Document:

Exhibit 4.2

      

      

      FOCUS IMPACT ACQUISITION CORP.

      DESCRIPTION OF SECURITIES

       

      The following summary of the material terms of the securities of Focus Impact Acquisition Corp. (“we, “us,” “our” or “the company”) is not
        intended to be a complete summary of the rights and preferences of such securities and is subject to and qualified by reference to our amended and restated certificate of incorporation incorporated by reference as an exhibit to the company’s Annual
        Report on Form 10-K for the year ended December 31, 2021 (the “Report”), and applicable Delaware law. We urge you to read our amended and restated certificate of incorporation in its entirety for a complete description of the rights and preferences
        of our securities.

       

      Certain Terms

       

      Unless otherwise stated in this exhibit or the context otherwise requires, references to:

       

      	

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              “Auldbrass Partners” are to Auldbrass Partners, L.P., an investment
                  management fund and investor in our sponsor;

            

       

      	

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              “common stock” are to our Class A common stock and our Class B common stock, collectively;

            

       

      	

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              “founder shares” are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to the offering, and the shares of our Class A
                common stock issued upon the conversion thereof;

            

       

      	

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              “initial stockholders” are to holders of our founder shares prior to our initial public offering;

            

       

      	

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              “management” or our “management team” are to our officers and directors, and “directors” are to our current directors;

            

       

      	

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              “private placement warrants” are to the warrants issued to our sponsor in a private placement simultaneously with the closing of the offering;

            

       

      	

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              “public shares” are to shares of our Class A common stock sold as part of the units in the offering (whether they are purchased in our initial public offering or
                thereafter in the open market);

            

       

      	

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              “public stockholders” are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or
                members of our management team purchase public shares, provided that each initial stockholder’s and member of our management team’s status as a “public stockholder” shall only exist with respect to such public shares;

            

       

      	

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              “sponsor” are to Focus Impact Sponsor, LLC, a Delaware limited liability company;

            

       

      	

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              “we,” “us,” “our,” “company,” or “our company” are to Focus Impact Acquisition Corp.

            

       

      Pursuant to our amended and restated certificate of incorporation, our authorized capital stock consists of 500,000,000 shares of Class A
        common stock, $0.0001 par value, 50,000,000 shares of Class B common stock, $0.0001 par value, and 1,000,000 shares of undesignated preferred stock, $0.0001 par value. The following description summarizes the material terms of our capital stock.
        Because it is only a summary, it may not contain all the information that is important to you.

       

      Units

       

      Each unit consists of one whole share of Class A common stock and one-half of one warrant. Each whole warrant entitles the holder thereof
        to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in our final prospectus related to our initial public offering. Pursuant to the warrant agreement, a warrant holder may exercise
        its warrants only for a whole number of shares of Class A common stock. This means that only a whole warrant may be exercised at any given time by a warrant holder. No fractional warrants will be issued upon separation of the units and only whole
        warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant.

       

      
        
          

      

      The Class A common stock and warrants were not traded separately until we filed with the SEC a Current Report on Form 8-K which included an
        audited balance sheet reflecting our receipt of the gross proceeds at the closing of our initial public offering and the sale of the private placement units. We filed a Current Report on Form 8-K which includes this audited balance sheet promptly
        after the completion of our initial public offering.

      

      

      Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial
        business combination.

       

      Common Stock

       

      As of the date of the Report, there were 23,000,000 shares of Class A common stock, par value $0.0001, and 5,750,000 shares of Class B
        common stock, par value $0.0001, were issued and outstanding.

       

      Common stockholders of record are entitled to one vote for each share held on all matters to be voted on by stockholders. Holders of the
        Class A common stock and holders of the Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, except as required by law. Unless specified in our amended and restated certificate of
        incorporation or bylaws, or as required by applicable provisions of the DGCL or applicable stock exchange rules, the affirmative vote of a majority of our shares of common stock that are voted is required to approve any such matter voted on by our
        stockholders. Our board of directors is divided into three classes, each of which will generally serve for a term of three years with only one class of directors being elected in each year. There is no cumulative voting with respect to the election
        of directors, with the result that the holders of more than 50% of the shares voted for the election of directors can elect all of the directors. Our stockholders are entitled to receive ratable dividends when, as and if declared by the board of
        directors out of funds legally available therefor.

       

      Because our amended and restated certificate of incorporation authorizes the issuance of up to 500,000,000 shares of Class A common stock,
        if we were to enter into a business combination, we may (depending on the terms of such a business combination) be required to increase the number of shares of Class A common stock which we are authorized to issue at the same time as our
        stockholders vote on the business combination to the extent we seek stockholder approval in connection with our business combination.

       

      In accordance with Nasdaq corporate governance requirements, we are not required to hold an annual meeting until no later than one year
        after our first fiscal year end following our listing on Nasdaq. Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws, unless such
        election is made by written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business combination, and thus we may not be in compliance with Section
        211(b) of the DGCL, which requires an annual meeting. Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force us to hold one by submitting an
        application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL. Prior to the completion of an initial business combination, any vacancy on the board of directors may be filled by a nominee chosen by holders of a
        majority of our founder shares. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason.

       

      
        
          

      

      We will provide our stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial
        business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination including interest earned on the
        funds held in the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The per-share amount we will distribute
        to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriter. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have
        agreed (i) to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination and a stockholder vote to approve an amendment to our amended and
        restated certificate of incorporation (A) that would modify the substance or timing of our obligation to provide holders of shares of Class A common stock the right to have their shares redeemed in connection with our initial business combination
        or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of our initial public offering or (B) with respect to any other provision relating to the rights of holders of our Class
        A commons stock and (ii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 18 months from the closing of our
        initial public offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame).
        Unlike many blank check companies that hold stockholder votes and conduct proxy solicitations in conjunction with their initial business combinations and provide for related redemptions of public shares for cash upon completion of such initial
        business combinations even when a vote is not required by law, if a stockholder vote is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated
        certificate of incorporation, conduct the redemptions pursuant to the tender offer rules of the SEC, and file tender offer documents with the SEC prior to completing our initial business combination. Our amended and restated certificate of
        incorporation requires these tender offer documents to contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under the SEC’s proxy rules. If, however, a
        stockholder approval of the transaction is required by law, or we decide to obtain stockholder approval for business or other legal reasons, we will, like many blank check companies, offer to redeem shares in conjunction with a proxy solicitation
        pursuant to the proxy rules and not pursuant to the tender offer rules. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the
        business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock
        of the company entitled to vote at such meeting. However, the participation of our sponsor, officers, directors or their affiliates in privately- negotiated transactions (as described in our final prospectus), if any, could result in the approval
        of our business combination even if a majority of our public stockholders vote, or indicate their intention to vote, against such business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock
        voted, non- votes will have no effect on the approval of our business combination once a quorum is obtained. We will give at least 10 days prior written notice of any such meeting, if required, at which a vote shall be taken to approve our business
        combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination.

       

      If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our business
        combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in
        concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares of common stock sold in our initial public offering, which we refer
        to as the Excess Shares. However, we would not be restricting our stockholders’ ability to vote all of their shares (including Excess Shares) for or against our business combination. Our stockholders’ inability to redeem the Excess Shares will
        reduce their influence over our ability to complete our business combination, and such stockholders could suffer a material loss in their investment if they sell such Excess Shares on the open market. Additionally, such stockholders will not
        receive redemption distributions with respect to the Excess Shares if we complete the business combination. And, as a result, such stockholders will continue to hold that number of shares exceeding 15% and, in order to dispose such shares would be
        required to sell their stock in open market transactions, potentially at a loss.

       

      
        
          

      

      If we seek stockholder approval in connection with our business combination, our initial stockholders have agreed to vote their founder
        shares and any public shares purchased during or after our initial public offering in favor of our initial business combination. As a result, in addition to our initial stockholders’ founder shares, we would need 8,625,001, or 37.5%, of the
        23,000,000 public shares sold in our initial public offering to be voted in favor of a transaction (assuming all outstanding shares are voted) in order to have our initial business combination approved. Additionally, each public stockholder may
        elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction (subject to the limitation described in the preceding paragraph).

       

      Pursuant to our amended and restated certificate of incorporation, if we are unable to complete our business combination within 18 months
        from the closing of our initial public offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter subject to lawfully available funds
        therefor, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay
        our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders
        (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of
        directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Our sponsor, officers and directors have entered into a letter agreement
        with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our business combination within 18 months from the closing
        of our initial public offering. However, if our initial stockholders acquire public shares in or after our initial public offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we
        fail to complete our business combination within the prescribed time period.

       

      In the event of a liquidation, dissolution or winding up of the company after a business combination, our stockholders are entitled to
        share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. Our stockholders have no preemptive or other
        subscription rights. There are no sinking fund provisions applicable to the common stock, except that we will provide our stockholders with the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount
        then on deposit in the trust account, upon the completion of our initial business combination, subject to the limitations described herein.

       

      Founder Shares

       

      The founder shares are identical to the shares of Class A common stock included in the units sold in our initial public offering, and holders
        of founder shares have the same stockholder rights as public stockholders, except that (a) the founder shares are subject to certain transfer restrictions, as described in more detail below, (b) our sponsor, officers and directors have entered into
        a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination and a
        stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) that would modify the substance or timing of our obligation to provide holders of shares of Class A common stock the right to have their shares
        redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of our initial public offering or (B) with respect to any
        other provision relating to the rights of holders of our Class A commons stock and (ii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial
        business combination within 18 months from the closing of our initial public offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial
        business combination within the prescribed time frame), (c) the founder shares are shares of our Class B common stock that will automatically convert into shares of our Class A common stock at the time of our initial business combination, or at any
        time prior thereto at the option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein and (d) are entitled to registration rights. If we submit our business combination to our
        public stockholders for a vote, our initial stockholders have agreed to vote any founder shares held by them and any public shares purchased during or after our initial public offering in favor of our initial business combination.

       

      The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business
        combination on a one-for-one basis (subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like), and subject to further adjustment as provided herein. In the case that additional shares of Class A
        common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in the final prospectus and related to the closing of the business combination, the ratio at which shares of Class B common stock shall convert
        into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of
        shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon completion of
        our initial public offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the business combination (excluding any shares or equity-linked securities issued, or to be issued, to any
        seller in the business combination). Holders of founder shares may also elect to convert their shares of Class B common stock into an equal number of shares of Class A common stock, subject to adjustment as provided above, at any time.

       

      
        
          

      

      With certain limited exceptions, the founder shares are not transferable, assignable or salable (except to our officers and directors and
        other persons or entities affiliated with our sponsor, each of whom will be subject to the same transfer restrictions) until the earlier of (A) one year after the completion of our initial business combination or (B) subsequent to our initial
        business combination, (x) if the closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any
        30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our
        stockholders having the right to exchange their shares of common stock for cash, securities or other property.

       

      Prior to our initial business combination, only holders of our founder shares will have the right to vote on the election of directors.
        Holders of our public shares will not be entitled to vote on the election of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the
        board of directors for any reason. These provisions of our amended and restated certificate of incorporation may only be amended by a resolution passed by a majority of our Class B common stock. With respect to any other matter submitted to a vote
        of our stockholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling
        the holder to one vote.

       

      Preferred Stock

       

      Our amended and restated certificate of incorporation provides that shares of preferred stock may be issued from time to time in one or more
        series. Our board of directors is authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable
        to the shares of each series. Our board of directors is able to, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders of the common stock and
        could have anti-takeover effects. The ability of our board of directors to issue preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing
        management. We have no preferred stock outstanding at the date hereof. Although we do not currently intend to issue any shares of preferred stock, we cannot assure you that we will not do so in the future. No shares of preferred stock were issued
        or registered in our initial public offering.

       

      Warrants

       

      Public Stockholders’ Warrants

       

      Each whole warrant entitles the registered holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to
        adjustment as discussed below, at any time commencing on the later of one year from the closing of our initial public offering and 30 days after the completion of our initial business combination, except as discussed in the immediately succeeding
        paragraph. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares of Class A common stock. This means only a whole warrant may be exercised at a given time by a warrant holder. No fractional
        warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will expire five years after the completion of our initial business combination, at 5:00 p.m., New York City time, or earlier upon redemption or
        liquidation.

       

      
        
          

      

      We will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to
        settle such warrant exercise unless a registration statement under the Securities Act with respect to the shares of Class A common stock underlying the warrants is then effective and a prospectus relating thereto is current, subject to our
        satisfying our obligations described below with respect to registration, or a valid exemption from registration is available. No warrant will be exercisable and we will not be obligated to issue a share of Class A common stock upon exercise of a
        warrant unless the share of Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. In the event
        that the conditions in the two immediately preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In no
        event will we be required to net cash settle any warrant. In the event that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit
        solely for the share of Class A common stock underlying such unit.

       

      We have agreed that as soon as practicable, but in no event later than twenty business days after the closing of our initial business
        combination, we will use our commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the shares of Class A common stock issuable upon exercise of the warrants, and we will use
        our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus
        relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement; provided that if our Class A common stock is at the time of any exercise of a warrant not listed on a national
        securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a “cashless basis” in
        accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will use our commercially reasonably efforts to register or qualify the
        shares under applicable blue sky laws to the extent an exemption is not available. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th day after the closing of
        the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a “cashless
        basis” in accordance with Section 3(a)(9) of the Securities Act or another exemption, but we will use our commercially reasonably efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
        In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of shares of Class A
        common stock underlying the warrants, multiplied by the excess of the “fair market value” (defined below) less the exercise price of the warrants by (y) the fair market value and (B) the product of 0.361 and the number of whole warrants being
        exercised by such holder. The “fair market value” as used in this paragraph shall mean the volume weighted average price of the Class A common stock for the 10 trading days ending on the trading day prior to the date on which the notice of exercise
        is received by the warrant agent.

       

      Redemption of warrants when
          the price per share of Class A common stock equals or exceeds $18.00. Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants):

       

      	

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              in whole and not in part;

            

       

      	

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              at a price of $0.01 per warrant;

            

       

      	

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              upon a minimum of 30 days’ prior written notice of redemption to each warrant holder; and

            

       

      	

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              if, and only if, the closing price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon
                exercise or the exercise price of a warrant as described under the heading “— Warrants — Public Stockholders’ Warrants — Anti-dilution Adjustments”) for any 20 trading days within a 30-trading day period ending three trading days before we
                send the notice of redemption to the warrant holders.

            

       

      

      
        
          

      

      We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the
        shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period. If and when the warrants become
        redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.

       

      We have established the last of the redemption criterion discussed above to prevent a redemption call unless there is at the time of the call
        a significant premium to the warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the warrants, each warrant holder will be entitled to exercise his, her or its warrant prior to the scheduled
        redemption date. However, the price of the Class A common stock may fall below the $18.00 redemption trigger price (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the
        heading “— Warrants — Public Stockholders’ Warrants — Anti-dilution Adjustments”) as well as the $11.50 (for whole shares) warrant exercise price after the redemption notice is issued.

       

      Redemption of warrants when
          the price per share of Class A common stock equals or exceeds $10.00. Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants):

       

      	

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              in whole and not in part;

            

       

      	

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              at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior
                to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the “fair market value” of our Class A common stock (as defined below) except as otherwise described below;

            

       

      	

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              if, and only if, the closing price of our Class A common stock equals or exceeds $10.00 per public share (as adjusted for adjustments to the number of shares issuable
                upon exercise or the exercise price of a warrant as described under the heading “— Warrants — Public Stockholders’ Warrants — Anti-dilution Adjustments”) for any 20 trading days within the 30-trading day period ending three trading days
                before we send the notice of redemption to the warrant holders; and

            

       

      	

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              if the closing price of the Class A common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send
                the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “—Warrants — Public
                Stockholders’ Warrants— Anti-dilution Adjustments”), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above.

