Exhibit 10.2

BRIDGE TERM LOAN CREDIT AGREEMENT

by and among

WILMINGTON SAVINGS FUND SOCIETY, FSB,

as Agent,

THE LENDERS THAT ARE PARTIES HERETO

as the Lenders,

and

NUVERRA ENVIRONMENTAL SOLUTIONS, INC.

as Borrower

Dated as of October 5, 2018

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1.

 

DEFINITIONS AND CONSTRUCTION

     1    

1.1

 

Definitions

     1    

1.2

 

Accounting Terms

     1    

1.3

 

[Reserved]

     2    

1.4

 

Construction

     2    

1.5

 

Time References

     3    

1.6

 

Schedules and Exhibits

     3  

2.

 

LOANS AND TERMS OF PAYMENT

     3    

2.1

 

[Reserved]

     3    

2.2

 

Term Loan

     3    

2.3

 

Borrowing Procedures

     3    

2.4

 

Payments; Reductions of Term Commitments; Prepayments

     5    

2.5

 

Promise to Pay

     7    

2.6

 

Interest Rate: Rates, Payments, and Calculations

     8    

2.7

 

Crediting Payments

     9    

2.8

 

Designated Account

     9    

2.9

 

Maintenance of Loan Account; Statements of Obligations

     9    

2.10

 

Fees

     10    

2.11

 

[Reserved]

     10    

2.12

 

[Reserved]

     10    

2.13

 

Capital Requirements

     10  

3.

 

CONDITIONS; TERM OF AGREEMENT

     11    

3.1

 

Conditions Precedent to the Initial Extension of Credit

     11    

3.2

 

Conditions Precedent to all Extensions of Credit

     11    

3.3

 

Reserved

     12    

3.4

 

Effect of Maturity

     12    

3.5

 

Conditions Subsequent

     12  

4.

 

REPRESENTATIONS AND WARRANTIES

     12    

4.1

 

Due Organization and Qualification; Subsidiaries

     12    

4.2

 

Due Authorization; No Conflict

     13    

4.3

 

Governmental Consents

     13    

4.4

 

Binding Obligations

     14  

 

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4.5

  

Title to Assets; No Encumbrances

     14    

4.6

  

Litigation

     14    

4.7

  

Compliance with Laws

     14    

4.8

  

No Material Adverse Effect

     14    

4.9

  

Solvency

     14    

4.10

  

Complete Disclosure

     15    

4.11

  

Patriot Act

     15    

4.12

  

Margin Stock

     15    

4.13

  

Governmental Regulation

     16    

4.14

  

OFAC

     16    

4.15

  

O.S.H.A.

     16    

4.16

  

First Lien and Second Lien Loan Documents

     16  

5.

 

AFFIRMATIVE COVENANTS

     16    

5.1

  

Financial Matters

     16    

5.2

  

Existence

     16    

5.3

  

Maintenance of Properties

     17    

5.4

  

Compliance with Laws

     17    

5.5

  

Disclosure Updates

     17    

5.6

  

Formation of Subsidiaries

     17    

5.7

  

Rights Offering

     17  

6.

 

[RESERVED]

     18  

7.

 

[RESERVED]

     18  

8.

 

EVENTS OF DEFAULT

     18    

8.1

  

Payments

     18    

8.2

  

Covenants

     18    

8.3

  

Judgments

     18    

8.4

  

Voluntary Bankruptcy, etc.

     18    

8.5

  

Involuntary Bankruptcy, etc.

     19    

8.6

  

Default Under Other Agreements

     19    

8.7

  

Representations, etc.

     19    

8.8

  

Guaranty

     19    

8.9

  

[Reserved]

     19  

 

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8.10

 

Loan Documents

     19    

8.11

 

Change of Control

     20  

9.

 

RIGHTS AND REMEDIES

     20    

9.1

 

Rights and Remedies

     20    

9.2

 

Remedies Cumulative

     20  

10.

 

WAIVERS; INDEMNIFICATION

     21    

10.1

 

Demand; Protest; etc.

     21    

10.2

 

[Reserved]

     21    

10.3

 

Indemnification

     21  

11.

 

NOTICES

     22  

12.

 

CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL REFERENCE PROVISION

     23  

13.

 

ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS

     25    

13.1

 

Assignments and Participations

     25    

13.2

 

Successors

     29  

14.

 

AMENDMENTS; WAIVERS

     29    

14.1

 

Amendments and Waivers

     30    

14.2

 

Replacement of Certain Lenders

     31    

14.3

 

No Waivers; Cumulative Remedies

     31  

15.

 

AGENT; THE LENDER GROUP

     31    

15.1

 

Appointment and Authorization of Agent

     31    

15.2

 

Delegation of Duties

     32    

15.3

 

Liability of Agent

     32    

15.4

 

Reliance by Agent

     32    

15.5

 

Notice of Default or Event of Default

     33    

15.6

 

Credit Decision

     33    

15.7

 

Costs and Expenses; Indemnification

     34    

15.8

 

Agent in Individual Capacity

     34    

15.9

 

Successor Agent

     35    

15.10

 

Lender in Individual Capacity

     35    

15.11

 

[Reserved]

     35    

15.12

 

Restrictions on Actions by Lenders; Sharing of Payments

     35  

 

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15.13

 

[Reserved]

     36    

15.14

 

Payments by Agent to the Lenders

     36    

15.15

 

[Reserved]

     36    

15.16

 

[Reserved]

     36    

15.17

 

Several Obligations; No Liability

     36  

16.

 

WITHHOLDING TAXES

     36    

16.1

 

Payments

     36    

16.2

 

Exemptions

     37    

16.3

 

Reductions

     38    

16.4

 

Refunds

     39  

17.

 

GENERAL PROVISIONS

     39    

17.1

 

Effectiveness

     39    

17.2

 

Section Headings

     39    

17.3

 

Interpretation

     40    

17.4

 

Severability of Provisions

     40    

17.5

 

[Reserved]

     40    

17.6

 

Debtor-Creditor Relationship

     40    

17.7

 

Counterparts; Electronic Execution

     40    

17.8

 

Revival and Reinstatement of Obligations; Certain Waivers

     40    

17.9

 

Confidentiality

     41    

17.10

 

Survival

     42    

17.11

 

Patriot Act

     42    

17.12

 

Integration

     43    

17.13

 

No Setoff

     43    

17.14

 

Subordination Agreement

     43  

 

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EXHIBITS AND SCHEDULES

 

Exhibit A-1    Form of Assignment and Acceptance Schedule A-1    Agent’s Account
Schedule A-2    Authorized Persons Schedule C-1    Term Commitments Schedule D-1
   Designated Account Schedule 1.1    Definitions Schedule 3.1    Conditions
Precedent Schedule 3.5    Conditions Subsequent Schedule 3.6    Post-Closing
Items

 

 

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BRIDGE TERM LOAN CREDIT AGREEMENT

THIS BRIDGE TERM LOAN CREDIT AGREEMENT (this “Agreement”), is entered into as of
October 5, 2018, by and among the lenders identified on the signature pages
hereof (each of such lenders, together with its successors and permitted
assigns, is referred to hereinafter as a “Lender”, as that term is hereinafter
further defined), WILMINGTON SAVINGS FUND SOCIETY, FSB, as administrative agent
for each member of the Lender Group (in such capacity, together with its
successors and assigns in such capacity, “Agent”), NUVERRA ENVIRONMENTAL
SOLUTIONS, INC., a Delaware corporation (“Borrower”) and the Guarantors party
hereto.

WHEREAS, Borrower has requested, subject to the conditions set forth herein, the
Lenders to extend to Borrower a $32,500,000 bridge term loan (i) to finance a
portion of the purchase price for the acquisition (the “Clearwater Acquisition”)
by Borrower, through its subsidiary Nuverra Ohio Disposal, LLC, of all of the
membership interests of each of Clearwater Three, LLC, an Ohio limited liability
company (“Clearwater Three”), Clearwater Five, LLC, an Ohio limited liability
company (“Clearwater Five”), and Clearwater Solutions, LLC, an Ohio limited
liability company (“Clearwater Solutions”), (ii) effectuate the prepayment of
Second Lien Term Loans having an aggregate outstanding principal amount equal to
$10,000,000 and (ii) for working capital, transaction expenses and other general
corporate purposes; and

WHEREAS, the Lenders and the Agent have agreed to provide such bridge term loan
to Borrower, on and subject to the terms and conditions set forth herein;

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:

1. DEFINITIONS AND CONSTRUCTION.

1.1 Definitions. Capitalized terms used in this Agreement shall have the
meanings specified therefor on Schedule 1.1.

1.2 Accounting Terms. All accounting terms not specifically defined herein shall
be construed in accordance with GAAP; provided, that if Borrower notifies Agent
that Borrower requests an amendment to any provision hereof to eliminate the
effect of any Accounting Change occurring after the Closing Date or in the
application thereof on the operation of such provision (or if Agent notifies
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such Accounting Change or in the application thereof, then Agent and
Borrower agree that they will negotiate in good faith amendments to the
provisions of this Agreement that are directly affected by such Accounting
Change with the intent of having the respective positions of the Lenders and
Borrower after such Accounting Change conform as nearly as possible to their
respective positions prior to giving effect to such Accounting Change and, until
any such amendments have been agreed upon and agreed to by the Required Lenders,
the provisions in this Agreement shall be calculated as if no such Accounting
Change had occurred. When used herein, the term “financial statements” shall
include the notes and schedules thereto. Whenever the term “Borrower” is used in
respect of

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a financial covenant or a related definition, it shall be understood to mean
Borrower and its Subsidiaries on a consolidated basis, unless the context
clearly requires otherwise. Notwithstanding anything to the contrary contained
herein, (a) all financial statements delivered hereunder shall be prepared, and
all financial covenants contained herein shall be calculated, without giving
effect to any election under the Statement of Financial Accounting Standards
No. 159 (or any similar accounting principle) permitting a Person to value its
financial liabilities or Indebtedness at the fair value thereof, and (b) the
term “unqualified opinion” as used herein to refer to opinions or reports
provided by accountants shall mean an opinion or report that is (i) unqualified,
and (ii) does not include any explanation, supplemental comment, or other
comment concerning the ability of the applicable Person to continue as a going
concern or concerning the scope of the audit.

1.3 [Reserved].

1.4 Construction. Unless the context of this Agreement or any other Loan
Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the terms “includes”
and “including” are not limiting, and the term “or” has, except where otherwise
indicated, the inclusive meaning represented by the phrase “and/or.” The words
“hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document,
as the case may be, as a whole and not to any particular provision of this
Agreement or such other Loan Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Agreement unless
otherwise specified. Any reference in this Agreement or in any other Loan
Document to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). 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. Any reference herein or in
any other Loan Document to the satisfaction, repayment, or payment in full of
the Obligations shall mean (a) the payment or repayment in full in immediately
available funds of (i) the principal amount of, and interest accrued and unpaid
with respect to, all outstanding Term Loans, together with the payment of any
premium applicable to the repayment of the Term Loans, (ii) all Lender Group
Expenses that have accrued and are unpaid regardless of whether demand has been
made therefor, (iii) all fees or charges that have accrued hereunder or under
any other Loan Document and are unpaid, (b) the receipt by Agent of cash
collateral in order to secure any other contingent Obligations for which a claim
or demand for payment has been made on or prior to such time or in respect of
matters or circumstances known to Agent or a Lender at such time that are
reasonably expected to result in any loss, cost, damage, or expense (including
attorneys’ fees and legal expenses), such cash collateral to be in such amount
as Agent reasonably determines is appropriate to secure such contingent
Obligations, (c) the payment or repayment in full in immediately available funds
of all other outstanding Obligations other than unasserted contingent
indemnification Obligations, and (d) the termination of all of the Term
Commitments of the Lenders. Any reference herein to any Person shall be
construed to include such Person’s successors and assigns. Any requirement of a
writing contained herein or in any other Loan Document shall be satisfied by the
transmission of a Record.

 

2

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1.5 Time References. Unless the context of this Agreement or any other Loan
Document clearly requires otherwise, all references to time of day refer to
Eastern standard time or Eastern daylight saving time, as in effect in New York,
New York on such day. For purposes of the computation of a period of time from a
specified date to a later specified date, the word “from” means “from and
including” and the words “to” and “until” each means “to and including”;
provided that, with respect to a computation of fees or interest payable to
Agent or any Lender, such period shall in any event consist of at least one full
day.

1.6 Schedules and Exhibits. All of the schedules and exhibits attached to this
Agreement shall be deemed incorporated herein by reference.

2. LOANS AND TERMS OF PAYMENT.

2.1 [Reserved].

2.2 Term Loans.

(a) Term Loan. Subject to the terms and conditions of this Agreement, on the
Closing Date, each Lender with a Term Commitment agrees (severally, not jointly
or jointly and severally) to make a term loan (the “Term Loan”) to Borrower in
an aggregate principal amount equal to such Lender’s Pro Rata Share of the Term
Commitment. The aggregate Term Commitment of all Lenders as of the Closing Date
is $32,500,000.

(b) Repayment of Term Loan. The outstanding unpaid principal balance and all
accrued and unpaid interest on the Term Loan shall be due and payable on the
earlier of (1) the Maturity Date, and (2) the date of the acceleration of the
Term Loan in accordance with the terms hereof. Any principal amount of the Term
Loan that is repaid or prepaid may not be reborrowed. All principal of, interest
on, and other amounts payable in respect of the Term Loan shall constitute
Obligations.

2.3 Borrowing Procedures.

(a) Procedure for Borrowing Term Loans. The Borrowing of the Term Loan shall be
made by a written request by an Authorized Person delivered to Agent and
received by Agent no later than 12:00 p.m. Eastern on the Business Day that is
three (3) Business Days prior to the requested Funding Date, specifying (A) the
amount of such Borrowing, and (B) the requested Funding Date (which shall be a
Business Day); provided, that Agent may, in its sole discretion, elect to accept
as timely requests that are received later than 12:00 p.m. Eastern on the
applicable Business Day.

(b) [Reserved.]

(c) Making of Term Loans.

(i) After receipt of a request for a Borrowing pursuant to Section 2.3(a), Agent
shall notify the Lenders by telecopy, telephone, email, or other electronic form
of transmission, of the requested Borrowing; such notification to be sent by
4:00 p.m. Eastern on the Business Day that is two (2) Business Days prior to the
requested Funding Date. If Agent has

 

3

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notified the Lenders of a requested Borrowing on the Business Day that is one
(1) Business Day prior to the Funding Date, then each Lender shall make the
amount of such Lender’s Pro Rata Share of the requested Borrowing available to
Agent in immediately available funds, to Agent’s Account, not later than 10:00
a.m. on the Business Day that is the requested Funding Date. After Agent’s
receipt of the proceeds of such Term Loans from the Lenders, Agent shall make
the proceeds thereof available to Borrower on the applicable Funding Date by
transferring immediately available funds equal to such proceeds received by
Agent to the Designated Account; provided, that, no Lender shall have an
obligation to make any Term Loan, if one or more of the applicable conditions
precedent set forth in Section 3 will not be satisfied on the requested Funding
Date for the applicable Borrowing unless such condition has been waived. Agent
shall charge to the Loan Account usual and customary fees for the wire transfer
of each Borrowing.

(ii) Unless Agent receives notice from a Lender prior to 9:30 a.m. on the
Business Day that is the requested Funding Date relative to a requested
Borrowing as to which Agent has notified the Lenders of a requested Borrowing
that such Lender will not make available as and when required hereunder to Agent
for the account of Borrower the amount of that Lender’s Pro Rata Share of the
Borrowing, Agent may assume that each Lender has made or will make such amount
available to Agent in immediately available funds on the Funding Date and Agent
may (but shall not be so required), in reliance upon such assumption, make
available to Borrower a corresponding amount. If, on the requested Funding Date,
any Lender shall not have remitted the full amount that it is required to make
available to Agent in immediately available funds and if Agent has made
available to Borrower such amount on the requested Funding Date, then such
Lender shall make the amount of such Lender’s Pro Rata Share of the requested
Borrowing available to Agent in immediately available funds, to Agent’s Account,
no later than 10:00 a.m. on the Business Day that is the first Business Day
after the requested Funding Date (in which case, the interest accrued on such
Lender’s portion of such Borrowing for the Funding Date shall be for Agent’s
separate account). If any Lender shall not remit the full amount that it is
required to make available to Agent in immediately available funds as and when
required hereby and if Agent has made available to Borrower such amount, then
that Lender shall be obligated to immediately remit such amount to Agent,
together with interest at the Interest Rate for each day until the date on which
such amount is so remitted. A notice submitted by Agent to any Lender with
respect to amounts owing under this Section 2.3(c)(ii) shall be conclusive,
absent manifest error. If the amount that a Lender is required to remit is made
available to Agent, then such payment to Agent shall constitute such Lender’s
Term Loan for all purposes of this Agreement. If such amount is not made
available to Agent on the Business Day following the Funding Date, Agent will
notify Borrower of such failure to fund and, upon demand by Agent, Borrower
shall pay such amount to Agent for Agent’s account, together with interest
thereon for each day elapsed since the date of such Borrowing, at a rate per
annum equal to the interest rate applicable at the time to the Term Loans
composing such Borrowing.

(d) [Reserved].

(e) [Reserved].

(f) Notation. Agent, as a non-fiduciary agent for Borrower, shall maintain a
register showing the principal amount of the Term Loans owing to each Lender,
and the interests therein of each Lender, from time to time and such register
shall, absent manifest error, conclusively be presumed to be correct and
accurate.

 

4

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(g) Independent Obligations. All Term Loans shall be made by the applicable
Lenders contemporaneously and in accordance with their Pro Rata Shares of the
applicable Term Commitments. It is understood that (i) no Lender shall be
responsible for any failure by any other Lender to perform its obligation to
make any Term Loan (or other extension of credit) hereunder, nor shall any Term
Commitment of any Lender be increased or decreased as a result of any failure by
any other Lender to perform its obligations hereunder, and (ii) no failure by
any Lender to perform its obligations hereunder shall excuse any other Lender
from its obligations hereunder.

2.4 Payments; Reductions of Term Commitments; Prepayments.

(a) Payments by Borrower.

(i) Except as otherwise expressly provided herein (including as may be provided
in Section 2.4(a)(iii)), all payments by Borrower shall be made to Agent’s
Account for the account of the Lender Group and shall be made in immediately
available funds, no later than 1:30 p.m. on the date specified herein. Any
payment received by Agent later than 1:30 p.m. shall be deemed to have been
received (unless Agent, in its sole discretion, elects to credit it on the date
received) on the following Business Day and any applicable interest or fee shall
continue to accrue until such following Business Day.

(ii) Unless Agent receives notice from Borrower prior to the date on which any
payment is due to the Lenders that Borrower will not make such payment in full
as and when required, Agent may assume that Borrower has made (or will make)
such payment in full to Agent on such date in immediately available funds and
Agent may (but shall not be so required to), in reliance upon such assumption,
distribute to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent Borrower does not make such payment in
full to Agent on the date when due, each Lender severally shall repay to Agent
on demand such amount distributed to such Lender, together with interest thereon
at the Interest Rate for each day from the date such amount is distributed to
such Lender until the date repaid.

(iii) Notwithstanding anything to the contrary in this Agreement, and provided
that no Insolvency Proceeding has been commenced by or against Borrower or any
Guarantor, to the extent the Subordination Agreement does not permit payment of
the same in cash, the portion of any Term Loan payment attributable to principal
on the Term Loan and any Repayment Fee may be made by delivering directly to the
Lenders a number of shares of common stock of Borrower having a value equal to
the amount of such principal or fee payment (with the value of such common stock
determined based on the Designated Price thereof). Upon the commencement of an
Insolvency Proceeding against Borrower or any Guarantor, the Term Loan may be
paid only in cash. Borrower shall give notice to Agent setting forth the dollar
equivalent of the payment in shares and, upon receipt of the shares, Lenders
shall confirm in writing to Agent (A) that payment has been received and (B) the
updated loan balance following the payment in shares of common stock.

