defined in Article 9 of the
Uniform Commercial Code differently than in another Article thereof, the term
shall have the meaning set forth in Article 9 of the Uniform Commercial Code and
(b) if by reason of mandatory provisions of law, perfection, or the effect of
perfection or non-perfection, of a security interest in any Collateral or the
availability of any remedy hereunder is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than the State of New York, “UCC” means the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such perfection or effect of perfection or
non-perfection or availability of such remedy, as the case may be.

 

SECTION 1.2  Interpretation.  The rules of interpretation specified in
Section 1.02 of the Credit Agreement shall be applicable to this Related Real
Estate Collateral Security Agreement.

 

SECTION 1.3  Perfection Certificate.  The Collateral Agent and the Grantor agree
that the Perfection Certificate and all schedules, amendments and supplements
thereto are, and shall at all times remain, a part of this Related Real Estate
Collateral Security Agreement.

 

ARTICLE II

 

GRANT OF SECURITY AND SECURED OBLIGATIONS

 

SECTION 2.1  Pledge; Grant of Security Interest.  As collateral security for the
payment and performance in full of all the Secured Obligations, the Grantor
hereby pledges and grants to the Collateral Agent for

 

3

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

 

its benefit and for the benefit of the other Secured Parties, a lien on and
security interest in and to all of the right, title and interest of the Grantor
in, to and under the following personal property and interests in such personal
property, wherever located, and whether now existing or hereafter arising or
acquired from time to time (collectively, the “Collateral”):

 

(a)   all Specified Fixed Asset Collateral;

 

(b)   all books and records and documents relating to the Collateral (whether
tangible or electronic, which contain any information relating to any of the
foregoing), but only to the extent necessary or desirable to sell, transfer or
otherwise realize on any of the other Collateral; and

 

(c)   all Proceeds of the foregoing and all accessions to, substitutions and
replacements for, and rents, profits and products of, each of the foregoing, any
and all proceeds of any insurance (including proceeds of business interruption
and other insurance claims against third parties), indemnity, warranty or
guaranty payable to the Grantor from time to time with respect to any of the
foregoing.

 

Notwithstanding anything to the contrary contained in clauses (a) through
(d) above, the security interest created by this Related Real Estate Collateral
Security Agreement shall not extend to, and the term “Collateral” shall not
include, any Excluded Assets and the Grantor shall from time to time at the
request of the Collateral Agent give written notice to the Collateral Agent
identifying in reasonable detail the Excluded Assets described in clause (a) of
the definition thereof and shall provide to the Collateral Agent such other
information regarding such Excluded Assets as the Collateral Agent may
reasonably request.

 

SECTION 2.2  Secured Obligations.  This Related Real Estate Collateral Security
Agreement secures, and the Collateral is collateral security for, the payment
and performance in full when due of the Secured Obligations.

 

SECTION 2.3  Security Interest.

 

(a)           The Grantor hereby irrevocably authorizes the Collateral Agent at
any time and from time to time to authenticate and file in any relevant
jurisdiction any financing statements (including fixture filings) and amendments
thereto that contain the information required by Article 9 of the UCC of each
applicable jurisdiction for the filing of any financing statement or amendment
relating to the Collateral, including, without limitation, (i) the type of
organization and any organizational identification number issued to the Grantor
and (ii) a description of the Collateral.  The Grantor agrees to provide all
information described in the immediately preceding sentence to the Collateral
Agent promptly upon request.

 

(b)           Each Grantor hereby ratifies its prior authorization for the
Collateral Agent to file in any relevant jurisdiction any financing statements
or amendments thereto relating to the Collateral if filed prior to the date
hereof.

 

SECTION 2.4  [Limitation on Secured Obligations.  Notwithstanding any provision
herein to the contrary, the amount of the Secured Obligations secured by the
[Mortgaged Property][Specified Fixed Asset Collateral located on the Material
Related Collateral Location] and the related Collateral that is

 

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“Operating Property” (as defined in the SVU Indenture as then in effect) shall
be automatically limited to the maximum amount of the Secured Obligations
permitted to be secured by such assets without violating the terms of the SVU
Indenture and without giving rise, to any obligation on the part of any Loan
Party to grant a Lien on any of its assets to secure Indebtedness governed by or
subject to the terms of the SVU Indenture.]1

 

ARTICLE III

 

PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES; USE OF COLLATERAL

 

SECTION 3.1  Financing Statements and Other Filings; Maintenance of Perfected
Security Interest(d)    .  The Grantor represents and warrants that the only
filings, registrations and recordings necessary and appropriate to create,
preserve, protect, publish notice of and perfect the security interest granted
by the Grantor to the Collateral Agent (for the benefit of the Secured Parties)
pursuant to this Related Real Estate Collateral Security Agreement in respect of
the Collateral are listed in Schedule 3.2 hereto.  The Grantor represents and
warrants that all such filings, registrations and recordings have been delivered
to the Collateral Agent in completed and, to the extent necessary or
appropriate, duly executed form for filing in each governmental, municipal or
other office specified in Schedule 3.2 hereto.  The Grantor agrees that at the
sole cost and expense of the Grantor, (a) the Grantor will maintain the security
interest created by this Related Real Estate Collateral Security Agreement in
the Collateral as a perfected first priority security interest (subject to
Permitted Encumbrances having priority by operation of law) and shall defend
such security interest against the claims and demands of all Persons (other than
with respect to Permitted Encumbrances), (b) the Grantor shall furnish to the
Collateral Agent from time to time statements and schedules further identifying
and describing the Collateral and such other reports in connection with the
Collateral as the Collateral Agent may reasonably request, all in reasonable
detail and (c) at any time and from time to time, upon the written request of
the Collateral Agent, the Grantor shall promptly and duly execute and deliver,
and file and have recorded, such further instruments and documents and take such
further action as the Collateral Agent may reasonably request, including the
filing of any financing statements, continuation statements and other documents
(including this Related Real Estate Collateral Security Agreement) under the UCC
(or other applicable Law) in effect in any jurisdiction with respect to the
security interest created hereby wherever required by applicable Law in each
case to perfect, continue and maintain a valid, enforceable, first priority
security interest (subject to Permitted Encumbrances having priority by
operation of law) as provided herein and to preserve the other rights and
interests granted to the Collateral Agent hereunder, as against the Grantor and
third parties (other than with respect to Permitted Encumbrances), with respect
to the Collateral.

 

SECTION 3.2  Supplements; Further Assurances.  The Grantor shall take such
further actions, and execute and deliver to the Collateral Agent such additional
assignments, agreements, supplements, powers and instruments, as the Collateral
Agent may in its reasonable judgment deem necessary or appropriate, wherever
required by Law, in order to perfect, preserve and protect the security interest
in the Collateral as provided herein and the rights and interests granted to the
Collateral

 

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1 To be included only if this Related Real Estate Collateral Security Agreement
is entered into in connection with the execution and delivery of a Mortgage or
other grant of security interest on “Operating Property” (as defined in the SVU
Indenture) as then in effect.

 

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Agent hereunder, or better to assure and confirm unto the Collateral Agent or
permit the Collateral Agent to exercise and enforce its rights, powers and
remedies hereunder with respect to any Collateral.  Without limiting the
generality of the foregoing, the Grantor shall make, execute, endorse,
acknowledge, file or refile and/or deliver to the Collateral Agent from time to
time upon reasonable request such lists, descriptions and designations of the
Collateral, copies of warehouse receipts, receipts in the nature of warehouse
receipts, bills of lading, documents of title, vouchers, invoices, schedules,
confirmatory assignments, supplements, additional security agreements,
conveyances, financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments.  If an Event of
Default has occurred and is continuing, the Collateral Agent may institute and
maintain, in its own name or in the name of the Grantor, such suits and
proceedings as the Collateral Agent may be advised by counsel shall be necessary
or expedient to prevent any impairment of the security interest in or the
perfection thereof in the Collateral.  All of the foregoing shall be at the sole
cost and expense of the Grantor.  The Grantor and the Collateral Agent
acknowledge that this Related Real Estate Collateral Security Agreement is
intended to grant to the Collateral Agent for the benefit of the Secured Parties
a security interest in and Lien upon the Collateral and shall not constitute or
create a present assignment of any of the Collateral.