            

       

      Beginning on the date the notice of redemption is given until the warrants are redeemed or exercised, holders may elect to exercise their
        warrants on a cashless basis. The numbers in the table below represent the number of shares of Class A common stock that a warrant holder will receive upon such cashless exercise in connection with a redemption by us pursuant to this redemption
        feature, based on the “fair market value” of our Class A common stock on the corresponding redemption date (assuming holders elect to exercise their warrants and such warrants are not redeemed for $0.10 per warrant), determined for these purposes
        based on volume weighted average price of our Class A common stock during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants, and the number of months that the corresponding
        redemption date precedes the expiration date of the warrants, each as set forth in the table below. We will provide our warrant holders with the final fair market value no later than one business day after the 10-trading day period described above
        ends.

       

      Pursuant to the warrant agreement, references above to shares of Class A common stock shall include a security other than shares of Class A
        common stock into which the shares of Class A common stock have been converted or exchanged for in the event we are not the surviving company in our initial business combination. The numbers in the table below will not be adjusted when determining
        the number of shares of Class A common stock to be issued upon exercise of the warrants if we are not the surviving entity following our initial business combination.

       

      
        
          

      

      The share prices set forth in the column headings of the table below will be adjusted as of any date on which the number of shares issuable
        upon exercise of a warrant or the exercise price of a warrant is adjusted as set forth under the heading “— Anti-dilution Adjustments” below. If the number of shares issuable upon exercise of a warrant is adjusted, the adjusted share prices in the
        column headings will equal the share prices immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the number of shares deliverable upon exercise of a warrant immediately prior to such adjustment and the
        denominator of which is the number of shares deliverable upon exercise of a warrant as so adjusted. The number of shares in the table below shall be adjusted in the same manner and at the same time as the number of shares issuable upon exercise of
        a warrant. If the exercise price of a warrant is adjusted, (a) in the case of an adjustment pursuant to the fifth paragraph under the heading “— Anti-dilution Adjustments” below, the adjusted share prices in the column headings will equal the
        unadjusted share price multiplied by a fraction, the numerator of which is the higher of the Market Value and the Newly Issued Price as set forth under the heading “— Anti-dilution Adjustments” and the denominator of which is $10.00 and (b) in the
        case of an adjustment pursuant to the second paragraph under the heading “— Anti-dilution Adjustments” below, the adjusted share prices in the column headings will equal the unadjusted share price less the decrease in the exercise price of a
        warrant pursuant to such exercise price adjustment.

      

      

      	
              Redemption Date

            	 	
              Fair Market Value of Class A Common Stock

            	 
	
              (period to expiration of warrants)

            	 	
              ≤$10.00

            	 	 	 	
              11.00

            	 	 	 	
              12.00

            	 	 	 	
              13.00

            	 	 	 	
              14.00

            	 	 	 	
              15.00

            	 	 	 	
              16.00

            	 	 	 	
              17.00

            	 	 	
              ≥18.00

            	 
	
              60 months

            	 	 	
              0.261

            	 	 	 	
              0.281

            	 	 	 	
              0.297

            	 	 	 	
              0.311

            	 	 	 	
              0.324

            	 	 	 	
              0.337

            	 	 	 	
              0.348

            	 	 	 	
              0.358

            	 	 	 	
              0.361

            	 
	
              57 months

            	 	 	
              0.257

            	 	 	 	
              0.277

            	 	 	 	
              0.294

            	 	 	 	
              0.310

            	 	 	 	
              0.324

            	 	 	 	
              0.337

            	 	 	 	
              0.348

            	 	 	 	
              0.358

            	 	 	 	
              0.361

            	 
	
              54 months

            	 	 	
              0.252

            	 	 	 	
              0.272

            	 	 	 	
              0.291

            	 	 	 	
              0.307

            	 	 	 	
              0.322

            	 	 	 	
              0.335

            	 	 	 	
              0.347

            	 	 	 	
              0.357

            	 	 	 	
              0.361

            	 
	
              51 months

            	 	 	
              0.246

            	 	 	 	
              0.268

            	 	 	 	
              0.287

            	 	 	 	
              0.304

            	 	 	 	
              0.320

            	 	 	 	
              0.333

            	 	 	 	
              0.346

            	 	 	 	
              0.357

            	 	 	 	
              0.361

            	 
	
              48 months

            	 	 	
              0.241

            	 	 	 	
              0.263

            	 	 	 	
              0.283

            	 	 	 	
              0.301

            	 	 	 	
              0.317

            	 	 	 	
              0.332

            	 	 	 	
              0.344

            	 	 	 	
              0.356

            	 	 	 	
              0.361

            	 
	
              45 months

            	 	 	
              0.235

            	 	 	 	
              0.258

            	 	 	 	
              0.279

            	 	 	 	
              0.298

            	 	 	 	
              0.315

            	 	 	 	
              0.330

            	 	 	 	
              0.343

            	 	 	 	
              0.356

            	 	 	 	
              0.361

            	 
	
              42 months

            	 	 	
              0.228

            	 	 	 	
              0.252

            	 	 	 	
              0.274

            	 	 	 	
              0.294

            	 	 	 	
              0.312

            	 	 	 	
              0.328

            	 	 	 	
              0.342

            	 	 	 	
              0.355

            	 	 	 	
              0.361

            	 
	
              39 months

            	 	 	
              0.221

            	 	 	 	
              0.246

            	 	 	 	
              0.269

            	 	 	 	
              0.290

            	 	 	 	
              0.309

            	 	 	 	
              0.325

            	 	 	 	
              0.340

            	 	 	 	
              0.354

            	 	 	 	
              0.361

            	 
	
              36 months

            	 	 	
              0.213

            	 	 	 	
              0.239

            	 	 	 	
              0.263

            	 	 	 	
              0.285

            	 	 	 	
              0.305

            	 	 	 	
              0.323

            	 	 	 	
              0.339

            	 	 	 	
              0.353

            	 	 	 	
              0.361

            	 
	
              33 months

            	 	 	
              0.205

            	 	 	 	
              0.232

            	 	 	 	
              0.257

            	 	 	 	
              0.280

            	 	 	 	
              0.301

            	 	 	 	
              0.320

            	 	 	 	
              0.337

            	 	 	 	
              0.352

            	 	 	 	
              0.361

            	 
	
              30 months

            	 	 	
              0.196

            	 	 	 	
              0.224

            	 	 	 	
              0.250

            	 	 	 	
              0.274

            	 	 	 	
              0.297

            	 	 	 	
              0.316

            	 	 	 	
              0.335

            	 	 	 	
              0.351

            	 	 	 	
              0.361

            	 
	
              27 months

            	 	 	
              0.185

            	 	 	 	
              0.214

            	 	 	 	
              0.242

            	 	 	 	
              0.268

            	 	 	 	
              0.291

            	 	 	 	
              0.313

            	 	 	 	
              0.332

            	 	 	 	
              0.350

            	 	 	 	
              0.361

            	 
	
              24 months

            	 	 	
              0.173

            	 	 	 	
              0.204

            	 	 	 	
              0.233

            	 	 	 	
              0.260

            	 	 	 	
              0.285

            	 	 	 	
              0.308

            	 	 	 	
              0.329

            	 	 	 	
              0.348

            	 	 	 	
              0.361

            	 
	
              21 months

            	 	 	
              0.161

            	 	 	 	
              0.193

            	 	 	 	
              0.223

            	 	 	 	
              0.252

            	 	 	 	
              0.279

            	 	 	 	
              0.304

            	 	 	 	
              0.326

            	 	 	 	
              0.347

            	 	 	 	
              0.361

            	 
	
              18 months

            	 	 	
              0.146

            	 	 	 	
              0.179

            	 	 	 	
              0.211

            	 	 	 	
              0.242

            	 	 	 	
              0.271

            	 	 	 	
              0.298

            	 	 	 	
              0.322

            	 	 	 	
              0.345

            	 	 	 	
              0.361

            	 
	
              15 months

            	 	 	
              0.130

            	 	 	 	
              0.164

            	 	 	 	
              0.197

            	 	 	 	
              0.230

            	 	 	 	
              0.262

            	 	 	 	
              0.291

            	 	 	 	
              0.317

            	 	 	 	
              0.342

            	 	 	 	
              0.361

            	 
	
              12 months

            	 	 	
              0.111

            	 	 	 	
              0.146

            	 	 	 	
              0.181

            	 	 	 	
              0.216

            	 	 	 	
              0.250

            	 	 	 	
              0.282

            	 	 	 	
              0.312

            	 	 	 	
              0.339

            	 	 	 	
              0.361

            	 
	
              9 months

            	 	 	
              0.090

            	 	 	 	
              0.125

            	 	 	 	
              0.162

            	 	 	 	
              0.199

            	 	 	 	
              0.237

            	 	 	 	
              0.272

            	 	 	 	
              0.305

            	 	 	 	
              0.336

            	 	 	 	
              0.361

            	 
	
              6 months

            	 	 	
              0.065

            	 	 	 	
              0.099

            	 	 	 	
              0.137

            	 	 	 	
              0.178

            	 	 	 	
              0.219

            	 	 	 	
              0.259

            	 	 	 	
              0.296

            	 	 	 	
              0.331

            	 	 	 	
              0.361

            	 
	
              3 months

            	 	 	
              0.034

            	 	 	 	
              0.065

            	 	 	 	
              0.104

            	 	 	 	
              0.150

            	 	 	 	
              0.197

            	 	 	 	
              0.243

            	 	 	 	
              0.286

            	 	 	 	
              0.326

            	 	 	 	
              0.361

            	 
	
              0 months

            	 	 	
              —

            	 	 	 	
              —

            	 	 	 	
              0.042

            	 	 	 	
              0.115

            	 	 	 	
              0.179

            	 	 	 	
              0.233

            	 	 	 	
              0.281

            	 	 	 	
              0.323

            	 	 	 	
              0.361

            	 

      

      

      The exact fair market value and redemption date may not be set forth in the table above, in which case, if the fair market value is between
        two values in the table or the redemption date is between two redemption dates in the table, the number of shares of Class A common stock to be issued for each warrant exercised will be determined by a straight-line interpolation between the number
        of shares set forth for the higher and lower fair market values and the earlier and later redemption dates, as applicable, based on a 365 or 366-day year, as applicable. For example, if the volume weighted average price of our Class A common stock
        during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of the warrants is $11.00 per share, and at such time there are 57 months until the expiration of the warrants, holders may choose
        to, in connection with this redemption feature, exercise their warrants for 0.277 shares of Class A common stock for each whole warrant. For an example where the exact fair market value and redemption date are not as set forth in the table above,
        if the volume weighted average price of our Class A common stock during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of the warrants is $13.50 per share, and at such time there are 38
        months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.298 shares of Class A common stock for each whole warrant. In no event will the warrants be exercisable on
        a cashless basis in connection with this redemption feature for more than 0.361 shares of Class A common stock per warrant (subject to adjustment). Finally, as reflected in the table above, if the warrants are out of the money and about to expire,
        they cannot be exercised on a cashless basis in connection with a redemption by us pursuant to this redemption feature, since they will not be exercisable for any shares of Class A common stock.

       

      
        
          

      

      This redemption feature differs from the typical warrant redemption features used in many other blank check offerings, which typically only
        provide for a redemption of warrants for cash (other than the private placement warrants) when the trading price for the Class A common stock exceeds $18.00 per share for a specified period of time. This redemption feature is structured to allow
        for all of the outstanding warrants to be redeemed when the Class A common stock is trading at or above $10.00 per public share, which may be at a time when the trading price of our Class A common stock is below the exercise price of the warrants.
        We have established this redemption feature to provide us with the flexibility to redeem the warrants without the warrants having to reach the $18.00 per share threshold set forth above under “— Redemption of warrants when the price per share of
        Class A common stock equals or exceeds $18.00.” Holders choosing to exercise their warrants in connection with a redemption pursuant to this feature will, in effect, receive a number of shares for their warrants based on an option pricing model
        with a fixed volatility input as of the date of the final prospectus. This redemption right provides us with an additional mechanism by which to redeem all of the outstanding warrants, and therefore have certainty as to our capital structure as the
        warrants would no longer be outstanding and would have been exercised or redeemed. We will be required to pay the applicable redemption price to warrant holders if we choose to exercise this redemption right and it will allow us to quickly proceed
        with a redemption of the warrants if we determine it is in our best interest to do so. As such, we would redeem the warrants in this manner when we believe it is in our best interest to update our capital structure to remove the warrants and pay
        the redemption price to the warrant holders.

       

      As stated above, we can redeem the warrants when the Class A common stock is trading at a price starting at $10.00, which is below the
        exercise price of $11.50, because it will provide certainty with respect to our capital structure and cash position while providing warrant holders with the opportunity to exercise their warrants on a cashless basis for the applicable number of
        shares. If we choose to redeem the warrants when the Class A common stock is trading at a price below the exercise price of the warrants, this could result in the warrant holders receiving fewer shares of Class A common stock than they would have
        received if they had chosen to wait to exercise their warrants for shares of Class A common stock if and when the Class A common stock was trading at a price higher than the exercise price of $11.50.

       

      No fractional shares of Class A common stock will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a
        fractional interest in a share, we will round down to the nearest whole number of the number of shares of Class A common stock to be issued to the holder. If, at the time of redemption, the warrants are exercisable for a security other than the
        shares of Class A common stock pursuant to the warrant agreement (for instance, if we are not the surviving company in our initial business combination), the warrants may be exercised for such security. At such time as the warrants become
        exercisable for a security other than the Class A common stock, the Company (or surviving company) will use its commercially reasonable efforts to register under the Securities Act the security issuable upon the exercise of the warrants.

       

      Redemption procedures.

       

      A holder of a warrant may notify us in writing in the event it elects to be subject to a requirement that such holder will not have the right
        to exercise such warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the warrant agent’s actual knowledge, would beneficially own in excess of 9.8% (or such other amount as a
        holder may specify) of the shares of Class A common stock issued and outstanding immediately after giving effect to such exercise.

       

      
        
          

      

      Anti-dilution Adjustments. If the number
        of outstanding shares of Class A common stock is increased by a stock dividend payable in shares of Class A common stock, or by a split-up of shares of Class A common stock or other similar event, then, on the effective date of such stock dividend,
        split-up or similar event, the number of shares of Class A common stock issuable on exercise of each warrant will be increased in proportion to such increase in the outstanding shares of Class A common stock. A rights offering made to all or
        substantially all holders of Class A common stock entitling holders to purchase shares of Class A common stock at a price less than the “historical fair market value” (as defined below) will be deemed a stock dividend of a number of shares of Class
        A common stock equal to the product of (i) the number of shares of Class A common stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for
        shares of Class A common stock) and (ii) one minus the quotient of (x) the price per share of Class A common stock paid in such rights offering and (y) the historical fair market value. For these purposes, (i) if the rights offering is for
        securities convertible into or exercisable for shares of Class A common stock, in determining the price payable for shares of Class A common stock, there will be taken into account any consideration received for such rights, as well as any
        additional amount payable upon exercise or conversion and (ii) “historical fair market value” means the volume weighted average price of the Class A common stock as reported during the 10 trading day period ending on the trading day prior to the
        first date on which the Class A common stock trades on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.

       

      In addition, if we, at any time while the warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities
        or other assets to all or substantially all of the holders of the shares of Class A common stock on account of such shares of Class A common stock (or other securities into which the warrants are convertible), other than (a) as described above, (b)
        any cash dividends or cash distributions which, when combined on a per share basis with all other cash dividends and cash distributions paid on the shares of Class A common stock during the 365-day period ending on the date of declaration of such
        dividend or distribution does not exceed $0.50 (as adjusted to appropriately reflect any other adjustments and excluding cash dividends or cash distributions that resulted in an adjustment to the exercise price or to the number of shares of Class A
        common stock issuable on exercise of each warrant) but only with respect to the amount of the aggregate cash dividends or cash distributions equal to or less than $0.50 per share, (c) to satisfy the redemption rights of the holders of shares of
        Class A common stock in connection with a proposed initial business combination, (d) to satisfy the redemption rights of the holders of shares of Class A common stock in connection with a stockholder vote to amend our amended and restated
        certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of our initial public offering, or (B)
        with respect to any other provisions relating to the rights of holders of our Class A common stock, or (e) in connection with the redemption of our public shares upon our failure to complete our initial business combination, then the warrant
        exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each share of Class A common stock in respect of such
        event.