 

5

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(b) Apportionment and Application.

(i) So long as no Application Event has occurred and is continuing, all
principal and interest payments received by Agent (regardless of whether such
payment is in the form of cash or shares of common stock) shall be apportioned
ratably among the Lenders (according to the unpaid principal balance of the
Obligations to which such payments relate held by each Lender) and all payments
of fees and expenses received by Agent (other than fees or expenses that are for
Agent’s separate account) shall be apportioned ratably among the Lenders having
a Pro Rata Share of the type of Term Commitment or Obligation to which a
particular fee or expense relates. Subject to Section 2.4(b)(iv) and
Section 2.4(e), all payments to be made hereunder by Borrower (regardless of
whether such payment is in the form of cash or shares of common stock) shall be
remitted to Agent and all such payments (unless required to be applied to the
Secured Obligations pursuant to the Subordination Agreement) shall be applied,
so long as no Application Event has occurred and is continuing, to reduce the
balance of the Term Loans outstanding and, thereafter, to Borrower (to be wired
to the Designated Account) or such other Person entitled thereto under
applicable law.

(ii) At any time that an Application Event has occurred and is continuing, all
payments remitted to Agent shall be applied as follows:

(A) first, ratably, to pay any Lender Group Expenses (including cost or expense
reimbursements) or indemnities then due to Agent under the Loan Documents, until
paid in full,

(B) second, ratably, to pay any fees or premiums then due to Agent under the
Loan Documents until paid in full,

(C) third, ratably, to pay any Lender Group Expenses (including cost or expense
reimbursements) or indemnities then due to any of the Lenders under the Loan
Documents, until paid in full,

(D) fourth, ratably, to pay any fees or premiums then due to any of the Lenders
under the Loan Documents until paid in full,

(E) fifth, ratably, to pay interest accrued in respect of the Term Loans until
paid in full,

(F) sixth, ratably, to pay the principal of all Term Loans until paid in full,

(G) seventh, to pay any other Obligations, and

(H) eighth, to Borrower (to be wired to the Designated Account) or such other
Person entitled thereto under applicable law.

(iii) Agent promptly shall distribute to each Lender, pursuant to the applicable
wire instructions received from each Lender in writing, such funds as it may be
entitled to receive.

 

6

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(iv) In each instance, so long as no Application Event has occurred and is
continuing, Section 2.4(b)(i) shall not apply to any payment made by Borrower to
Agent and specified by Borrower to be for the payment of specific Obligations
then due and payable (or prepayable) under any provision of this Agreement or
any other Loan Document.

(v) For purposes of Section 2.4(b)(ii), “paid in full” of a type of Obligation
means, payment in cash or immediately available funds of all amounts owing on
account of such type of Obligation, including interest accrued after the
commencement of any Insolvency Proceeding, default interest, interest on
interest, and expense reimbursements, irrespective of whether any of the
foregoing would be or is allowed or disallowed in whole or in part in any
Insolvency Proceeding.

(vi) In the event of a direct conflict between the priority provisions of this
Section 2.4 and any other provision contained in this Agreement or any other
Loan Document, it is the intention of the parties hereto that such provisions be
read together and construed, to the fullest extent possible, to be in concert
with each other. In the event of any actual, irreconcilable conflict that cannot
be resolved as aforesaid, if the conflict relates to the provisions of this
Section 2.4, then the provisions of this Section 2.4 shall control and govern.

(c) Reduction of Term Loan Commitments. The Term Commitments shall terminate
upon the making of the Term Loan on the Closing Date.

(d) Optional Prepayments. Borrower may prepay the Term Loans at any time, in
whole or in part, plus accrued and unpaid interest on the principal amount being
prepaid to the prepayment date and all fees, costs, expenses and other amounts
related thereto. Each prepayment of the Term Loan shall be applied to the
remaining installments of principal due on the Term Loan pro rata among such
remaining installments.

(e) Mandatory Prepayment. Concurrently with the completion of the Rights
Offering, Borrower shall prepay the outstanding principal amount of the Term
Loan, plus accrued and unpaid interest thereon and all fees, costs, expenses and
other amounts related thereto, in accordance with Section 2.4(f) in an amount
equal to 100% of the Net Cash Proceeds received from such Rights Offering.

(f) Application of Payments. Each prepayment pursuant to Section 2.4(e) shall,
(A) so long as no Application Event shall have occurred and be continuing, be
applied solely to the outstanding principal amount of the Term Loan and (B) if
an Application Event shall have occurred and be continuing, be applied in the
manner set forth in Section 2.4(b)(ii).

2.5 Promise to Pay.

(a) Borrower agrees to pay the Lender Group Expenses on the earlier of (i) the
first day of the month following the date on which the applicable Lender Group
Expenses were first incurred or (ii) the date on which demand therefor is made
by Agent (upon the written instruction of the Required Lenders) (it being
acknowledged and agreed that any charging of such costs, expenses or Lender
Group Expenses to the Loan Account pursuant to the provisions of Section 2.6(d)
shall be deemed to constitute a demand for payment thereof for the purposes of
this

 

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subclause (ii)); Borrower promises to pay all of the Obligations (including
principal, interest, premiums, if any, fees, costs, and expenses (including
Lender Group Expenses)) in full on the Maturity Date or, if earlier, on the date
on which the Obligations become due and payable pursuant to the terms of this
Agreement. Borrower agrees that (i) its obligations contained in the first
sentence of this Section 2.5 shall survive payment or satisfaction in full of
all other Obligations and (ii) all payments of the Lender Group Expenses shall
be nonrefundable under all circumstances.

(b) Any Lender may request that any portion of its Term Commitments or the Term
Loans made by it be evidenced by one or more promissory notes. In such event,
Borrower shall execute and deliver to such Lender the requested promissory notes
payable to the order of such Lender in a form furnished by such Lender and
reasonably satisfactory to Borrower. Thereafter, the portion of the Term
Commitments and Term Loans evidenced by such promissory notes and interest
thereon shall at all times be represented by one or more promissory notes in
such form payable to the order of the payee named therein.

2.6 Interest Rate: Rates, Payments, and Calculations.

(a) Interest Rate. Except as provided in Section 2.6(c), the Term Loans shall
bear interest at a per annum rate equal to the Interest Rate, payable in cash on
the dates set forth in Section 2.6(d).

(b) [Reserved].

(c) Default Rate. Upon the occurrence and during the continuation of (A) an
Event of Default described in Section 8.4 or Section 8.5, automatically, and
(B) any other Event of Default, at the election of the Required Lenders in their
sole discretion, all Term Loans, and Obligations that have been charged to the
Loan Account pursuant to the terms hereof, shall bear interest at a per annum
rate equal to three (3) percentage points above the per annum rate otherwise
applicable thereunder.

(d) Payment. Except to the extent provided to the contrary in Section 2.10,
(i) all interest and all other fees payable hereunder or under any of the other
Loan Documents shall be due and payable in cash, in arrears, on the first
Business Day of each month and (ii) all costs and expenses payable hereunder or
under any of the other Loan Documents, and all Lender Group Expenses shall be
due and payable on the earlier of (x) the first day of the month following the
date on which the applicable costs, expenses, or Lender Group Expenses were
first incurred or (y) the date on which demand therefor is made by Agent (it
being acknowledged and agreed that any charging of such costs, expenses or
Lender Group Expenses to the Loan Account pursuant to the provisions of the
following sentence shall be deemed to constitute a demand for payment thereof
for the purposes of this subclause (y)). Borrower hereby authorizes Agent, from
time to time without prior notice to Borrower, to charge to the Loan Account
(A) on the first day of each month, all interest accrued during the prior month
on the Term Loans hereunder, (B) as and when incurred or accrued, all fees and
costs provided for in Section 2.10, (C) as and when due and payable, all other
fees payable hereunder or under any of the other Loan Documents, (D) as and when
incurred or accrued, all other Lender Group Expenses, and (E) as and when due
and payable, all other payment obligations payable under any Loan Document. All
amounts (including interest, fees, costs, expenses, Lender Group Expenses, or
other amounts payable hereunder or under any other Loan Document) charged to the
Loan Account shall thereupon constitute Obligations hereunder and shall accrue
interest at the rate(s) then applicable to Term Loans.

 

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(e) Computation. All interest and fees chargeable under the Loan Documents shall
be computed on the basis of a 360-day year, in each case, for the actual number
of days elapsed in the period during which the interest or fees accrue.

(f) Intent to Limit Charges to Maximum Lawful Rate. In no event shall the
interest rate or rates payable under this Agreement, plus any other amounts paid
in connection herewith, exceed the highest rate permissible under any law that a
court of competent jurisdiction shall, in a final determination, deem
applicable. Borrower and the Lender Group, in executing and delivering this
Agreement, intend legally to agree upon the rate or rates of interest and manner
of payment stated within it; provided, that, anything contained herein to the
contrary notwithstanding, if such rate or rates of interest or manner of payment
exceeds the maximum allowable under applicable law, then, ipso facto, as of the
date of this Agreement, Borrower is and shall be liable only for the payment of
such maximum amount as is allowed by law, and payment received from Borrower in
excess of such legal maximum, whenever received, shall be applied to reduce the
principal balance of the Obligations to the extent of such excess.

2.7 Crediting Payments. Subject to Section 2.4(a)(iii), the receipt of any
payment item by Agent shall not be required to be considered a payment on
account unless such payment item is a wire transfer of immediately available
federal funds made to Agent’s Account or unless and until such payment item is
honored when presented for payment. Should any payment item not be honored when
presented for payment, then Borrower shall be deemed not to have made such
payment and interest shall be calculated accordingly. Anything to the contrary
contained herein notwithstanding, but subject to Section 2.4(a)(iii), any
payment item shall be deemed received by Agent only if it is received into
Agent’s Account on a Business Day on or before 1:30 p.m. If any payment item is
received into Agent’s Account on a non-Business Day or after 1:30 p.m. on a
Business Day (unless Agent, in its sole discretion, elects to credit it on the
date received), it shall be deemed to have been received by Agent as of the
opening of business on the immediately following Business Day.

2.8 Designated Account. Agent is authorized to make the Term Loans under this
Agreement based upon telephonic or other instructions received from anyone
purporting to be an Authorized Person or, without instructions, if pursuant to
Section 2.6(d). Borrower agrees to establish and maintain the Designated Account
with the Designated Account Bank for the purpose of receiving the proceeds of
the Term Loans requested by Borrower and made by Agent or the Lenders hereunder.
Unless otherwise agreed by Agent and Borrower, any Term Loan requested by
Borrower and made by Agent or the Lenders hereunder shall be made to the
Designated Account.

2.9 Maintenance of Loan Account; Statements of Obligations. Agent shall maintain
an account on its books in the name of Borrower (the “Loan Account”) on which
Borrower will be charged with the Term Loans made by Agent or the Lenders to
Borrower or for Borrower’s account, and with all other payment Obligations
hereunder or under the other Loan Documents, including, accrued interest, fees
and expenses, and Lender Group Expenses. In accordance with

 

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Section 2.7, the Loan Account will be credited with all payments received by
Agent from Borrower or for Borrower’s account. Agent shall make available to
Borrower monthly statements regarding the Loan Account, including the principal
amount of the Term Loans, interest accrued hereunder, fees accrued or charged
hereunder or under the other Loan Documents, and a summary itemization of all
charges and expenses constituting Lender Group Expenses accrued hereunder or
under the other Loan Documents, and each such statement, absent manifest error,
shall be conclusively presumed to be correct and accurate and constitute an
account stated between Borrower and the Lender Group unless, within 30 days
after Agent first makes such a statement available to Borrower, Borrower shall
deliver to Agent written objection thereto describing the error or errors
contained in such statement.

2.10 Fees. Borrower shall pay to Agent, for the account of Agent, as and when
due and payable under the terms of the Fee Letter, the fees set forth in the Fee
Letter.

2.11 [Reserved].

2.12 [Reserved].

2.13 Capital Requirements.

(a) If, after the date hereof, any Lender determines that (i) any Change in Law
regarding capital or reserve requirements for banks or bank holding companies or
(ii) compliance by such Lender, or their respective parent bank holding
companies, with any guideline, request or directive of any Governmental
Authority regarding capital adequacy (whether or not having the force of law),
has the effect of reducing the return on such Lender’s, or such holding
companies’ capital as a consequence of such Lender’s commitments, Term Loans,
participations or other obligations hereunder to a level below that which such
Lender, or such holding companies could have achieved but for such Change in Law
or compliance (taking into consideration such Lender’s, or such holding
companies’ then existing policies with respect to capital adequacy and assuming
the full utilization of such entity’s capital) by any amount deemed by such
Lender to be material, then such Lender may notify Borrower and Agent thereof.
Following receipt of such notice, Borrower agrees to pay such Lender on demand
the amount of such reduction of return of capital as and when such reduction is
determined, payable within 30 days after presentation by such Lender of a
statement in the amount and setting forth in reasonable detail such Lender’s
calculation thereof and the assumptions upon which such calculation was based
(which statement shall be deemed true and correct absent manifest error). In
determining such amount, such Lender may use any reasonable averaging and
attribution methods. Failure or delay on the part of any Lender to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s right to demand such compensation; provided that Borrower shall not be
required to compensate a Lender pursuant to this Section for any reductions in
return incurred more than 180 days prior to the date that such Lender notifies
Borrower of such Change in Law giving rise to such reductions and of such
Lender’s intention to claim compensation therefor; provided further that if such
claim arises by reason of the Change in Law that is retroactive, then the
180-day period referred to above shall be extended to include the period of
retroactive effect thereof.

 

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(b) If any Lender requests additional or increased costs referred to in
Section 2.13(a) (such Lender, an “Affected Lender”), then such Affected Lender
shall use reasonable efforts to promptly designate a different one of its
lending offices or to assign its rights and obligations hereunder to another of
its offices or branches, if (i) in the reasonable judgment of such Affected
Lender, such designation or assignment would eliminate or reduce amounts payable
pursuant to Section 2.13(a) and (ii) in the reasonable judgment of such Affected
Lender, such designation or assignment would not subject it to any material
unreimbursed cost or expense and would not otherwise be materially
disadvantageous to it. Borrower agrees to pay all reasonable out-of-pocket costs
and expenses incurred by such Affected Lender in connection with any such
designation or assignment. If, after such reasonable efforts, such Affected
Lender does not so designate a different one of its lending offices or assign
its rights to another of its offices or branches so as to eliminate Borrower’s
obligation to pay any future amounts to such Affected Lender pursuant to
Section 2.13(a), then Borrower (without prejudice to any amounts then due to
such Affected Lender under Section 2.13(a)) may, unless prior to the effective
date of any such assignment the Affected Lender withdraws its request for such
additional amounts under Section 2.13(a), substitute a Lender, in each case,
reasonably acceptable to Agent to purchase the Obligations owed to such Affected
Lender and such Affected Lender’s commitments hereunder (a “Replacement
Lender”), and if such Replacement Lender agrees to such purchase, such Affected
Lender shall assign to the Replacement Lender its Obligations and commitments,
and upon such purchase by the Replacement Lender, which such Replacement Lender
shall be deemed to be a “Lender” for purposes of this Agreement and such
Affected Lender shall cease to be a “Lender” for purposes of this Agreement.

(c) Notwithstanding anything herein to the contrary, the protection of
Section 2.13 shall be available to each Lender regardless of any possible
contention of the invalidity or inapplicability of the law, rule, regulation,
judicial ruling, judgment, guideline, treaty or other change or condition which
shall have occurred or been imposed, so long as it shall be customary for
issuing banks or lenders affected thereby to comply therewith. Notwithstanding
any other provision herein, no Lender shall demand compensation pursuant to this
Section 2.13 if it shall not at the time be the general policy or practice of
such Lender to demand such compensation in similar circumstances under
comparable provisions of other credit agreements, if any.

3. CONDITIONS; TERM OF AGREEMENT.

3.1 Conditions Precedent to the Initial Extension of Credit. The obligation of
each Lender to make its initial Term Loan is subject to the fulfillment, to the
satisfaction of Agent and each Lender, of each of the conditions precedent set
forth on Schedule 3.1.

3.2 Conditions Precedent to all Extensions of Credit. The obligation of the
Lender Group (or any member thereof) to make any Term Loans hereunder at any
time shall be subject to the following conditions precedent:

(a) the representations and warranties of Borrower and its Subsidiaries
contained in this Agreement or in the other Loan Documents shall be true and
correct in all material respects (except that such materiality qualifier shall
not be applicable to any representations and warranties that already are
qualified or modified by materiality in the text thereof) on and as of the date
of such extension of credit, as though made on and as of such date (except to
the extent that such representations and warranties relate solely to an earlier
date, in which case such representations and warranties shall be true and
correct in all material respects (except that such materiality qualifier shall
not be applicable to any representations and warranties that already are
qualified or modified by materiality in the text thereof) as of such earlier
date);

 

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(b) no Default or Event of Default shall have occurred and be continuing on the
date of such extension of credit, nor shall either result from the making
thereof; and

(c) the receipt by Agent from Borrower of a request for Borrowing pursuant to
the requirements of Section 2.3(a).

3.3 Reserved.

3.4 Effect of Maturity. On the Maturity Date, the applicable commitments of the
Lender Group to provide additional credit hereunder shall automatically be
terminated and all of the Obligations immediately shall become due and payable
without notice or demand and Borrower shall be required to repay all of the
Obligations in full. No termination of the obligations of the Lender Group
(other than payment in full of the Obligations and termination of the Term
Commitments) shall relieve or discharge any Loan Party of its duties,
obligations, or covenants hereunder or under any other Loan Document.

3.5 Conditions Subsequent. The obligation of the Lender Group (or any member
thereof) to continue to make Term Loans is subject to the fulfillment, on or
before the date applicable thereto, of the conditions subsequent set forth on
Schedule 3.5 (the failure by Borrower to so perform or cause to be performed
such conditions subsequent as and when required by the terms thereof (unless
such date is extended, in writing, by the Required Lenders), shall constitute an
Event of Default).

4. REPRESENTATIONS AND WARRANTIES.

In order to induce the Lender Group to enter into this Agreement, Borrower makes
the following representations and warranties to the Lender Group which shall be
true, correct, and complete, in all material respects (except that such
materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text
thereof), as of the Closing Date, and shall be true, correct, and complete, in
all material respects (except that such materiality qualifier shall not be
applicable to any representations and warranties that already are qualified or
modified by materiality in the text thereof), as of the date of the making of
each Term Loan made thereafter, as though made on and as of the date of such
Term Loan (except to the extent that such representations and warranties relate
solely to an earlier date, in which case such representations and warranties
shall be true and correct in all material respects (except that such materiality
qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof) as of such
earlier date) and such representations and warranties shall survive the
execution and delivery of this Agreement:

4.1 Due Organization and Qualification; Subsidiaries.

(a) Each Loan Party (i) is duly organized and existing and in good standing
under the laws of the jurisdiction of its organization, (ii) is qualified to do
business in any state where the failure to be so qualified could reasonably be
expected to result in a Material Adverse Effect, and (iii) has all requisite
power and authority to own and operate its properties, to carry on its business
as now conducted and as proposed to be conducted, to enter into the Loan
Documents to which it is a party and to carry out the transactions contemplated
thereby.

 

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(b) Except as may be required under Borrower’s equity incentive and compensation
plans or agreements, Borrower is not subject to any obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any shares of its Equity
Interests or any security convertible into or exchangeable for any of its Equity
Interests.

(c) All of the outstanding Equity Interests of each Subsidiary of Borrower has
been validly issued and is fully paid and non-assessable.