 

SECTION 3.3  Grant of License.  For the purpose of enabling the Collateral
Agent, during the continuance of an Event of Default, to exercise rights and
remedies under Article V hereof at such time as the Collateral Agent shall be
lawfully entitled to exercise such rights and remedies, and for no other
purpose, the Grantor hereby grants to the Collateral Agent, to the extent
assignable, an irrevocable, non-exclusive license (exercisable without payment
of royalty or other compensation to the Grantor) to use, assign, license or
sublicense any of the Intellectual Property now owned or hereafter acquired by
the Grantor, wherever the same may be located, including in such license access
to all media in which any of the licensed items may be recorded or stored and to
all computer programs used for the compilation or printout hereof.

 

ARTICLE IV

 

REPRESENTATIONS, WARRANTIES AND COVENANTS

 

In addition to, and without limitation of, each of the representations,
warranties and covenants set forth in the Credit Agreement and the other Loan
Documents, the Grantor represents, warrants and covenants as follows:

 

SECTION 4.1  Title(a) .  No financing statement, mortgage, or other public
notice with respect to all or any part of the Collateral is on file or of record
in any public office, except such as have been filed in favor of the Collateral
Agent pursuant to this Related Real Estate Collateral Security Agreement or as
are permitted by the Credit Agreement.  The security interests granted pursuant
to this Related Real Estate Collateral Security Agreement constitute a legal and
valid security interest in favor of the Collateral Agent, for the benefit of the
Secured Parties, securing the payment and performance of the Grantor’s
Obligations and upon completion of the filings and other actions specified on
Schedule 3.2 hereto (all of which, in the case of all filings and other
documents referred to on such Schedule, have been delivered to the Collateral
Agent in duly completed and duly executed form, as applicable, and may be filed
by the Collateral Agent at any time) and payment of all filing fees, will
constitute fully perfected

 

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security interests in all of the Collateral, prior to all other Liens on the
Collateral except for Permitted Encumbrances arising by operation of law that
have priority under such law.

 

SECTION 4.2  Limitation on Liens; Defense of Claims; Transferability of
Collateral.  The Grantor, as to Collateral now owned by it or acquired by it
from time to time after the date hereof, is or will be the sole direct and
beneficial owner of such Collateral free from any Lien or other right, title or
interest of any Person other than the Liens and security interest created by
this Related Real Estate Collateral Security Agreement and Permitted
Encumbrances.  The Grantor shall, at its own cost and expense, defend title to
the Collateral pledged by it hereunder and the security interest therein and
Lien thereon granted to the Collateral Agent and the priority thereof against
all claims and demands of all Persons, at its own cost and expense, at any time
claiming any interest therein adverse to the Collateral Agent or any other
Secured Party other than Permitted Encumbrances.  There is no agreement, and the
Grantor shall not enter into any agreement or take any other action, that would
restrict the transferability of any of the Collateral or otherwise impair or
conflict with the Grantor’s obligations or the rights of the Collateral Agent
hereunder.

 

SECTION 4.3  Chief Executive Office; Change of Name; Jurisdiction of
Organization.

 

(a)           The exact legal name, type of organization, jurisdiction of
organization, federal taxpayer identification number, organizational
identification number and the mailing address for purposes of completing a UCC-1
financing statement of such Grantor is indicated next to its name in
Schedules I(A) and I(B) of the Perfection Certificate.  No Grantor has, during
the four months prior to the date of this Related Real Estate Collateral
Security Agreement, been known by or used any other legal or fictitious name or
been a party to any merger or consolidation, or acquired all or substantially
all of the assets of any Person, or acquired any of its property or assets out
of the ordinary course of business, except as set forth in
Schedule 4.3(a) hereto.

 

(b)   The Collateral Agent may rely on advice of counsel as to whether any or
all UCC financing statements of the Grantors need to be amended as a result of
any of the changes described in Section 5.14 of the Credit Agreement [or in any
Periodic Update Schedule or Occurrence Update Schedule].  If any Grantor fails
to provide information to the Collateral Agent about such changes on a timely
basis, the Collateral Agent shall not be liable or responsible to any party for
any failure to maintain a perfected security interest in such Grantor’s property
constituting Collateral, for which the Collateral Agent needed to have
information relating to such changes.  The Collateral Agent shall have no duty
to inquire about such changes if any Grantor does not inform the Collateral
Agent of such changes, the parties acknowledging and agreeing that it would not
be feasible or practical for the Collateral Agent to search for information on
such changes if such information is not provided by any Grantor.

 

SECTION 4.4  No Conflicts, Consents, etc.  No consent of any party (including,
without limitation, equityholders or creditors of the Grantor) and no consent,
authorization, approval, license or other action by, and no notice to or filing
with, any Governmental Authority or regulatory body or other Person is required
for the grant of the security interest by the Grantor of the Collateral pledged
by it pursuant to this Related Real Estate Collateral Security Agreement or for
the execution, delivery or performance hereof by the Grantor, except for the
perfection or maintenance of the Liens created under this Related Real Estate
Collateral Security Agreement

 

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(including the first priority nature thereof, subject to Permitted Encumbrances
having priority by operation of law) and such consents which have been obtained
or made prior to the date hereof and are in full force and effect.  Following
the occurrence and during the continuation of an Event of Default, if the
Collateral Agent desires to exercise any remedies, voting or consensual rights
or attorney-in-fact powers set forth in this Related Real Estate Collateral
Security Agreement and determines it necessary to obtain any approvals or
consents of any Governmental Authority or any other Person therefor, then, upon
the reasonable request of the Collateral Agent, the Grantor agrees to use
commercially reasonable efforts to assist and aid the Collateral Agent to obtain
as soon as commercially practicable any necessary approvals or consents for the
exercise of any such remedies, rights and powers.

 

SECTION 4.5  Collateral.  All information set forth herein, including the
schedules annexed hereto, and all information contained in any documents,
schedules and lists heretofore delivered to any Secured Party in connection with
this Related Real Estate Collateral Security Agreement, in each case, relating
to the Collateral, is accurate and complete in all material respects.  The
Collateral described on the schedules annexed hereto constitutes all of the
property of such type of Collateral owned or held by the Grantor.

 

SECTION 4.6  Insurance(c)  .  The Grantor shall (a) maintain or shall cause to
be maintained such insurance as is required pursuant to Section 5.07 of the
Credit Agreement; (b) maintain such other insurance as may be required by
applicable Law; and (c) furnish to the Collateral Agent, upon written request,
full information as to the insurance carried.  The Grantor hereby irrevocably
makes, constitutes and appoints the Collateral Agent (and all officers,
employees or agents designated by the Collateral Agent) as the Grantor’s true
and lawful agent (and attorney-in-fact), exercisable only after the occurrence
and during the continuance of an Event of Default, for the purpose of making,
settling and adjusting claims in respect of the Collateral under policies of
insurance, endorsing the name of the Grantor on any check, draft, instrument or
other item of payment for the proceeds of such policies of insurance and for
making all determinations and decisions with respect thereto.  In the event that
the Grantor at any time or times shall fail to obtain or maintain any of the
policies of insurance required hereby or to pay any premium in whole or in part
relating thereto, the Collateral Agent may, without waiving or releasing any
obligation or liability of the Grantor hereunder or any Default or Event of
Default, in its sole discretion, obtain and maintain such policies of insurance
and pay such premium and take any other actions with respect thereto as the
Collateral Agent deems advisable.  All sums disbursed by the Collateral Agent in
connection with this Section 4.6, including reasonable attorneys’ fees, court
costs, expenses and other charges relating thereto, shall be payable, upon
demand, by the Grantor to the Collateral Agent and shall be additional Secured
Obligations secured hereby.

 

SECTION 4.7  Payment of Taxes; Compliance with Laws; Contested Liens;
Claims(d)  .  The Grantor represents and warrants that all Claims imposed upon
or assessed against the Collateral have been paid and discharged except to the
extent such Claims constitute a Lien not yet due and payable or a Permitted
Encumbrance.  The Grantor shall comply with all applicable Law relating to the
Collateral the failure to comply with which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.  The Grantor may
at its own expense contest the validity, amount or applicability of any Claims
so long as the contest thereof shall be conducted in accordance with, and
permitted pursuant to

 

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the provisions of, the Credit Agreement.  Notwithstanding the foregoing
provisions of this Section 4.7, no contest of any such obligation may be pursued
by the Grantor if such contest would expose the Collateral Agent or any other
Secured Party to (a) any possible criminal liability or (b) any additional civil
liability for failure to comply with such obligations unless the Grantor shall
have furnished a bond or other security therefor satisfactory to the Collateral
Agent or such other Secured Party, as the case may be.