       

      If the number of outstanding shares of Class A common stock is decreased by a consolidation, combination, reverse stock split or
        reclassification of shares of Class A common stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or similar event, the number of shares of Class A common stock issuable
        on exercise of each warrant will be decreased in proportion to such decrease in outstanding shares of Class A common stock.

       

      Whenever the number of shares of Class A common stock purchasable upon the exercise of the warrants is adjusted, as described above, the
        warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of shares of Class A common stock purchasable upon the exercise of
        the warrants immediately prior to such adjustment and (y) the denominator of which will be the number of shares of Class A common stock so purchasable immediately thereafter.

       

      
        
          

      

      In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection
        with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of
        directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the
        aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business
        combination (net of redemptions), and (z) the volume weighted average trading price of our shares of Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business
        combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share
        redemption trigger price described above under “—Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00” and “— Redemption of warrants when the price per shares of Class A common stock equals or exceeds
        $10.00” will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described above under “— Redemption of warrants when the price per
        share of Class A common stock equals or exceeds $10.00” will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price.

       

      In case of any reclassification or reorganization of the outstanding shares of Class A common stock (other than those described above or that
        solely affects the par value of such shares of Class A common stock), or in the case of any merger or consolidation of us with or into another corporation (other than a consolidation or merger in which we are the continuing corporation and that
        does not result in any reclassification or reorganization of our outstanding shares of Class A common stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of us as an entirety or
        substantially as an entirety in connection with which we are dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of
        the shares of Class A common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of Class A common stock or other securities or property (including cash)
        receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received if such holder had exercised their warrants immediately
        prior to such event. However, if such holders were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or
        other assets for which each warrant will become exercisable will be deemed to be the weighted average of the kind and amount received per share by such holders in such consolidation or merger that affirmatively make such election, and if a tender,
        exchange or redemption offer has been made to and accepted by such holders (other than a tender, exchange or redemption offer made by the company in connection with redemption rights held by stockholders of the company as provided for in the
        company’s amended and restated certificate of incorporation or as a result of the redemption of shares of Class A common stock by the company if a proposed initial business combination is presented to the stockholders of the company for approval)
        under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which such maker is a part, and together with
        any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the
        Exchange Act) more than 50% of the issued and outstanding shares of Class A common stock, the holder of a warrant will be entitled to receive the highest amount of cash, securities or other property to which such holder would actually have been
        entitled as a stockholder if such warrant holder had exercised the warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the shares of Class A common stock held by such holder had been purchased pursuant
        to such tender or exchange offer, subject to adjustment (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in the warrant agreement. If less than 70% of the
        consideration receivable by the holders of shares of Class A common stock in such a transaction is payable in the form of shares of Class A common stock in the successor entity that is listed for trading on a national securities exchange or is
        quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within thirty days following public
        disclosure of such transaction, the warrant exercise price will be reduced as specified in the warrant agreement based on the Black- Scholes value (as defined in the warrant agreement) of the warrant. The purpose of such exercise price reduction is
        to provide additional value to holders of the warrants when an extraordinary transaction occurs during the exercise period of the warrants pursuant to which the holders of the warrants otherwise do not receive the full potential value of the
        warrants. The purpose of such exercise price reduction is to provide additional value to holders of the warrants when an extraordinary transaction occurs during the exercise period of the warrants pursuant to which the holders of the warrants
        otherwise do not receive the full potential value of the warrants.

       

      
        
          

      

      The warrants were issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant
        agent, and us. You should review a copy of the warrant agreement, which is filed as an exhibit to the Report, for a complete description of the terms and conditions applicable to the warrants.

       

      The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder for the purpose of (i) curing
        any ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to the description of the terms of the warrants and the warrant agreement set forth in the final prospectus, or defective provision, (ii) amending
        the provisions relating to cash dividends on shares of common stock as contemplated by and in accordance with the warrant agreement or (iii) adding or changing any provisions with respect to matters or questions arising under the warrant agreement
        as the parties to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered holders of the warrants, provided that the approval by the holders of at least 50% of the
        then-outstanding public warrants is required to make any change that adversely affects the interests of the registered holders of public warrants.

       

      The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant
        agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price (or on a cashless basis, if applicable), by certified or official bank check payable
        to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of Class A common stock and any voting rights until they exercise their warrants and receive shares of Class A common stock.
        After the issuance of shares of Class A common stock upon exercise of the warrants, each holder will be entitled to one (1) vote for each share held of record on all matters to be voted on by stockholders.

       

      No fractional shares will be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a
        fractional interest in a share, we will, upon exercise, round down to the nearest whole number of shares of Class A common stock to be issued to the warrant holder.

       

      We have agreed that, subject to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the
        warrant agreement will be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and we irrevocably submit to such jurisdiction, which jurisdiction will be the
        exclusive forum for any such action, proceeding or claim. This provision applies to claims under the Securities Act but does not apply to claims under the Exchange Act or any claim for which the federal district courts of the United States of
        America are the sole and exclusive forum.

       

      Private Placement Warrants

       

      The private placement warrants (including the Class A common stock issuable upon exercise of the private placement warrants) will not be
        transferable, assignable or saleable until 30 days after the completion of our initial business combination (except, among other limited exceptions as described under the section of the final prospectus entitled “Principal Stockholders —
        Restrictions on Transfers of Founder Shares and Private Placement Warrants,” to our officers and directors and other persons or entities affiliated with our sponsor) and they will not be redeemable under certain redemption scenarios by us so long
        as they are held by our sponsor or its permitted transferees. Otherwise, the private placement warrants have terms and provisions that are identical to those of the warrants being sold as part of the units in our initial public offering, including
        as to exercise price, exercisability and exercise period. If the private placement warrants are held by holders other than the sponsor or its permitted transferees, the private placement warrants will be redeemable by us under all redemption
        scenarios and exercisable by the holders on the same basis as the warrants included in the units sold in our initial public offering.

       

      If holders of the private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering
        their warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the excess of the “fair market value”
        (defined below) over the exercise price of the warrants by (y) the fair market value.

       

      
        
          

      

      The “fair market value” shall mean the average reported closing price of the Class A common stock for the 10 trading days ending on the third
        trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted
        transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited.
        An insider cannot trade in our securities if he or she is in possession of material non-public information.

       

      Accordingly, unlike public stockholders who could sell the shares of Class A common stock issuable upon exercise of the warrants freely in
        the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate.

       

      In order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor
        or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. Such warrants
        would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period.

       

      Our sponsor has agreed not to transfer, assign or sell any of the private placement warrants (including the Class A common stock issuable
        upon exercise of any of these warrants) until the date that is 30 days after the date we complete our initial business combination, except that, among other limited exceptions as described under the section of the final prospectus entitled
        “Principal Stockholders — Restrictions on Transfers of Founder Shares and Private Placement Warrants” made to our officers and directors and other persons or entities affiliated with our sponsor.

       

      Dividends

       

      We have not paid any cash dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of a business
        combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial conditions subsequent to completion of a business combination. The payment of any cash
        dividends subsequent to a business combination will be within the discretion of our board of directors at such time. Our board of directors is not currently contemplating and does not anticipate declaring any stock dividends in the foreseeable
        future. Further, if we incur any indebtedness, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.

       

      Our Transfer Agent and Warrant Agent

       

      The transfer agent for our common stock and warrant agent for our warrants is Continental Stock Transfer & Trust Company. We have agreed
        to indemnify Continental Stock Transfer & Trust Company in its roles as transfer agent and warrant agent, its agents and each of its stockholders, directors, officers and employees against all claims and losses that may arise out of acts
        performed or omitted for its activities in that capacity, except for any liability due to any gross negligence, willful misconduct or bad faith of the indemnified person or entity. Continental Stock Transfer & Trust Company has agreed that it
        has no right of set off or any right, title, interest or claim of any kind to, or to any monies in, the trust account, and has irrevocably waived any right, title, interest or claim of any kind to, or any monies in, the trust account that it may
        have now or in the future. Accordingly, any indemnification provided will only be able to be satisfied, or a claim will only be able to be pursued, solely against us and our assets outside the trust account and not against any monies in the trust
        account or interest earned thereon.

       

      

      
        
          

      

      Our Amended and Restated Certificate of Incorporation.

       

      Provisions Related to Our initial public offering

       

      Our amended and restated certificate of incorporation contains certain requirements and restrictions relating to our initial public offering
        that will apply to us until the completion of our initial business combination. These provisions cannot be amended without the approval of the holders of 65% of our common stock. Our initial stockholders, who will collectively beneficially own 20%
        of our common stock upon the closing of our initial public offering (assuming they do not purchase any units in our initial public offering), will participate in any vote to amend our amended and restated certificate of incorporation and will have
        the discretion to vote in any manner they choose. Specifically, our amended and restated certificate of incorporation provides, among other things, that:

       

      	

            	•	
              if we are unable to complete our initial business combination within 18 months from the closing of our initial public offering, we will (i) cease all operations except
                for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter subject to lawfully available funds therefor, redeem 100% of the public shares, at a per-share price, payable in cash,
                equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to
                pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions,
                if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to
                our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law;

            

       

      	

            	•	
              prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust
                account or (ii) vote as a class with our public shares (a) on our initial business combination or on any other proposal presented to stockholders prior to or in connection with the completion of an initial business combination or (b) to
                approve an amendment to our amended and restated certificate of incorporation to (x) extend the time we have to consummate a business combination beyond 18 months from the closing of our initial public offering or (y) amend the foregoing
                provisions;

            

       

      	

            	•	
              although we do not intend to enter into a business combination with a target business that is affiliated with or related to Auldbrass Partners or our sponsor, officers,
                directors or members of our advisory board we are not prohibited from doing so. In the event we enter into such a transaction, a committee of independent and disinterested directors, will obtain an opinion from an independent investment
                banking firm or another independent entity that commonly renders valuation opinions that such a business combination is fair to our company from a financial point of view;

            

       

      	

            	•	
              if a stockholder vote on our initial business combination is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we
                will offer to redeem our public shares pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, and will file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the
                same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act. Whether or not we maintain our registration under the Exchange Act or our listing
                on Nasdaq, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above;

            

       

      	

            	•	
              our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of our assets held in the
                trust account excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination;

            

       

      	

            	•	
              if our stockholders approve an amendment to our amended and restated certificate of incorporation that would affect the substance or timing of our obligation to redeem
                100% of our public shares if we do not complete our business combination within 18 months from the closing of our initial public offering or with respect to any other provisions relating to the rights of holders of our Class A common stock,
                we will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon such approval at a per- share price, payable in cash, equal to the aggregate amount then on deposit in the
                trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding public shares; and

            

       

      

      
        
          

      

      	

            	•	
              we will not effectuate our initial business combination with another blank check company or a similar company with nominal operations.

            

       

      In addition, our amended and restated certificate of incorporation provides that under no circumstances will we redeem our public shares in
        an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination.

       

      Certain Anti-Takeover Provisions of Delaware Law and Our Amended and Restated Certificate of
        Incorporation and Bylaws

       

      We have opted out of Section 203 of the DGCL. However, our amended and restated certificate of incorporation contains similar provisions
        providing that we may not engage in certain “business combinations” with any “interested stockholder” for a three-year period following the time that the stockholder became an interested stockholder, unless:

       

      	

            	•	
              prior to such time, our board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested
                stockholder;

            

       

      	

            	•	
              upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of our voting
                stock outstanding at the time the transaction commenced, excluding certain shares; or

            

       

      	

            	•	
              at or subsequent to that time, the business combination is approved by our board of directors and by the affirmative vote of holders of at least 66 2⁄3% of the outstanding voting stock that is not owned by the interested stockholder.

            

       

      Generally, a “business combination” includes a merger, asset or stock sale or certain other transactions resulting in a financial benefit to
        the interested stockholder. Subject to certain exceptions, an “interested stockholder” is a person who, together with that person’s affiliates and associates, owns, or within the previous three years owned, 15% or more of our voting stock.

       

      Under certain circumstances, this provision will make it more difficult for a person who would be an “interested stockholder” to effect
        various business combinations with a corporation for a three-year period. This provision may encourage companies interested in acquiring our company to negotiate in advance with our board of directors because the stockholder approval requirement
        would be avoided if our board of directors approves either the business combination or the transaction which results in the stockholder becoming an interested stockholder. These provisions also may have the effect of preventing changes in our board
        of directors and may make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best interests.

       

      Our amended and restated certificate of incorporation provides that our sponsor and its affiliates, any of its direct or indirect transferees
        of at least 15% of our outstanding common stock and any group as to which such persons are party to, do not constitute “interested stockholders” for purposes of this provision.

       

      Our amended and restated certificate of incorporation provides that our board of directors will be classified into three classes of
        directors. As a result, in most circumstances, a person can gain control of our board only by successfully engaging in a proxy contest at two or more annual meetings.

       

      Our authorized but unissued common stock and preferred stock are available for future issuances without stockholder approval and could be
        utilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could render
        more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise.

       

      

      
        
          

      

      Exclusive Forum for Certain Lawsuits

       

      Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum,
        the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for any (1) derivative action or proceeding brought on behalf of our company, (2) action asserting a claim of breach of a
        fiduciary duty owed by any director, officer, employee or agent of our company to our company or our stockholders, or any claim for aiding and abetting any such alleged breach, (3) action asserting a claim against our company or any director or
        officer of our company arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or our bylaws, or (4) action asserting a claim against us or any director or officer of our company governed by the
        internal affairs doctrine except for, as to each of (1) through (4) above, any claim (A) as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the
        indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C)
        arising under the federal securities laws, including the Securities Act as to which the Court of Chancery and the federal district court for the District of Delaware shall concurrently be the sole and exclusive forums. Notwithstanding the
        foregoing, the provisions of this paragraph will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of America shall be the sole and
        exclusive forum. Although we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against
        our directors and officers. Furthermore, the enforceability of choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of
        provisions to be inapplicable or unenforceable.

       

      Special Meeting of Stockholders

       

      Our bylaws provide that special meetings of our stockholders may be called only by a majority vote of our board of directors, by our Chief
        Executive Officer or by our Chairman.

       

      Advance Notice Requirements for Stockholder Proposals and Director Nominations

       

      Our bylaws provide that stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates for
        election as directors at our annual meeting of stockholders, must provide timely notice of their intent in writing. To be timely, a stockholder’s notice will need to be received by the company secretary at our principal executive offices not later
        than the close of business on the 90th day nor earlier than the open of business on the 120th day prior to the anniversary date of the immediately preceding annual meeting of stockholders. Pursuant to Rule 14a-8 of the Exchange Act, proposals
        seeking inclusion in our annual proxy statement must comply with the notice periods contained therein. Our bylaws also specify certain requirements as to the form and content of a stockholders’ meeting. These provisions may preclude our
        stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders.

       

      Action by Written Consent

       

      Any action required or permitted to be taken by our common stockholders must be effected by a duly called annual or special meeting of such
        stockholders and may not be effected by written consent of the stockholders other than with respect to our Class B common stock.

       

      

      
        
          

      

      Classified Board of Directors

       

      Our board of directors is divided into three classes, Class I, Class II and Class III, with members of each class serving staggered
        three-year terms. Our amended and restated certificate of incorporation provides that the authorized number of directors may be changed only by resolution of the board of directors. Subject to the terms of any preferred stock, any or all of the
        directors may be removed from office at any time, but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of our capital stock entitled to vote generally in the election of
        directors, voting together as a single class. Any vacancy on our board of directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office.