(d) Except as set forth on Schedule 4.1(d), there are no subscriptions, options,
warrants, or calls relating to any shares of Borrower’s or its Subsidiaries’
Equity Interests, including any right of conversion or exchange under any
outstanding security or other instrument.

4.2 Due Authorization; No Conflict.

(a) As to each Loan Party, the execution, delivery, and performance by such Loan
Party of the Loan Documents to which it is a party have been duly authorized by
all necessary action on the part of such Loan Party.

(b) As to each Loan Party, the execution, delivery, and performance by such Loan
Party of the Loan Documents to which it is a party do not and will not
(i) violate any material provision of federal, state, or local law or regulation
applicable to any Loan Party or its Subsidiaries, the Governing Documents of any
Loan Party or its Subsidiaries, or any order, judgment, or decree of any court
or other Governmental Authority binding on any Loan Party or its Subsidiaries,
(ii) conflict with, result in a breach of, or constitute (with due notice or
lapse of time or both) a default under any material agreement of any Loan Party
or its Subsidiaries where any such conflict, breach or default could
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect, (iii) result in or require the creation or imposition of any
Lien of any nature whatsoever upon any assets of any Loan Party, other than
Permitted Liens (as defined in the Second Lien Credit Agreement), or
(iv) require any approval of any holder of Equity Interests of a Loan Party or
any approval or consent of any Person under any material agreement of any Loan
Party, other than consents or approvals that have been obtained and that are
still in force and effect and except, in the case of material agreements, for
consents or approvals, the failure to obtain could not individually or in the
aggregate reasonably be expected to cause a Material Adverse Effect.

4.3 Governmental Consents. The execution, delivery, and performance by each Loan
Party of the Loan Documents to which such Loan Party is a party and the
consummation of the transactions contemplated by the Loan Documents do not and
will not require any registration with, consent, or approval of, or notice to,
or other action with or by, any Governmental Authority, other than
registrations, consents, approvals, notices, or other actions that have been
obtained and that are still in force and effect.

 

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4.4 Binding Obligations. Each Loan Document has been duly executed and delivered
by each Loan Party that is a party thereto and is the legally valid and binding
obligation of such Loan Party, enforceable against such Loan Party in accordance
with its respective terms, except as enforcement may be limited by equitable
principles or by bankruptcy, insolvency, reorganization, moratorium, or similar
laws relating to or limiting creditors’ rights generally.

4.5 Title to Assets; No Encumbrances. Each of the Loan Parties and its
Subsidiaries has (a) good, sufficient and legal title to (in the case of fee
interests in Real Property), (b) valid leasehold interests in (in the case of
leasehold interests in real or personal property), and (c) good and marketable
title to (in the case of all other personal property), all of their respective
assets reflected in their most recent financial statements, in each case except
for assets disposed of since the date of such financial statements to the extent
permitted hereby. All of such assets are free and clear of Liens, except for
Permitted Liens (as defined in the Second Lien Credit Agreement).

4.6 Litigation. There are no actions, suits, or proceedings pending or, to the
knowledge of Borrower, after due inquiry, threatened in writing against a Loan
Party or any of its Subsidiaries that either individually or in the aggregate
could reasonably be expected to result in a Material Adverse Effect.

4.7 Compliance with Laws. No Loan Party nor any of its Subsidiaries (a) is in
violation of any applicable laws, rules, regulations, executive orders, or codes
(including Environmental Laws) that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect, or (b) is subject
to or in default with respect to any final judgments, writs, injunctions,
decrees, rules or regulations of any court or any federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect.

4.8 No Material Adverse Effect. All historical financial statements relating to
the Loan Parties and their Subsidiaries that have been delivered by Borrower to
Agent have been prepared in accordance with GAAP (except, in the case of
unaudited financial statements, for the lack of footnotes and being subject to
year-end audit adjustments) and present fairly in all material respects, the
Loan Parties’ and their Subsidiaries’ consolidated financial condition as of the
date thereof and results of operations for the period then ended. Since
April 30, 2017, no event, circumstance, or change has occurred that has or could
reasonably be expected to result in a Material Adverse Effect with respect to
the Loan Parties and their Subsidiaries, other than (i) as customarily resulting
from the commencement of petitions for relief similar to the Bankruptcy Cases
and (ii) as contemplated in Borrower’s business plan delivered to the Lenders
prior to July 28, 2017.

4.9 Solvency.

(a) Each Loan Party is Solvent.

(b) No transfer of property is being made by any Loan Party and no obligation is
being incurred by any Loan Party in connection with the transactions
contemplated by this Agreement or the other Loan Documents with the intent to
hinder, delay, or defraud either present or future creditors of such Loan Party.

 

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4.10 Complete Disclosure. All factual information taken as a whole (other than
forward-looking information and projections and information of a general
economic nature and general information about Borrower’s industry) furnished by
or on behalf of a Loan Party or its Subsidiaries in writing to Agent or any
Lender (including all information contained in the Schedules hereto or in the
other Loan Documents) for purposes of or in connection with this Agreement or
the other Loan Documents, and all other such factual information taken as a
whole (other than forward-looking information and projections and information of
a general economic nature and general information about Borrower’s industry)
hereafter furnished by or on behalf of a Loan Party or its Subsidiaries in
writing to Agent or any Lender will be, true and accurate, in all material
respects, on the date as of which such information is dated or certified and not
incomplete by omitting to state any fact necessary to make such information
(taken as a whole) not misleading in any material respect at such time in light
of the circumstances under which such information was provided. The Projections
delivered to Agent on July 5, 2017 and July 17, 2017 represent, and as of the
date on which any other Projections are delivered to Agent, such additional
Projections represent, Borrower’s good faith estimate, on the date such
Projections are delivered, of the Loan Parties’ and their Subsidiaries’ future
performance for the periods covered thereby based upon assumptions believed by
Borrower to be reasonable at the time of the delivery thereof to Agent (it being
understood that such Projections are subject to significant uncertainties and
contingencies, many of which are beyond the control of the Loan Parties and
their Subsidiaries, and no assurances can be given that such Projections will be
realized, and although reflecting Borrower’s good faith estimate, projections or
forecasts based on methods and assumptions which Borrower believed to be
reasonable at the time such Projections were prepared, are not to be viewed as
facts, and that actual results during the period or periods covered by the
Projections may differ materially from projected or estimated results).

4.11 Patriot Act. To the extent applicable, each Loan Party is in compliance, in
all material respects, with the (a) Trading with the Enemy Act, as amended, and
each of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling
legislation or executive order relating thereto, and (b) Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA Patriot Act of 2001) (the “Patriot Act”). No part of the
proceeds of the loans made hereunder will be used by any Loan Party or any of
their Affiliates, 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, as amended.

4.12 Margin Stock. No Loan Party nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. No part of
the proceeds of the loans made to Borrower will be used to purchase or carry any
Margin Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock or for any purpose that violates the provisions of
Regulation T, U or X of the Board of Governors.

 

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4.13 Governmental Regulation. No Loan Party nor any of its Subsidiaries is
subject to regulation under the Federal Power Act or the Investment Company Act
of 1940 or under any other federal or state statute or regulation which may
limit its ability to incur Indebtedness or which may otherwise render all or any
portion of the Obligations unenforceable. No Loan Party nor any of its
Subsidiaries is a “registered investment company” or a company “controlled” by a
“registered investment company” or a “principal underwriter” of a “registered
investment company” as such terms are defined in the Investment Company Act of
1940.

4.14 OFAC. No Loan Party nor any of its Subsidiaries is in violation of any of
the country or list based economic and trade sanctions administered and enforced
by OFAC. No Loan Party nor any of its Subsidiaries (a) is a Sanctioned Person or
a Sanctioned Entity, (b) has its assets located in Sanctioned Entities, or
(c) derives revenues from investments in, or transactions with Sanctioned
Persons or Sanctioned Entities. No proceeds of any loan made hereunder will be
used to fund any operations in, finance any investments or activities in, or
make any payments to, a Sanctioned Person or a Sanctioned Entity.

4.15 O.S.H.A. Each of Borrower and its Subsidiaries has complied in all material
respects with, and its facilities, business, leaseholds, equipment and other
property are in material compliance with, the provisions of the federal
Occupational Safety and Health Act and all rules and regulations promulgated
thereunder, and all Federal, state and local governmental rules, ordinances and
regulations similar thereto. There are no outstanding citations, notices or
orders of non-compliance issued to Borrower or any Subsidiary or relating to its
facilities, business, leaseholds, equipment or other property under the federal
Occupational Safety and Health Act, any rule or regulation promulgated
thereunder, or any similar state or local Governmental Rules.

4.16 First Lien and Second Lien Loan Documents. As of the Closing Date, Borrower
has delivered to Agent a complete and correct copy of the First Lien Loan
Documents and the Second Lien Loan Documents (in each case including all
schedules, exhibits, amendments, supplements, modifications, assignments and all
other documents delivered pursuant thereto or in connection therewith).

5. AFFIRMATIVE COVENANTS.

Borrower covenants and agrees that, until termination of all of the Term
Commitments and payment in full of the Obligations:

5.1 Financial Matters. Borrower agrees (a) that no Subsidiary of a Loan Party
will have a fiscal year different from that of Borrower, (b) to maintain a
system of accounting that enables Borrower to produce financial statements in
accordance with GAAP, and (c) that it will, and will cause each other Loan Party
to, (i) keep a reporting system that shows all additions, sales, claims,
returns, and allowances with respect to its and its Subsidiaries’ sales, and
(ii) maintain its billing systems and practices substantially as in effect as of
the Closing Date and shall only make material modifications thereto with notice
to, and with the consent of, Agent.

5.2 Existence. Borrower will, and will cause each of its Subsidiaries to, at all
times preserve and keep in full force and effect such Person’s valid existence
and good standing in its jurisdiction of organization and good standing with
respect to all other jurisdictions in which it is qualified to do business and
any rights, franchises, permits, licenses, accreditations, authorizations, or
other approvals material to their businesses, in each case except as could not
reasonably be expected to result in a Material Adverse Effect.

 

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5.3 Maintenance of Properties. Borrower will, and will cause each of its
Subsidiaries to, maintain and preserve all of its assets that are necessary or
useful in the proper conduct of its business in good working order and
condition, ordinary wear, tear, casualty, asset sales and condemnation excepted.

5.4 Compliance with Laws. Borrower will, and will cause each of its Subsidiaries
to, comply with the requirements of all applicable laws, rules, regulations, and
orders of any Governmental Authority, other than laws, rules, regulations, and
orders the non-compliance with which, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.

5.5 Disclosure Updates. Borrower will, promptly and in no event later than 5
Business Days after obtaining knowledge thereof, notify Agent if any written
information, exhibit, or report furnished to Agent or the Lenders contained, at
the time it was furnished, any untrue statement of a material fact or omitted to
state any material fact necessary to make the statements contained therein not
misleading in light of the circumstances in which made. The foregoing to the
contrary notwithstanding, any notification pursuant to the foregoing provision
will not cure or remedy the effect of the prior untrue statement of a material
fact or omission of any material fact nor shall any such notification have the
effect of amending or modifying this Agreement or any of the Schedules hereto.

5.6 Formation of Subsidiaries. Borrower will, at the time that any Loan Party
forms any direct or indirect Subsidiary (other than an Immaterial Subsidiary) or
acquires any direct or indirect Subsidiary (other than an Immaterial Subsidiary)
after the Closing Date, (a) within 10 Business Days of such formation or
acquisition (or such later date as permitted by Agent in its sole discretion)
cause such new Subsidiary to provide to Agent a joinder to the Guaranty
Agreement in form and substance reasonably satisfactory to Agent; provided, that
the joinder to the Guaranty Agreement shall not be required to be provided to
Agent with respect to any Subsidiary of Borrower that is a CFC if providing such
agreements would result in adverse tax consequences or the costs to the Loan
Parties of providing such guaranty or such security agreements are unreasonably
excessive (as determined by the Required Lenders in consultation with Borrower)
in relation to the benefits to the Lender Group of the security or guarantee
afforded thereby, and (b) provide to Agent all other documentation, including
one or more opinions of counsel reasonably satisfactory to Agent, which, in its
opinion, is appropriate with respect to the execution and delivery of the
joinder to the Guaranty Agreement referred to above. Any document, agreement, or
instrument executed or issued pursuant to this Section 5.6 shall constitute a
Loan Document.

5.7 Rights Offering. Borrower will use its reasonable best efforts to effectuate
and close the Rights Offering as soon as practicable following the Closing Date,
including but not limited to (i) filing a Registration Statement on Form S-1 (or
such other form as may then be available to Borrower) containing a prospectus
with regard to the Rights Offering, which Registration Statement and prospectus
shall be in a form reasonably acceptable to the Lender

 

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Group, (ii) responding to any comments on the Registration Statement as may be
received from the staff of the SEC in order to clear such comments and cause the
Registration Statement to become effective, and (iii) mailing or otherwise
causing to be available to Borrower’s common stockholders a prospectus and any
other documents as may be required in connection with the Rights Offering. Each
Lender agrees to cooperate fully with the other parties hereto and to execute
and deliver such further filings, documents, certificates, agreements,
amendments and instruments and to take such other actions as may be reasonably
requested by Borrower to effectuate the Rights Offering.

6. [RESERVED]

7. [RESERVED]

8. EVENTS OF DEFAULT.

Any one or more of the following events shall constitute an event of default
(each, an “Event of Default”) under this Agreement:

8.1 Payments. If Borrower fails to pay when due and payable, or when declared
due and payable, (a) all or any portion of the Obligations consisting of
interest, fees, or charges due the Lender Group, reimbursement of Lender Group
Expenses, or other amounts (other than any portion thereof constituting
principal) constituting Obligations (including any portion of the Obligations
that accrues after the commencement of an Insolvency Proceeding, regardless of
whether allowed or allowable in whole or in part as a claim in any such
Insolvency Proceeding), and such failure continues for a period of three
(3) Business Days, or (b) all or any portion of the principal of the Term Loans;

8.2 Covenants. If any Loan Party or any of its Subsidiaries fails to perform or
observe any covenant or other agreement contained in this Agreement, or in any
of the other Loan Documents, in each case, other than any such covenant or
agreement that is the subject of another provision of this Section 8 (in which
event such other provision of this Section 8 shall govern), and such failure
continues for a period of 30 days after the earlier of (i) the date on which
such failure shall first become known to any officer of Borrower or (ii) the
date on which written notice thereof is given to Borrower by Agent;

8.3 Judgments. If one or more judgments, orders, or awards for the payment of
money involving an aggregate amount of $1,725,000, or more (except to the extent
covered (other than to the extent of customary deductibles) by insurance
pursuant to which the insurer has not denied coverage) is entered or filed
against a Loan Party or any of its Subsidiaries, or with respect to any of their
respective assets, and either (a) there is a period of 30 consecutive days at
any time after the entry of any such judgment, order, or award during which
(1) the same is not discharged, satisfied, vacated, or bonded pending appeal, or
(2) a stay of enforcement thereof is not in effect, or (b) enforcement
proceedings are commenced upon such judgment, order, or award;

8.4 Voluntary Bankruptcy, etc. If an Insolvency Proceeding is commenced by a
Loan Party or any of its Subsidiaries;

 

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8.5 Involuntary Bankruptcy, etc. If an Insolvency Proceeding is commenced
against a Loan Party or any of its Subsidiaries and any of the following events
occur: (a) such Loan Party or such Subsidiary consents to the institution of
such Insolvency Proceeding against it, (b) the petition commencing the
Insolvency Proceeding is not timely controverted, (c) the petition commencing
the Insolvency Proceeding is not dismissed within 60 calendar days of the date
of the filing thereof, (d) an interim trustee is appointed to take possession of
all or any substantial portion of the properties or assets of, or to operate all
or any substantial portion of the business of, such Loan Party or its
Subsidiary, or (e) an order for relief shall have been issued or entered
therein;

8.6 Default Under Other Agreements. If there is (a) a default under one or more
agreements (other than the Loan Documents, the First Lien Loan Documents or the
Second Lien Loan Documents) to which a Loan Party or any of its Subsidiaries is
a party with one or more third Persons relative to a Loan Party’s or any of its
Subsidiaries’ Indebtedness involving an aggregate amount of $1,150,000 or more,
and such default (i) occurs at the final maturity of the obligations thereunder,
or (ii) results in a right by such third Person, irrespective of whether
exercised, to accelerate the maturity of such Loan Party’s or its Subsidiary’s
obligations thereunder; (b) a default in or an involuntary early termination of
one or more Hedge Agreements to which a Loan Party or any of its Subsidiaries is
a party involving an aggregate amount of $1,150,000 or more; or (c) a default
under the First Lien Credit Agreement or the Second Lien Credit Agreement as a
result of the failure to make any payment of any principal, interest, fees or
other amount in respect of the First Lien Obligations or the Second Lien
Obligations on the final maturity date of any term loans in respect of the First
Lien Indebtedness or Second Lien Indebtedness, and such default shall continue
(and shall not be cured or waived) for a period of ten (10) days; or (d) a
default under the First Lien Credit Agreement or the Second Lien Credit
Agreement as a result of the failure to perform or observe any other condition
or covenant (after the expiration of any applicable grace or cure periods), or
any other event shall occur or condition exist (after the expiration of all
applicable grace periods) under the First Lien Loan Documents or the Second Lien
Loan Documents, if as a result of such failure, event or condition the maturity
of the First Lien Obligations or Second Lien Obligations (or any refinancing
thereof) has been accelerated.

8.7 Representations, etc. If any warranty, representation, certificate,
statement, or Record made herein or in any other Loan Document or delivered in
writing to Agent or any Lender in connection with this Agreement or any other
Loan Document proves to be untrue in any material respect (except that such
materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text
thereof) as of the date of issuance or making or deemed making thereof;

8.8 Guaranty. If the obligation of any Guarantor under the guaranty contained in
the Guaranty Agreement is limited or terminated by operation of law or by such
Guarantor (other than in accordance with the terms of this Agreement);

8.9 [Reserved].

8.10 Loan Documents. The validity or enforceability of any Loan Document shall
at any time for any reason (other than solely as the result of an action or
failure to act on the part of Agent) be declared to be null and void, or a
proceeding shall be commenced by a Loan Party or its Subsidiaries, or by any
Governmental Authority having jurisdiction over a Loan Party or its
Subsidiaries, seeking to establish the invalidity or unenforceability thereof,
or a Loan Party or its Subsidiaries shall deny that such Loan Party or its
Subsidiaries has any liability or obligation purported to be created under any
Loan Document; or

 

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8.11 Change of Control. A Change of Control shall occur.

9. RIGHTS AND REMEDIES.

9.1 Rights and Remedies. Upon the occurrence and the continuation of an Event of
Default, Agent may, and, at the instruction of the Required Lenders, shall (in
each case under clauses (a) or (b) by written notice to Borrower), in addition
to any other rights or remedies provided for hereunder or under any other Loan
Document or by applicable law, do any one or more of the following:

(a) declare the principal of, and any and all accrued and unpaid interest and
fees in respect of, the Term Loans and all other Obligations, whether evidenced
by this Agreement or by any of the other Loan Documents to be immediately due
and payable, whereupon the same shall become and be immediately due and payable
and Borrower shall be obligated to repay all of such Obligations in full,
without presentment, demand, protest, or further notice or other requirements of
any kind, all of which are hereby expressly waived by Borrower;

(b) declare the Term Commitments terminated, whereupon the Term Commitments
shall immediately be terminated together with any obligation of any Lender to
make Term Loans; and

(c) exercise all other rights and remedies available to Agent or the Lenders
under the Loan Documents, under applicable law, or in equity.