 

ARTICLE V

 

REMEDIES

 

SECTION 5.1  Remedies.  Upon the occurrence and during the continuance of any
Event of Default the Collateral Agent may, and at the direction of the Required
Lenders, shall, from time to time in respect of the Collateral, in addition to
the other rights and remedies provided for herein, under applicable Law or
otherwise available to it, subject to the Intercreditor Agreement:

 

(a)           Personally, or by agents or attorneys, immediately take possession
of the Collateral or any part thereof, from the Grantor or any other Person who
then has possession of any part thereof with or without notice or process of
law, and for that purpose may enter upon the Grantor’s premises where any of the
Collateral is located, remove such Collateral, remain present at such premises
to receive copies of all communications and remittances relating to the
Collateral and use in connection with such removal and possession any and all
services, supplies, aids and other facilities of the Grantor;

 

(b)           Demand, sue for, collect or receive any money or property at any
time payable or receivable in respect of the Collateral including, without
limitation, instructing the obligor or obligors on any agreement, instrument or
other obligation constituting part of the Collateral to make any payment
required by the terms of such agreement, instrument or other obligation directly
to the Collateral Agent, and in connection with any of the foregoing,
compromise, settle, extend the time for payment and make other modifications
with respect thereto; provided, that, in the event that any such payments are
made directly to the Grantor, prior to receipt by any such obligor of such
instruction, the Grantor shall segregate all amounts received pursuant thereto
in trust for the benefit of the Collateral Agent and shall promptly pay such
amounts to the Collateral Agent;

 

(c)           Sell, assign, grant a license to use or otherwise liquidate, or
direct the Grantor to sell, assign, grant a license to use or otherwise
liquidate, any and all investments made in whole or in part with the Collateral
or any part thereof, and take possession of the proceeds of any such sale,
assignment, license or liquidation;

 

(d)           Take possession of the Collateral or any part thereof, by
directing the Grantor in writing to deliver the same to the Collateral Agent at
any place or places so designated by the Collateral Agent, in which event the
Grantor shall at its own expense:  (i) forthwith cause the same to be moved to
the place or places designated by the Collateral Agent and therewith delivered
to the Collateral Agent, (ii) store and keep any Collateral so delivered to the
Collateral Agent at such place or places pending further action by the
Collateral Agent and (iii) while the Collateral shall be so stored and kept,
provide such security and

 

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maintenance services as shall be necessary to protect the same and to preserve
and maintain them in good condition.  The Grantor’s obligation to deliver the
Collateral as contemplated in this Section 5.1 is of the essence hereof.  Upon
application to a court of equity having jurisdiction, the Collateral Agent shall
be entitled to a decree requiring specific performance by the Grantor of such
obligation;

 

(e)           Withdraw all moneys, instruments, securities and other property in
any bank, financial securities, deposit or other account of the Grantor
constituting Collateral for application to the Secured Obligations as provided
in Section 7.02 of the Credit Agreement;

 

(f)            Exercise any and all rights as beneficial and legal owner of the
Collateral, including, without limitation, perfecting assignment of and
exercising any and all voting, consensual and other rights and powers with
respect to any Collateral; and

 

(g)           Exercise all the rights and remedies of a secured party under the
UCC, and the Collateral Agent may also in its sole discretion, without notice
except as specified in Section 5.2 hereof, sell, assign or grant a license to
use the Collateral or any part thereof in one or more parcels at public or
private sale, at any exchange, broker’s board or at any of the Collateral
Agent’s offices or elsewhere, for cash, on credit or for future delivery, and at
such price or prices and upon such other terms as the Collateral Agent may deem
commercially reasonable.  The Collateral Agent or any other Secured Party or any
of their respective Affiliates may be the purchaser, licensee, assignee or
recipient of any or all of the Collateral at any such sale and shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold, assigned or
licensed at such sale, to use and apply any of the Secured Obligations owed to
such Person as a credit on account of the purchase price of any Collateral
payable by such Person at such sale.  Each purchaser, assignee, licensee or
recipient at any such sale shall acquire the property sold, assigned or licensed
absolutely free from any claim or right on the part of the Grantor, and the
Grantor hereby waives, to the fullest extent permitted by Law, all rights of
redemption, stay and/or appraisal which it now has or may at any time in the
future have under any rule of law or statute now existing or hereafter enacted. 
The Collateral Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given.  The Collateral Agent may
adjourn any public or private sale from time to time by announcement at the time
and place fixed therefor, and such sale may, without further notice, be made at
the time and place to which it was so adjourned.  To the fullest extent
permitted by Law, the Grantor hereby waives any claims against the Collateral
Agent arising by reason of the fact that the price at which any Collateral may
have been sold, assigned or licensed at such a private sale was less than the
price which might have been obtained at a public sale, even if the Collateral
Agent accepts the first offer received and does not offer such Collateral to
more than one offeree.

 

SECTION 5.2  Notice of Sale.  The Grantor acknowledges and agrees that, to the
extent notice of sale or other disposition of Collateral shall be required by
applicable Law and unless the Collateral is perishable or threatens to decline
speedily in value, or is of a type customarily sold on a recognized market (in
which event the Collateral Agent shall provide the Grantor such advance notice
as may be practicable under the circumstances), 10 days’ prior notice to the
Grantor of the time and place of any public sale or of the time after which any
private sale or other intended disposition is to take place shall be
commercially reasonable notification of such matters.  No

 

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notification need be given to the Grantor if it has signed, after the occurrence
of an Event of Default, a statement renouncing or modifying (as permitted under
Law) any right to notification of sale or other intended disposition.

 

SECTION 5.3  Waiver of Notice and Claims(e)   .  The Grantor hereby waives, to
the fullest extent permitted by applicable Law, notice or judicial hearing in
connection with the Collateral Agent’s taking possession or the Collateral
Agent’s disposition of any of the Collateral, including, without limitation, any
and all prior notice and hearing for any prejudgment remedy or remedies and any
such right which the Grantor would otherwise have under law, and the Grantor
hereby further waives, to the fullest extent permitted by applicable Law: 
(a) all damages occasioned by such taking of possession, (b) all other
requirements as to the time, place and terms of sale or other requirements with
respect to the enforcement of the Collateral Agent’s rights hereunder and
(c) all rights of redemption, appraisal, valuation, stay, extension or
moratorium now or hereafter in force under any applicable Law.  The Collateral
Agent shall not be liable for any incorrect or improper payment made pursuant to
this Article V in the absence of gross negligence or willful misconduct as
determined in a final, nonappealable judgment of a court of competent
jurisdiction.  Any sale of, or the grant of options to purchase, or any other
realization upon, any Collateral shall operate to divest all right, title,
interest, claim and demand, either at law or in equity, of the Grantor therein
and thereto, and shall be a perpetual bar both at law and in equity against the
Grantor and against any and all Persons claiming or attempting to claim the
Collateral so sold, optioned or realized upon, or any part thereof, from,
through or under the Grantor.

 

SECTION 5.4  Certain Sales of Collateral.

 

(a)           The Grantor recognizes that, by reason of certain prohibitions
contained in law, rules, regulations or orders of any Governmental Authority,
the Collateral Agent may be compelled, with respect to any sale of all or any
part of the Collateral, to limit purchasers to those who meet the requirements
of such Governmental Authority.  The Grantor acknowledges that any such sales
may be at prices and on terms less favorable to the Collateral Agent than those
obtainable through a public sale without such restrictions, and, notwithstanding
such circumstances, agrees that any such restricted sale shall be deemed to have
been made in a commercially reasonable manner and that, except as may be
required by applicable Law, the Collateral Agent shall have no obligation to
engage in public sales.

 

SECTION 5.5  No Waiver; Cumulative Remedies.

 

(a)           No failure on the part of the Collateral Agent to exercise, no
course of dealing with respect to, and no delay on the part of the Collateral
Agent in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right,
power or remedy hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or remedy; nor shall the Collateral Agent be
required to look first to, enforce or exhaust any other security, collateral or
guaranties.  The remedies herein provided are cumulative and are not exclusive
of any remedies provided by Law.