       

      Class B Common Stock Consent Right

       

      For so long as any shares of Class B common stock remain outstanding, we may not, without the prior vote or written consent of the holders of
        a majority of the shares of Class B common stock then outstanding, voting separately as a single class, amend, alter or repeal any provision our certificate of incorporation, whether by merger, consolidation or otherwise, if such amendment,
        alteration or repeal would alter or change the powers, preferences or relative, participating, optional or other or special rights of the Class B common stock. Any action required or permitted to be taken at any meeting of the holders of Class B
        common stock may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of the outstanding Class B common stock having not less
        than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of Class B common stock were present and voted.

       

      Securities Eligible For Future Sale

       

      We have 28,750,000 shares of common stock outstanding. Of these shares, the 23,000,000 sold in our initial public offering are freely
        tradable without restriction or further registration under the Securities Act, except for any shares purchased by one of our affiliates within the meaning of Rule 144 under the Securities Act. All of the remaining 5,750,000 shares and all
        11,200,000 private placement warrants are restricted securities under Rule 144, in that they were issued in private transactions not involving a public offering, and the shares of Class B common stock and private placement warrants are subject to
        transfer restrictions as set forth elsewhere in the final prospectus related to our initial public offering. These restricted securities will be subject to registration rights as more fully described below under “— Registration and Stockholder
        Rights.”

       

      Rule 144

       

      Pursuant to Rule 144, a person who has beneficially owned restricted shares of our common stock or warrants for at least six months would be
        entitled to sell their securities provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding, a sale and (ii) we are subject to the Exchange Act periodic reporting
        requirements for at least three months before the sale and have filed all required reports under Section 13 or 15(d) of the Exchange Act during the twelve months (or such shorter period as we were required to file reports) preceding the sale.

       

      Persons who have beneficially owned restricted shares of our common stock or warrants for at least six months but who are our affiliates at
        the time of, or at any time during the three months preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of securities that does not exceed the
        greater of:

       

      	

            	•	
              1% of the total number of shares of common stock then-outstanding, which will equal 287,500 shares immediately after our initial public offering; or

            

       

      	

            	•	
              the average weekly reported trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.

            

       

      

      
        
          

      

      Sales by our affiliates under Rule 144 are also limited by manner of sale provisions and notice requirements and to the availability of
        current public information about us.

       

      Restrictions on the Use of Rule 144 by Shell Companies or Former Shell Companies

       

      Rule 144 is not available for the resale of securities initially issued by shell companies (other than business combination related shell
        companies) or issuers that have been at any time previously a shell company. However, Rule 144 also includes an important exception to this prohibition if the following conditions are met:

       

      	

            	•	
              the issuer of the securities that was formerly a shell company has ceased to be a shell company;

            

       

      	

            	•	
              the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; and

            

       

      	

            	•	
              the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding twelve months (or such shorter
                period that the issuer was required to file such reports and materials), other than Form 8-K reports; and at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status
                as an entity that is not a shell company.

            

       

      As a result, our sponsor will be able to sell its founder shares and private placement warrants, as applicable, pursuant to Rule 144 without
        registration one year after we have completed our initial business combination.

       

      Registration and Stockholder Rights

       

      The holders of the founder shares, private placement warrants and warrants that may be issued upon conversion of working capital loans (and
        any shares of Class A common stock issuable upon the exercise of the private placement warrants and warrants that may be issued upon conversion of working capital loans and upon conversion of the founder shares) are entitled to registration rights
        pursuant to a registration rights and stockholder agreement signed in connection with our initial public offering, requiring us to register such securities for resale (in the case of the founder shares, only after conversion to our Class A common
        stock). The holders of the majority of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to
        registration statements filed subsequent to our completion of our initial business combination and rights to require us to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration and stockholder
        rights agreement provides that we will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable lock-up period, which occurs (i) in the case of the founder shares, on the earlier
        of (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits,
        stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation,
        merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property and (ii) in the case of the private
        placement warrants and the respective Class A common stock underlying such warrants, 30 days after the completion of our initial business combination. We will bear the expenses incurred in connection with the filing of any such registration
        statements.

       

      In addition, pursuant to the registration and stockholder rights agreement, our sponsor, upon consummation of an initial business
        combination, will be entitled to nominate three individuals for election to our board of directors.

       

      Listing of Securities

       

      Our units, Class A common stock and warrants are each traded on the Nasdaq under the symbol “FIACU,” “FIAC” and “FIAC.W,” respectively.exh101-xthirdamendedandr

13305085v8 3/30/2022 11:07 AM 1075.279            THIRD AMENDED AND RESTATED CREDIT AGREEMENT  dated as of  March 31, 2022  among  HF FOODS GROUP INC., B&R GLOBAL HOLDINGS, INC.  and certain of their Affiliates  The Lenders Party Hereto  and  JPMORGAN CHASE BANK, N.A.,  as Administrative Agent  ___________________________  JPMORGAN CHASE BANK, N.A.,  as Sole Bookrunner and Sole Lead Arranger      ASSET BASED LENDING  

 

  -i-  TABLE OF CONTENTS  Page  ARTICLE I DEFINITIONS ....................................................................................................................................... 1  SECTION 1.01 Defined Terms .............................................................................................................. 1  SECTION 1.02 Classification of Loans and Borrowings ..................................................................... 45  SECTION 1.03 Terms Generally ......................................................................................................... 45  SECTION 1.04 Accounting Terms; GAAP .......................................................................................... 45  SECTION 1.05 Interest Rates; Benchmark Notifications .................................................................... 46  SECTION 1.06 Effect of Amendment and Restatement; No Novation; Release ................................. 46  ARTICLE II THE CREDITS ................................................................................................................................... 47  SECTION 2.01 Commitments .............................................................................................................. 47  SECTION 2.02 Loans and Borrowings. ............................................................................................... 48  SECTION 2.03 Requests for Revolving Borrowings ........................................................................... 48  SECTION 2.04 Protective Advances. .................................................................................................. 49  SECTION 2.05 Swingline Loans and Overadvances. .......................................................................... 50  SECTION 2.06 Letters of Credit. ......................................................................................................... 52  SECTION 2.07 Funding of Borrowings. .............................................................................................. 57  SECTION 2.08 Interest Elections......................................................................................................... 58  SECTION 2.09 Termination of Commitments; Increase in Revolving Commitments. ....................... 59  SECTION 2.10 Repayment and Amortization of Loans; Evidence of Debt. ....................................... 60  SECTION 2.11 Prepayment of Loans. ................................................................................................. 61  SECTION 2.12 Fees. ............................................................................................................................ 63  SECTION 2.13 Interest. ....................................................................................................................... 64  SECTION 2.14 Alternate Rate of Interest; Illegality ........................................................................... 65  SECTION 2.15 Increased Costs. .......................................................................................................... 67  SECTION 2.16 Break Funding Payments ............................................................................................ 68  SECTION 2.17 Withholding of Taxes; Gross-Up. ............................................................................... 69  SECTION 2.18 Payments Generally; Allocation of Proceeds; Sharing of Setoffs. ............................. 72  SECTION 2.19 Mitigation Obligations; Replacement of Lenders. ...................................................... 75  SECTION 2.20 Defaulting Lenders ..................................................................................................... 76  SECTION 2.21 Returned Payments ..................................................................................................... 78  SECTION 2.22 Banking Services and Swap Agreements ................................................................... 78  ARTICLE III REPRESENTATIONS AND WARRANTIES. .............................................................................. 78  SECTION 3.01 Organization; Powers .................................................................................................. 78  SECTION 3.02 Authorization; Enforceability ..................................................................................... 78  SECTION 3.03 Governmental Approvals; No Conflicts ..................................................................... 79  SECTION 3.04 Financial Condition; No Material Adverse Change. ................................................... 79  SECTION 3.05 Properties. ................................................................................................................... 79  SECTION 3.06 Litigation and Environmental Matters. ....................................................................... 80  SECTION 3.07 Compliance with Laws and Agreements; No Default ................................................ 80  SECTION 3.08 Investment Company Status ....................................................................................... 80  SECTION 3.09 Taxes ........................................................................................................................... 80  SECTION 3.10 ERISA ......................................................................................................................... 80  SECTION 3.11 Disclosure ................................................................................................................... 81  SECTION 3.12 Material Agreements ................................................................................................... 81  SECTION 3.13 Solvency. .................................................................................................................... 81  SECTION 3.14 Insurance ..................................................................................................................... 81  SECTION 3.15 Capitalization and Subsidiaries ................................................................................... 82  

 

-ii-  SECTION 3.16 Security Interest in Collateral ..................................................................................... 82  SECTION 3.17 Employment Matters................................................................................................... 82  SECTION 3.18 Margin Regulations..................................................................................................... 82  SECTION 3.19 Use of Proceeds .......................................................................................................... 82  SECTION 3.20 No Burdensome Restrictions ...................................................................................... 82  SECTION 3.21 Anti-Corruption Laws and Sanctions.......................................................................... 82  SECTION 3.22 Affiliate Transactions ................................................................................................. 83  SECTION 3.23 Common Enterprise .................................................................................................... 83  SECTION 3.24 Holding Companies .................................................................................................... 83  SECTION 3.25 Agricultural Matters .................................................................................................... 83  SECTION 3.26 [Reserved] .................................................................................................................. 83  SECTION 3.27 [Reserved] .................................................................................................................. 84  SECTION 3.28 Affected Financial Institutions .................................................................................... 84  SECTION 3.29 Plan Assets; Prohibited Transactions .......................................................................... 84  SECTION 3.30 Possible Financial Statement Restatement .................................................................. 84  ARTICLE IV CONDITIONS. .................................................................................................................................. 84  SECTION 4.01 Effective Date ............................................................................................................. 84  SECTION 4.02 Each Credit Event ....................................................................................................... 86  ARTICLE V AFFIRMATIVE COVENANTS. ....................................................................................................... 86  SECTION 5.01 Financial Statements; Borrowing Base and Other Information .................................. 86  SECTION 5.02 Notices of Material Events ......................................................................................... 90  SECTION 5.03 Existence; Conduct of Business .................................................................................. 91  SECTION 5.04 Payment of Obligations .............................................................................................. 91  SECTION 5.05 Maintenance of Properties .......................................................................................... 91  SECTION 5.06 Books and Records; Inspection Rights ....................................................................... 91  SECTION 5.07 Compliance with Laws and Material Contractual Obligations ................................... 92  SECTION 5.08 Use of Proceeds .......................................................................................................... 92  SECTION 5.09 Accuracy of Information ............................................................................................. 92  SECTION 5.10 Insurance ..................................................................................................................... 93  SECTION 5.11 Casualty and Condemnation ....................................................................................... 93  SECTION 5.12 Appraisals ................................................................................................................... 94  SECTION 5.13 Depository Banks ........................................................................................................ 94  SECTION 5.14 Additional Collateral; Further Assurances. ................................................................. 94  SECTION 5.15 Receivables. ................................................................................................................ 95  SECTION 5.16 Inventory and Equipment. ........................................................................................... 95  SECTION 5.17 Agricultural Matters .................................................................................................... 96  SECTION 5.18 Post-Closing Covenant ............................................................................................... 96  ARTICLE VI NEGATIVE COVENANTS. ............................................................................................................ 96  SECTION 6.01 Indebtedness ............................................................................................................... 97  SECTION 6.02 Liens ........................................................................................................................... 99  SECTION 6.03 Fundamental Changes. .............................................................................................. 100  SECTION 6.04 Investments, Loans, Advances, Guarantees and Acquisitions .................................. 101  SECTION 6.05 Asset Sales ................................................................................................................ 103  SECTION 6.06 Sale and Leaseback Transactions.............................................................................. 104  SECTION 6.07 Swap Agreements ..................................................................................................... 104  SECTION 6.08 Restricted Payments; Certain Payments of Indebtedness. ........................................ 105  SECTION 6.09 Transactions with Affiliates ...................................................................................... 107  SECTION 6.10 Restrictive Agreements ............................................................................................. 107  SECTION 6.11 Amendment of Material Documents ......................................................................... 108  

 

-iii-  SECTION 6.12 [Reserved]. ............................................................................................................... 108  SECTION 6.13 Fixed Charge Coverage Ratio ................................................................................... 108  ARTICLE VII EVENTS OF DEFAULT. .............................................................................................................. 108  ARTICLE VIII THE ADMINISTRATIVE AGENT. .......................................................................................... 111  SECTION 8.01 Authorization and Action .......................................................................................... 111  SECTION 8.02 Administrative Agent's Reliance, Indemnification, Etc. ........................................... 113  SECTION 8.03 Posting of Communications. ..................................................................................... 114  SECTION 8.04 The Administrative Agent Individually .................................................................... 115  SECTION 8.05 Successor Administrative Agent. .............................................................................. 116  SECTION 8.06 Acknowledgements of Lenders and Issuing Bank. ................................................... 117  SECTION 8.07 Collateral Matters. .................................................................................................... 118  SECTION 8.08 Credit Bidding........................................................................................................... 119  SECTION 8.09 Certain ERISA Matters. ............................................................................................ 120  SECTION 8.10 Flood Laws ............................................................................................................... 121  ARTICLE IX MISCELLANEOUS. ....................................................................................................................... 121  SECTION 9.01 Notices. ..................................................................................................................... 121  SECTION 9.02 Waivers; Amendments. ............................................................................................. 123  SECTION 9.03 Expenses; Indemnity; Damage Waiver. .................................................................... 125  SECTION 9.04 Successors and Assigns. ........................................................................................... 127  SECTION 9.05 Survival ..................................................................................................................... 131  SECTION 9.06 Counterparts; Integration; Effectiveness; Electronic Execution. .............................. 131  SECTION 9.07 Severability ............................................................................................................... 131  SECTION 9.08 Right of Setoff .......................................................................................................... 131  SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process. .................................. 132  SECTION 9.10 WAIVER OF JURY TRIAL ..................................................................................... 133  SECTION 9.11 Headings ................................................................................................................... 133  SECTION 9.12 Confidentiality .......................................................................................................... 133  SECTION 9.13 Several Obligations; Nonreliance; Violation of Law ................................................ 134  SECTION 9.14 USA PATRIOT Act .................................................................................................. 134  SECTION 9.15 Disclosure ................................................................................................................. 134  SECTION 9.16 Appointment for Perfection ...................................................................................... 134  SECTION 9.17 Interest Rate Limitation ............................................................................................ 135  SECTION 9.18 Marketing Consent .................................................................................................... 135  SECTION 9.19 Acknowledgement and Consent to Bail-In of Affected Financial Institutions ......... 135  SECTION 9.20 No Fiduciary Duty, etc. ............................................................................................. 135  SECTION 9.21 Hazard Insurance Disclosure .................................................................................... 136  SECTION 9.22 Acknowledgement Regarding Any Supported QFCs ............................................... 136  SECTION 9.23 Reaffirmation ............................................................................................................ 137  ARTICLE X LOAN GUARANTY ......................................................................................................................... 137  SECTION 10.01 Guaranty ................................................................................................................... 137  SECTION 10.02 Guaranty of Payment ................................................................................................. 138  SECTION 10.03 No Discharge or Diminishment of Loan Guaranty. ................................................... 138  SECTION 10.04 Defenses Waived ....................................................................................................... 138  SECTION 10.05 Rights of Subrogation ................................................................................................ 139  SECTION 10.06 Reinstatement; Stay of Acceleration .......................................................................... 139  SECTION 10.07 Information ............................................................................................................... 139  SECTION 10.08 Termination ............................................................................................................... 139  SECTION 10.09 Taxes ......................................................................................................................... 139  SECTION 10.10 Maximum Liability .................................................................................................... 140  

 

-iv-  SECTION 10.11 Contribution. ............................................................................................................. 140  SECTION 10.12 Liability Cumulative ................................................................................................. 140  SECTION 10.13 Keepwell ................................................................................................................... 141  SECTION 10.14 Waivers of Other Rights and Defenses ..................................................................... 141  ARTICLE XI THE BORROWER REPRESENTATIVE. ................................................................................... 142  SECTION 11.01 Appointment; Nature of Relationship ....................................................................... 142  SECTION 11.02 Powers ....................................................................................................................... 142  SECTION 11.03 Employment of Agents ............................................................................................. 142  SECTION 11.04 Notices ...................................................................................................................... 142  SECTION 11.05 Successor Borrower Representative ......................................................................... 142  SECTION 11.06 Execution of Loan Documents; Borrowing Base Certificate.................................... 142  SECTION 11.07 Reporting .................................................................................................................. 143       