The foregoing to the contrary notwithstanding, upon the occurrence of any Event
of Default described in Section 8.4 or Section 8.5, in addition to the remedies
set forth above, without any notice to Borrower or any other Person or any act
by the Lender Group, the Term Commitments shall automatically terminate and the
Obligations, inclusive of the principal of, and any and all accrued and unpaid
interest and fees in respect of, the Term Loans and all other Obligations,
whether evidenced by this Agreement or by any of the other Loan Documents, shall
automatically become and be immediately due and payable and Borrower shall
automatically be obligated to repay all of such Obligations in full, without
presentment, demand, protest, or notice or other requirements of any kind, all
of which are expressly waived by Borrower.

9.2 Remedies Cumulative. The rights and remedies of the Lender Group under this
Agreement, the other Loan Documents, and all other agreements shall be
cumulative. The Lender Group shall have all other rights and remedies not
inconsistent herewith as provided by law, or in equity. No exercise by the
Lender Group of one right or remedy shall be deemed an election, and no waiver
by the Lender Group of any Event of Default shall be deemed a continuing waiver.
No delay by the Lender Group shall constitute a waiver, election, or
acquiescence by it.

 

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10. WAIVERS; INDEMNIFICATION.

10.1 Demand; Protest; etc. Borrower waives demand, protest, notice of protest,
notice of default or dishonor, notice of payment and nonpayment, nonpayment at
maturity, release, compromise, settlement, extension, or renewal of documents,
instruments, chattel paper, and guarantees at any time held by the Lender Group
on which Borrower may in any way be liable.

10.2 [Reserved].

10.3 Indemnification. Borrower shall pay, indemnify, defend, and hold the
Agent-Related Persons, the Lender-Related Persons, and each Participant (each,
an “Indemnified Person”) harmless (to the fullest extent permitted by law) from
and against any and all losses, claims, demands, suits, actions, investigations,
proceedings, liabilities, fines, costs, penalties, and damages, and all
reasonable fees and disbursements of attorneys, experts, or consultants and all
other costs and expenses, joint and several, actually incurred in connection
therewith or in connection with the enforcement of this indemnification (as and
when they are incurred and irrespective of whether suit is brought), at any time
asserted against, imposed upon, or incurred by any of them (a) in connection
with or as a result of or related to the execution and delivery, enforcement,
performance, or administration (including any restructuring or workout with
respect hereto) of this Agreement, any of the other Loan Documents, or any
claim, litigation, investigation or proceeding relating to any of the foregoing,
regardless of whether any Indemnified Person is a party thereto, whether or not
such claim, litigation, investigation or proceeding are brought by Borrower or
its equity holders, affiliates, creditors or any other person, or the
transactions contemplated hereby or thereby or the monitoring of Borrower’s and
its Subsidiaries’ compliance with the terms of the Loan Documents, and to
reimburse each Indemnified Person within 30 days of written demand for any
reasonable actual documented out of pocket expenses incurred in connection with
investigating or defending any of the foregoing (provided, that the
indemnification in this clause (a) shall not extend to any proceeding (other
than a proceeding against Agent acting pursuant to the Loan Documents in its
capacity as Agent or any of its Affiliates or its or their respective officers,
directors, employees, controlling persons or members) solely between or among
Indemnified Persons that does not arise from any acts or omissions by Borrower
or any of its Subsidiaries; it being understood and agreed that the
indemnification in this clause (a) shall extend to the Agent-Related Persons and
their successors (but not the Lenders) relative to disputes between or among
Agent on the one hand, and one or more Lenders, or one or more of their
Affiliates, on the other hand, or any Taxes or any costs attributable to Taxes,
which shall be governed by Section 16), (b) with respect to any actual or
prospective investigation, litigation, or proceeding related to this Agreement,
any other Loan Document, the making of any Term Loans hereunder, or the use of
the proceeds of the Term Loans provided hereunder (irrespective of whether any
Loan Party or Indemnified Person is a party thereto), or any act, omission,
event, or circumstance in any manner related thereto, and (c) in connection with
or arising out of any presence or release of Hazardous Materials at, on, under,
to or from any assets or properties owned, leased or operated by Borrower or any
of its Subsidiaries or any Environmental Actions, Environmental Liabilities or
Remedial Actions related in any way to Borrower, any of its Subsidiaries or any
assets, properties, operations or actions of Borrower or any of its Subsidiaries
or any other violations of or liabilities arising under Environmental Law or
Environmental Permits by or relating to Borrower or any of its Subsidiaries or
any assets or properties owned, leased or operated by Borrower or any of its
Subsidiaries (each and all of the foregoing, the “Indemnified Liabilities”). The
foregoing to the contrary notwithstanding, Borrower shall have no obligation to
any Indemnified Person under this Section 10.3 with respect to (1) any
Indemnified Liability that

 

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a court of competent jurisdiction finally determines to have resulted from
(A) the gross negligence, bad faith or willful misconduct of such Indemnified
Person or its officers, directors, employees, controlling persons or members or
(B) a material breach in bad faith by any Indemnified Person of its obligations
under this Agreement or the other Loan Documents. This provision shall survive
the termination of this Agreement and the repayment in full of the Obligations.
If any Indemnified Person makes any payment to any other Indemnified Person with
respect to an Indemnified Liability as to which Borrower was required to
indemnify the Indemnified Person receiving such payment, the Indemnified Person
making such payment is entitled to be indemnified and reimbursed by Borrower
with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO
EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE
OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH
INDEMNIFIED PERSON OR OF ANY OTHER PERSON. THE PROVISIONS OF THIS SECTION 10.3
SHALL SURVIVE THE RESIGNATION OR TERMINATION OF ANY AGENT AND TERMINATION OF
THIS AGREEMENT.

11. NOTICES.

Unless otherwise provided in this Agreement, all notices or demands relating to
this Agreement or any other Loan Document shall be in writing and (except for
financial statements and other informational documents which may be sent by
first-class mail, postage prepaid) shall be personally delivered or sent by
registered or certified mail (postage prepaid, return receipt requested),
overnight courier, electronic mail (at such email addresses as a party may
designate in accordance herewith), or telefacsimile. In the case of notices or
demands to Borrower or Agent, as the case may be, they shall be sent to the
respective address set forth below:

 

  If to Borrower:   

NUVERRA ENVIRONMENTAL SOLUTIONS, INC.

14624 North Scottsdale Road, Suite 300

Scottsdale, Arizona 85254

Attn: Chief Legal Officer

Tel: (602) 903-7802

Fax No.: (602) 903-7806

  with copies to:   

SQUIRE PATTON BOGGS (US) LLP

1 E. Washington Street, Suite 2700

Phoenix, Arizona 85004

Attn: Matthew Holman, Esq.

Tel: (602) 528-4083

Fax No.: (602) 253-8129

 

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  If to Agent:   

WILMINGTON SAVINGS FUND SOCIETY, FSB

500 Delaware Avenue

Wilmington, DE 19801

Attention: Corporate Trust

Reference: Nuverra Environmental Solutions, Inc. Term Loan Credit Agreement

Fax No.: 302-421-9137

  with copies to:   

MORRISON & FOERSTER LLP

250 West 55th Street

New York, NY 10019-9601

Attn: Jon Levine, Esq.

Fax No.: 212-468-7900

Any party hereto may change the address at which they are to receive notices
hereunder, by notice in writing in the foregoing manner given to the other
party. All notices or demands sent in accordance with this Section 11, shall be
deemed received on the earlier of the date of actual receipt or three
(3) Business Days after the deposit thereof in the mail; provided, that
(a) notices sent by overnight courier service shall be deemed to have been given
when received, (b) notices by facsimile shall be deemed to have been given when
sent (except that, if not given during normal business hours for the recipient,
shall be deemed to have been given at the opening of business on the next
Business Day for the recipient) and (c) notices by electronic mail shall be
deemed received upon the sender’s receipt of an acknowledgment from the intended
recipient (such as by the “return receipt requested” function, as available,
return email or other written acknowledgment).

12. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL REFERENCE PROVISION.

(a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS
EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH
OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF
AND THEREOF, THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL
MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO, AND ANY
CLAIMS, CONTROVERSIES OR DISPUTES ARISING HEREUNDER OR THEREUNDER OR RELATED
HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN
THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED
IN THE COUNTY OF NEW YORK, STATE OF NEW YORK; PROVIDED, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY PROPERTY MAY BE BROUGHT, AT AGENT’S OPTION, IN THE
COURTS OF ANY JURISDICTION WHERE AGENT ELECTS

 

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TO BRING SUCH ACTION OR WHERE SUCH PROPERTY MAY BE FOUND. BORROWER AND EACH
MEMBER OF THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW,
ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO
OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS
SECTION 12(b).

(c) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND EACH MEMBER
OF THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS, IF ANY, TO A JURY
TRIAL OF ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION DIRECTLY OR
INDIRECTLY BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE
TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS (EACH A
“CLAIM”). BORROWER AND EACH MEMBER OF THE LENDER GROUP 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 AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.

(d) BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK
AND THE STATE OF NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENTS, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT
AGENT MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN
THE COURTS OF ANY JURISDICTION.

(e) NO CLAIM MAY BE MADE BY ANY LOAN PARTY AGAINST AGENT, ANY LENDER, ISSUING
BANK, OR ANY AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, COUNSEL, REPRESENTATIVE,
AGENT, OR ATTORNEY-IN-FACT OF ANY OF THEM FOR ANY SPECIAL, INDIRECT,
CONSEQUENTIAL, PUNITIVE OR EXEMPLARY DAMAGES OR LOSSES IN RESPECT OF ANY CLAIM
FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING OUT OF OR
RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR ANY ACT, OMISSION, OR EVENT OCCURRING IN CONNECTION THEREWITH, AND
EACH LOAN PARTY HEREBY WAIVES, RELEASES, AND AGREES NOT TO SUE UPON ANY CLAIM
FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED
TO EXIST IN ITS FAVOR.

 

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13. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

13.1 Assignments and Participations.

(a) (i) Subject to the conditions set forth in clause (a)(ii) below, any Lender
may assign and delegate all or any portion of its rights and duties under the
Loan Documents (including the Obligations owed to it and its Term Commitments)
to one or more assignees (each, an “Assignee”).

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

(A) no assignment may be made (x) to a natural person that is not a “qualified
purchaser” within the meaning of Section 2(a)(51) of the Investment Company Act
of 1940, (y) to a Loan Party or a Subsidiary of a Loan Party or (z) to any
Competitor;

(B) the amount of the Term Loans, Term Commitments and the other rights and
obligations of the assigning Lender hereunder and under the other Loan Documents
subject to each such assignment (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to Agent) shall be in a
minimum amount (unless waived by Agent) of $100,000 (except such minimum amount
shall not apply to (I) an assignment or delegation by any Lender to any other
Lender, an Affiliate of any Lender, or a Related Fund of such Lender or (II) a
group of new Lenders, each of which is an Affiliate of each other or a Related
Fund of such new Lender to the extent that the aggregate amount to be assigned
to all such new Lenders is at least $100,000);

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

(D) the parties to each assignment shall execute and deliver to Agent an
Assignment and Acceptance; provided, that Borrower and Agent may continue to
deal solely and directly with the assigning Lender in connection with the
interest so assigned to an Assignee until (1) written notice of such assignment,
together with payment instructions, addresses, and related information with
respect to the Assignee, have been given to Borrower and Agent by such Lender
and the Assignee, (2) such Lender and the Assignee have delivered to Borrower
and Agent an Assignment and Acceptance and Agent has notified the assigning
Lender of its receipt thereof and (3) unless waived by Agent, the assigning
Lender or Assignee has paid to Agent, for Agent’s separate account, a processing
fee in the amount of $3,500; and

(E) the assignee, if it is not a Lender, shall deliver to Agent an
Administrative Questionnaire in a form approved by Agent (the “Administrative
Questionnaire”).

(b) From and after the date that Agent receives the executed Assignment and
Acceptance and, if applicable, payment of the required processing fee, (i) the
Assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, shall be a “Lender” and shall have the rights and obligations of a
Lender under the Loan Documents, and (ii) the assigning Lender shall, to the
extent that rights and obligations hereunder and under the other Loan Documents
have been

 

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assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
(except with respect to Section 10.3) and be released from any future
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 and the other Loan Documents, such Lender
shall cease to be a party hereto and thereto); provided, that nothing contained
herein shall release any assigning Lender from obligations that survive the
termination of this Agreement, including such assigning Lender’s obligations
under Section 15 and Section 17.9(a).

(c) By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the Assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, 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 or any other Loan Document furnished pursuant hereto,
(ii) such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Loan Party or the
performance or observance by any Loan Party of any of its obligations under this
Agreement or any other Loan Document furnished pursuant hereto, (iii) such
Assignee confirms that it has received a copy of this Agreement, together with
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,
(iv) such Assignee will, independently and without reliance upon 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, (v) such
Assignee appoints and authorizes Agent to take such actions and to exercise such
powers under this Agreement and the other Loan Documents as are delegated to
Agent, by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto, and (vi) such Assignee agrees that it will
perform all of the obligations which by the terms of this Agreement are required
to be performed by it as a Lender.

(d) Immediately upon Agent’s receipt of the required processing fee, if
applicable, and delivery of notice to the assigning Lender pursuant to
Section 13.1(b), this Agreement shall be deemed to be amended to the extent, but
only to the extent, necessary to reflect the addition of the Assignee and the
resulting adjustment of the Term Commitments arising therefrom. The Term
Commitment allocated to each Assignee shall reduce such Term Commitments of the
assigning Lender pro tanto.

(e) Any Lender may at any time sell to one or more commercial banks, financial
institutions, or other Persons (a “Participant”) participating interests in all
or any portion of its Obligations, its Term Commitment, and the other rights and
interests of that Lender (the “Originating Lender”) hereunder and under the
other Loan Documents; provided, that (i) the Originating Lender shall remain a
“Lender” for all purposes of this Agreement and the other Loan Documents and the
Participant receiving the participating interest in the Obligations, the Term
Commitments, and the other rights and interests of the Originating Lender
hereunder shall not constitute a “Lender” hereunder or under the other Loan
Documents and the Originating Lender’s obligations under this Agreement shall
remain unchanged, (ii) the Originating Lender shall remain solely responsible
for the performance of such obligations, (iii) Borrower, Agent, and the Lenders

 

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shall continue to deal solely and directly with the Originating Lender in
connection with the Originating Lender’s rights and obligations under this
Agreement and the other Loan Documents, (iv) no Lender shall transfer or grant
any participating interest under which the Participant has the right to approve
any amendment to, or any consent or waiver with respect to, this Agreement or
any other Loan Document, except to the extent such amendment to, or consent or
waiver with respect to this Agreement or of any other Loan Document would
(A) extend the final maturity date of the Obligations hereunder in which such
Participant is participating, (B) reduce the interest rate applicable to the
Obligations hereunder in which such Participant is participating, (C) release
all or substantially all of the guaranties (except to the extent expressly
provided herein or in any of the Loan Documents) supporting the Obligations
hereunder in which such Participant is participating, (D) postpone the payment
of, or reduce the amount of, the interest or fees payable to such Participant
through such Lender (other than a waiver of default interest), or (E) decreases
the amount or postpones the due dates of scheduled principal repayments or
prepayments or premiums payable to such Participant through such Lender, (v) no
participation shall be sold to a natural person, (vi) no participation shall be
sold to a Loan Party, and (vii) all amounts payable by Borrower hereunder shall
be determined as if such Lender had not sold such participation, except that, if
amounts outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an Event of
Default, each Participant shall be deemed to have the right of set off in
respect of its participating interest in amounts owing under this Agreement to
the same extent as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement. The rights of any Participant
only shall be derivative through the Originating Lender with whom such
Participant participates and no Participant shall have any rights under this
Agreement or the other Loan Documents or any direct rights as to the other
Lenders, Agent, Borrower, or otherwise in respect of the Obligations. No
Participant shall have the right to participate directly in the making of
decisions by the Lenders among themselves.

(f) In connection with any such assignment or participation or proposed
assignment or participation or any grant of a security interest in, or pledge
of, its rights under and interest in this Agreement, a Lender may, subject to
the provisions of Section 17.9, disclose all documents and information which it
now or hereafter may have relating to Borrower and its Subsidiaries and their
respective businesses.

(g) Any other provision in this Agreement notwithstanding, any Lender may at any
time create a security interest in, or pledge, all or any portion of its rights
under and interest in this Agreement in favor of any Federal Reserve Bank in
accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury
Regulation 31 CFR §203.24, and such Federal Reserve Bank may enforce such pledge
or security interest in any manner permitted under applicable law.

(h) The Loan Parties hereby acknowledge that the Lenders and their Affiliates
may securitize the Term Loans (a “Securitization”) through the pledge of the
Term Loans as collateral security for loans to the Lenders or their Affiliates
or through the sale of the Term Loans or the issuance of direct or indirect
interests in the Term Loans to their controlled Affiliates, which loans to the
Lenders or their Affiliates or direct or indirect interests will be rated by
Moody’s, S&P or one or more other rating agencies. The Loan Parties shall, to
the extent commercially reasonable, cooperate with the Lenders and their
Affiliates to effect any and all Securitizations. Notwithstanding the foregoing,
no such Securitization shall release the Lender party thereto from any of its
obligations hereunder or substitute any pledgee, secured party or any other
party to such Securitization for such Lender as a party hereto and no change in
ownership of the Term Loans may be effected except pursuant to this
Section 13.1.

 

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(i) Agent (as a non-fiduciary agent on behalf of Borrower) shall maintain, or
cause to be maintained, a register (the “Register”) on which it enters the name
and address of each Lender as the registered owner of the Term Commitments and
Term Loans (and the principal amount thereof and stated interest thereon) held
by such Lender (each, a “Registered Loan”). Other than in connection with an
assignment by a Lender of all or any portion of its portion of the Term
Commitments and Term Loans to an Affiliate of such Lender or a Related Fund of
such Lender (i) a Registered Loan (and the registered note, if any, evidencing
the same) may be assigned or sold in whole or in part only by registration of
such assignment or sale on the Register (and each registered note shall
expressly so provide) and (ii) any assignment or sale of all or part of such
Registered Loan (and the registered note, if any, evidencing the same) may be
effected only by registration of such assignment or sale on the Register,
together with the surrender of the registered note, if any, evidencing the same
duly endorsed by (or accompanied by a written instrument of assignment or sale
duly executed by) the holder of such registered note, whereupon, at the request
of the designated assignee(s) or transferee(s), one or more new registered notes
in the same aggregate principal amount shall be issued to the designated
assignee(s) or transferee(s). Prior to the registration of assignment or sale of
any Registered Loan (and the registered note, if any evidencing the same),
Borrower shall treat the Person in whose name such Registered Loan (and the
registered note, if any, evidencing the same) is registered as the owner thereof
for the purpose of receiving all payments thereon and for all other purposes,
notwithstanding notice to the contrary. In the case of any assignment by a
Lender of all or any portion of its Term Commitments and Term Loans to an
Affiliate of such Lender or a Related Fund of such Lender, and which assignment
is not recorded in the Register, the assigning Lender, on behalf of Borrower,
shall maintain a register comparable to the Register.

(j) In the event that a Lender sells participations in the Registered Loan, such
Lender, as a non-fiduciary agent on behalf of Borrower, shall maintain (or cause
to be maintained) a register on which it enters the name of all participants in
the Registered Loans held by it (and the principal amount (and stated interest
thereon) of the portion of such Registered Loans that is subject to such
participations) (the “Participant Register”). A Registered Loan (and the
Registered Note, if any, evidencing the same) may be participated in whole or in
part only by registration of such participation on the Participant Register (and
each registered note shall expressly so provide). Any participation of such
Registered Loan (and the registered note, if any, evidencing the same) may be
effected only by the registration of such participation on the Participant
Register.

(k) Agent shall make a copy of the Register (and each Lender shall make a copy
of its Participant Register to the extent it has one) available for review by
Borrower from time to time as Borrower may reasonably request.