 

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(b)           In the event that the Collateral Agent shall have instituted any
proceeding to enforce any right, power or remedy under this Related Real Estate
Collateral Security Agreement by foreclosure, sale, entry or otherwise, and such
proceeding shall have been discontinued or abandoned for any reason or shall
have been determined adversely to the Collateral Agent, then and in every such
case, the Grantor, the Collateral Agent and each other Secured Party shall be
restored to their respective former positions and rights hereunder with respect
to the Collateral, and all rights, remedies and powers of the Collateral Agent
and the other Secured Parties shall continue as if no such proceeding had been
instituted.

 

SECTION 5.6  Application of Proceeds.  The proceeds received by the Collateral
Agent in respect of any sale of, collection from or other realization upon all
or any part of the Collateral pursuant to the exercise by the Collateral Agent
of its remedies shall be applied, together with any other sums then held by the
Collateral Agent pursuant to this Related Real Estate Collateral Security
Agreement, in accordance with and as set forth in Section 7.02 of the Credit
Agreement.

 

SECTION 5.7  Third Party Agreements.  Pursuant to the Collateral Access
Agreements (as defined in the ABL Credit Agreement), the Collateral Agent has
the right to give notice to certain Persons who are parties thereto or
recipients thereof.  With respect to each Collateral Access Agreement (as
defined in the ABL Credit Agreement), the Collateral Agent hereby acknowledges
and agrees that it will not deliver any notice to such Persons in connection
with the exercise of its rights and remedies under the Credit Agreement, this
Related Real Estate Collateral Security Agreement and the other Loan Documents
until after the occurrence and during the continuance of an Event of Default.

 

ARTICLE VI

 

MISCELLANEOUS

 

SECTION 6.1  Concerning the Collateral Agent.

 

(a)           The Collateral Agent has been appointed as agent pursuant to the
Credit Agreement.  The actions of the Collateral Agent hereunder are subject to
the provisions of the Credit Agreement.  The Collateral Agent shall have the
right hereunder to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking action (including,
without limitation, the release or substitution of the Collateral), in
accordance with this Related Real Estate Collateral Security Agreement and the
Credit Agreement.  The Collateral Agent may employ agents and attorneys-in-fact
in connection herewith and shall not be liable for the negligence or misconduct
of any such agents or attorneys-in-fact.  The Collateral Agent may resign and a
successor Collateral Agent may be appointed in the manner provided in the Credit
Agreement.  Upon the acceptance of any appointment as the Collateral Agent by a
successor Collateral Agent, that successor Collateral Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Collateral Agent under this Related Real Estate Collateral
Security Agreement, and the retiring Collateral Agent shall thereupon be
discharged from its duties and obligations under this Related Real Estate
Collateral Security Agreement.  After any retiring Collateral Agent’s
resignation, the provisions hereof shall inure to its benefit as to any actions
taken or omitted to be taken by it under this Related Real Estate Collateral
Security Agreement while it was the Collateral Agent.

 

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(b)           The Collateral Agent shall be deemed to have exercised reasonable
care in the custody and preservation of the Collateral in its possession if such
Collateral is accorded treatment substantially equivalent to that which the
Collateral Agent, in its individual capacity, accords its own property
consisting of similar instruments or interests, it being understood that neither
the Collateral Agent nor any of the other Secured Parties shall have
responsibility for, without limitation taking any necessary steps to preserve
rights against any Person with respect to any Collateral.

 

(c)           The Collateral Agent shall be entitled to rely upon any written
notice, statement, certificate, order or other document or any telephone message
believed by it 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
Related Real Estate Collateral Security Agreement and its duties hereunder, upon
advice of counsel selected by it.

 

(d)           If any item of Collateral also constitutes collateral granted to
the Collateral Agent under any other deed of trust, mortgage, security
agreement, pledge or instrument of any type, in the event of any conflict
between the provisions hereof and the provisions of such other deed of trust,
mortgage, security agreement, pledge or instrument of any type in respect of
such collateral, the Collateral Agent, in its sole discretion, shall select
which provision or provisions shall control.

 

SECTION 6.2  Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact(f)   .  If the Grantor shall fail to perform any covenants
contained in this Related Real Estate Collateral Security Agreement or in the
Credit Agreement (including, without limitation, the Grantor’s covenants to
(a) pay the premiums in respect of all required insurance policies hereunder,
(b) pay Claims, (c) make repairs, (d) discharge Liens or (e) pay or perform any
other obligations of the Grantor with respect to any Collateral) or if any
warranty on the part of the Grantor contained herein shall be breached, the
Collateral Agent may (but shall not be obligated to) do the same or cause it to
be done or remedy any such breach, and may expend funds for such purpose;
provided, that, the Collateral Agent shall in no event be bound to inquire into
the validity of any tax, lien, imposition or other obligation which the Grantor
fails to pay or perform as and when required hereby.  Any and all amounts so
expended by the Collateral Agent shall be paid by the Grantor in accordance with
the provisions of Section 6.3 hereof.  Neither the provisions of this
Section 6.2 nor any action taken by the Collateral Agent pursuant to the
provisions of this Section 6.2 shall prevent any such failure to observe any
covenant contained in this Related Real Estate Collateral Security Agreement nor
any breach of warranty from constituting an Event of Default.  The Grantor
hereby appoints the Collateral Agent its attorney-in-fact, with full authority
in the place and stead of the Grantor and in the name of the Grantor, or
otherwise, from time to time after the occurrence and during the continuation of
an Event of Default in the Collateral Agent’s discretion to take any action and
to execute any instrument consistent with the terms of the Credit Agreement and
the other Security Documents which the Collateral Agent may deem necessary to
accomplish the purposes hereof.  The foregoing grant of authority is a power of
attorney coupled with an interest and such appointment shall be irrevocable for
the term hereof.  The Grantor hereby ratifies all that such attorney shall
lawfully do or cause to be done by virtue hereof.

 

13

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SECTION 6.3  Expenses.  The Grantor will upon demand pay to the Collateral Agent
the amount of any and all amounts required to be paid pursuant to Section 9.05
of the Credit Agreement.

 

SECTION 6.4  Continuing Security Interest; Assignment(g)   .  This Related Real
Estate Collateral Security Agreement shall create a continuing security interest
in the Collateral and shall (a) be binding upon the Grantor, their respective
successors and assigns, and (b) inure, together with the rights and remedies of
the Collateral Agent hereunder, to the benefit of the Collateral Agent and the
other Secured Parties and each of their respective successors, transferees and
assigns.  No other Persons (including, without limitation, any other creditor of
the Grantor) shall have any interest herein or any right or benefit with respect
hereto.  Without limiting the generality of the foregoing clause (b), any
Secured Party may assign or otherwise transfer any indebtedness held by it
secured by this Related Real Estate Collateral Security Agreement to any other
Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Party, herein or otherwise,
subject, however, to the provisions of the Credit Agreement.

 

SECTION 6.5  Termination; Release.

 

(a)           This Related Real Estate Collateral Security Agreement, the Lien
in favor of the Collateral Agent (for the benefit of itself and the other
Secured Parties) and all other security interests granted hereby shall terminate
with respect to all Secured Obligations, and all rights to the Collateral shall
revert to the Grantor or any other Person entitled thereto, either (i) as
provided in Section 9.20 of the Credit Agreement, or (ii) when the Commitments
shall have expired or been terminated and the principal of and interest on each
Loan and all fees and other Secured Obligations shall have been indefeasibly
paid in full in cash; provided, that, in connection with the termination of this
Related Real Estate Collateral Security Agreement, the Collateral Agent may
require such indemnities and collateral security as it shall reasonably deem
necessary or appropriate to protect the Secured Parties against (A) loss on
account of credits previously applied to the Secured Obligations that may
subsequently be reversed or revoked, (B) any Secured Obligations (other than
contingent indemnification obligations for which no claim has been asserted)
that may thereafter arise under Section 9.05 of the Credit Agreement.

 

(b)           (i) Upon the consummation of a transaction expressly permitted
under the Credit Agreement, which results in the Grantor ceasing to be a
Subsidiary of the Borrower, the Grantor shall be automatically released from its
obligations under this Related Real Estate Collateral Security Agreement, the
security interest granted hereby shall terminate with respect to the Grantor and
all rights to the Collateral of the Grantor shall revert to the Grantor or any
other Person entitled thereto.