 

-v-  SCHEDULES:  Commitment Schedule  Schedule 1.1(a) -- Working Capital Borrowers  Schedule 1.1(b) -- Real Estate Borrowers  Schedule 1.01 -- Eligible Real Property  Schedule 3.05  -- Properties  Schedule 3.06  -- Disclosed Matters  Schedule 3.12 -- Material Agreements  Schedule 3.14  -- Insurance  Schedule 3.15  --  Capitalization and Subsidiaries   Schedule 3.22  --  Affiliate Transactions  Schedule 3.25  --  Agricultural Matters  Schedule 6.01  --  Existing Indebtedness  Schedule 6.02  --  Existing Liens  Schedule 6.04  --  Existing Investments  Schedule 6.10  --  Existing Restrictions        EXHIBITS:  Exhibit A -- Form of Assignment and Assumption  Exhibit B -- [reserved]  Exhibit C --  Form of Borrowing Base Certificate  Exhibit D  --  Form of Compliance Certificate  Exhibit E  --  Joinder Agreement  Exhibit F-1  --  U.S. Tax Certificate (For Foreign Lenders that are not Partnerships for U.S.  Federal Income Tax Purposes)  Exhibit F-2  --  U.S. Tax Certificate (For Foreign Participants that are not Partnerships for U.S.  Federal Income Tax Purposes)  Exhibit F-3  --  U.S. Tax Certificate (For Foreign Participants that are Partnerships for U.S.  Federal Income Tax Purposes)  Exhibit F-4  --  U.S. Tax Certificate (For Foreign that are Partnerships for U.S. Federal Income  Tax Purposes)  Exhibit G  --  Closing Checklist  

 

  -1-  THIRD AMENDED AND RESTATED CREDIT AGREEMENT dated as of March 31, 2022 (as  it may be amended or modified from time to time, this "Agreement") among each of the entities set forth  on Schedule 1.1(a) (collectively referred to as the "Working Capital Borrowers"), each of the entities set  forth on Schedule 1.1(b) (collectively referred to as the "Real Estate Borrowers"; the Working Capital  Borrowers, together with the Real Estate Borrowers, collectively referred to as the "Borrowers" and each  individually a "Borrower"), the other Loan Parties party hereto, the Lenders party hereto, and JPMORGAN  CHASE BANK, N.A., as Administrative Agent.  WHEREAS, Administrative Agent and certain of the Borrowers are party to the Existing Credit  Agreement (as defined below) dated as of the Second Amendment and Restatement Date (as defined  below); and  WHEREAS, the parties hereto and to the Existing Credit Agreement intend that (i) this Agreement  amend and restate in its entirety the Existing Credit Agreement and (ii) the Existing Obligations (as defined  below) owing under the Existing Credit Agreement shall continue to exist under, and be evidenced by, this  Agreement;  THEREFORE, the parties hereto further agree as follows:  ARTICLE I    Definitions  SECTION 1.01 Defined Terms.  As used in this Agreement, the following terms have the  meanings specified below:  "Account" has the meaning assigned to such term in the Security Agreement.  "Account Debtor" means any Person obligated on an Account.  "Acquired Majority Owned Subsidiary" means a Subsidiary acquired by a Loan Party after the  Effective Date pursuant to a Permitted Acquisition and as to which the Loan Parties own more than 50%  but less than 100% of the Equity Interests thereof.  "Acquisition" means any transaction, or any series of related transactions, consummated on or after  the Effective Date, by which any Loan Party (a) acquires any going business or all or substantially all of  the assets of any Person, whether through purchase of assets, merger or otherwise or (b) directly or  indirectly acquires (in one transaction or as the most recent transaction in a series of transactions) at least a  majority (in number of votes) of the Equity Interests of a Person which has ordinary voting power for the  election of managers, directors or other similar management personnel of a Person (other than Equity  Interests having such power only by reason of the happening of a contingency) or a majority of the  outstanding Equity Interests of a Person.  "Additional Term Loan" has the meaning assigned to such term in Section 2.01(b).  "Adjusted Daily Simple SOFR" means an interest rate per annum equal to (a) the Daily Simple  SOFR, plus (b) 0.10%; provided that if the Adjusted Daily Simple SOFR as so determined would be less  than the Floor, such rate shall be deemed to be equal to the Floor for the purposes of this Agreement.  "Adjusted REVSOFR30 Rate" (i) means an interest rate per annum equal to (a) the REVSOFR30  Rate plus (b) 0.10%; provided that (x) if the Adjusted REVSOFR30 Rate as so determined would be less  than the Floor, such rate shall be deemed to be equal to the Floor for the purposes of this Agreement and  

 

-2-  (y) if the REVSOFR30 Rate shall not be available, then the Adjusted REVSOFR30 Rate shall be equal to  the CB Floating Rate (unless an alternate rate is established in accordance with Section 2.14); and (ii) when  used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such  Borrowing, are bearing interest at a rate determined by reference to the Adjusted REVSOFR30 Rate.  "Adjusted Term SOFR Rate" means, for any Interest Period, an interest rate per annum equal to  (a) the Term SOFR Rate for such Interest Period, plus (b) 0.10%; provided that if the Adjusted Term SOFR  Rate as so determined would be less than the Floor, such rate shall be deemed to be equal to the Floor for  the purposes of this Agreement.  "Administrative Agent" means JPMorgan Chase Bank, N.A., in its capacity as administrative agent  for the Lenders hereunder.  "Administrative Questionnaire" means an Administrative Questionnaire in a form supplied by the  Administrative Agent.  "Affected Financial Institution" means (a) any EEA Financial Institution or (b) any UK Financial  Institution.  "Affiliate" means, with respect to a specified Person, another Person that directly, or indirectly  through one or more intermediaries, Controls or is Controlled by or is under common Control with the  specified Person.  "Affiliate Loans" means loans and advances made by HF Foods to any Affiliate that is not a  Subsidiary.  "Agricultural Claims" means outstanding payables of the Loan Parties relating to purchases by any  Loan Party of Inventory consisting of farm products that are secured by FSA Liens or State Agricultural  Liens, or that are subject to the PACA Trust.  "Agent Indemnitee" has the meaning assigned to it in Section 9.03(c).  "Aggregate Credit Exposure" means, at any time, the aggregate Credit Exposure of all the Lenders  at such time.  "Aggregate Revolving Commitment" means, at any time, the aggregate of the Revolving  Commitments of all of the Lenders, as increased or reduced from time to time pursuant to the terms and  conditions hereof.  As of the Effective Date, the Aggregate Revolving Commitment is $100,000,000.  "Aggregate Revolving Exposure" means, at any time, the aggregate Revolving Exposure of all the  Lenders at such time.  "Anti-Corruption Laws" means all laws, rules, and regulations of any jurisdiction applicable to any  Loan Party or any of its Subsidiaries from time to time concerning or relating to bribery or corruption.  "Applicable Parties" has the meaning assigned to it in Section 8.03(c).  "Applicable Percentage" means, with respect to any Lender, (a) with respect to Revolving Loans,  LC Exposure, Overadvances or Swingline Loans, a percentage equal to a fraction the numerator of which  is such Lender's Revolving Commitment and the denominator of which is the Aggregate Revolving  Commitment (provided that, if the Revolving Commitments have terminated or expired, the Applicable  Percentages shall be determined based upon such Lender's share of the Aggregate Revolving Exposure at  

 

-3-  that time), (b) with respect to the Term A Loan, a percentage equal to a fraction the numerator of which is  the aggregate outstanding principal amount of the Term A Loan of such Term A Lender and the  denominator of which is the aggregate outstanding principal amount of the Term A Loan of all Term A  Lenders, (c) with respect to the Term B Loan, a percentage equal to a fraction the numerator of which is  the aggregate outstanding principal amount of the Term B Loan of such Term B Lender and the denominator  of which is the aggregate outstanding principal amount of the Term B Loan of all Term B Lenders, and  (d) with respect to Protective Advances or with respect to the Aggregate Credit Exposure, a percentage  based upon its share of the Aggregate Credit Exposure and the unused Commitments; provided that, in  accordance with Section 2.20, so long as any Lender shall be a Defaulting Lender, such Defaulting Lender's  Commitment shall be disregarded in the calculations under clauses (a) and (c) above.    "Applicable Rate" means, for any day, with respect to any Loan, or with respect to the commitment  fees payable hereunder, as the case may be, the applicable rate per annum set forth below under the  applicable caption below:  Revolving Loans: REVSOFR30 Rate Loans  CB Floating Rate Loans  Term SOFR Rate Loans  1.375%  -(1.125)%  1.375%  Term A Loan:  REVSOFR30 Rate Loans  CB Floating Rate Loans  Term SOFR Rate Loans  1.875%  -(0.625)%  1.875%  Term B Loan:  REVSOFR30 Rate Loans  CB Floating Rate Loans  Term SOFR Rate Loans  1.875%  -(0.625)%  1.875%  Commitment Fee:  0.15%    "Approved Electronic Platform" has the meaning assigned to it in Section 8.03(a).  "Approved Fund" has the meaning assigned to such term in Section 9.04.  "Arranger" means JPMorgan Chase Bank, N.A., in its capacity as sole bookrunner and sole lead  arranger hereunder.  "Assignment and Assumption" means an assignment and assumption agreement entered into by a  Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and  accepted by the Administrative Agent, in the form of Exhibit A or any other form (including electronic  records generated by the use of an electronic platform) approved by the Administrative Agent.  "Availability" means, at any time, an amount equal to (a) the lesser of (i) the Aggregate Revolving  Commitment and (ii) the Borrowing Base minus (b) the Aggregate Revolving Exposure.  "Availability Period" means the period from and including the Effective Date to but excluding the  earlier of the Maturity Date and the date of termination of the Commitments.  "Available Revolving Commitment" means, at any time, the Aggregate Revolving Commitment  minus the Aggregate Revolving Exposure.  "Available Tenor" means, as of any date of determination and with respect to the then-current  Benchmark, as applicable, any tenor for such Benchmark (or component thereof) or payment period for  interest calculated with reference to such Benchmark (or component thereof), as applicable, that is or may  

 

-4-  be used for determining the length of an Interest Period for any term rate or otherwise, for determining any  frequency of making payments of interest calculated pursuant to this Agreement as of such date and not  including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the  definition of "Interest Period" pursuant to clause (e) of Section 2.14.  "B&R" means B&R Global Holdings, Inc., a Delaware corporation.  "B&R Realty" means B&R Group Realty Holding LLC, a Delaware limited liability company.  "B&R Realty Seller Note" means, that certain Unsecured Subordinated Promissory Note dated as  of the Second Amendment and Restatement Date issued to B&R Realty by B&R with a ten year term in  the initial principal amount of $7,000,000, as in effect on the Effective Date or as modified in accordance  with the terms of the B&R Realty Subordination Agreement.  "B&R Realty Subordination Agreement" means that certain Subordination and Intercreditor  Agreement dated as of the Second Amendment and Restatement Date by and among B&R Realty, B&R  and Administrative Agent, as the same may be amended, restated, supplemented or otherwise modified  from time to time.  "Bail-In Action" means the exercise of any Write-Down and Conversion Powers by the applicable  EEA Resolution Authority in respect of any liability of an Affected Financial Institution.  "Bail-In Legislation" means (a) with respect to any EEA Member Country implementing Article  55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the  implementing law for such EEA Member Country from time to time which is described in the EU Bail-In  Legislation Schedule and (b) with respect to the United Kingdom,  Part I of the United Kingdom Banking  Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United  Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial  institutions or their affiliates (other than through liquidation, administration or other insolvency  proceedings).  "Banking Services" means each and any of the following bank services provided to any Loan Party  by any Lender or any of its Affiliates: (a) credit cards for commercial customers (including, without  limitation, "commercial credit cards" and purchasing cards), (b) stored value cards, (c) merchant processing  services, (d) treasury management services (including, without limitation, controlled disbursement,  automated clearinghouse transactions, return items, overdrafts, cash pooling services, and interstate  depository network services), and (e) Lease Financing.  "Banking Services Obligations" means any and all obligations of the Loan Parties, whether absolute  or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all  renewals, extensions and modifications thereof and substitutions therefor) in connection with Banking  Services.  "Banking Services Reserves" means all Reserves which the Administrative Agent from time to  time establishes in its Permitted Discretion for Banking Services then provided or outstanding.  "Bankruptcy Code" means Title 11 of the United States Code entitled "Bankruptcy", as now and  hereafter in effect, or any successor statute.  "Bankruptcy Event" means, with respect to any Person, when such Person becomes the subject of  a voluntary or involuntary bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee,  administrator, custodian, assignee for the benefit of creditors or similar Person charged with the  

 

-5-  reorganization or liquidation of its business, appointed for it, or, in the good faith determination of the  Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or  acquiescence in, any such proceeding or appointment or has had any order for relief in such proceeding  entered in respect thereof, provided that a Bankruptcy Event shall not result solely by virtue of any  ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental  Authority or instrumentality thereof, unless such  ownership interest results in or provides such Person with  immunity from the jurisdiction of courts within the U.S. or from the enforcement of judgments or writs of  attachment on its assets or permits such Person (or such Governmental Authority or instrumentality), to  reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.  "Basel III" – means:  (a) the agreements on capital requirements, a leverage ratio and liquidity standards contained  in "Basel III: A global regulatory framework for more resilient banks and banking systems", "Basel III:  International framework for liquidity risk measurement, standards and monitoring" and "Guidance for  national authorities operating the countercyclical capital buffer" published by the Basel Committee on  Banking Supervision in December 2010, each as amended, supplemented or restated;  (b) the rules for global systemically important banks contained in "Global systemically  important banks: assessment methodology and the additional loss absorbency requirement – Rules text"  published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented  or restated; and  (c) any further guidance or standards published by the Basel Committee on Banking  Supervision relating to "Basel III".  "Benchmark" means, initially, with respect to (i) any Term Benchmark Loan, the Term SOFR Rate  and (ii) any Adjusted REVSOFR30 Rate Loan, the REVSOFR30 Rate; provided that if a Benchmark  Transition Event and the related Benchmark Replacement Date have occurred with respect to the Term  SOFR Rate, the REVSOFR30 Rate or the then-current Benchmark, then "Benchmark" means the applicable  Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior  benchmark rate pursuant to clause (b) of Section 2.14.  "Benchmark Replacement" means, for any Available Tenor, the first alternative set forth in the  order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement  Date:  (1) the Adjusted Daily Simple SOFR;  (2) the sum of: (a) the alternate benchmark rate that has been selected by the Administrative  Agent and the Borrower Representative as the replacement for the then-current Benchmark for the  applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a  replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental  Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a  replacement for the then-current Benchmark for dollar-denominated syndicated credit facilities at such time  in the United States and (b) the related Benchmark Replacement Adjustment.  If the Benchmark Replacement as determined pursuant to clause (1) or (2) above would be less  than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this  Agreement and the other Loan Documents.  