13.2 Successors. This Agreement shall bind and inure to the benefit of the
respective successors and assigns of each of the parties; provided, that
Borrower may not assign this Agreement or any rights or duties hereunder without
the Lenders’ prior written consent and any prohibited assignment shall be
absolutely void ab initio. No consent to assignment by the Lenders shall release
Borrower from its Obligations. A Lender may assign this Agreement and the other
Loan Documents and its rights and duties hereunder and thereunder pursuant to
Section 13.1 and, except as expressly required pursuant to Section 13.1, no
consent or approval by Borrower is required in connection with any such
assignment.

 

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14. AMENDMENTS; WAIVERS.

14.1 Amendments and Waivers.

(a) No amendment, waiver or other modification of any provision of this
Agreement or any other Loan Document (other than the Fee Letter), and no consent
with respect to any departure by Borrower therefrom, shall be effective unless
the same shall be in writing and signed by the Required Lenders (or by Agent at
the written request of the Required Lenders) and the Loan Parties that are party
thereto and then any such waiver or consent shall be effective, but only in the
specific instance and for the specific purpose for which given; provided, that
no such waiver, amendment, or consent shall, unless in writing and signed by all
of the Lenders directly affected thereby and all of the Loan Parties that are
party thereto, do any of the following:

(i) increase the amount of or extend the expiration date of any Term Commitment
of any Lender or amend, modify, or eliminate the last sentence of
Section 2.4(c),

(ii) postpone or delay any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees, or other amounts due
hereunder or under any other Loan Document,

(iii) reduce the principal of, or the rate of interest on, any loan or other
extension of credit hereunder, or reduce any fees or other amounts payable
hereunder or under any other Loan Document (except in connection with the waiver
of applicability of Section 2.6(c) (which waiver shall be effective with the
written consent of the Required Lenders)),

(iv) amend, modify, or eliminate this Section or any provision of this Agreement
providing for consent or other action by all Lenders,

(v) amend, modify, or eliminate Section 3.1 or 3.2,

(vi) amend, modify, or eliminate Section 15.11,

(vii) [reserved],

(viii) amend, modify, or eliminate the definitions of “Required Lenders” or “Pro
Rata Share”,

(ix) [reserved],

(x) other than in connection with a merger, liquidation, dissolution or sale of
such Person expressly permitted by the terms hereof or the other Loan Documents,
release Borrower or any Guarantor from any obligation for the payment of money
or consent to the assignment or transfer by Borrower or any Guarantor of any of
its rights or duties under this Agreement or the other Loan Documents,

 

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(xi) amend, modify, or eliminate any of the provisions of Section 2.4(b)(i) or
(ii), or

(xii) amend, modify, or eliminate any of the provisions of Section 13.1 with
respect to assignments to, or participations with, Persons who are Loan Parties
or Affiliates of Loan Parties.

(b) No amendment, waiver, modification, or consent shall amend, modify, waive,
or eliminate,

(i) the definition of, or any of the terms or provisions of, the Fee Letter,
without the written consent of Agent and Borrower (and shall not require the
written consent of any of the Lenders),

(ii) any provision of Section 15 pertaining to Agent, or any other rights or
duties of Agent under this Agreement or the other Loan Documents, without the
written consent of Agent, Borrower, and the Required Lenders, and

(c) Anything in this Section 14.1 to the contrary notwithstanding, any
amendment, modification, elimination, waiver, consent, termination, or release
of, or with respect to, any provision of this Agreement or any other Loan
Document that relates only to the relationship of the Lender Group among
themselves, and that does not affect the rights or obligations of Borrower,
shall not require consent by or the agreement of any Loan Party.

14.2 Replacement of Certain Lenders.

(a) If (i) any action to be taken by the Lender Group or Agent hereunder
requires the consent, authorization, or agreement of all Lenders or all Lenders
affected thereby and if such action has received the consent, authorization, or
agreement of the Required Lenders but not of all Lenders or all Lenders affected
thereby, or (ii) any Lender makes a claim for compensation under Section 16,
then Borrower or Agent, upon at least 5 Business Days prior irrevocable notice,
may permanently replace any Lender that failed to give its consent,
authorization, or agreement (a “Non-Consenting Lender”) or any Lender that made
a claim for compensation (a “Tax Lender”) with one or more Replacement Lenders,
and the Non-Consenting Lender or Tax Lender, as applicable, shall have no right
to refuse to be replaced hereunder. Such notice to replace the Non-Consenting
Lender or Tax Lender, as applicable, shall specify an effective date for such
replacement, which date shall not be later than 15 Business Days after the date
such notice is given.

(b) Prior to the effective date of such replacement, the Non-Consenting Lender
or Tax Lender, as applicable, and each Replacement Lender shall execute and
deliver an Assignment and Acceptance, subject only to the Non-Consenting Lender
or Tax Lender, as applicable, being repaid in full its share of the outstanding
Obligations (without any premium or penalty of any kind whatsoever, but
including all interest, fees and other amounts that may be due and payable in
respect thereof). If the Non-Consenting Lender or Tax Lender, as applicable,
shall refuse or fail to execute and deliver any such Assignment and Acceptance
prior to the effective date of such replacement, Agent may, but shall not be
required to, execute and deliver such

 

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Assignment and Acceptance in the name or and on behalf of the Non-Consenting
Lender or Tax Lender, as applicable, and irrespective of whether Agent executes
and delivers such Assignment and Acceptance, the Non-Consenting Lender or Tax
Lender, as applicable, shall be deemed to have executed and delivered such
Assignment and Acceptance. The replacement of any Non-Consenting Lender or Tax
Lender, as applicable, shall be made in accordance with the terms of
Section 13.1. Until such time as one or more Replacement Lenders shall have
acquired all of the Obligations, the Term Commitments, and the other rights and
obligations of the Non-Consenting Lender or Tax Lender, as applicable, hereunder
and under the other Loan Documents, the Non-Consenting Lender or Tax Lender, as
applicable, shall remain obligated to make the Non-Consenting Lender’s or Tax
Lender’s, as applicable, Pro Rata Share of Term Loans.

14.3 No Waivers; Cumulative Remedies. No failure by Agent or any Lender to
exercise any right, remedy, or option under this Agreement or any other Loan
Document, or delay by Agent or any Lender in exercising the same, will operate
as a waiver thereof. No waiver by Agent or any Lender will be effective unless
it is in writing, and then only to the extent specifically stated. No waiver by
Agent or any Lender on any occasion shall affect or diminish Agent’s and each
Lender’s rights thereafter to require strict performance by Borrower of any
provision of this Agreement. Agent’s and each Lender’s rights under this
Agreement and the other Loan Documents will be cumulative and not exclusive of
any other right or remedy that Agent or any Lender may have.

15. AGENT; THE LENDER GROUP.

15.1 Appointment and Authorization of Agent. Each Lender hereby designates and
appoints Agent as its agent under this Agreement and the other Loan Documents
and each Lender hereby irrevocably authorizes Agent to execute and deliver each
of the other Loan Documents on its behalf and to take such other action on its
behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to
Agent by the terms of this Agreement or any other Loan Document, together with
such powers as are reasonably incidental thereto. Agent agrees to act as agent
for and on behalf of the Lenders on the conditions contained in this Section 15.
The provisions of this Section 15 are solely for the benefit of Agent and the
Lenders, and neither Borrower nor any other party shall have rights as a
third-party beneficiary of any of such provisions. Any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document
notwithstanding, Agent shall not have any duties or responsibilities, except
those expressly set forth herein or in the other Loan Documents, nor shall Agent
have or be deemed to have any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against Agent. Without limiting the generality of the foregoing,
the use of the term “agent” in this Agreement or the other Loan Documents with
reference to Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only a representative relationship between independent
contracting parties. Except as expressly otherwise provided in this Agreement,
Lenders agree that Agent shall act upon the written instruction of the Required
Lenders with respect to exercising or refraining from exercising any
discretionary rights or taking or refraining from taking any actions that Agent
expressly is entitled to take or assert under or pursuant to this Agreement and
the other Loan Documents. Without

 

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limiting the generality of the foregoing, or of any other provision of the Loan
Documents that provides rights or powers to Agent, Lenders agree that Agent
shall have the right to exercise the following powers as long as this Agreement
remains in effect: (a) maintain, in accordance with its customary business
practices, ledgers and records reflecting the status of the Obligations and
related matters, (b) execute or file any and all financing or similar statements
or notices, amendments, renewals, supplements, documents, instruments, proofs of
claim, notices and other written agreements with respect to the Loan Documents,
(c) [reserved] (d) open and maintain such bank accounts and cash management
arrangements as Agent deems necessary and appropriate in accordance with the
Loan Documents for the foregoing purposes, (e) perform, exercise, and enforce
any and all other rights and remedies of the Lender Group with respect to
Borrower or its Subsidiaries, the Obligations, or otherwise related to any of
same as provided in the Loan Documents, and (f) incur and pay such Lender Group
Expenses as Agent may deem necessary or appropriate for the performance and
fulfillment of its functions and powers pursuant to the Loan Documents.

15.2 Delegation of Duties. Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys in fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agent or attorney in fact except to the extent
that a court of competent jurisdiction determines in a final and nonappealable
order that Agent acted with gross negligence or willful misconduct in the
selection of such agent(s) or attorney(s) in fact.

15.3 Liability of Agent. None of the Agent-Related Persons shall (a) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (b) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by Borrower or any of its
Subsidiaries or Affiliates, or any officer or director thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by Agent
under or in connection with, this Agreement or any other Loan Document, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of Borrower or its
Subsidiaries or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Lenders to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the books and records or properties of
Borrower or its Subsidiaries.

15.4 Reliance by Agent. Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, telefacsimile or other electronic
method of transmission, telex or telephone message, statement or other document
or conversation believed by it to be genuine and correct and to have been
signed, sent, or made by the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel to Borrower or counsel to any
Lender), independent accountants and other experts selected by Agent. Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless Agent shall first receive such
advice or concurrence of the Lenders as it deems appropriate and until such
instructions are received, Agent

 

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shall act, or refrain from acting, as it deems advisable. Agent shall not have
any duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby or by the
other Loan Documents that Agent is required to exercise as directed in writing
by the Required Lenders. If Agent so requests, it shall first be indemnified to
its reasonable satisfaction by the Lenders against any and all liability and
expense that may be incurred by it by reason of taking or continuing to take any
such action. Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders and such request
and any action taken or failure to act pursuant thereto shall be binding upon
all of the Lenders. In determining compliance with any condition hereunder to
the making of a Term Loan, that by its terms must be fulfilled to the
satisfaction of the Lenders, Agent may presume that such condition is
satisfactory to the Lenders unless Agent shall have received notice to the
contrary from the Lenders prior to the making of such Loan.

15.5 Notice of Default or Event of Default. Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest, fees, and
expenses required to be paid to Agent for the account of the Lenders and, except
with respect to Events of Default of which Agent has actual knowledge, unless
Agent shall have received written notice from a Lender or Borrower referring to
this Agreement, describing such Default or Event of Default, and stating that
such notice is a “notice of default.” Agent promptly will notify the Lenders of
its receipt of any such notice or of any Event of Default of which Agent has
actual knowledge. If any Lender obtains actual knowledge of any Event of
Default, such Lender promptly shall notify the other Lenders and Agent of such
Event of Default. Each Lender shall be solely responsible for giving any notices
to its Participants, if any. Subject to Section 15.4, Agent shall take such
action with respect to such Default or Event of Default as may be requested by
the Required Lenders in accordance with Section 9; provided, that unless and
until Agent has received any such request, Agent may (but shall not be obligated
to) take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable.

15.6 Credit Decision. Each Lender acknowledges that none of the Agent-Related
Persons has made any representation or warranty to it, and that no act by Agent
hereinafter taken, including any review of the affairs of Borrower and its
Subsidiaries or Affiliates, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Lender. Each Lender represents to
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such due diligence, documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of Borrower or any other Person party to a Loan Document, and
all applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrower. Each Lender also represents that it will, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrower or any
other Person party to a Loan Document. Except for notices, reports, and other
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Lenders by Agent, Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of
Borrower or any other Person party to a Loan Document that may come into the
possession of any of the Agent-Related Persons. Each Lender acknowledges that
Agent does not have any duty or responsibility, either initially or on a
continuing basis (except to the extent, if any, that is expressly specified
herein) to provide such Lender with any credit or other information with respect
to Borrower, its Affiliates or any of their respective business, legal,
financial or other affairs, and irrespective of whether such information came
into Agent’s or its Affiliates’ or representatives’ possession before or after
the date on which such Lender became a party to this Agreement.

15.7 Costs and Expenses; Indemnification. Agent may incur and pay Lender Group
Expenses to the extent Agent reasonably deems necessary or appropriate for the
performance and fulfillment of its functions, powers, and obligations pursuant
to the Loan Documents, including court costs, attorneys’ fees and expenses, fees
and expenses of financial accountants, advisors, consultants, and appraisers and
costs of collection by outside collection agencies, whether or not Borrower is
obligated to reimburse Agent or Lenders for such expenses pursuant to this
Agreement or otherwise. Whether or not the transactions contemplated hereby are
consummated, each of the Lenders, on a ratable basis, shall indemnify and defend
the Agent-Related Persons (to the extent not reimbursed by or on behalf of
Borrower and without limiting the obligation of Borrower to do so) from and
against any and all Indemnified Liabilities; provided, that no Lender shall be
liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities resulting solely from such Person’s gross negligence or
willful misconduct. Without limitation of the foregoing, each Lender shall
reimburse Agent upon demand for such Lender’s ratable share of any costs or out
of pocket expenses (including attorneys, accountants, advisors, and consultants
fees and expenses) incurred by Agent in connection with the preparation,
execution, delivery, administration, modification, amendment, or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement or any
other Loan Document to the extent that Agent is not reimbursed for such expenses
by or on behalf of Borrower. The undertaking in this Section shall survive the
payment of all Obligations hereunder and the resignation or replacement of
Agent.

15.8 Agent in Individual Capacity. Agent and its Affiliates may make loans to,
issue letters of credit for the account of, accept deposits from, acquire Equity
Interests in, and generally engage in any kind of banking, trust, financial
advisory, underwriting, or other business with Borrower and its Subsidiaries and
Affiliates and any other Person party to any Loan Document as though Agent were
not Agent hereunder, and, in each case, without notice to or consent of the
other members of the Lender Group. The other members of the Lender Group
acknowledge that, pursuant to such activities, Agent or its Affiliates may
receive information regarding Borrower or its Affiliates or any other Person
party to any Loan Documents that is subject to confidentiality obligations in
favor of Borrower or such other Person and that prohibit the disclosure of such
information to the Lenders, and the Lenders acknowledge that, in such
circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver Agent will use its reasonable best efforts to obtain),
Agent shall not be under any obligation to provide such information to them.

 

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15.9 Successor Agent. Agent may resign as Agent upon 30 days (10 days if an
Event of Default has occurred and is continuing) prior written notice to the
Lenders (unless such notice is waived by the Required Lenders) and Borrower
(unless such notice is waived by Borrower or an Event of Default exists). In
addition, the Required Lenders may agree in writing to remove and replace Agent.
If Agent resigns or is terminated, as the case may be, under this Agreement, the
Required Lenders shall be entitled to appoint a successor Agent for the Lenders
from among the Lenders or otherwise. If no successor Agent is appointed prior to
the effective date of the resignation or termination, as the case may be, of
Agent, the Required Lenders may appoint a successor Agent from among the Lenders
or such other Person as the Required Lenders shall select. In any such event,
upon the acceptance of its appointment as successor Agent hereunder, such
successor Agent shall succeed to all the rights, powers, and duties of the
retiring Agent and the term “Agent” shall mean such successor Agent and the
retiring Agent’s appointment, powers, and duties as Agent shall be terminated.
After any retiring Agent’s resignation hereunder as Agent, the provisions of
this Section 15 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Agent under this Agreement. If no successor Agent
has accepted appointment as Agent by the date which is 30 days following a
retiring Agent’s notice of resignation, the retiring Agent’s resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of Agent hereunder until such time, if any, as the Lenders appoint a
successor Agent as provided for above.

15.10 Lender in Individual Capacity. Any Lender and its respective Affiliates
may make loans to, issue letters of credit for the account of, accept deposits
from, acquire Equity Interests in and generally engage in any kind of banking,
trust, financial advisory, underwriting, or other business with Borrower and its
Subsidiaries and Affiliates and any other Person party to any Loan Documents as
though such Lender were not a Lender hereunder without notice to or consent of
the other members of the Lender Group. The other members of the Lender Group
acknowledge that, pursuant to such activities, such Lender and its respective
Affiliates may receive information regarding Borrower or its Affiliates or any
other Person party to any Loan Documents that is subject to confidentiality
obligations in favor of Borrower or such other Person and that prohibit the
disclosure of such information to the Lenders, and the Lenders acknowledge that,
in such circumstances, such Lender shall not be under any obligation to provide
such information to them.

15.11 [Reserved].

15.12 Restrictions on Actions by Lenders; Sharing of Payments.

(a) Each of the Lenders agrees that it shall not, without the express written
consent of Agent, set off against the Obligations, any amounts owing by such
Lender to Borrower or its Subsidiaries or any deposit accounts of Borrower or
its Subsidiaries now or hereafter maintained with such Lender. Each of the
Lenders further agrees that it shall not, unless specifically requested to do so
in writing by Agent, take or cause to be taken any action, including, the
commencement of any legal or equitable proceedings to enforce any Loan Document
against Borrower or any Guarantor.

(b) If, at any time or times any Lender shall receive payments from Agent in
excess of such Lender’s Pro Rata Share of all such distributions by Agent, such
Lender promptly shall (i) turn the same over to Agent, in kind, and with such
endorsements as may be required to negotiate the same to Agent, or in
immediately available funds, as applicable, for the account of

 

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all of the Lenders and for application to the Obligations in accordance with the
applicable provisions of this Agreement, or (ii) purchase, without recourse or
warranty, an undivided interest and participation in the Obligations owed to the
other Lenders so that such excess payment received shall be applied ratably as
among the Lenders in accordance with their Pro Rata Shares; provided, that to
the extent that such excess payment received by the purchasing party is
thereafter recovered from it, those purchases of participations shall be
rescinded in whole or in part, as applicable, and the applicable portion of the
purchase price paid therefor shall be returned to such purchasing party, but
without interest except to the extent that such purchasing party is required to
pay interest in connection with the recovery of the excess payment.

15.13 [Reserved].

15.14 Payments by Agent to the Lenders. All payments to be made by Agent to the
Lenders shall be made by bank wire transfer of immediately available funds
pursuant to such wire transfer instructions as each party may designate for
itself by written notice to Agent. Concurrently with each such payment, Agent
shall identify whether such payment (or any portion thereof) represents
principal, premium, fees, or interest of the Obligations (to the extent Borrower
has so identified such payments).

15.15 [Reserved].

15.16 [Reserved].

15.17 Several Obligations; No Liability. Notwithstanding that certain of the
Loan Documents now or hereafter may have been or will be executed only by or in
favor of Agent in its capacity as such, and not by or in favor of the Lenders,
any and all obligations to make any credit available hereunder shall constitute
the several (and not joint) obligations of the respective Lenders on a ratable
basis, according to their respective Term Commitments, to make an amount of such
credit not to exceed, in principal amount, at any one time outstanding, the
amount of their respective Term Commitments. Nothing contained herein shall
confer upon any Lender any interest in, or subject any Lender to any liability
for, or in respect of, the business, assets, profits, losses, or liabilities of
any other Lender. Each Lender shall be solely responsible for notifying its
Participants of any matters relating to the Loan Documents to the extent any
such notice may be required, and no Lender shall have any obligation, duty, or
liability to any Participant of any other Lender. Except as provided in
Section 15.7, no member of the Lender Group shall have any liability for the
acts of any other member of the Lender Group. No Lender shall be responsible to
Borrower or any other Person for any failure by any other Lender to fulfill its
obligations to make credit available hereunder, nor to advance for such Lender
or on its behalf, nor to take any other action on behalf of such Lender
hereunder or in connection with the financing contemplated herein.