 

(i)    Upon any sale or other transfer by the Grantor of any Collateral that is
expressly permitted under the Credit Agreement (other than a sale or other
transfer to a Loan Party), or upon the effectiveness of any written consent to
the release of the security interest granted hereby in any Collateral pursuant
to Section 9.20 of the Credit Agreement, the security interest granted hereby
shall terminate with respect to such Collateral and all rights to the Collateral
shall revert to Grantor or any other Person entitled thereto.

 

14

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(ii)   At such time as any of the foregoing contained Sections 6.5(a),
6.5(b)(i) and 6.5(b)(ii) hereof, upon the Borrower’s written request and at the
sole cost and expense of the Grantor, the Collateral Agent will (A) assign,
transfer and deliver to the Grantor, against receipt and without recourse to or
warranty by the Collateral Agent, such of the Collateral to be released (in the
case of a release) or all of the Collateral (in the case of the satisfaction of
Sections 6.5(a), 6.5(b)(i) and 6.5(b)(ii) hereof) as may be in possession of the
Collateral Agent and as shall not have been sold or otherwise applied pursuant
to the terms hereof, and (B) with respect to any other Collateral, authorize the
filing of appropriate termination statements and other documents (including UCC
termination statements or releases) to terminate such security interests.

 

(c)           At any time that the Grantor desires that the Collateral Agent
take any action described in Section 6.5(b) hereof, the Grantor shall, upon
request of the Collateral Agent, deliver to the Collateral Agent an officer’s
certificate certifying that the release of the respective Collateral is
permitted pursuant to Sections 6.5(a) or 6.5(b) hereof.  The Collateral Agent
shall have no liability whatsoever to any other Secured Party as the result of
any release of Collateral by it as permitted (or which the Collateral Agent in
good faith believes to be permitted) by this Section 6.5.

 

SECTION 6.6  Modification in Writing.  No amendment, modification, supplement,
termination or waiver of or to any provision hereof, nor consent to any
departure by the Grantor therefrom, shall be effective unless the same shall be
made in accordance with the terms of the Credit Agreement and unless in writing
and signed by the Collateral Agent and the Grantor.  Any amendment, modification
or supplement of or to any provision hereof, any waiver of any provision hereof
and any consent to any departure by the Grantor from the terms of any provision
hereof shall be effective only in the specific instance and for the specific
purpose for which made or given.  Except where notice is specifically required
by this Related Real Estate Collateral Security Agreement or any other document
evidencing the Secured Obligations, no notice to or demand on the Grantor in any
case shall entitle the Grantor to any other or further notice or demand in
similar or other circumstances.

 

SECTION 6.7  Notices.  Unless otherwise provided herein or in the Credit
Agreement, any notice or other communication herein required or permitted to be
given shall be given in the manner and become effective as set forth in the
Credit Agreement, as to the Grantor, addressed to it at the address of the
Borrower set forth in the Credit Agreement and as to the Collateral Agent,
addressed to it at the address set forth in the Credit Agreement, or in each
case at such other address as shall be designated by such party in a written
notice to the other parties hereto complying as to delivery with the terms of
this Section 6.7.

 

SECTION 6.8  GOVERNING LAW.  THIS RELATED REAL ESTATE COLLATERAL SECURITY
AGREEMENT AND ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER
SOUNDING IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR
RELATING TO THIS RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW).

 

15

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SECTION 6.9  CONSENT TO JURISDICTION; SERVICE OF PROCESS; WAIVER OF JURY TRIAL.

 

(a)           THE GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE
COURT OR FEDERAL COURT OF THE UNITED STATES OF AMERICA SITTING IN NEW YORK
COUNTY, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS RELATED REAL ESTATE COLLATERAL SECURITY
AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND The GRANTOR
HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT.  the
GRANTOR AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS RELATED REAL ESTATE
COLLATERAL SECURITY AGREEMENT SHALL AFFECT ANY RIGHT THAT THE COLLATERAL AGENT
OR ANY SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT AGAINST the
GRANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION if required to
realize upon the collateral or enforce any judgment.

 

(b)           THE GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT IN
ANY COURT REFERRED TO IN SECTION 6.9(a) HEREOF.  THE GRANTOR HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH SUIT, ACTION OR PROCEEDING IN ANY
SUCH COURT.

 

(c)           THE GRANTOR AND, EXCEPT AS PROVIDED IN THE LAST SENTENCE OF
SECTION 6.9(a) HEREOF, EACH SECURED PARTY, AGREES THAT ANY ACTION COMMENCED BY
THE GRANTOR ASSERTING ANY CLAIM OR COUNTERCLAIM ARISING UNDER OR IN CONNECTION
WITH THIS RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT OR ANY OTHER LOAN
DOCUMENT SHALL BE BROUGHT SOLELY IN A COURT OF THE STATE OF NEW YORK SITTING IN
NEW YORK COUNTY OR ANY FEDERAL COURT SITTING THEREIN AS THE COLLATERAL AGENT
MAY ELECT IN ITS SOLE DISCRETION AND CONSENTS TO THE EXCLUSIVE JURISDICTION OF
SUCH COURTS WITH RESPECT TO ANY SUCH ACTION.

 

16

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(d)           EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN
THE MANNER PROVIDED FOR NOTICES IN SECTION 6.7 HEREOF EXCLUDING SERVICE OF
PROCESS BY MAIL.  NOTHING IN THIS RELATED REAL ESTATE COLLATERAL SECURITY
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

(e)           EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT.  EACH PARTY HERETO
(i) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
RELATED REAL ESTATE COLLATERAL SECURITY AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 6.9.

 

Severability of Provisions.  Any provision hereof which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.

 

Execution in Counterparts; Effectiveness.  This Related Real Estate Collateral
Security Agreement may be executed in any number of counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract.  Delivery of an executed counterpart of a signature page of
this Related Real Estate Collateral Security Agreement by facsimile or other
electronic transmission (including “.pdf” or “.tif”) shall be as effective as
delivery of a manually executed counterpart of this Related Real Estate
Collateral Security Agreement.

 

No Release.  Nothing set forth in this Related Real Estate Collateral Security
Agreement shall relieve the Grantor from the performance of any term, covenant,
condition or agreement on the Grantor’s part to be performed or observed under
or in respect of any of the Collateral or from any liability to any Person under
or in respect of any of the Collateral or shall impose any obligation on the
Collateral Agent or any other Secured Party to perform or observe any such term,
covenant, condition or agreement on the Grantor’s part to be so performed or
observed or shall impose any liability on the Collateral Agent or any other
Secured Party for any act or omission on the part of the Grantor relating
thereto or for any breach of any representation or warranty on the part of the
Grantor contained in this Related Real Estate Collateral Security Agreement, the
Credit Agreement or the other Loan Documents, or under or in respect of the
Collateral or made in connection herewith or therewith.  The obligations of the
Grantor contained in this Section 6.12 shall survive the termination hereof and
the discharge of the Grantor’s other obligations under this Related Real Estate
Collateral Security Agreement, the Credit Agreement and the other Loan
Documents.

 

17

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Obligations Absolute.  All obligations of the Grantor hereunder shall be
absolute and unconditional irrespective of:

 

(a)           any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of the Grantor;

 

(b)           any lack of validity or enforceability of the Credit Agreement or
any other Loan Document, or any other agreement or instrument relating thereto;

 

(c)           any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations, or any other amendment or
waiver of or any consent to any departure from the Credit Agreement or any other
Loan Document or any other agreement or instrument relating thereto;

 

(d)           any pledge, exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to any departure
from any guarantee, for all or any of the Secured Obligations;

 

(e)           any exercise, non-exercise or waiver of any right, remedy, power
or privilege under or in respect hereof, the Credit Agreement or any other Loan
Document except as specifically set forth in a waiver granted pursuant to the
provisions of Section 6.6 hereof; or

 

(f)            any other circumstances which might otherwise constitute a
defense available to, or a discharge of, the Grantor (other than the termination
of this Related Real Estate Collateral Security Agreement in accordance with
Section 6.5(a) hereof).

 

Intercreditor Agreement.  This Related Real Estate Collateral Security Agreement
and the Liens granted to the Collateral Agent pursuant to this Related Real
Estate Collateral Security Agreement or any other Loan Documents in any
Collateral and the exercise of any right or remedy with respect to any
Collateral hereunder or any other Loan Document are subject to the provisions of
the Intercreditor Agreement.  In the event of any inconsistency between the
terms of this Related Real Estate Collateral Security Agreement and the terms of
the Intercreditor Agreement, the terms of the Intercreditor Agreement shall
control.