 

-6-  "Benchmark Replacement Adjustment" means, with respect to any replacement of the then-current  Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available  Tenor for any setting of such Unadjusted Benchmark Replacement, the spread adjustment, or method for  calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that  has been selected by the Administrative Agent and the Borrower Representative for the applicable  Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread  adjustment, or method for calculating or determining such spread adjustment, for the replacement of such  Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body  on the applicable Benchmark Replacement Date and/or (ii) any evolving or then-prevailing market  convention for determining a spread adjustment, or method for calculating or determining such spread  adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark  Replacement for dollar-denominated syndicated credit facilities at such time.  "Benchmark Replacement Conforming Changes" means, with respect to any Benchmark  Replacement, any Term Benchmark Loan, and/or any Adjusted REVSOFR30 Rate Loan any technical,  administrative or operational changes (including changes to the definition of "CB Floating Rate," the  definition of "Business Day," the definition of "U.S. Government Securities Business Day," the definition  of "Interest Period," timing and frequency of determining rates and making payments of interest, timing of  borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the  applicability of breakage provisions, and other technical, administrative or operational matters) that the  Administrative Agent decides may be appropriate to reflect the adoption and implementation of such  Benchmark and to permit the administration thereof by the Administrative Agent in a manner substantially  consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such  market practice is not administratively feasible or if the Administrative Agent determines that no market  practice for the administration of such Benchmark exists, in such other manner of administration as the  Administrative Agent decides is reasonably necessary in connection with the administration of this  Agreement and the other Loan Documents).  "Benchmark Replacement Date" means, with respect to any Benchmark, the earliest to occur of the  following events with respect to such then-current Benchmark:  (1) in the case of clause (1) or (2) of the definition of "Benchmark Transition Event," the later  of (a) the date of the public statement or publication of information referenced therein and (b) the date on  which the administrator of such Benchmark (or the published component used in the calculation thereof)  permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component  thereof); or  (2) in the case of clause (3) of the definition of "Benchmark Transition Event," the first date  on which such Benchmark (or the published component used in the calculation thereof) has been determined  and announced by the regulatory supervisor for the administrator of such Benchmark (or such component  thereof) to be no longer representative; provided, that such non-representativeness will be determined by  reference to the most recent statement or publication referenced in such clause (3) and even if any Available  Tenor of such Benchmark (or such component thereof) continues to be provided on such date.  For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs  on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark  Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and  (ii) the "Benchmark Replacement Date" will be deemed to have occurred in the case of clause (1) or (2)  with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with  respect to all then-current Available Tenors of such Benchmark (or the published component used in the  calculation thereof).   

 

-7-  "Benchmark Transition Event" means, with respect to any Benchmark, the occurrence of one or  more of the following events with respect to such then-current Benchmark:  (1) a public statement or publication of information by or on behalf of the administrator of  such Benchmark (or the published component used in the calculation thereof) announcing that such  administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such  component thereof), permanently or indefinitely, provided that, at the time of such statement or publication,  there is no successor administrator that will continue to provide any Available Tenor of such Benchmark  (or such component thereof);   (2) a public statement or publication of information by the regulatory supervisor for the  administrator of such Benchmark (or the published component used in the calculation thereof), the Federal  Reserve Board, the NYFRB, the CME Term SOFR Administrator, an insolvency official with jurisdiction  over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction  over the administrator for such Benchmark (or such component) or a court or an entity with similar  insolvency or resolution authority over the administrator for such Benchmark (or such component), in each  case, which states that the administrator of such Benchmark (or such component) has ceased or will cease  to provide all Available Tenors of such Benchmark (or such component thereof) permanently or  indefinitely; provided that, at the time of such statement or publication, there is no successor administrator  that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or  (3) a public statement or publication of information by the regulatory supervisor for the  administrator of such Benchmark (or the published component used in the calculation thereof) announcing  that all Available Tenors of such Benchmark (or such component thereof) are no longer, or as of a specified  future date will no longer be, representative.  For the avoidance of doubt, a "Benchmark Transition Event" will be deemed to have occurred with  respect to any Benchmark if a public statement or publication of information set forth above has occurred  with respect to each then-current Available Tenor of such Benchmark (or the published component used in  the calculation thereof).  "Benchmark Unavailability Period" means, with respect to any Benchmark, the period (if any)  (x) beginning at the time that a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition  has occurred if, at such time, no Benchmark Replacement has replaced such then-current Benchmark for  all purposes hereunder and under any Loan Document in accordance with Section 2.14 and (y) ending at  the time that a Benchmark Replacement has replaced such then-current Benchmark for all purposes  hereunder and under any Loan Document in accordance with Section 2.14.  "Beneficial Ownership Certification" means a certification regarding beneficial ownership or  control as required by the Beneficial Ownership Regulation.  "Beneficial Ownership Regulation" means 31 C.F.R. § 1010.230.  "Benefit Plan" means any of (a) an "employee benefit plan" (as defined in Section 3(3) of ERISA)  that is subject to Title I of ERISA, (b) a "plan" as defined in Section 4975 of the Code to which Section  4975 of the Code applies, and (c) any Person whose assets include (for purposes of the Plan Asset  Regulations or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any  such "employee benefit plan" or "plan".  "BHC Act Affiliate" of a party means an "affiliate" (as such term is defined under, and interpreted  in accordance with, 12 U.S.C. 1841(k)) of such party.  

 

-8-  "Borrower" or "Borrowers" has the meaning assigned to such term in the preamble hereto.  "Borrower Representative" has the meaning assigned to such term in Section 11.01.  "Borrowing" means (a) Revolving Loans of the same Type, made, converted or continued on the  same date and, in the case of Term Benchmark Loans, as to which a single Interest Period is in effect, (b) a  portion of the Term A Loan of the same Type, converted or continued on the same date and, in the case of  Term Benchmark Loans, as to which a single Interest Period is in effect, (c) a portion of the Term B Loan  of the same Type, converted or continued on the same date and, in the case of Term Benchmark Loans, as  to which a single Interest Period is in effect, (d) a Swingline Loan, (e) a Protective Advance and (f) an  Overadvance.  "Borrowing Base" means, at any time, the sum of (a) 85% of Eligible Accounts at such time, plus  (b) the lesser of (i) 65% of Eligible Inventory, at such time, valued at the lower of cost or market value,  determined on a first-in-first-out basis and (ii) the product of 85% multiplied by the Net Orderly Liquidation  Value percentage identified in the most recent Inventory appraisal ordered by the Administrative Agent  multiplied by Eligible Inventory, valued at the lower of cost or market value, determined on a first-in-first- out basis; provided, that until the Administrative Agent obtains an initial appraisal with respect to the  Inventory of Great Wall Illinois, Great Wall Texas and Great Wall Virginia, clause (b) with respect to the  Inventory of Great Wall Illinois, Great Wall Texas and Great Wall Virginia shall be equal to 65% of Eligible  Inventory of Great Wall Illinois, Great Wall Texas and Great Wall Virginia, valued at the lower of cost or  market value, determined on a first-in-first-out basis, plus (c) the Special Advance Amount, minus  (d) Reserves.  The Administrative Agent may, in its Permitted Discretion, reduce the advance rates set forth  above, adjust Reserves or reduce one or more of the other elements used in computing the Borrowing Base.  "Borrowing Base Certificate" means a certificate, signed and certified as accurate and complete by  a Financial Officer of the Borrower Representative, which shows the consolidated and consolidating  Borrowing Base of the Working Capital Borrowers and which is in substantially the form of Exhibit C or  another in substantially the form of Exhibit C or another form which is acceptable to the Administrative  Agent in its sole discretion.  "Borrowing Request" means a request by the Borrower Representative for a Revolving Borrowing  in accordance with Section 2.03.  "Burdensome Restrictions" means any consensual encumbrance or restriction of the type described  in clause (a) or (b) of Section 6.10.  "Business Day" means any day that is not a Saturday, Sunday or other day on which commercial  banks in New York City are authorized or required by law to remain closed; provided that, in relation to  RFR Loans and any interest rate settings, fundings, disbursements, settlements or payments of any such  RFR Loan, or any other dealings of such RFR Loan, any such day that is only an U.S. Government  Securities Business Day.  "Capital" means Capital Trading, LLC, a Utah limited liability company.  "Capital Expenditures" means, without duplication, any expenditure or commitment to expend  money for any purchase or other acquisition of any asset which would be classified as a fixed or capital  asset on a consolidated balance sheet of HF Foods and its Subsidiaries prepared in accordance with GAAP.  "Capital Lease Obligations" of any Person means the obligations of such Person to pay rent or other  amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or  a combination thereof, which obligations are required to be classified and accounted for as capital leases or  

 

-9-  financing leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall  be the capitalized amount thereof determined in accordance with GAAP.  "CB Floating Rate" means the greater of the Prime Rate or 2.5%.  Any change in the CB Floating  Rate due to a change in the Prime Rate shall be effective from and including the effective date of such  change in the Prime Rate.  "CBFR", when used in reference to: (a) a rate of interest, refers to the Adjusted REVSOFR30 Rate,  unless the Adjusted REVSOFR30 Rate shall not be available at such time, then it refers to the CB Floating  Rate, and (b) any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such  Borrowing, bear interest at a rate determined by reference to the Adjusted REVSOFR30 Rate or the CB  Floating Rate.  "Change in Control" means (a) occupation at any time of a majority of the seats (other than vacant  seats) on the board of directors of HF Foods by Persons who were not (i) directors (or equivalent managers)  of HF Foods on the date of this Agreement, nominated, appointed or approved for consideration by  shareholders for election by the board of directors (or equivalent managers) of HF Foods (ii) approved by  the board of directors (or equivalent managers) of HF Foods as director (or equivalent manager) candidates  prior to their election, nor (iii) appointed by directors (or equivalent managers) so nominated, appointed or  approved; (b) HF Foods shall cease to own, directly or indirectly, free and clear of all Liens or other  encumbrances, 100% of the outstanding voting Equity Interests of each of its Subsidiaries (other than  Ocean West, Monterey, Min Food, HF Industrial, SynGlobal, Irwindale, any Acquired Majority Owned  Subsidiary and other than any Subsidiary that has been dissolved to the extent such dissolution is permitted  hereunder) on a fully diluted basis; (c) HF Foods shall cease to own, directly or indirectly, free and clear of  all Liens or other encumbrances, the percentage of the outstanding voting Equity Interests of Ocean West,  Monterey, Min Food, SynGlobal or HF Industrial owned by HF Foods on the Effective Date, on a fully  diluted basis, unless any such Subsidiary is dissolved to the extent such dissolution is permitted hereunder;  (d) (1) prior to the Irwindale Sale, HF Foods shall cease to own, directly or indirectly, free and clear of all  Liens or other encumbrances, 100% of the outstanding voting Equity Interests of Irwindale and  (2) following the Irwindale Sale, HF Foods shall cease to own, directly or indirectly, free and clear of all  Liens or other encumbrances, the percentage of the outstanding voting Equity Interests of Irwindale owned  by HF Foods on the Irwindale Sale Date, on a fully diluted basis, unless Irwindale is dissolved to the extent  such dissolution is permitted hereunder; (e) HF Foods shall cease to own, directly or indirectly, free and  clear of all Liens or other encumbrances, the percentage of the outstanding voting Equity Interests of any  Acquired Majority Owned Subsidiary owned by HF Foods on the date of the acquisition by HF Foods of  such Acquired Majority Owned Subsidiary, unless any such Acquired Majority Owned Subsidiary is  dissolved to the extent such dissolution is permitted hereunder; or (f) the acquisition of ownership, directly  or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities  Exchange Act of 1934 and the rules of the SEC thereunder as in effect on the date hereof), of Equity Interests  representing more than 30% of the aggregate ordinary voting power represented by the issued and  outstanding Equity Interests of the HF Foods; provided that one or more unaffiliated persons shall not be  deemed to have acquired any Equity Interests beneficially owned by the other persons such to be considered  a "group" solely by virtue of taking concerted actions relating to an offering of Equity Interests by HF Foods  if (x) the purchase of Equity Interests is not made with the purpose nor with the effect of changing or  influencing control of HF Foods and (y) there is no agreement among, or between such unaffiliated persons  requiring them to vote or otherwise act together with respect to the securities of HF Foods (except for the  sole purpose of facilitating the specific offering by HF Foods).  "Change in Law" means the occurrence after the date of this Agreement (or, with respect to any  Lender, such later date on which such Lender becomes a party to this Agreement) of any of the following:  (a) the adoption of or taking effect of any law, rule, regulation or treaty; (b) any change in any law, rule,  regulation or treaty or in the administration, interpretation, implementation or application thereof by any  

 

-10-  Governmental Authority; or (c) compliance by any Lender or the Issuing Bank (or, for purposes of  Section 2.15(b), by any lending office of such Lender or by such Lender's or the Issuing Bank's holding  company, if any) with any request, guideline, requirement or directive (whether or not having the force of  law) of any Governmental Authority made or issued after the date of this Agreement; provided that  notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer  Protection Act and all requests, rules, guidelines, requirements or directives thereunder or issued in  connection therewith or in the implementation thereof, and (y) all requests, rules, guidelines, requirements  or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking  Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in  each case pursuant to Basel III, shall in each case be deemed to be a "Change in Law", regardless of the  date enacted, adopted, issued or implemented.  "Charges" has the meaning assigned to such term in Section 9.17.  "Chase Equipment Debt" means Indebtedness of B&R, Logistics, Rongcheng, Mountain and  Capital to Chase Equipment Lender in connection with the financing of certain Equipment from time to  time, pursuant to and in accordance with the Chase Equipment Debt Documents.  "Chase Equipment Debt Documents" means, collectively, the certain Master Loan and Security  Agreement dated as of February 23, 2018 by and among Chase Equipment Lender, B&R, Logistics,  Rongcheng, Mountain and Capital, and all other agreements, instruments and documents delivered in  connection therewith, and all amendments, restatements, supplements or other modifications thereto, in  each case in form and substance acceptable to Chase Equipment Lender.  "Chase Equipment Lender" means JPMorgan Chase Bank, N.A. as equipment lender under the  Chase Equipment Debt Documents.  "Class", when used in reference to any Loan or Borrowing, refers to whether such Loan, or the  Loans comprising such Borrowing, are Revolving Loans, the Term A Loan, the Term B Loan, Swingline  Loans, Protective Advances or Overadvances.  "CME Term SOFR Administrator" means CME Group Benchmark Administration Limited as  administrator of the forward-looking term SOFR (or a successor administrator).  "Code" means the Internal Revenue Code of 1986, as amended from time to time.  "Collateral" means any and all property owned, leased or operated by a Person covered by the  Collateral Documents and any and all other property of any Loan Party, now existing or hereafter acquired,  that may at any time be, become or be intended to be, subject to a security interest or Lien in favor of the  Administrative Agent, on behalf of itself and the Secured Parties, to secure the Secured Obligations.  "Collateral Access Agreement" has the meaning assigned to such term in the Security Agreement.  "Collateral Deposit Account" has the meaning assigned to such term in the Security Agreement.  "Collateral Documents" means, collectively, the Security Agreement, the Mortgages and any other  agreements, instruments and documents executed in connection with this Agreement, the Original Credit  Agreement, the Prior Credit Agreement or the Existing Credit Agreement that are intended to create, perfect  or evidence Liens to secure the Secured Obligations, including, without limitation, all other security  agreements, pledge agreements, mortgages, deeds of trust, loan agreements, notes, guarantees,  subordination agreements, pledges, powers of attorney, consents, assignments, contracts, fee letters,  notices, leases, financing statements and all other written matter whether heretofore, now or hereafter  

 

-11-  executed by any Loan Party and delivered to the Administrative Agent, as each of the same have been or  may hereafter be amended, restated, supplemented or otherwise modified from time to time.  "Collection Account" has the meaning assigned to such term in the Security Agreement.  "Commercial LC Exposure" means, at any time, the sum of (a) the aggregate undrawn amount of  all outstanding commercial Letters of Credit plus (b) the aggregate amount of all LC Disbursements relating  to commercial Letters of Credit that have not yet been reimbursed by or on behalf of the Working Capital  Borrowers.  The Commercial LC Exposure of any Revolving Lender at any time shall be its Applicable  Percentage of the aggregate Commercial LC Exposure at such time.  "Commitment" means, with respect to each Lender, the sum of such Lender's Revolving  Commitment, Term A Loan Commitment and Term B Loan Commitment, together with the commitment  of such Lender to acquire participations in Protective Advances hereunder.  The initial amount of each  Lender's Commitment is set forth on the Commitment Schedule, or in the Assignment and Assumption or  other documentation or record (as such term is defined in Section 9-102(a)(70) of the New York Uniform  Commercial Code) as provided in Section 9.04(b)(ii)(C), pursuant to which such Lender shall have assumed  its Commitment, as applicable.  "Commitment Schedule" means the Schedule attached hereto identified as such.  "Commodity Exchange Act" means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as  amended from time to time, and any successor statute.  "Communications" has the meaning assigned to such term in Section 8.03(c).  "Compliance Certificate" means a certificate of a Financial Officer of the Borrower Representative  in substantially the form of Exhibit D.  "Connection Income Taxes" means Other Connection Taxes that are imposed on or measured by  net income (however denominated) or that are franchise Taxes or branch profits Taxes.  "Consolidated Subsidiaries" means, with respect to any Person (the "parent") at any date, any  corporation, limited liability company, partnership, association or other entity the accounts of which would  be consolidated with those of the parent in the parent's consolidated financial statements if such financial  statements were prepared in accordance with GAAP as of such date.  "Control" means the possession, directly or indirectly, of the power to direct or cause the direction  of the management or policies of a Person, whether through the ability to exercise voting power, by contract  or otherwise.  "Controlling" and "Controlled" have meanings correlative thereto.  "Controlled Disbursement Account" means any account of the Working Capital Borrowers  maintained with the Administrative Agent as a zero balance, cash management account pursuant to and  under any agreement between a Working Capital Borrower and the Administrative Agent, as modified and  amended from time to time, and through which all disbursements of a Working Capital Borrower are made  and settled on a daily basis with no uninvested balance remaining overnight.  "Corresponding Tenor" with respect to any Available Tenor means, as applicable, either a tenor  (including overnight) or an interest payment period having approximately the same length (disregarding  business day adjustment) as such Available Tenor.  