16. WITHHOLDING TAXES.

16.1 Payments. All payments by or on account of any obligation of any Loan Party
under any Loan Document will be made free and clear of, and without deduction or
withholding for, any present or future Indemnified Taxes, and in the event any
deduction or withholding of Indemnified Taxes is required, Borrower shall comply
with the next sentence of this Section 16.1. If any Indemnified Taxes are so
levied or imposed, Borrower agrees to pay the full amount of such

 

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Indemnified Taxes and such additional amounts as may be necessary so that every
payment of all amounts due under this Agreement, any note, or Loan Document,
including any amount paid pursuant to this Section 16.1 after withholding or
deduction for or on account of any Indemnified Taxes, will not be less than the
amount provided for herein. Borrower shall indemnify Agent and each Lender and
Participant, within 10 days after demand therefor, for the full amount of any
Indemnified Taxes (including Indemnified Taxes imposed or asserted on or
attributable to amounts payable under this Section 16.1) payable or paid by such
Agent, Lender or Participant or required to be withheld or deducted from a
payment to such Agent, Lender or Participant and any reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
Borrower will furnish to Agent as promptly as possible after the date the
payment of any Indemnified Tax is due pursuant to applicable law, certified
copies of tax receipts evidencing such payment by Borrower. Borrower agrees to
pay any present or future stamp, value added or documentary taxes or any other
excise or property taxes, charges, or similar levies that arise from any payment
made hereunder or from the execution, delivery, performance, recordation, or
filing of, or otherwise with respect to this Agreement or any other Loan
Document.

16.2 Exemptions.

(a) If a Lender or Participant is entitled to claim an exemption or reduction
from United States withholding tax, such Lender or Participant agrees with and
in favor of Agent, to deliver to Agent (or, in the case of a Participant, to the
Lender granting the participation only) one of the following before receiving
its first payment under this Agreement:

(i) if such Lender or Participant is entitled to claim an exemption from United
States withholding tax pursuant to the portfolio interest exception, (A) a
statement of the Lender or Participant, signed under penalty of perjury, that it
is not a (I) a “bank” as described in Section 881(c)(3)(A) of the IRC, (II) a
10% shareholder of Borrower (within the meaning of Section 871(h)(3)(B) of the
IRC), or (III) a controlled foreign corporation related to Borrower within the
meaning of Section 864(d)(4) of the IRC, and (B) a properly completed and
executed IRS Form W-8BEN, Form W-8BEN-E or Form W-8IMY (with proper
attachments);

(ii) if such Lender or Participant is entitled to claim an exemption from, or a
reduction of, withholding tax under a United States tax treaty, a properly
completed and executed copy of IRS Form W-8BEN or Form W-8BEN-E;

(iii) if such Lender or Participant is entitled to claim that interest paid
under this Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such Lender, a
properly completed and executed copy of IRS Form W-8ECI;

(iv) if such Lender or Participant is entitled to claim that interest paid under
this Agreement is exempt from United States withholding tax because such Lender
or Participant serves as an intermediary, a properly completed and executed copy
of IRS Form W-8IMY (with proper attachments); or

 

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(v) a properly completed and executed copy of any other form or forms, including
IRS Form W-9, as may be required under the IRC or other laws of the United
States as a condition to exemption from, or reduction of, United States
withholding or backup withholding tax.

(b) Each Lender and each Participant shall provide new forms (or successor
forms) upon the expiration or obsolescence of any previously delivered forms or
promptly notify Borrower and Agent in writing of its legal inability to do so.
Each Lender or Participant shall promptly notify Agent (or, in the case of a
Participant, to the Lender granting the participation only) of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.

(c) If a Lender or Participant claims an exemption from withholding tax in a
jurisdiction other than the United States, such Lender or such Participant
agrees with and in favor of Agent, to deliver to Agent (or, in the case of a
Participant, to the Lender granting the participation only) any such form or
forms, as may be required under the laws of such jurisdiction as a condition to
exemption from, or reduction of, foreign withholding or backup withholding tax
before receiving its first payment under this Agreement, but only if such Lender
or such Participant is legally able to deliver such forms, provided, that
nothing in this Section 16.2(c) shall require a Lender or Participant to
disclose any information that it deems to be confidential (including without
limitation, its tax returns). Each Lender and each Participant shall provide new
forms (or successor forms) upon the expiration or obsolescence of any previously
delivered forms or promptly notify Borrower and Agent in writing of its legal
inability to do so. Each Lender and each Participant shall promptly notify Agent
(or, in the case of a Participant, to the Lender granting the participation
only) of any change in circumstances which would modify or render invalid any
claimed exemption or reduction.

(d) If a Lender or Participant claims exemption from, or reduction of,
withholding tax and such Lender or Participant sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of
Borrower, such Lender or Participant agrees to notify Agent (or, in the case of
a sale of a participation interest, to the Lender granting the participation
only) of the percentage amount in which it is no longer the beneficial owner of
Obligations of Borrower. To the extent of such percentage amount, Agent will
treat such Lender’s or such Participant’s documentation provided pursuant to
Section 16.2(a) or 16.2(c) as no longer valid. With respect to such percentage
amount, such Assignee (or assignee Participant) may provide new documentation,
pursuant to Section 16.2(a) or 16.2(c), if applicable. Borrower agrees that each
Participant shall be entitled to the benefits of this Section 16 with respect to
its participation in any portion of the Term Commitments and the Obligations so
long as such Participant complies with the obligations set forth in this
Section 16 with respect thereto.

16.3 Reductions.

(a) If a Lender or a Participant is entitled to a reduction in the applicable
withholding tax, Agent (or, in the case of a Participant, to the Lender granting
the participation) may withhold from any interest payment to such Lender or such
Participant an amount equivalent to the applicable withholding tax after taking
into account such reduction. If the forms or other documentation required by
Section 16.2(a) or 16.2(c) are not delivered to Agent (or, in the case of

 

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a Participant, to the Lender granting the participation), then Agent (or, in the
case of a Participant, to the Lender granting the participation) may withhold
from any interest payment to such Lender or such Participant not providing such
forms or other documentation an amount equivalent to the applicable withholding
tax.

(b) If the IRS or any other Governmental Authority of the United States or other
jurisdiction asserts a claim that Agent (or, in the case of a Participant, to
the Lender granting the participation) did not properly withhold tax from
amounts paid to or for the account of any Lender or any Participant due to a
failure on the part of the Lender or any Participant (because the appropriate
form was not delivered, was not properly executed, or because such Lender failed
to notify Agent (or such Participant failed to notify the Lender granting the
participation) of a change in circumstances which rendered the exemption from,
or reduction of, withholding tax ineffective, or for any other reason) such
Lender shall indemnify and hold Agent harmless (or, in the case of a
Participant, such Participant shall indemnify and hold the Lender granting the
participation harmless) for all amounts paid, directly or indirectly, by Agent
(or, in the case of a Participant, to the Lender granting the participation), as
tax or otherwise, including penalties and interest, and including any taxes
imposed by any jurisdiction on the amounts payable to Agent (or, in the case of
a Participant, to the Lender granting the participation only) under this
Section 16, together with all costs and expenses (including attorneys’ fees and
expenses). The obligation of the Lenders and the Participants under this
subsection shall survive the payment of all Obligations and the resignation or
replacement of Agent.

16.4 Refunds. If Agent or a Lender reasonably determines that it has received a
refund of any Indemnified Taxes to which Borrower has paid additional amounts
pursuant to this Section 16, so long as no Default or Event of Default has
occurred and is continuing, it shall pay over such refund to Borrower (but only
to the extent of payments made, or additional amounts paid, by Borrower under
this Section 16 with respect to Indemnified Taxes giving rise to such a refund),
net of all out-of-pocket expenses of Agent or such Lender and without interest
(other than any interest paid by the applicable Governmental Authority with
respect to such a refund); provided, that Borrower, upon the request of Agent or
such Lender, agrees to repay the amount paid over to Borrower (plus any
penalties, interest or other charges, imposed by the applicable Governmental
Authority, other than such penalties, interest or other charges imposed as a
result of the willful misconduct or gross negligence of Agent hereunder) to
Agent or such Lender in the event Agent or such Lender is required to repay such
refund to such Governmental Authority. Notwithstanding anything in this
Agreement to the contrary, this Section 16 shall not be construed to require
Agent or any Lender to make available its tax returns (or any other information
which it deems confidential) to Borrower or any other Person.

17. GENERAL PROVISIONS.

17.1 Effectiveness. This Agreement shall be binding and deemed effective when
executed by Borrower, Agent, and each Lender whose signature is provided for on
the signature pages hereof.

17.2 Section Headings. Headings and numbers have been set forth herein for
convenience only. Unless the contrary is compelled by the context, everything
contained in each Section applies equally to this entire Agreement.

 

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17.3 Interpretation. Neither this Agreement nor any uncertainty or ambiguity
herein shall be construed against the Lender Group or Borrower, whether under
any rule of construction or otherwise. On the contrary, this Agreement has been
reviewed by all parties and shall be construed and interpreted according to the
ordinary meaning of the words used so as to accomplish fairly the purposes and
intentions of all parties hereto.

17.4 Severability of Provisions. Each provision of this Agreement shall be
severable from every other provision of this Agreement for the purpose of
determining the legal enforceability of any specific provision.

17.5 [Reserved].

17.6 Debtor-Creditor Relationship. The relationship between the Lenders and
Agent, on the one hand, and the Loan Parties, on the other hand, is solely that
of creditor and debtor. No member of the Lender Group has (or shall be deemed to
have) any fiduciary relationship or duty to any Loan Party arising out of or in
connection with the Loan Documents or the transactions contemplated thereby, and
there is no agency or joint venture relationship between the members of the
Lender Group, on the one hand, and the Loan Parties, on the other hand, by
virtue of any Loan Document or any transaction contemplated therein.

17.7 Counterparts; Electronic Execution. This Agreement 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
Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by telefacsimile or
other electronic method of transmission also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. The foregoing shall apply to each other Loan Document mutatis
mutandis.

17.8 Revival and Reinstatement of Obligations; Certain Waivers. If any member of
the Lender Group repays, refunds, restores, or returns in whole or in part, any
payment or property previously paid or transferred to such member of the Lender
Group in full or partial satisfaction of any Obligation or on account of any
other obligation of any Loan Party under any Loan Document, because the payment,
transfer, or the incurrence of the obligation so satisfied is asserted or
declared to be void, voidable, or otherwise recoverable under any law relating
to creditors’ rights, including provisions of the Bankruptcy Code relating to
fraudulent transfers, preferences, or other voidable or recoverable obligations
or transfers (each, a “Voidable Transfer”), or because such member of the Lender
Group elects to do so on the reasonable advice of its counsel in connection with
a claim that the payment, transfer, or incurrence is or may be a Voidable
Transfer, then, as to any such Voidable Transfer, or the amount thereof that
such member of the Lender Group elects to repay, restore, or return (including
pursuant to a settlement of any claim in respect thereof), and as to all
reasonable costs, expenses, and attorneys’ fees of such member of the Lender
Group related thereto, the liability of the Loan Parties with respect to the
amount or property paid, refunded, restored, or returned will automatically and
immediately be revived, reinstated, and restored and will exist.

 

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17.9 Confidentiality.

(a) Agent and Lenders each individually (and not jointly or jointly and
severally) agree that material, non-public information regarding Borrower and
its Subsidiaries, their operations, assets, and existing and contemplated
business plans (“Confidential Information”) shall be treated by Agent and the
Lenders in a confidential manner, and shall not be disclosed by Agent and the
Lenders to Persons who are not parties to this Agreement, except: (i) to
attorneys for and other advisors, accountants, auditors, and consultants to any
member of the Lender Group and to employees, directors and officers of any
member of the Lender Group (the Persons in this clause (i), “Lender Group
Representatives”) on a “need to know” basis in connection with this Agreement
and the transactions contemplated hereby and on a confidential basis, (ii) to
investors, prospective investors, lenders, Subsidiaries and Affiliates of any
member of the Lender Group, provided that any such investor, prospective
investor, lender, Subsidiary or Affiliate shall have agreed to receive such
information hereunder subject to the terms of this Section 17.9, (iii) as may be
required by regulatory authorities so long as such authorities are informed of
the confidential nature of such information, (iv) as may be required by statute,
decision, or judicial or administrative order, rule, or regulation; provided
that (x) prior to any disclosure under this clause (iv), the disclosing party
agrees to provide Borrower with prior notice thereof, to the extent that it is
practicable to do so and to the extent that the disclosing party is permitted to
provide such prior notice to Borrower pursuant to the terms of the applicable
statute, decision, or judicial or administrative order, rule, or regulation and
(y) any disclosure under this clause (iv) shall be limited to the portion of the
Confidential Information as may be required by such statute, decision, or
judicial or administrative order, rule, or regulation, (v) as may be agreed to
in advance in writing by Borrower, (vi) as requested or required by any
Governmental Authority pursuant to any subpoena or other legal process,
provided, that, (x) prior to any disclosure under this clause (vi) the
disclosing party agrees to provide Borrower with prior written notice thereof,
to the extent that it is practicable to do so and to the extent that the
disclosing party is permitted to provide such prior written notice to Borrower
pursuant to the terms of the subpoena or other legal process and (y) any
disclosure under this clause (vi) shall be limited to the portion of the
Confidential Information as may be required by such Governmental Authority
pursuant to such subpoena or other legal process, (vii) as to any such
information that is or becomes generally available to the public (other than as
a result of prohibited disclosure by Agent or the Lenders or the Lender Group
Representatives), (viii) in connection with any assignment, participation or
pledge of any Lender’s interest under this Agreement, provided that prior to
receipt of Confidential Information any such assignee, participant, or pledgee
shall have agreed in writing to receive such Confidential Information either
subject to the terms of this Section 17.9 or pursuant to confidentiality
requirements substantially similar to those contained in this Section 17.9 (and
such Person may disclose such Confidential Information to Persons employed or
engaged by them as described in clause (i) above), (ix) in connection with any
litigation or other adversary proceeding involving parties hereto which such
litigation or adversary proceeding involves claims related to the rights or
duties of such parties under this Agreement or the other Loan Documents;
provided, that, prior to any disclosure to any Person (other than any Loan
Party, Agent, any Lender, any of their respective Affiliates, or their
respective counsel) under this clause (ix) with respect to litigation involving
any Person (other than Borrower, Agent, any Lender, any of their respective
Affiliates, or their respective counsel), the disclosing party agrees to provide
Borrower with prior written notice thereof, and (x) in connection with, and to
the extent reasonably necessary for, the exercise of any secured creditor remedy
under this Agreement or under any other Loan Document.

 

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(b) Anything in this Agreement to the contrary notwithstanding, Agent and
Lenders may disclose information concerning the terms and conditions of this
Agreement and the other Loan Documents to loan syndication and pricing reporting
services or in its marketing or promotional materials, with such information to
consist of deal terms and other information customarily found in such
publications or marketing or promotional materials. Borrower and each Subsidiary
hereby authorizes and gives permission for Agent, Lenders and their respective
Affiliates to use the legal or fictional company name, logo, trademark and/or
personal quotes in connection with promotional materials that Agent or any
Lender may disseminate to the public relating to Agent or such Lender’s
relationship with Borrower. Promotional materials may include, but are not
limited to, brochures, video tapes, emails, internet websites, advertising in
newspapers and/or other periodicals, lucites, pictures and photographs.

(c) The Loan Parties hereby acknowledge that Agent or its Affiliates may make
available to the Lenders materials or information provided by or on behalf of
Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower
Materials on IntraLinks, SyndTrak or another similar electronic system (the
“Platform”) and 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 Loan Parties or their securities) (each, a “Public Lender”). The Loan
Parties shall be deemed to have authorized Agent and its Affiliates and the
Lenders to treat Borrower Materials marked “PUBLIC” or otherwise at any time
filed with the SEC as not containing any material non-public information with
respect to the Loan Parties or their securities for purposes of United States
federal and state securities laws. All Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated as
“Public Investor” (or another similar term). Agent and its Affiliates and the
Lenders shall be entitled to treat any Borrower Materials that are not marked
“PUBLIC” or that are not at any time filed with the SEC as being suitable only
for posting on a portion of the Platform not marked as “Public Investor” (or
such other similar term).

17.10 Survival. All representations and warranties made by the Loan Parties in
the Loan Documents and in the certificates or other instruments delivered in
connection with or pursuant to this Agreement or any other Loan Document shall
be considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of the Loan Documents and the making of any
Term Loans, regardless of any investigation made by any such other party or on
its behalf and notwithstanding that Agent or any Lender 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 hereunder, and shall continue in
full force and effect as long as the principal of, or any accrued interest on,
any Term Loan or any fee or any other amount payable under this Agreement is
outstanding or unpaid and so long as the Term Commitments have not expired or
been terminated.

17.11 Patriot Act. Each Lender that is subject to the requirements of the
Patriot Act hereby notifies Borrower that pursuant to the requirements of the
Act, it is required to obtain, verify and record information that identifies the
Loan Parties, which information includes the names, address and tax
identification numbers of the Loan Parties and other information that will

 

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allow such Lender to identify the Loan Parties in accordance with the Patriot
Act. In addition, if Agent is required by law or regulation or internal policies
to do so, it shall have the right to periodically conduct (a) Patriot Act
searches, OFAC/PEP searches, and customary individual background checks for the
Loan Parties and (b) OFAC/PEP searches and customary individual background
checks for the Loan Parties’ senior management and key principals, and Borrower
agrees to cooperate in respect of the conduct of such searches and further
agrees that the reasonable costs and charges for such searches shall constitute
Lender Group Expenses hereunder and be for the account of Borrower. This notice
is given in accordance with the requirements of the Patriot Act and is effective
for Agent.

17.12 Integration. This Agreement, together with the other Loan Documents,
reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.

17.13 No Setoff. All payments made by Borrower hereunder or under any note or
other Loan Document will be made in immediately available funds and without
setoff, counterclaim, or other defense.

17.14 Subordination Agreement. Agent and each Lender hereunder, by its
acceptance of the benefits provided hereunder, (a) agrees that it will be bound
by, and will take no actions contrary to, the provisions of the Subordination
Agreement, and (b) authorizes and instructs Agent to enter into the
Subordination Agreement as Agent on behalf of each Lender. Agent and each Lender
hereby agrees that the terms, conditions and provisions contained in this
Agreement are subject to the Subordination Agreement and, in the event of a
conflict between the terms of the Subordination Agreement and this Agreement,
the terms of the Subordination Agreement shall govern and control.

[Signature pages to follow.]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first above written.

 

BORROWER:    

NUVERRA ENVIRONMENTAL SOLUTIONS, INC.,

a Delaware corporation

      By:   /s/ Edward A. Lang       Name:   Edward A. Lang       Title:  
Executive Vice President and Chief Financial Officer

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WILMINGTON SAVINGS FUND SOCIETY, FSB, as Agent By:   /s/ Geoffrey J. Lewis Name:
  Geoffrey J. Lewis Title:   Vice President

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ASCRIBE II INVESTMENTS LLC, as a Lender By:   /s/ Lawrence First Name:  
Lawrence First Title:   Managing Director

 

ASCRIBE III INVESTMENTS LLC, as a Lender By:   /s/ Lawrence First Name:  
Lawrence First Title:   Managing Director

 

ECF VALUE FUND, LP, as a Lender By:   /s/ Jeffrey Gates Name:   Jeffrey Gates
Title:   President

 

ECF VALUE FUND II, LP, as a Lender By:   /s/ Jeffrey Gates Name:   Jeffrey Gates
Title:   President

 

ECF VALUE FUND INTERNATIONAL MASTER, LP, as a Lender By:   /s/ Jeffrey Gates
Name:   Jeffrey Gates Title:   President

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Schedule 1.1

As used in the Agreement, the following terms shall have the following
definitions:

“Accounting Changes” means changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants (or successor thereto or any agency with similar functions).