 

[Signature Pages Follow]

 

18

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IN WITNESS WHEREOF, the Grantor and the Collateral Agent have caused this
Related Real Estate Collateral Security Agreement to be duly executed and
delivered by their duly authorized officers as of the date first above written.

 

 

GRANTOR

 

 

 

[                                        ]

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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

 

 

GOLDMAN SACHS BANK USA,

 

as Collateral Agent

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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

 

EXHIBIT 1

 

[Mortgaged Property][Material Related Collateral Location]

 

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

 

SCHEDULE 3.2

Filings, Registrations and Recordings

 

Name of Grantor

 

UCC-1 Financing
Statement Filing Office

 

 

 

 

 

 

 

 

 

 

[LIST APPLICABLE MORTGAGES AND ANY REQUIRED FIXTURE FILINGS]

 

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

 

SCHEDULE 4.3(a)

Other Legal and Fictitious Names, Mergers, Consolidations, Acquisitions

 

I. Legal and Fictitious Names.  During the past three years, the Grantor has
used the following trade name(s) and/or trade style(s):

 

Company

 

Trade Name/Divisions

 

 

 

 

 

 

 

 

 

 

II. Changes in Names, Jurisdiction of Organization or Corporate Structure. 
Except as set forth below, the Grantor has not changed its name, jurisdiction of
organization or its corporate structure in any way (e.g., by merger,
consolidation, change in corporate form, change in jurisdiction of organization
or otherwise) within the past three years:

 

Date of Change

 

Description of Change

 

 

 

 

 

 

 

 

 

 

III. Acquisitions of Equity Interests or Assets.  Except as set forth below, the
Grantor has not acquired the controlling equity interests of another entity or
substantially all the assets of another entity within the past three years:

 

Date of Acquisition

 

Description of Acquisition

 

 

 

 

 

 

 

 

 

 

P-1

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Exhibit Q
to the Credit Agreement

 

MODIFIED DUTCH AUCTION PROCEDURES

 

(See attached)

 

Q-1

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

 

Exhibit Q
to the Credit Agreement

 

MODIFIED DUTCH AUCTION PROCEDURES

 

This Outline is intended to summarize certain basic terms of the modified Dutch
auction procedures pursuant to and in accordance with the terms and conditions
of Sections 9.04(k) of the Credit Agreement, of which this Exhibit Q is a part
(the “Auction Procedures”).  It is not intended to be a definitive statement of
all of the terms and conditions of a modified Dutch auction, the definitive
terms and conditions for which shall be set forth in the applicable auction
procedures set for each Auction (the “Auction Documents”).  None of the
Administrative Agent, the Auction Manager and any other Agent, or any of their
respective Affiliates, makes any recommendation pursuant to the Auction
Documents as to whether or not any Lender should sell its Loans to Borrower (the
“Purchaser”) pursuant to the Auction Documents, nor shall the decision by the
Administrative Agent, the Auction Manager or any other Agent (or any of their
Affiliates) in its capacity as a Lender be deemed to constitute such a
recommendation.  Each Lender should make its own decision on whether to sell any
of its Loans and, if it decides to do so, the principal amount of and price to
be sought for such Loans.  In addition, each Lender should consult its own
attorney, business advisor or tax advisor as to legal, business, tax and related
matters concerning this Auction and the Auction Documents.  Capitalized terms
not otherwise defined in this Exhibit have the meanings assigned to them in the
Credit Agreement.

 

Summary.  The Purchaser may conduct one or more modified Dutch auctions in order
to purchase Loans (each, an “Auction”) pursuant to the procedures described
herein.

 

Notice Procedures.  In connection with each Auction, the Purchaser will provide
notification to the Auction Manager (for distribution to the Lenders) of the
Loans substantially in the form of Annex A to this Exhibit Q that will be the
subject of the Auction (an “Auction Notice”).  Each Auction Notice shall contain
(i) the maximum principal amount of Loans that the Purchaser is willing to
purchase in the Auction (the “Auction Amount”), which shall be no less than
$[              ] or an integral multiple of $[              ] in excess
thereof; (ii) the range of discounts to par (the “Discount Range”), expressed as
a range of prices per $1,000 (in increments of $5), at which the Purchaser would
be willing to purchase Loans in the Auction; and (iii) the date on which the
Auction will conclude, on which date Return Bids (as defined below) will be due
by [1:00 p.m. New York time], as such date and time may be extended (such time,
the “Expiration Time”) for a period not exceeding three Business Days upon
notice by the Purchaser to the Auction Manager received not less than 24 hours
before the original Expiration Time; provided, however, that only one extension
per auction shall be permitted.  An Auction shall be regarded as a “Failed
Auction” in the event that either (x) Purchaser withdraws such Auction in
accordance with the terms hereof or (y) the Expiration Time occurs with no
Qualifying Bids having been received.  In the event of a Failed Auction,
Purchaser shall not be permitted to deliver a new Auction Notice prior to the
date occurring five (5) Business Days after such withdrawal or Expiration Time,
as the case may be.

 

Reply Procedures.  In connection with any Auction, each Lender holding Loans
wishing to participate in such Auction shall, prior to the Expiration Time,
provide the Auction Manager

 

Q-2

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

 

with a notice of participation substantially in the form of Annex B to this
Exhibit Q (the “Return Bid”) which shall specify (i) a discount to par expressed
as a price per $1,000 (in increments of $5) of Loans (the “Reply Price”) within
the Discount Range and (ii) the principal amount of Loans, in an amount not less
than [$1,000,000] or an integral multiple in excess thereof, that such Lender is
willing to offer for sale at its Reply Price (the “Reply Amount”); provided,
that Lender may submit a Reply Amount that is less than the minimum amount
and/or incremental amount requirements described above only if the Reply Amount
comprises the entire amount of Loans held by such Lender.  Lenders may only
submit one Return Bid per Auction but each Return Bid may contain up to [three]
component bids, each of which may result in a separate Qualifying Bid (as
defined below) and each of which will not be contingent on any other component
bid submitted by such Lender resulting in a Qualifying Bid.  In addition to the
Return Bid, the participating Lender must execute and deliver, to be held by the
Auction Manager, a Borrower Assignment and Acceptance.  The Purchaser will not
purchase any Loans at a price that is outside of the applicable Discount Range,
nor will any Return Bids (including any component bids specified therein)
submitted at a price that is outside such applicable Discount Range be
considered in any calculation of the Applicable Threshold Price (as defined
below).

 

Acceptance Procedures.  Based on the Reply Prices and Reply Amounts received by
the Auction Manager, the Auction Manager, in consultation with the Purchaser,
will calculate the lowest purchase price (the “Applicable Threshold Price”) for
the Auction within the Discount Range for the Auction that will allow the
Purchaser to complete the Auction by purchasing the full Auction Amount (or such
lesser amount of Loans for which the Purchaser has received Qualifying Bids (as
defined below)).  The Purchaser shall purchase Loans from each Lender whose
Return Bid is within the Discount Range and contains a Reply Price that is equal
to or less than the Applicable Threshold Price (each, a “Qualifying Bid”).  All
Loans included in Qualifying Bids (including multiple component Qualifying Bids
contained in a single Return Bid) received at a Reply Price lower than the
Applicable Threshold Price will be purchased at the applicable Reply Price and
shall not be subject to proration unless the aggregate principal amount of all
such Loans at a Reply Price lower than the Applicable Threshold Price would
exceed the Auction Amount.

 

Proration Procedures.  All Loans offered in Return Bids (or, if applicable, any
component bid thereof) constituting Qualifying Bids at the Applicable Threshold
Price will be purchased at the Applicable Threshold Price; provided that if the
aggregate principal amount of all Loans for which Qualifying Bids have been
submitted in any given Auction at the Applicable Threshold Price would exceed
the remaining portion of the Auction Amount (if any, after deducting all Loans
to be purchased at a Reply Price lower than the Applicable Threshold Price), the
Purchaser shall purchase the Loans for which the Qualifying Bids submitted were
at the Applicable Threshold Price ratably based on the respective principal
amounts offered and in an aggregate amount equal to the amount necessary to
complete the purchase of the Auction Amount.  No Return Bids (or any component
thereof) will be accepted above the Applicable Threshold Price.