 

-12-  "Covered Entity" means any of the following:  (i) a "covered entity" as that term is defined in, and interpreted in accordance with, 12 C.F.R.  § 252.82(b);  (ii) a "covered bank" as that term is defined in, and interpreted in accordance with, 12 C.F.R.  § 47.3(b); or  (iii) a "covered FSI" as that term is defined in, and interpreted in accordance with, 12 C.F.R. §  382.2(b).  "Credit Exposure" means, as to any Lender at any time, the sum of (a) such Lender's Revolving  Exposure at such time, plus (b) an amount equal to the aggregate principal amount of its Term A Loan  outstanding at such time, plus (c) an amount equal to the aggregate principal amount of its Term B Loan  outstanding at such time.  "Credit Party" means the Administrative Agent, the Issuing Bank, the Swingline Lender or any  other Lender.  "Daily Simple SOFR" means, for any day (a "SOFR Rate Day"), a rate per annum equal to SOFR  for the day (such day "SOFR Determination Date") that is five (5) U.S. Government Securities Business  Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate  Day or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government  Securities Business Day immediately preceding such SOFR Rate Day, in each case, as such SOFR is  published by the SOFR Administrator on the SOFR Administrator's Website.  Any change in Daily Simple  SOFR due to a change in SOFR shall be effective from and including the effective date of such change in  SOFR without notice to the Borrowers.  "DDA Access Product" means the bank service provided to any Working Capital Borrower by  JPMCB in its sole discretion consisting of direct access to schedule payments from the Funding Account  by electronic, internet or other access mechanisms that may be agreed upon from time to time by JPMCB  and the funding of such payments under the Loan Borrowing Option in the DDA Access Product  Agreement.  "DDA Access Product Agreement" means JPMCB's Treasury Services End of Day Investment &  Loan Sweep Service Terms, as in effect on the date of this Agreement, as the same may be amended from  time to time.  "Default" means any event or condition which constitutes an Event of Default or which upon notice,  lapse of time or both would, unless cured or waived, become an Event of Default.  "Default Right" has the meaning assigned to that term in, and shall be interpreted in accordance  with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.  "Defaulting Lender" means any Lender that (a) has failed, within two Business Days of the date  required to be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations  in Letters of Credit or Swingline Loans or (iii) pay over to any Credit Party any other amount required to  be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies the Administrative  Agent in writing that such failure is the result of such Lender's good faith determination that a condition  precedent  to funding (specifically identified and including the particular Default, if any) has not been  satisfied; (b) has notified any Borrower or any Credit Party in writing, or has made a public statement, to  the effect that it does not intend or expect to comply with any of its funding obligations under this  

 

-13-  Agreement (unless such writing or public statement indicates that such position is based on such Lender's  good faith determination that a condition precedent (specifically identified and including the particular  Default, if any) to funding a Loan under this Agreement cannot be satisfied) or generally under other  agreements in which it commits to extend credit, (c) has failed, within three Business Days after request by  a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such  Lender that it will comply with its obligations (and is financially able to meet such obligations as of the  date of certification) to fund prospective Loans and participations in then outstanding Letters of Credit and  Swingline Loans under this Agreement, provided that such Lender shall cease to be a Defaulting Lender  pursuant to this clause (c) upon such Credit Party's receipt of such certification in form and substance  satisfactory to it and the Administrative Agent, or (d) has become the subject of (i) a Bankruptcy Event or  (ii) a Bail-In Action.  "Disclosed Matters" means the actions, suits, proceedings, investigations and environmental  matters disclosed in Schedule 3.06.  "Disposition" or "Dispose" means the sale, transfer, license, lease or other disposition (in one  transaction or in a series of transactions and whether effected pursuant to a Division or otherwise) of any  property by any Person (including any sale and leaseback transaction and any issuance of Equity Interests  by a Subsidiary of such Person), including any sale, assignment, transfer or other disposal, with or without  recourse, of any notes or accounts receivable or any rights and claims associated therewith.  "Dividing Person" has the meaning assigned to it in the definition of "Division."  "Division" means the division of the assets, liabilities and/or obligations of a Person (the "Dividing  Person") among two or more Persons (whether pursuant to a "plan of division" or similar arrangement),  which may or may not include the Dividing Person and pursuant to which the Dividing Person may or may  not survive.  "Division Successor" means any Person that, upon the consummation of a Division of a Dividing  Person, holds all or any portion of the assets, liabilities and/or obligations previously held by such Dividing  Person immediately prior to the consummation of such Division.  A Dividing Person which retains any of  its assets, liabilities and/or obligations after a Division shall be deemed a Division Successor upon the  occurrence of such Division.  "Document" has the meaning assigned to such term in the Security Agreement.  "dollars" or "$" refers to lawful money of the U.S.  "Domestic Subsidiary" means a Subsidiary organized under the laws of a jurisdiction located in the  U.S.  "EBITDA" means, for any period, Net Income for such period plus (a) without duplication and to  the extent deducted in determining Net Income for such period, the sum of (i) Interest Expense for such  period, (ii) income tax expense for such period, (iii) all amounts attributable to depreciation and  amortization expense for such period, (iv) any extraordinary charges for such period, (v) any other non- cash charges for such period (but excluding any non-cash charge in respect of an item that was included in  Net Income in a prior period) and (vi) legal expenses incurred in connection with any and all investigations  (whether internal to HF Foods or generated by any Governmental Authority or securities market operator)  and litigation that arise out of or are related to the allegations published on March 23, 2020 by Hindenburg  Research as they appear at the website https://hindenburgresearch.com/hf-foods/ (the "Hindenburg  Claims"), in an aggregate amount not to exceed 15% of EBITDA (calculated before giving effect to any  such addback for such period) as of the end of each fiscal quarter of HF Foods for the four fiscal quarter  

 

-14-  period then ended, minus (b) without duplication and to the extent included in Net Income, any  extraordinary gains and any non-cash items of income for such period, all calculated for HF Foods and its  Subsidiaries on a consolidated basis in accordance with GAAP.  Notwithstanding the foregoing, in no event  shall EBITDA attributable to Subsidiaries that are not wholly owned by HF Foods (including Acquired  Majority Owned Subsidiaries) ("Majority EBITDA") for any period exceed 10% of aggregate EBITDA of  HF Foods and its Subsidiaries for such period (calculated prior to including Majority EBITDA in such  determination).  "ECP" means an "eligible contract participant" as defined in Section 1(a)(18) of the Commodity  Exchange Act or any regulations promulgated thereunder and the applicable rules issued by the Commodity  Futures Trading Commission and/or the SEC.  "EEA Financial Institution" means (a) any institution established in any EEA Member Country  which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA  Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any  institution established in an EEA Member Country which is a subsidiary of an institution described in  clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.  "EEA Member Country" means any of the member states of the European Union, Iceland,  Liechtenstein, and Norway.  "EEA Resolution Authority" means any public administrative authority or any Person entrusted  with public administrative authority of any EEA Member Country (including any delegee) having  responsibility for the resolution of any EEA Financial Institution.  "Effective Date" means the date on which the conditions specified in Section 4.01 are satisfied (or  waived in accordance with Section 9.02).  "Electronic Signature" means an electronic sound, symbol, or process attached to, or associated  with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such  contract or record.  "Electronic System" means any electronic system, including e-mail, e-fax, web portal access for  such Borrower and any other Internet or extranet-based site, whether such electronic system is owned,  operated or hosted by the Administrative Agent or any Issuing Bank and any of its respective Related Parties  or any other Person, providing for access to data protected by passcodes or other security system.  "Eligible Accounts" means, at any time, the Accounts of a Working Capital Borrower which the  Administrative Agent determines in its Permitted Discretion are eligible as the basis for the extension of  Revolving Loans and Swingline Loans and the issuance of Letters of Credit hereunder.  Without limiting  the Administrative Agent's discretion provided herein, Eligible Accounts shall not include any Account of  a Working Capital Borrower:  (a) which is not subject to a first priority perfected Lien in favor of the Administrative  Agent;  (b) which is subject to any Lien other than (i) a Lien in favor of the Administrative  Agent and (ii) a Permitted Encumbrance which does not have priority over the Lien in favor of the  Administrative Agent;  (c) (i) with respect to which the scheduled due date is more than 90 days after the date  of the original invoice therefor, (ii) which is unpaid more than 90 days after the date of the original invoice  

 

-15-  therefor or more than 60 days after the original due date therefor, or (iii) which has been written off the  books of such Working Capital Borrower or otherwise designated as uncollectible;  (d) which is owing by an Account Debtor for which more than 50% of the Accounts  owing from such Account Debtor and its Affiliates are ineligible hereunder;  (e) which is owing by an Account Debtor to the extent the aggregate amount of  Accounts owing from such Account Debtor and its Affiliates to such Working Capital Borrower exceeds  25% of the aggregate amount of Eligible Accounts;  (f) with respect to which any covenant, representation or warranty contained in this  Agreement or in the Security Agreement has been breached or is not true;  (g) which (i) does not arise from the sale of goods or performance of services in the  ordinary course of business, (ii) is not evidenced by an invoice or other documentation satisfactory to the  Administrative Agent which has been sent to the Account Debtor, (iii) represents a progress billing, (iv) is  contingent upon such Working Capital Borrower's completion of any further performance, (v) represents a  sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment, cash-on-delivery  or any other repurchase or return basis or (vi) relates to payments of interest;  (h) for which the goods giving rise to such Account have not been shipped to the  Account Debtor or for which the services giving rise to such Account have not been performed by such  Working Capital Borrower or if such Account was invoiced more than once;  (i) with respect to which any check or other instrument of payment has been returned  uncollected for any reason;  (j) which is owed by an Account Debtor which has (i) applied for, suffered, or  consented to the appointment of any receiver, custodian, trustee, or liquidator of its assets, (ii) had  possession of all or a material part of its property taken by any receiver, custodian, trustee or liquidator,  (iii) filed, or had filed against it, any request or petition for liquidation, reorganization, arrangement,  adjustment of debts, adjudication as bankrupt, winding-up, or voluntary or involuntary case under any state  or federal bankruptcy laws, (iv) admitted in writing its inability, or is generally unable to, pay its debts as  they become due, (v) become insolvent, or (vi) ceased operation of its business;  (k) which is owed by any Account Debtor which has sold all or substantially all of its  assets;  (l) which is owed by an Account Debtor which (i) does not maintain its chief  executive office in the U.S. (including any territory thereof) or Canada or (ii) is not organized under  applicable law of the U.S., any state of the U.S., or the District of Columbia, Canada, or any province of  Canada unless, in any such case, such Account is backed by a letter of credit acceptable to the  Administrative Agent which is in the possession of, and is directly drawable by, the Administrative Agent;  (m) which is owed in any currency other than dollars;  (n) which is owed by (i) any government (or any department, agency, public  corporation, or instrumentality thereof) of any country other than the U.S. unless such Account is backed  by a letter of credit acceptable to the Administrative Agent which is in the possession of, and is directly  drawable by, the Administrative Agent, or (ii) any government of the U.S., or any department, agency,  public corporation, or instrumentality thereof, unless the Federal Assignment of Claims Act of 1940, as  amended (31 U.S.C. § 3727 et seq. and 41 U.S.C. § 15 et seq.), and any other steps necessary to perfect the  

 

-16-  Lien of the Administrative Agent in such Account have been complied with to the Administrative Agent's  satisfaction;  (o) which is owed by any Affiliate of any Loan Party or any employee, officer,  manager, director, agent, member or other equityholder of any Loan Party or any of its Affiliates;  (p) which is evidenced by an invoice as to which partial payment has been made by  the Account Debtor, except for up to $2,000,000 in the aggregate of "short-pay" Accounts that are paid  pursuant to arrangements between the applicable Working Capital Borrower and the Account Debtor;  (q) which is owed by an Account Debtor or any Affiliate of such Account Debtor to  which such Working Capital Borrower is indebted, but only to the extent of such indebtedness, or is subject  to any security, deposit, progress payment, retainage or other similar advance made by or for the benefit of  an Account Debtor, in each case to the extent thereof;  (r) which is subject to any counterclaim, deduction, defense, setoff or dispute but only  to the extent thereof;  (s) which is evidenced by any promissory note, chattel paper or instrument;  (t) with respect to which such Working Capital Borrower has made any agreement  with the Account Debtor for any reduction thereof, other than discounts and adjustments given in the  ordinary course of business, or any Account which was partially paid and such Working Capital Borrower  created a new receivable for the unpaid portion of such Account;   (u) which does not comply in all material respects with the requirements of all  applicable laws and regulations, whether Federal, state or local, including without limitation the Federal  Consumer Credit Protection Act, the Federal Truth in Lending Act and Regulation Z of the Federal Reserve  Board;  (v) which is for goods that have been sold under a purchase order or pursuant to the  terms of a contract or other agreement or understanding (written or oral) that indicates or purports that any  Person other than such Working Capital Borrower has or has had an ownership interest in such goods, or  which indicates any party other than such Working Capital Borrower as payee or remittance party; or  (w) which the Administrative Agent determines may not be paid by reason of the  Account Debtor's inability to pay or which the Administrative Agent otherwise determines is unacceptable  for any reason whatsoever.  In the event that an Account of a Working Capital Borrower which was previously an Eligible Account  ceases to be an Eligible Account hereunder, such Working Capital Borrower or the Borrower  Representative shall notify the Administrative Agent thereof on and at the time of submission to the  Administrative Agent of the next Borrowing Base Certificate.  In determining the amount of an Eligible  Account of a Working Capital Borrower, the face amount of an Account may, in the Administrative Agent's  Permitted Discretion, be reduced by, without duplication, to the extent not reflected in such face amount,  (i) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program  allowances, price adjustments, finance charges or other allowances (including any amount that such  Working Capital Borrower may be obligated to rebate to an Account Debtor pursuant to the terms of any  agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect  of such Account but not yet applied by such Working Capital Borrower to reduce the amount of such  Account.  