“Administrative Questionnaire” has the meaning specified therefor in
Section 13.1(a) of the Agreement.

“Affected Lender” has the meaning specified therefor in Section 2.13(b) of the
Agreement.

“Affiliate” means, as applied to any Person, any other Person who controls, is
controlled by, or is under common control with, such Person. For purposes of
this definition, “control” means the possession, directly or indirectly through
one or more intermediaries, of the power to direct the management and policies
of a Person, whether through the ownership of Equity Interests, by contract, or
otherwise. Notwithstanding the foregoing, no Lender shall be deemed to be an
Affiliate of a Loan Party.

“Agent” has the meaning specified therefor in the preamble to the Agreement.

“Agent-Related Persons” means Agent, together with its Affiliates, controlling
persons and their respective directors, officers, employees, partners, advisors,
agents and other representatives of each of the foregoing and their respective
successors.

“Agent’s Account” means the Deposit Account of Agent identified on Schedule A-1
to the Agreement (or such other Deposit Account of Agent that has been
designated as such, in writing, by Agent to Borrower and the Lenders).

“Agreement” means the Bridge Term Loan Credit Agreement to which this Schedule
1.1 is attached.

“Application Event” means the occurrence and continuance of (a) a failure by
Borrower to repay the Obligations in full on the Maturity Date, or (b) an Event
of Default and the election by Agent or the Required Lenders to require that
payments be applied pursuant to Section 2.4(b)(ii) of the Agreement.

“Assignee” has the meaning specified therefor in Section 13.1(a) of the
Agreement.

“Assignment and Acceptance” means an Assignment and Acceptance Agreement
substantially in the form of Exhibit A-1 to the Agreement.

“Authorized Person” means any one of the individuals identified on Schedule A-2
to the Agreement, as such schedule is updated from time to time by written
notice from Borrower to Agent.

 

Schedule 1.1 - Page 1

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“Bankruptcy Code” means Chapter 11 of title 11 of the United States Code.

“Board of Directors” means, as to any Person, the board of directors (or
comparable managers) of such Person, or any committee thereof duly authorized to
act on behalf of the board of directors (or comparable managers).

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

“Borrower” has the meaning specified therefor in the preamble to the Agreement.

“Borrower Materials” has the meaning specified therefor in Section 17.9(c) of
the Agreement.

“Borrowing” means a borrowing consisting of Term Loans made on the same day by
the Lenders.

“Business Day” means any day excluding Saturday, Sunday, and any day which is a
legal holiday under the laws of the State of New York or which is a day on which
Agent is otherwise closed for transacting business with the public.

“CFC” means a controlled foreign corporation (as that term is defined in the
IRC).

“Change in Law” means the occurrence after the date of the Agreement of: (a) the
adoption or effectiveness of any law, rule, regulation, judicial ruling,
judgment or treaty, (b) any change in any law, rule, regulation, judicial
ruling, judgment or treaty or in the administration, interpretation,
implementation or application by any Governmental Authority of any law, rule,
regulation, guideline or treaty, or (c) the making or issuance by any
Governmental Authority of any request, rule, guideline or directive, whether or
not having the force of law; provided that notwithstanding anything in the
Agreement to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer
Protection Act and all requests, rules, guidelines or directives thereunder or
issued in connection therewith and (ii) all requests, rules, guidelines or
directives concerning capital adequacy promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States or foreign regulatory authorities shall,
in each case, be deemed to be a “Change in Law,” regardless of the date enacted,
adopted or issued.

“Change of Control” means that:

(a) Gates Capital Management LLC and Ascribe Capital LLC shall cease to own and
control legally and beneficially (free and clear of all Liens), either directly
or indirectly, equity securities in Borrower representing more than 40% of the
combined voting power of all of equity securities entitled to vote for members
of the board of directors or equivalent governing body of Borrower; or

 

Schedule 1.1 - Page 2

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(b) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, but excluding any employee benefit plan
of such person or its subsidiaries, and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such plan)
other than the Equity Investors becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all securities
that such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time (such right, an
“option right”)), directly or indirectly, of 35% or more of the Equity Interests
of Borrower entitled to vote for members of the board of directors or equivalent
governing body of Borrower on a fully-diluted basis (and taking into account all
such securities that such “person” or “group” has the right to acquire pursuant
to any option right); or

(c) during any period of 12 consecutive months, individuals who at the beginning
of such period were members of Borrower’s board of directors cease for any
reason to constitute a majority of the directors of Borrower then in office
unless (i) such new directors were elected by a majority of the directors of
Borrower who constituted the board of directors of Borrower at the beginning of
such period (or by directors so elected) or by the stockholders pursuant to the
nomination of the existing directors, or (ii) the reason for such directors
failing to constitute a majority is a result of retirement by directors due to
age, death or disability, or

(d) Borrower shall cease, directly or indirectly, to own and control legally and
beneficially all of the Equity Interests in the other Loan Parties; or

(e) a “Change of Control” (as defined in the First Lien Credit Agreement or the
Second Lien Credit Agreement) shall occur.

“China Water” means China Water and Drinks, Inc., a Delaware corporation.

“Clearwater Acquisition” has the meaning set forth in the recitals to the
Agreement.

“Clearwater Acquisition Agreement” means the Equity Purchase Agreement, dated as
of October 5, 2018, among David Niederst Irrevocable Trust and Stillwater Seven,
LLC as sellers and Nuverra Ohio Disposal LLC, as buyer, as amended and in effect
from time to time to the extent permitted herein.

“Clearwater Entities” means, collectively, Clearwater Five, Clearwater Solutions
and Clearwater Three.

“Clearwater Five” has the meaning set forth in the recitals to the Agreement.

“Clearwater Solutions” has the meaning set forth in the recitals to the
Agreement.

“Clearwater Three” has the meaning set forth in the recitals to the Agreement.

“Clearwater Transactions” means (a) the Clearwater Acquisition and the other
transactions contemplated by the Clearwater Acquisition Agreement, (b) the
entering into of this Agreement and the other Loan Documents, (c) the entering
into the First Lien Amendment and any related First Lien Loan Documents and
(d) the payment of all fees and expenses in connection herewith and therewith.

 

Schedule 1.1 - Page 3

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“Closing Date” means the date of the making of the initial Term Loans (or other
extension of credit) under the Agreement.

“Competitor” means any Person which is a direct competitor of Borrower or its
Subsidiaries if, at the time of a proposed assignment, the assigning Lender has
actual knowledge that such Person is a direct competitor of Borrower or its
Subsidiaries; provided, that in connection with any assignment or participation,
the Assignee or Participant with respect to such proposed assignment or
participation that is an investment bank, a commercial bank, a finance company,
a fund, or other Person which merely has an economic interest in any such direct
competitor, and is not itself such a direct competitor of Borrower or its
Subsidiaries, shall not be deemed to be a direct competitor for the purposes of
this definition.

“Confidential Information” has the meaning specified therefor in Section 17.9(a)
of the Agreement.

“Default” means an event, condition, or default that, with the giving of notice,
the passage of time, or both, would be an Event of Default.

“Designated Account” means the Deposit Account of Borrower identified on
Schedule D-1 to the Agreement (or such other Deposit Account of Borrower located
at Designated Account Bank that has been designated as such, in writing, by
Borrower to Agent).

“Designated Account Bank” has the meaning specified therefor in Schedule D-1 to
the Agreement (or such other bank that is located within the United States that
has been designated as such, in writing, by Borrower to Agent).

“Designated Price” means the 20-day volume weighted average price of the common
stock of Borrower preceding the issuance of a press release or other similar
public announcement of the Clearwater Acquisition.

“Disqualified Equity Interests” means any Equity Interests that, by their terms
(or by the terms of any security or other Equity Interests into which they are
convertible or for which they are exchangeable), or upon the happening of any
event or condition (a) mature or are mandatorily redeemable (other than solely
for Qualified Equity Interests), pursuant to a sinking fund obligation or
otherwise (except as a result of a change of control or asset sale so long as
any rights of the holders thereof upon the occurrence of a change of control or
asset sale event shall be subject to the prior repayment in full of the Term
Loans and all other Obligations that are accrued and payable and the termination
of the Term Commitments), (b) are redeemable at the option of the holder thereof
(other than solely for Qualified Equity Interests), in whole or in part,
(c) provide for the scheduled payments of dividends in cash, or (d) are or
become convertible into or exchangeable for Indebtedness or any other Equity
Interests that would constitute Disqualified Equity Interests, in each case,
prior to the date that is 180 days after the Maturity Date.

“Dollars” or “$” means United States dollars.

 

Schedule 1.1 - Page 4

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“Environmental Action” means any written complaint, summons, citation, notice,
directive, order, claim, litigation, investigation, judicial or administrative
proceeding, judgment, letter, or other written communication from any
Governmental Authority, or any third party involving violations of or liability
under Environmental Laws or releases of Hazardous Materials, including without
limitation (a) from any assets, properties, or businesses of any Borrower, any
Subsidiary of a Borrower, or any of their predecessors in interest, (b) from
adjoining properties or businesses, or (c) from or onto any facilities which
received Hazardous Materials generated by any Borrower, any Subsidiary of a
Borrower, or any of their predecessors in interest.

“Environmental Law” means any applicable federal, state, provincial, foreign or
local statute, law, rule, regulation, ordinance, code, binding and enforceable
guideline, binding and enforceable written policy, or rule of common law now or
hereafter in effect and in each case as amended, or any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, in each case, to the extent binding on
Borrower or its Subsidiaries, relating to the environment, the effect of the
environment on human health, employee health, or Hazardous Materials, in each
case as amended from time to time.

“Environmental Liabilities” means all liabilities, monetary obligations, losses,
damages, costs and expenses (including all reasonable fees, disbursements and
expenses of counsel, experts, or consultants, and costs of investigation and
feasibility studies and diminution in value), fines, penalties, sanctions, and
interest incurred as a result of any claim or demand, or Remedial Action
required, by any Governmental Authority or any third party, and which relate to
any Environmental Action or otherwise relating to or arising under any
Environmental Laws or Environmental Permits.

“Environmental Permits” means all permits, licenses, consents, authorizations
and registrations required under Environmental Laws.

“Equity Interests” means, with respect to a Person, all of the shares, options,
warrants, interests, participations, or other equivalents (regardless of how
designated) of or in such Person, whether voting or nonvoting, including capital
stock (or other ownership or profit interests or units), preferred stock, or any
other “equity security” (as such term is defined in Rule 3a11-1 of the General
Rules and Regulations promulgated by the SEC under the Exchange Act).

“Equity Investors” means Mark D. Johnsrud, Gates Capital Management LLC, Ascribe
Capital LLC and their respective Affiliates.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute thereto.

“ERISA Affiliate” means (a) any Person subject to ERISA whose employees are
treated as employed by the same employer as the employees of Borrower or its
Subsidiaries under IRC Section 414(b), (b) any trade or business subject to
ERISA whose employees are treated as employed by the same employer as the
employees of Borrower or its Subsidiaries under IRC Section 414(c), (c) solely
for purposes of Section 302 of ERISA and Section 412 of the IRC, any
organization subject to ERISA that is a member of an affiliated service group of
which Borrower or any of its Subsidiaries is a member under IRC Section 414(m),
or (d) solely for purposes of Section 302 of ERISA and Section 412 of the IRC,
any Person subject to ERISA that is a party to an arrangement with Borrower or
any of its Subsidiaries and whose employees are aggregated with the employees of
Borrower or its Subsidiaries under IRC Section 414(o).

 

Schedule 1.1 - Page 5

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“Event of Default” has the meaning specified therefor in Section 8 of the
Agreement.

“Exchange Act” means the Securities Exchange Act of 1934, as in effect from time
to time.

“Excluded Taxes” means (i) any tax imposed on the net income or net profits of
any Lender or any Participant (including any branch profits taxes), in each case
imposed by the jurisdiction (or by any political subdivision or taxing authority
thereof) in which such Lender or such Participant is organized or the
jurisdiction (or by any political subdivision or taxing authority thereof) in
which such Lender’s or such Participant’s principal office is located in each
case as a result of a present or former connection between such Lender or such
Participant and the jurisdiction or taxing authority imposing the tax (other
than any such connection arising solely from such Lender or such Participant
having executed, delivered or performed its obligations or received payment
under, or enforced its rights or remedies under the Agreement or any other Loan
Document); (ii) taxes resulting from a Lender’s or a Participant’s failure to
comply with the requirements of Section 16.2 of the Agreement, (iii) any United
States federal withholding taxes that would be imposed on amounts payable to a
Foreign Lender pursuant to a law in effect at the time such Foreign Lender
becomes a party to the Agreement (or designates a new lending office), except
(A) any amount that such Foreign Lender (or its assignor, if any) was previously
entitled to receive pursuant to Section 16.1 of the Agreement, if any, with
respect to such withholding tax at the time such Foreign Lender becomes a party
to the Agreement (or designates a new lending office), and (B) additional United
States federal withholding taxes that may be imposed after the time such Foreign
Lender becomes a party to the Agreement (or designates a new lending office), as
a result of a change in law, rule, regulation, order or other decision with
respect to any of the foregoing by any Governmental Authority, and (iv) any
United States federal withholding taxes imposed under FATCA.

“FATCA” means Sections 1471 through 1474 of the IRC, as of the date of the
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with) and any current or future
regulations or official interpretations thereof.

“Fee Letter” means, collectively, that certain fee letter, dated as of even date
with the Agreement, between Borrower and Agent.

“First Lien Agent” means the “Agent” under and as defined in the First Lien
Credit Agreement.

“First Lien Amendment” means First Amendment to the First Lien Credit Agreement,
dated the date hereof, among the First Lien Agent, the Borrower and each other
party thereto from time to time as a loan party thereunder.

 

Schedule 1.1 - Page 6

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“First Lien Credit Agreement” means that certain First Lien Credit Agreement,
dated as of August 7, 2017, by and among ACF FinCo I LP, the First Lien Agent,
the First Lien Lenders, Borrower and each other Person party thereto from time
to time as a loan party thereunder, as amended and in effect from time to time.

“First Lien Indebtedness” means the Indebtedness evidenced by the First Lien
Loan Documents.

“First Lien Lenders” means each of the “Lenders” under and as defined in the
First Lien Credit Agreement.

“First Lien Loan Documents” means the First Lien Credit Agreement and each other
agreement, document and instrument executed and delivered in connection
therewith, as amended and in effect from time to time.

“First Lien Obligations” means the “Obligations” as defined in the First Lien
Credit Agreement.

“Foreign Lender” means any Lender or Participant that is not a United States
person within the meaning of IRC section 7701(a)(30).

“Funding Date” means the date on which a Borrowing occurs.

“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States, consistently applied.

“Governing Documents” means, with respect to any Person, the certificate or
articles of incorporation, by-laws, or other organizational documents of such
Person.

“Governmental Authority” means the government of any nation or any political
subdivision thereof, whether at the national, state, territorial, provincial,
municipal or any other level, 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).

“Guarantor” means (a) each Subsidiary of Borrower organized in the United States
of America as of the Closing Date, and (b) each other Person that becomes a
guarantor after the Closing Date pursuant to Section 5.6 of the Agreement;
provided that it is understood and agreed that (i) Nuverra Rocky Mountain and
(ii) China Water shall each not be required to become a guarantor hereunder so
long as it remains an Immaterial Subsidiary (and that, in either case, upon
ceasing to be an Immaterial Subsidiary, it shall within 10 Business Days take
all actions required under the Loan Documents, including Section 5.6 of the
Agreement, to become a guarantor hereunder and take all actions incidental
thereto).

“Guaranty Agreement” means the guaranty agreement, dated as of even date with
the Agreement, in form and substance reasonably satisfactory to Agent, executed
and delivered by Borrower and each of the Guarantors to Agent.

 

Schedule 1.1 - Page 7

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“Hazardous Materials” means (a) substances that are defined or listed in, or
otherwise classified pursuant to, any applicable laws or regulations as
“hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic
substances,” or any other formulation intended to define, list, or classify
substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP
toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.

“Hedge Agreement” means a “swap agreement” as that term is defined in
Section 101(53B)(A) of the Bankruptcy Code.

“Immaterial Subsidiaries” means any Subsidiary of Borrower which does not
(a) own any assets (other than assets of a de minimis nature), (b) have any
liabilities (other than liabilities of a de minimis nature), or (c) engage in
any business activity and “Immaterial Subsidiary” means any one of them. As of
the Closing Date, Nuverra Rocky Mountain and China Water are Immaterial
Subsidiaries.

“Indebtedness” as to any Person means (a) all obligations of such Person for
borrowed money, (b) all obligations of such Person evidenced by bonds,
debentures, notes, or other similar instruments and all reimbursement or other
obligations in respect of letters of credit, bankers acceptances, or other
financial products, (c) all obligations of such Person as a lessee under Capital
Leases, (d) all obligations or liabilities of others secured by a Lien on any
asset of such Person, irrespective of whether such obligation or liability is
assumed, (e) all obligations of such Person to pay the deferred purchase price
of assets (other than trade payables incurred in the ordinary course of business
and repayable in accordance with customary trade practices and, for the
avoidance of doubt, other than royalty payments payable in the ordinary course
of business in respect of non-exclusive licenses) and any Earn-Out required to
be paid in cash or similar obligation, (f) all monetary obligations of such
Person owing under Hedge Agreements (which amount shall be calculated based on
the amount that would be payable by such Person if the Hedge Agreement were
terminated on the date of determination), (g) any Disqualified Equity Interests
of such Person, and (h) any obligation of such Person guaranteeing or intended
to guarantee (whether directly or indirectly guaranteed, endorsed, co-made,
discounted, or sold with recourse) any obligation of any other Person that
constitutes Indebtedness under any of clauses (a) through (g) above. For
purposes of this definition, (i) the amount of any Indebtedness represented by a
guaranty or other similar instrument shall be the lesser of the principal amount
of the obligations guaranteed and still outstanding and the maximum amount for
which the guaranteeing Person may be liable pursuant to the terms of the
instrument embodying such Indebtedness, and (ii) the amount of any Indebtedness
which is limited or is non-recourse to a Person or for which recourse is limited
to an identified asset shall be valued at the lesser of (A) if applicable, the
limited amount of such obligations, and (B) if applicable, the fair market value
of such assets securing such obligation.

“Indemnified Liabilities” has the meaning specified therefor in Section 10.3 of
the Agreement.

 

Schedule 1.1 - Page 8

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“Indemnified Person” has the meaning specified therefor in Section 10.3 of the
Agreement.

“Indemnified Taxes” means, any Taxes other than Excluded Taxes.

“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the Bankruptcy Code or under any other state or federal
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.

“Interest Rate” means 11.0% per annum.

“IRC” means the Internal Revenue Code of 1986, as in effect from time to time.

“Lender” has the meaning set forth in the preamble to the Agreement and shall
also include any other Person made a party to the Agreement pursuant to the
provisions of Section 13.1 of the Agreement and “Lenders” means each of the
Lenders or any one or more of them.

“Lender Group” means each of the Lenders and Agent, or any one or more of them.