 

Notification Procedures.  Auction Manager will calculate the Applicable
Threshold Price and post the Applicable Threshold Price and proration
factor(s) onto an internet site (including an IntraLinks, SyndTrak or other
electronic workspace) in accordance with the Auction Manager’s standard
dissemination practices by [4:00 p.m. New York time] on the same

 

Q-3

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

 

Business Day as the date the Return Bids were due.  The Auction Manager will
insert the principal amount of Loans to be assigned and the applicable
settlement date into each applicable Borrower Assignment and Acceptance received
in connection with a Qualifying Bid.  Upon request of the submitting Lender, the
Auction Manager will promptly return any Borrower Assignment and Acceptance
received in connection with a Return Bid that is not a Qualifying Bid (as
defined below).

 

Additional Procedures.  Furthermore, in connection with any Auction, upon
submission by a Lender of a Return Bid, such Lender will not have any withdrawal
rights.  Any Return Bid (including any component bid thereof) delivered to the
Auction Manager may not be modified, revoked, terminated or cancelled by a
Lender.  However, an Auction may become void if the conditions to the purchase
of Loans by the Purchaser required by the terms and conditions of
Section 9.04(k) of the Credit Agreement are not met.  The purchase price for
each purchase of Loans shall be paid by the Purchaser [directly to the
respective assigning Lender] [to [the Auction Manager] [a paying agent selected
by the Purchaser] on behalf of the respective assigning Lender] on a settlement
date as determined by the Auction Manager in consultation with the Purchaser
(which shall be no later than ten (10) Business Days after the date Return Bids
are due). The Purchaser shall execute each applicable Borrower Assignment and
Acceptance received in connection with a Qualifying Bid.

 

All questions as to the form of documents and validity and eligibility of Loans
that are the subject of an Auction will be determined by the Auction Manager, in
consultation with the Purchaser, which determination will be final and binding. 
The Auction Manager’s interpretation of the terms and conditions of the Offer
Document, in consultation with the Purchaser, will be final and binding.

 

None of the Administrative Agent, the Auction Manager, any other Agent or any of
their respective Affiliates assumes any responsibility for the accuracy or
completeness of the information concerning the Purchaser, the Credit Parties, or
any of their Affiliates (whether contained in the Auction Documents or
otherwise) or for any failure to disclose events that may have occurred and may
affect the significance or accuracy of such information.

 

This Exhibit Q shall not require the Purchaser to initiate any Auction.

 

Q-4

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

 

Annex A to Exhibit Q

to the Credit Agreement

 

AUCTION NOTICE

 

[Borrower Letterhead]

 

[            ], as Auction Manager

[            ]
[            ]

Attention: [            ]

Fax No.:  [            ]

Email:  [            ]@gs.com

 

Re: Loan Auction

 

Ladies and Gentlemen:

 

Reference is made to that certain Term Loan Credit Agreement, dated as of
March 21, 2013 (as amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”), by and among SUPERVALU
INC., a Delaware corporation (“Borrower”), the Guarantors party thereto, the
Lenders party thereto from time to time (the “Lenders”), Goldman Sachs Bank USA,
as Administrative Agent and Collateral Agent, and the other agents named
therein.  Capitalized terms used but not defined herein have the meanings given
to such terms in the Credit Agreement.

 

SUPERVALU INC.  (the “Purchaser”) hereby gives notice to the Lenders that it
desires to conduct the following Auction:

 

·                                                  Auction Amount: 
$[                          ] in principal amount of Loans34

 

·                                                  Discount Range:  Not less
than $[                ] nor greater than $[                ] per $1,000
principal amount of Loans.

 

The Purchaser acknowledges that this Auction Notice may not be withdrawn other
than in accordance with the Auction Procedures.  The Auction shall be
consummated in accordance with the Auction Procedures with all Return Bids due
no later than [1:00] p.m. (New York time) on [                  ].

 

The Purchaser hereby represents and warrants that no Default or Event of Default
has occurred and is continuing or would result from such repurchase and Borrower
will not use the proceeds of any loans under the ABL Facility to acquire such
Loans.

 

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34  Modify, as appropriate, to: “$[                    ] maximum cash value to
be paid for all tendered Loans”

 

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Very truly yours,

 

 

 

SUPERVALU INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

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Annex B to Exhibit Q
to the Credit Agreement

 

RETURN BID

 

[            ], as Auction Manager

[            ]
[            ]

Attention: [            ]

Fax No.:  [            ]

Email:  [            ]@gs.com

 

Ladies and Gentlemen:

 

Reference is made to that certain Term Loan Credit Agreement, dated as of
March 21, 2013 (as amended, restated, replaced, supplemented or otherwise
modified from time to time, the “Credit Agreement”), by and among SUPERVALU
INC., a Delaware corporation (“Borrower”), the Guarantors party thereto, the
Lenders party thereto from time to time (the “Lenders”), Goldman Sachs Bank USA,
as Administrative Agent and Collateral Agent, and the other agents named
therein.  Capitalized terms used but not defined herein have the meanings given
to such terms in the Credit Agreement.

 

The undersigned Lender hereby gives notice of its participation in the Auction
by submitting the following Return Bid35:

 

Reply Price
(price per $1,000)

 

Reply Amount
(principal amount of Loans)

 

US$ 

 

US$

 

US$ 

 

US$

 

US$ 

 

US$

 

 

The undersigned Lender acknowledges that the submission of this Return Bid along
with an executed Borrower Assignment and Acceptance, to be held in escrow by the
Auction Manager, obligates the Lender to sell the entirety or its pro rata
portion of the Reply Amount in accordance with the Auction Procedures, as
applicable.

 

 

Very truly yours,

 

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35             Lender may submit up to [three] component bids but need not
submit more than one.  The sum of Lender’s bid(s) may not exceed the aggregate
principal face amount of Loans held by it as lender of record on the date of
submission of its Return Bid.

 

Q-1

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

 

 

[Name of Lender]

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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Exhibit R
to the Credit Agreement

 

FORM OF BORROWER ASSIGNMENT AND ACCEPTANCE

 

(See attached)

 

R-1

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Exhibit R
to the Credit Agreement

 

FORM OF BORROWER ASSIGNMENT AND ACCEPTANCE

 

This Borrower Assignment and Acceptance Agreement (the “Assignment”) is dated as
of the Borrower Assignment Effective Date set forth below and is entered into by
and between [Insert name of Assignor] (the “Assignor”) and SUPERVALU INC., a
Delaware corporation (the “Assignee”).  Capitalized terms used but not defined
herein shall have the meanings given to them in the Credit Agreement identified
below (as amended, the “Credit Agreement”) or the Modified Dutch Auction
Procedures with respect to the Assignment, receipt of a copy of which is hereby
acknowledged by the Assignee.  The Standard Terms and Conditions set forth in
Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Borrower Assignment Effective
Date inserted by the Auction Manager as contemplated in the Auction Procedures,
the interest in and to all of the Assignor’s rights and obligations under the
Credit Agreement and any other documents or instruments delivered pursuant
thereto that represents the amount and percentage interest identified below of
all of the Assignor’s outstanding rights and obligations under the facility
identified below (the “Assigned Interest”).  Such sale and assignment is without
recourse to the Assignor and, except as expressly provided in this Assignment,
without representation or warranty by the Assignor.

 

1.

 

Assignor:

 

 

 

 

 

 

 

 

 

2.

 

Assignee:

 

SUPERVALU INC.

 

 

 

 

 

 

 

3.

 

Borrower:

 

SUPERVALU INC.

 

 

 

 

 

 

 

4.

 

Administrative Agent:

 

Goldman Sachs Bank USA, as Administrative Agent under the Credit Agreement

 

 

 

 

 

 

 

5.

 

Credit Agreement:

 

Term Loan Credit Agreement dated as of March 21, 2013 among SUPERVALU INC., a
Delaware corporation, the Guarantors party thereto, the Lenders parties thereto
and Goldman Sachs Bank USA, as Administrative Agent and Collateral Agent

 

 

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

 

6.                                      Assigned Interest:

 

Term Facility

 

Aggregate Principal Face
Amount of Loans of Assignor

 

Percentage of Loans
of Assignor36

 

Loans

 

$

 

 

 

%

 

7.                                      Assigned Interest:

 

List below the Loans to be assigned by Assignor to Assignee, which shall be
subject to the terms and conditions of the Auction, including, without
limitation, the pro rata reduction procedures set forth in the Auction
Procedures.