“Lender Group Expenses” means all (a) costs or expenses (including taxes and
insurance premiums) required to be paid by Borrower or its Subsidiaries under
any of the Loan Documents that are paid, advanced, or incurred by the Lender
Group, (b) documented out-of-pocket fees or charges paid or incurred by Agent in
connection with the Lender Group’s transactions with Borrower or its
Subsidiaries under any of the Loan Documents, including, without limitation, the
reasonable out-of-pocket fees and expenses of Agent’s outside counsel (limited,
in the case of the fees and disbursements of counsel, to the fees, disbursements
and other out-of-pocket charges of one primary counsel and, if reasonably
necessary or advisable, any special counsel, one local counsel in any relevant
jurisdiction, and special Delaware bankruptcy counsel) and out-of-pocket costs
incurred in connection with travel and due diligence, photocopying,
notarization, couriers and messengers, telecommunication, public record
searches, filing fees, recording fees, publication, real estate surveys, real
estate title policies and endorsements, and environmental audits, (c) Agent’s
customary fees and charges imposed or incurred in connection with any background
checks or OFAC/PEP searches related to Borrower or its Subsidiaries, (d) Agent’s
customary fees and charges (as adjusted from time to time) with respect to the
disbursement of funds (or the receipt of funds) to or for the account of
Borrower (whether by wire transfer or otherwise), together with any
out-of-pocket costs and expenses incurred in connection therewith, (e) customary
charges imposed or incurred by Agent resulting from the dishonor of checks
payable by or to any Loan Party, (f) reasonable documented out-of-pocket costs
and expenses paid or incurred by the Lender Group to correct any default or
enforce any provision of the Loan Documents, (g) consulting or advisory fees and
expenses of Agent and fees and expenses related to any field examinations,
appraisals, or valuation, (h) Agent’s and Lenders’ reasonable costs and expenses
(including reasonable documented attorneys’ fees and expenses) relative to third
party subpoenas, claims or any other lawsuit or adverse proceeding paid or
incurred, whether in enforcing or defending the Loan Documents or otherwise in
connection with the transactions contemplated by the Loan Documents or the
Lender Group’s relationship

 

Schedule 1.1 - Page 9

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with Borrower or any of its Subsidiaries, (i) Agent’s reasonable documented
costs and expenses (including reasonable documented attorneys’ fees and due
diligence expenses) incurred in advising, structuring, drafting, reviewing,
administering (including travel, meals, and lodging), syndicating (including
reasonable costs and expenses relative to the CUSIP, DXSyndicate™, SyndTrak or
other communication costs incurred in connection with a syndication of the loan
facilities), or amending, waiving, or modifying the Loan Documents, and
(j) Agent’s and each Lender’s reasonable documented costs and expenses
(including reasonable documented attorneys, accountants, consultants, and other
advisors fees and expenses) incurred in terminating, enforcing (including
attorneys, accountants, consultants, and other advisors fees and expenses
incurred in connection with a “workout,” a “restructuring,” or an Insolvency
Proceeding concerning Borrower or any of its Subsidiaries or in exercising
rights or remedies under the Loan Documents), or defending the Loan Documents,
irrespective of whether a lawsuit or other adverse proceeding is brought.

“Lender Group Representatives” has the meaning specified therefor in
Section 17.9 of the Agreement.

“Lender-Related Person” means, with respect to any Lender, such Lender, together
with such Lender’s Affiliates, officers, directors, employees, attorneys, and
agents.

“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment,
charge, deposit arrangement, encumbrance, easement, lien (statutory or other),
security interest, or other security arrangement and any other preference,
priority, or preferential arrangement of any kind or nature whatsoever,
including any conditional sale contract or other title retention agreement, the
interest of a lessor under a Capital Lease and any synthetic or other financing
lease having substantially the same economic effect as any of the foregoing.

“Loan Account” has the meaning specified therefor in Section 2.9 of the
Agreement.

“Loan Documents” means the Agreement, the Fee Letter, the Subordination
Agreement, the Guaranty Agreement, any note or notes executed by Borrower in
connection with the Agreement and payable to any member of the Lender Group, and
any other instrument or agreement entered into, now or in the future, by
Borrower or any of its Subsidiaries and any member of the Lender Group in
connection with the Agreement.

“Loan Party” means Borrower or any Guarantor.

“Margin Stock” as defined in Regulation U of the Board of Governors as in effect
from time to time.

“Material Adverse Effect” means (a) a material adverse effect in the business,
operations, results of operations, assets, liabilities or financial condition of
Borrower and its Subsidiaries, taken as a whole, or (b) a material impairment of
Borrower’s and its Subsidiaries ability to perform their obligations under the
Loan Documents to which they are parties or of the Lender Group’s ability to
enforce the Obligations (other than as a result of as a result of an action
taken or not taken that is solely in the control of Agent).

 

Schedule 1.1 - Page 10

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“Material Contract” means each contract or instrument to which Borrower or any
of its Subsidiaries is a party or by which Borrower, any of its Subsidiaries or
any of their properties is bound (a) which is deemed to be a material contract
as provided in Regulation S-K promulgated by the SEC under the Securities Act,
or (b) the termination or suspension of which, or the failure of any party
thereto to perform its obligations thereunder, could reasonably be expected to
cause a Material Adverse Effect.

“Maturity Date” means April 5, 2019.

“Net Cash Proceeds” means the aggregate amount of cash received (directly or
indirectly) from time to time (whether as initial consideration or through the
payment or disposition of deferred consideration) by or on behalf of Borrower or
such Subsidiary in connection with the Rights Offering, after deducting
therefrom only (i) reasonable fees, commissions, and expenses related thereto
and required to be paid by Borrower or such Subsidiary in connection with the
Rights Offering, and (ii) taxes paid or payable to any taxing authorities by
Borrower or such Subsidiary in connection with the Rights Offering, in each case
to the extent, but only to the extent, that the amounts so deducted are, at the
time of receipt of such cash, actually paid or payable to a Person that is not
an Affiliate of Borrower or any of its Subsidiaries, and are properly
attributable to such transaction.

“Non-Consenting Lender” has the meaning specified therefor in Section 14.2(a) of
the Agreement.

“Nuverra Rocky Mountain” means Nuverra Rocky Mountain Pipeline, LLC, a Delaware
limited liability company, together with any direct or indirect subsidiaries
thereof formed or acquired after the Closing Date, and any successors or assigns
of the foregoing entities (provided, that in no event shall any such successors
or assigns be a Loan Party or other direct or indirect Subsidiary of a Loan
Party).

“Obligations” means all loans (including the Term Loan), debts, principal,
interest (including any interest that accrues after the commencement of an
Insolvency Proceeding, regardless of whether allowed or allowable in whole or in
part as a claim in any such Insolvency Proceeding), premiums, liabilities
(including all amounts charged to the Loan Account pursuant to the Agreement),
obligations (including indemnification obligations), fees (including the fees
provided for in the Fee Letter), Lender Group Expenses (including any fees or
expenses that accrue after the commencement of an Insolvency Proceeding,
regardless of whether allowed or allowable in whole or in part as a claim in any
such Insolvency Proceeding), guaranties, and all covenants and duties of any
other kind and description owing by any Loan Party arising out of, under,
pursuant to, in connection with, or evidenced by the Agreement or any of the
other Loan Documents and irrespective of whether for the payment of money,
whether direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising, and including all interest not paid when due and
all other expenses or other amounts that Borrower is required to pay or
reimburse by the Loan Documents or by law or otherwise in connection with the
Loan Documents. Without limiting the generality of the foregoing, the
Obligations of Borrower under the Loan Documents include the obligation to pay
(i) the principal of the Term Loans, (ii) interest accrued on the Term Loans,
(iii) Lender Group Expenses, (iv) fees payable under the Agreement or any of the
other Loan Documents, and (v) indemnities and other amounts payable by any Loan
Party under any Loan Document. Any reference in the Agreement or in the Loan
Documents to the Obligations shall include all or any portion thereof and any
extensions, modifications, renewals, or alterations thereof, both prior and
subsequent to any Insolvency Proceeding.

 

Schedule 1.1 - Page 11

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“OFAC” means The Office of Foreign Assets Control of the U.S. Department of the
Treasury.

“Originating Lender” has the meaning specified therefor in Section 13.1(e) of
the Agreement.

“Participant” has the meaning specified therefor in Section 13.1(e) of the
Agreement.

“Participant Register” has the meaning set forth in Section 13.1(j) of the
Agreement.

“Patriot Act” has the meaning specified therefor in Section 4.11 of the
Agreement.

“Person” means natural persons, corporations, limited liability companies,
limited partnerships, general partnerships, limited liability partnerships,
joint ventures, trusts, land trusts, business trusts, or other organizations,
irrespective of whether they are legal entities, and governments and agencies
and political subdivisions thereof.

“Platform” has the meaning specified therefor in Section 17.9(c) of the
Agreement.

“Projections” means Borrower’s forecasted (a) balance sheets, (b) profit and
loss statements, and (c) cash flow statements, all prepared on a basis
consistent with Borrower’s historical financial statements, together with
appropriate supporting details and a statement of underlying assumptions.

“Pro Rata Share” means, as of any date of determination:

(a) with respect to a Lender’s obligation to make all or a portion of the Term
Loans, with respect to such Lender’s right to receive payments of interest,
fees, and principal with respect to the Term Loans, and with respect to all
other computations and other matters related to the Term Commitments or the Term
Loans, the percentage obtained by dividing (i) the Term Loan Exposure of such
Lender by (ii) the aggregate Term Loan Exposure of all Lenders, and

(b) with respect to all other matters and for all other matters as to a
particular Lender (including the indemnification obligations arising under
Section 15.7 of the Agreement), the percentage obtained by dividing (i) the Term
Loan Exposure of such Lender by (ii) the aggregate Term Loan Exposure of all
Lenders, in any such case as the applicable percentage may be adjusted by
assignments permitted pursuant to Section 13.1; provided, that if all of the
Term Loans have been repaid in full and all Term Commitments have been
terminated, Pro Rata Share under this clause shall be determined as if the Term
Loans had not been repaid, collateralized, or terminated and shall be based upon
the Term Loan Exposures as they existed immediately prior to their repayment,
collateralization, or termination.

 

Schedule 1.1 - Page 12

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“Public Lender” has the meaning specified therefor in Section 17.9(c) of the
Agreement.

“Qualified Equity Interests” means and refers to any Equity Interests issued by
Borrower (and not by one or more of its Subsidiaries) that is not a Disqualified
Equity Interest.

“Real Property” means any estates or interests in real property now owned or
hereafter acquired by Borrower or its Subsidiaries and the improvements thereto.

“Record” means information that is inscribed on a tangible medium or that is
stored in an electronic or other medium and is retrievable in perceivable form.

“Register” has the meaning set forth in Section 13.1(i) of the Agreement.

“Registered Loan” has the meaning set forth in Section 13.1(i) of the Agreement.

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

“Remedial Action” means all actions taken to (a) clean up, remove, remediate,
contain, treat, monitor, assess, evaluate, or in any way address Hazardous
Materials in the indoor or outdoor environment, (b) prevent or minimize a
release or threatened release of Hazardous Materials so they do not migrate or
endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment, (c) restore or reclaim natural resources or the
environment, (d) perform any pre-remedial studies, investigations, or
post-remedial operation and maintenance activities, or (e) conduct any other
actions with respect to Hazardous Materials required by Environmental Laws.

“Replacement Lender” has the meaning specified therefor in Section 2.13(b) of
the Agreement.

“Required Lenders” means, at any time, Lenders whose aggregate Pro Rata Shares
(calculated under clause (d) of the definition of Pro Rata Shares) exceed
66 2⁄3%.

“Rights Offering” means that certain rights offering of Borrower pursuant to
which Borrower anticipates dividending to the holders of its common stock
subscription rights to purchase shares of the common stock of Borrower on a pro
rata basis with an aggregate purchase price of $32,500,000 (with the value of
such common stock being determined based on the Designated Price thereof).

“Sanctioned Entity” means (a) a country or a government of a country, (b) an
agency of the government of a country, (c) an organization directly or
indirectly controlled by a country or its government, (d) a Person resident in
or determined to be resident in a country, in each case, that is subject to a
country sanctions program administered and enforced by OFAC.

 

Schedule 1.1 - Page 13

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“Sanctioned Person” means a person named on the list of Specially Designated
Nationals maintained by OFAC.

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

“SEC” means the United States Securities and Exchange Commission and any
successor thereto.

“Second Lien Agent” means the “Agent” under and as defined in the Second Lien
Credit Agreement.

“Second Lien Amendment” means First Amendment to the Second Lien Credit
Agreement, dated the date hereof, among the Second Lien Agent, the Borrower and
each other party thereto from time to time as a loan party thereunder.

“Second Lien Credit Agreement” means that certain Second Lien Term Loan Credit
Agreement, dated as of August 7, 2017, by and among Wilmington Savings Fund
Society, FSB, the Second Lien Lenders and Borrower, as amended and in effect
from time to time.

“Second Lien Indebtedness” means the Indebtedness evidenced by the Second Lien
Loan Documents.

“Second Lien Lenders” means each of the “Lenders” under and as defined in the
Second Lien Credit Agreement.

“Second Lien Loan Documents” means the Second Lien Credit Agreement and each
other agreement, document and instrument executed and delivered in connection
therewith, as amended and in effect from time to time.

“Second Lien Obligations” means the “Obligations” as defined in the Second Lien
Credit Agreement.

“Securities Act” means the Securities Act of 1933, as amended from time to time,
and any successor statute.

“Securitization” has the meaning specified therefor in Section 13.1(h) of the
Agreement.

“Solvent” means, with respect to any Person as of any date of determination,
that (a) such Person is not engaged or about to engage in a business or
transaction for which the remaining assets of such Person are unreasonably small
in relation to the business or transaction or for which the property remaining
with such Person is an unreasonably small capital, and (b) such Person has not
incurred and does not intend to incur, or reasonably believe that it will incur,
debts beyond its ability to pay such debts as they become due (whether at
maturity or otherwise), and (c) such Person is “solvent” or not “insolvent”, as
applicable within the meaning given those terms

 

Schedule 1.1 - Page 14

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and similar terms under applicable laws relating to fraudulent transfers and
conveyances (provided, that this clause (c) shall exclude any definition of
“solvent” or “insolvent” which is defined as at fair valuations, the sum of such
Person’s debts and liabilities (including contingent liabilities) is less than
all of such Person’s assets). For purposes of this definition, the amount of any
contingent liability at any time shall be computed as the amount that, in light
of all of the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured liability
(irrespective of whether such contingent liabilities meet the criteria for
accrual under Statement of Financial Accounting Standard No. 5).

“Subordination Agreement” means the Subordination Agreement, dated of even date
herewith, by and among Agent, the First Lien Agent, the Second Lien Agent,
Borrower and each other obligor party thereto, as the same may be amended,
restated, supplemented or otherwise modified from time to time.

“Subsidiary” of a Person means a corporation, partnership, limited liability
company, or other entity in which that Person directly or indirectly owns or
controls the Equity Interests having ordinary voting power to elect a majority
of the Board of Directors of such corporation, partnership, limited liability
company, or other entity.

“Taxes” means any taxes, levies, imposts, duties, fees, assessments or other
charges of whatever nature now or hereafter imposed by any jurisdiction or by
any political subdivision or taxing authority thereof or therein, and all
interest, penalties or similar liabilities with respect thereto.

“Tax Lender” has the meaning specified therefor in Section 14.2(a) of the
Agreement.

“Term Commitment” means, with respect to each Lender, its Term Commitment, and,
with respect to all Lenders, their Term Commitments, in each case as such Dollar
amounts are set forth beside such Lender’s name under the applicable heading on
Schedule C-1 or in the Assignment and Acceptance pursuant to which such Lender
became a Lender under the Agreement, as such amounts may be reduced or increased
from time to time pursuant to assignments made in accordance with the provisions
of Section 13.1 of the Agreement.

“Term Loan” has the meaning specified therefor in Section 2.2(a) of the
Agreement.

“Term Loan Exposure” means, with respect to any Lender, as of any date of
determination (a) prior to the termination of the Term Commitments, the amount
of such Lender’s Term Commitment, and (b) after the termination of the Term
Commitments, the aggregate outstanding principal amount of the Term Loans of
such Lender.

“United States” means the United States of America.

“Voidable Transfer” has the meaning specified therefor in Section 17.8 of the
Agreement.

 

Schedule 1.1 - Page 15

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Schedule 3.1

The effectiveness of this Agreement is subject to the fulfillment, to the
satisfaction of Agent and each Lender, of each of the following conditions
precedent:

(a) the Closing Date shall occur on or before October 5, 2018;

(b) Agent shall have received each of the following documents, in form and
substance satisfactory to Agent, duly executed and delivered, and each such
document shall be in full force and effect:

(i) this Agreement;

(ii) the Guaranty Agreement;

(iii) the Subordination Agreement;

(iv) the Fee Letter,

(v) the First Lien Amendment, and

(vi) the Second Lien Amendment;

(c) Agent shall have received a certificate from a responsible officer of each
Loan Party:

(i) attesting to the resolutions of such Loan Party’s board of directors
authorizing its execution, delivery, and performance of the Loan Documents to
which it is a party,

(ii) authorizing specific officers of such Loan Party to execute the same,
attesting to the incumbency and signatures of such specific officers of such
Loan Party,

(iii) attesting to copies of each Loan Party’s Governing Documents, as amended,
modified, or supplemented to the Closing Date, which Governing Documents shall
be (A) certified by the responsible officer of such Loan Party, and (B) with
respect to Governing Documents that are charter documents, certified as of a
recent date (not more than 30 days prior to the Closing Date) by the appropriate
governmental official,

(iv) attesting to certificates of status with respect to each Loan Party, dated
within 14 days of the Closing Date, such certificates to be issued by the
appropriate officer of the jurisdiction of organization of such Loan Party,
which certificates shall indicate that such Loan Party is in good standing in
such jurisdiction, and

(v) attesting to certificates of status with respect to each Loan Party, each
dated within 30 days of the Closing Date, such certificates to be issued by the
appropriate officer of the jurisdictions (other than the jurisdiction of
organization of such Loan Party) in which such Loan Party’s failure to be duly
qualified or licensed would constitute a Material Adverse Effect, which
certificates shall indicate that such Loan Party is in good standing in such
jurisdictions;

 

Schedule 3.1 - Page 1

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(d) Since December 31, 2017, there shall not have occurred a Material Adverse
Effect;

(e) Agent shall have received an opinion of the Loan Parties’ counsel in form
and substance satisfactory to Agent;

(f) (i) The Lenders shall have completed their business and legal due diligence,
including (i) review of Borrower’s and its Subsidiaries’ (including the
Clearwater Entities’) books and records and verification of Borrower’s
representations and warranties to Agent and the Lenders, the results of which
shall be satisfactory to the Lenders, (ii) satisfactory review by the Lenders of
all contracts with Federal, state, municipal and governmental agencies, (iii) a
review of Borrower’s and its Subsidiaries’ (including the Clearwater Entities’)
insurance and (iv) a review of (A) a quality of earnings report of Borrower and
its Subsidiaries (including the Clearwater Entities), (B) all Material
Contracts, and (C) all surety bonds, licenses and permits, each of which shall
be satisfactory to the Lenders;

(g) The Lenders shall have received completed reference and background checks
with respect to Borrower’s senior management, the results of which are
satisfactory to the Lenders in their sole discretion;

(h) Borrower shall have paid all Lender Group Expenses incurred in connection
with the transactions contemplated by this Agreement and the other Loan
Documents;

(i) Borrower and each of its Subsidiaries shall have received all licenses,
approvals or evidence of other actions required by any Governmental Authority in
connection with the execution and delivery by Borrower or its Subsidiaries of
the Loan Documents or with the consummation of the transactions contemplated
thereby;

(j) the Clearwater Acquisition shall have been consummated (or shall be
consummated contemporaneously with the making of the Term Loan hereunder) in
accordance with the Clearwater Acquisition Agreement; and

(k) all other documents and legal matters in connection with the transactions
contemplated by this Agreement and the other Loan Documents shall have been
delivered, executed, or recorded and shall be in form and substance satisfactory
to Agent.

 

Schedule 3.1 - Page 2