 

Reply Price with
respect to Loans being
offered for
assignment to
Assignee (price per
$1,000 principal
amount)37

 

Reply Amount
(principal face
amount of Loans to
be Assigned to
Assignee at
relevant Reply
Price) (subject to
pro rata
reduction)38

 

Pro Rated Principal
Face Amount of
Loans Assigned39

 

Percentage
Assigned of
Loans40

 

$

 

 

$

 

 

$

 

 

 

%

$

 

 

$

 

 

$

 

 

 

%

$

 

 

$

 

 

$

 

 

 

%

 

8.                                      Borrower Assignment Effective Date:
                            , 20     [TO BE INSERTED BY AUCTION MANAGER AND
WHICH SHALL BE THE BORROWER ASSIGNMENT

 

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36                                      Set forth, to at least 9 decimals, as a
percentage of the Loans of all Lenders thereunder.  To be completed by Assignor.

 

37                                      To be completed by Assignor.

 

38                                      To be completed by Assignor.  The sum of
Lender’s Reply Amount(s) may not exceed the aggregate principal face amount of
Loans held by it as lender of record on the date of submission of its Return
Bid.

 

39                                      To be completed by the Auction Manager,
if necessary, based on the proration procedures set forth in the Auction
Procedures.

 

40             To be completed by the Auction Manager to at least 9 decimals as
a percentage of the Loans of all Lenders thereunder.

 

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

 

EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

 

9.             Notice and Wire Instructions:

 

ASSIGNOR:

ASSIGNEE:

 

 

[NAME OF ASSIGNOR]

SUPERVALU INC.

 

 

Notices:

Notices:

 

 

 

 

Attention:

Attention:

Telecopier:

Telecopier:

 

 

with a copy to:

with a copy to:

 

 

 

 

Attention:

Attention:

Telecopier:

Telecopier:

 

 

Wire Instructions:

 

 

The Assignor acknowledges and agrees that (i) submission of a Return Bid in
respect of the Loans will constitute a binding agreement between the Assignor
and the Assignee in accordance with the terms and conditions of the Auction
Procedures and the Credit Agreement; (ii) Loans will be deemed to have been
accepted by the Assignee to the extent such Loans are validly offered by
Assignor to Assignee in accordance with the terms and conditions of the Auction
Procedures and the Credit Agreement upon notification by the Auction Manager to
the Assignor that such Loans are part of a Qualifying Bid (subject to applicable
proration in accordance with the terms and conditions of the Auction); and
(iii) it does not have any withdrawal rights with respect to any offer to assign
of its Loans.

 

Subject to and effective upon the acceptance by the Assignee for purchase of the
principal amount of the Loans to be assigned by the Assignor to the Assignee,
the Assignor hereby irrevocably constitutes and appoints the Auction Manager as
the true and lawful agent and attorney-in-fact of the Assignor with respect to
such Loans, with full powers of substitution and revocation (such power of
attorney being deemed to be an irrevocable power coupled with an interest) to
complete or fill-in the blanks in this Assignment and deliver the completed
Assignment to the Assignee and the Assignor.

 

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

 

[Remainder of page intentionally left blank]

 

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

 

The Assignor acknowledges and agrees that its offer to assign Loans pursuant to
the Auction Procedures constitute the Assignor’s acceptance of the terms and
conditions (including the proration procedures) contained in the Auction
Procedures, the Credit Agreement and this Assignment.

 

The terms set forth in this Assignment are hereby agreed to:

 

 

ASSIGNOR:

 

 

 

[NAME OF ASSIGNOR]

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

ASSIGNEE:

 

 

 

SUPERVALU INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

Consented to and Accepted:

 

 

 

GOLDMAN SACHS BANK USA,

 

as Administrative Agent

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

[                ],

 

as Auction Manager

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

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

 

Annex 1
to Borrower Assignment and Acceptance

 

SUPERVALU INC.
TERM LOAN CREDIT AGREEMENT

 

STANDARD TERMS AND CONDITIONS FOR BORROWER
ASSIGNMENT AND ACCEPTANCE AGREEMENT

 

1.             Representations and Warranties.

 

1.1          Assignor.  The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim,
(iii) its Commitment and the outstanding balances of its Loans, without giving
effect to assignments thereof that have not become effective, are as set forth
in this Assignment and (iv) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and to consummate the
transactions contemplated hereby; (b) except as set forth in clause (a) above,
makes no representation or warranty and assumes no responsibility with respect
to (i) any statements, warranties or representations made in or in connection
with the Credit Agreement, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement, any
other Loan Document or any other instrument or document delivered pursuant
thereto, other than this Assignment (herein, collectively, the “Loan
Documents”), (iii) the financial condition of Borrower or any of its
Subsidiaries or (iv) the performance or observance by the Borrower or any of its
Subsidiaries of any of their respective obligations under any Loan Document or
any other instrument or document furnished pursuant thereto; and (c) has read
and agrees to all the terms and conditions (including the proration procedures)
of the Auction Procedures set forth in the Auction Documents. The Assignor
acknowledges that (i) the Borrower currently may have information regarding the
Loan Parties, their ability to perform their Obligations or any other matter
that may be material to a decision by such Assignor to participate in this
Assignment and that has not previously been disclosed to the Administrative
Agent and such Assignor (“Excluded Information”), (ii) the Excluded Information
may not be available to it, the Administrative Agent or the Assignor and
(iii) it has independently and without reliance on any other party made its own
analysis and determined to participate in this Assignment notwithstanding its
lack of knowledge of the Excluded Information.

 

1.2          Assignee.  The Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby
and to become a Lender under the Credit Agreement until such time as the Loans
are automatically cancelled without action by any Person on the Borrower
Assignment Effective Date, (ii) it meets all requirements of an Eligible
Assignee under the Credit Agreement and (iii) it has received a copy of the
Credit Agreement, together with copies of the most recent financial statements
referred to in Section 3.05(a) thereof or delivered pursuant to Section 5.01
thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment; (b) agrees that (i) it will, independently and without reliance
upon the Administrative Agent, the Auction Manager, the Collateral Agent, the
Assignor or any other

 

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

 

Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Credit Agreement and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Credit Agreement
are required to be performed by it as a Lender; and (c) appoints and authorizes
the Administrative Agent and the Collateral Agent to take such action as agent
on its behalf and to exercise such powers under the Credit Agreement as are
delegated to the Administrative Agent and the Collateral Agent, respectively, by
the terms thereof, together with such powers as are reasonably incidental
thereto.  Following repurchase by the Borrower pursuant to this Assignment, the
Assigned Interest shall, without further action by any Person, be deemed
cancelled for all purposes and no longer outstanding (and may not be resold by
the Borrower), for all purposes of the Credit Agreement and all other Loan
Documents, including, but not limited to (A) the making of, or the application
of, any payments to the Lenders under the Credit Agreement or any other Loan
Document, (B) the making of any request, demand, authorization, direction,
notice, consent or waiver under the Credit Agreement or any other Loan Document
or (C) the determination of Required Lenders, or for any similar or related
purpose, under the Credit Agreement or any other Loan Document.  In connection
with the Assigned Interest, the Administrative Agent is authorized to make
appropriate entries in the Register to reflect any such cancellation.

 

2.             Payments.  Payment to the Assignor by the Assignee in respect of
the settlement of the assignment of the Assigned Interest shall be paid by
Assignee directly to the Assignor and shall include all unpaid interest that has
accrued in respect of the Assigned Interest through the Borrower Assignment
Effective Date.  No interest shall accrue with respect to the Assigned Interest
from and after the Borrower Assignment Effective Date and such Assigned Interest
shall, from and after the Borrower Assignment Effective Date, and without
further action by any Person, be deemed cancelled for all purposes and no longer
outstanding.

 

3.             General Provisions.  This Assignment shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns.  This Assignment may be executed in any number of counterparts, which
together shall constitute one instrument.  Delivery of an executed counterpart
of a signature page of this Assignment by telecopy or other electronic
transmission shall be effective as delivery of a manually executed counterpart
of this Assignment.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK.

 

[Remainder of page intentionally left blank]

 

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