 

-17-  "Eligible Inventory" means, at any time, the Inventory of a Working Capital Borrower which the  Administrative Agent determines in its Permitted Discretion is eligible as the basis for the extension of  Revolving Loans and Swingline Loans and the issuance of Letters of Credit hereunder.  Without limiting  the Administrative Agent's discretion provided herein, Eligible Inventory of a Working Capital Borrower  shall not include any Inventory:  (a) which is not subject to a first priority perfected Lien in favor of the Administrative  Agent;  (b) which is subject to any Lien other than (i) a Lien in favor of the Administrative  Agent and (ii) a Permitted Encumbrance which does not have priority over the Lien in favor of the  Administrative Agent;  (c) which is, in the Administrative Agent's opinion, slow moving, obsolete,  unmerchantable, defective, used, unfit for sale, not salable at prices approximating at least the cost  of such Inventory in the ordinary course of business or unacceptable due to age, type, category  and/or quantity;  (d) with respect to which any covenant, representation or warranty contained in this  Agreement or in the Security Agreement has been breached or is not true and which does not  conform to all standards imposed by any Governmental Authority;  (e) in which any Person other than such Working Capital Borrower shall (i) have any  direct or indirect ownership, interest or title or (ii) be indicated on any purchase order or invoice  with respect to such Inventory as having or purporting to have an interest therein;  (f) which is not finished goods or which constitutes work-in-process, raw materials,  spare or replacement parts, subassemblies, packaging and shipping material, manufacturing  supplies, samples, prototypes, displays or display items, bill-and-hold or ship-in-place goods, goods  that are returned or marked for return, repossessed goods, defective or damaged goods, goods held  on consignment, or goods which are not of a type held for sale in the ordinary course of business;  (g) which is not located in the U.S. or is in transit with a common carrier from vendors  and suppliers;  (h) which is located in any location leased by such Working Capital Borrower unless  (A) (i) the lessor has delivered to the Administrative Agent a Collateral Access Agreement or (ii) a  Reserve for rent, charges and other amounts due or to become due with respect to such facility has  been established by the Administrative Agent in its Permitted Discretion and (B) at least $100,000  of Inventory of the Borrowers is located at such location;  (i) which is located in any third party warehouse or is in the possession of a bailee  (other than a third party processor) and is not evidenced by a Document, unless (A) (i) such  warehouseman or bailee has delivered to the Administrative Agent a Collateral Access Agreement  and such other documentation as the Administrative Agent may require or (ii) an appropriate  Reserve has been established by the Administrative Agent in its Permitted Discretion and (B) at  least $100,000 of Inventory of the Borrowers is located at such third party warehouse or in  possession of such bailee;  (j) which is being processed offsite at a third party location or outside processor, or is  in-transit to or from such third party location or outside processor;   

 

-18-  (k) which is a discontinued product or component thereof;   (l) which is the subject of a consignment by such Working Capital Borrower as  consignor;  (m) which is perishable;  (n) which consists of frozen food products that (i) have expired, (ii) are within 30 days  prior to their expiration date, or (iii) have aged more than 12 months;  (o) which contains or bears any intellectual property rights licensed to such Working  Capital Borrower unless the Administrative Agent is satisfied that it may sell or otherwise dispose  of such Inventory without (i) infringing the rights of such licensor, (ii) violating any contract with  such licensor, or (iii) incurring any liability with respect to payment of royalties other than royalties  incurred pursuant to sale of such Inventory under the current licensing agreement;  (p) which is not reflected in a current perpetual inventory report of such Working  Capital Borrower;  (q) for which reclamation rights have been asserted by the seller;  (r) which has been acquired from a Sanctioned Person; or  (s) which the Administrative Agent otherwise determines is unacceptable for any  reason whatsoever.  In the event that Inventory of a Working Capital Borrower which was previously Eligible Inventory  ceases to be Eligible Inventory hereunder, such Working Capital Borrower or the Borrower Representative  shall notify the Administrative Agent thereof on and at the time of submission to the Administrative Agent  of the next Borrowing Base Certificate.  "Eligible Real Property" means the real property owned by a Real Estate Borrower on the Effective  Date that is listed on Schedule 1.01 and that meets all of the following requirements:  (a) such Real Estate Borrower has good title to such real property;  (b) such real property is the subject of a fair market value appraisal conducted within the  60 day period prior to the Effective Date at the Administrative Agent's request by an appraiser satisfactory  to the Administrative Agent; and  (c) such Real Estate Borrower has the right to subject such real property to a Lien in favor of  the Administrative Agent; such real property is subject to a first priority perfected Lien in favor of the  Administrative Agent and is free and clear of all other Liens of any nature whatsoever (except for Permitted  Encumbrances that do not have priority over the Lien in favor of the Administrative Agent).  "Environmental Laws" means all laws, rules, regulations, codes, ordinances, orders, decrees,  judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any  Governmental Authority, relating in any way to (a) the environment, (b) preservation or reclamation of  natural resources, (c) the management, Release or threatened Release of any Hazardous Material or  (d) health and safety matters.  

 

-19-  "Environmental Liability" means any liability, contingent or otherwise (including any liability for  damages, costs of environmental remediation, fines, penalties or indemnities), of any Loan Party or  Subsidiary directly or indirectly resulting from or based upon (a) any violation of any Environmental Law,  (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials,  (c) any exposure to any Hazardous Materials, (d) the Release or threatened Release of any Hazardous  Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to  which liability is assumed or imposed with respect to any of the foregoing.  "Equipment" has the meaning assigned to such term in the Security Agreement.  "Equity Interests " means shares of capital stock, partnership interests, membership interests in a  limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and  any warrants, options or other rights entitling the holder thereof to purchase or acquire any of the foregoing,  but excluding any debt securities convertible into any of the foregoing.  "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to  time, and the rules and regulations promulgated thereunder.  "ERISA Affiliate" means any trade or business (whether or not incorporated) that, together with  any Loan Party, is treated as a single employer under Section 414(b) or (c) of the Code or Section 4001(14)  of ERISA or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a  single employer under Section 414 of the Code.  "ERISA Event" means (a) any "reportable event", as defined in Section 4043 of ERISA or the  regulations issued thereunder, with respect to a Plan (other than an event for which the 30-day notice period  is waived); (b) the failure to satisfy the "minimum funding standard" (as defined in Section 412 of the Code  or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or  Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to  any Plan; (d) the incurrence by any Loan Party or any ERISA Affiliate of any liability under Title IV of  ERISA with respect to the termination of any Plan; (e) the receipt by any Loan Party or any ERISA Affiliate  from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans  or to appoint a trustee to administer any Plan; (f) the incurrence by any Loan Party or any ERISA Affiliate  of any liability with respect to the withdrawal or partial withdrawal of any Loan Party or any ERISA  Affiliate from any Plan or Multiemployer Plan; or (g) the receipt by any Loan Party or any ERISA Affiliate  of any notice, or the receipt by any Multiemployer Plan from any Loan Party or any ERISA Affiliate of any  notice, concerning the imposition upon any Loan Party or any ERISA Affiliate of Withdrawal Liability or  a determination that a Multiemployer Plan is, or is expected to be, insolvent, in critical status or in  reorganization, within the meaning of Title IV of ERISA.  "EU Bail-In Legislation Schedule" means the EU Bail-In Legislation Schedule published by the  Loan Market Association (or any successor Person), as in effect from time to time.  "Event of Default" has the meaning assigned to such term in Article VII.  "Excluded Subsidiaries" means Hardin St Properties, LLC, a Montana limited liability company,  Ocean West, SynGlobal and 273 Fifth Avenue, LLC, a Delaware limited liability company.  "Excluded Swap Obligation" means, with respect to any Guarantor, any Swap Obligation if, and to  the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a  security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the  Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission  (or the application or official interpretation of any thereof) by virtue of such Guarantor's failure for any  

 

-20-  reason to constitute an ECP at the time the Guarantee of such Guarantor or the grant of such security interest  becomes or would become effective with respect to such Swap Obligation.  If a Swap Obligation arises  under a master agreement governing more than one swap, such exclusion shall apply only to the portion of  such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or  becomes illegal.  "Excluded Taxes" means any of the following Taxes imposed on or with respect to a Recipient or  required to be withheld or deducted from a payment to a Recipient: (a) Taxes imposed on or measured by  net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as  a result of such Recipient being organized under the laws of, or having its principal office or, in the case of  any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political  subdivision thereof) or (ii) that are Other Connection Taxes; (b) in the case of a Lender, U.S. Federal  withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an  applicable interest in a Loan, Letter of Credit or Commitment pursuant to a law in effect on the date on  which (i) such Lender acquires such interest in the Loan, Letter of Credit or Commitment (other than  pursuant to an assignment request by the Borrowers under Section 2.19(b)) or (ii) such Lender changes its  lending office, except in each case to the extent that, pursuant to Section 2.17, amounts with respect to such  Taxes were payable either to such Lender's assignor immediately before such Lender acquired the  applicable interest in a Loan, Letter of Credit or Commitment or to such Lender immediately before it  changed its lending office; (c) Taxes attributable to such Recipient's failure to comply with Section 2.17(f);  and (d) any withholding Taxes imposed under FATCA.  "Existing Credit Agreement" means that certain Second Amended and Restated Credit Agreement  dated as of the Second Amendment and Restatement Date by and among JPMCB, as the administrative  agent thereunder, the Lenders party thereto and the Loan Parties party thereto, as the same may have been  amended, supplemented or otherwise modified prior to the Effective Date.  "Existing Obligations" means the "Obligations" as defined in the Existing Credit Agreement.  "Extenuating Circumstance" means any period during which the Administrative Agent has  determined in its sole discretion (a) that due to unforeseen and/or nonrecurring circumstances, it is  impractical and/or not feasible to submit or receive a Borrowing Request or Interest Election Request by  email or fax or through an Electronic System, and (b) to accept a Borrowing Request or Interest Election  Request telephonically.  "FATCA" means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any  amended or successor version that is substantively comparable and not materially more onerous to comply  with), any current or future regulations or official interpretations thereof and any agreement entered into  pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices  adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental  Authorities and implementing such Sections of the Code.  "Federal Funds Effective Rate" means, for any day, the rate calculated by the NYFRB based on  such day's federal funds transactions by depositary institutions (as determined in such manner as shall be  set forth on the NYFRB's Website from time to time) and published on the next succeeding Business Day  by the NYFRB as the federal funds effective rate, provided that, if the Federal Funds Effective Rate as so  determined would be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.   "Federal Reserve Board" means the Board of Governors of the Federal Reserve System of the  United States of America.  

 

-21-  "Fee Letter" means that certain second amended and restated fee letter dated as of the Effective  Date by and among Administrative Agent and the Borrowers.  "Financial Officer" means the chief financial officer, principal accounting officer, treasurer or  controller of any applicable Borrower or the Borrower Representative.  "First Amendment and Restatement Date" means November 4, 2019.  "Fixed Charge Coverage Ratio" means the ratio, determined as of the end of each fiscal quarter of  HF Foods for the four fiscal quarter period then ended, of (a) EBITDA minus Unfinanced Capital  Expenditures to (b) Fixed Charges, all calculated for HF Foods and its Subsidiaries on a consolidated basis  in accordance with GAAP.  It is further agreed and understood by the parties hereto that, for purposes of  calculating the Fixed Charge Coverage Ratio for any applicable period, such calculation shall exclude the  Fixed Charges of any Person accrued prior to the date it becomes a Subsidiary or is merged into or  consolidated with HF Foods or any of its Subsidiaries.  "Fixed Charges" means, for any period, without duplication, cash Interest Expense, plus  prepayments and scheduled principal payments on Indebtedness made during such period, plus expenses  for taxes paid in cash, plus Restricted Payments paid in cash, plus Capital Lease Obligation payments, plus  cash contributions to any Plan, plus scheduled reductions in the Special Advance Amount, all calculated  for HF Foods and its Subsidiaries on a consolidated basis in accordance with GAAP.  It is further agreed  and understood by the parties hereto that, for purposes of calculating the Fixed Charge Coverage Ratio for  any applicable period, such calculation shall exclude the Fixed Charges of any Person accrued prior to the  date it becomes a Subsidiary or is merged into or consolidated with HF Foods or any of its Subsidiaries.  "Fixtures" has the meaning assigned to such term in the Security Agreement.  "Flood Laws" has the meaning assigned to such term in Section 8.10.  "Floor" means the benchmark rate floor, if any, provided in this Agreement initially (as of the  execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with  respect to the Adjusted Term SOFR Rate, the Adjusted REVSOFR30 Rate or the Adjusted Daily Simple  SOFR, as applicable.  For the avoidance of doubt, the initial Floor for each of the Adjusted Term SOFR  Rate, the Adjusted REVSOFR30 Rate or the Adjusted Daily Simple SOFR shall be 0%.  "Foreign Lender" means (a) if a Borrower is a U.S. Person, a Lender, with respect to such Borrower,  that is not a U.S. Person, and (b) if a Borrower is not a U.S. Person, a Lender, with respect to such Borrower,  that is resident or organized under the laws of a jurisdiction other than that in which such Borrower is  resident for tax purposes.  "Foreign Subsidiary" means any Subsidiary which is not a Domestic Subsidiary.  "FSA" means the Food Security Act of 1985, as amended and in effect from time to time, and  regulations issued from time to time thereunder.  "FSA Liens" means Liens on any Loan Party's Inventory consisting of farm products, and/or any  other assets of such Loan Party, in favor of lenders to the suppliers of such Inventory that have been properly  perfected pursuant to the FSA.  "Funding Account" means any of the deposit accounts of the Working Capital Borrowers to which  the Lender is authorized by the Working Capital Borrowers to transfer the proceeds of any Revolving  Borrowings requested or authorized pursuant to this Agreement.  

 

-22-  "GAAP" means generally accepted accounting principles in the U.S.  "Governmental Authority" means the government of the U.S., any other nation or any political  subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body,  court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or  administrative powers or functions of or pertaining to government.  "Great Wall Illinois" means Great Wall Seafood IL, L.L.C., an Illinois limited liability company.  "Great Wall Texas" means Great Wall Seafood TX, L.L.C., a Texas limited liability company.  "Great Wall Virginia" means Great Wall Seafood VA, L.L.C., a Virginia limited liability company.  "Great Wall Virginia Acquisition" means the acquisition by Great Wall Virginia of certain assets  of Great Wall Virginia Seller pursuant to the terms of the Great Wall Virginia Acquisition Agreement, in a  transaction that satisfies each of the following requirements:  (a) such Acquisition is consummated in compliance with the terms and conditions of the Great  Wall Virginia Acquisition Agreement, in form and substance reasonably satisfactory to Agent;  (b) both before and after giving effect to such Acquisition and the Loans (if any) requested to  be made in connection therewith, each of the representations and warranties in the Loan Documents is true  and correct (except any such representation or warranty which relates to a specified prior date) and no  Default exists, will exist, or would result therefrom;  (c) such Acquisition is structured so that Great Wall Virginia acquires the subject assets:  (d) no Loan Party shall, as a result of or in connection with any such Acquisition, assume or  incur any direct or contingent liabilities (whether relating to environmental, tax, litigation, or other matters)  that could have a Material Adverse Effect;  (e) all Liens on the assets to be acquired pursuant to such Acquisition shall be terminated;  (f) the Payment Condition shall have been satisfied;  (g) all actions required to be taken with respect to any newly acquired or formed Wholly- Owned Subsidiary of a Borrower or a Loan Party, as applicable, required under Section 5.14 shall have  been taken; and  (h) the Borrower Representative shall have delivered to the Administrative Agent the final  executed acquisition agreement and all other material documentation relating to such Acquisition.  "Great Wall Virginia Acquisition Agreement" means the asset purchase agreement pursuant to  which Great Wall Virginia Seller sells certain of its assets to Great Wall Virginia.  "Great Wall Virginia Seller" means Sealand Food Inc., a Virginia corporation.  "Guarantee" of or by any Person (the "guarantor") means any obligation, contingent or otherwise,  of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other  obligation of any other Person (the "primary obligor") in any manner, whether directly or indirectly, and  including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply  funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance  

 

-23-  or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property,  securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the  payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition  or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other  obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support  such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for  collection or deposit in the ordinary course of business.  "Guaranteed Obligations" has the meaning assigned to such term in Section 10.01.  "Guarantors" means all Loan Guarantors and all non-Loan Parties who have delivered an  Obligation Guaranty, and the term "Guarantor" means each or any one of them individually.  "Han Feng" means Han Feng, Inc., a North Carolina corporation.  "Han Feng Mortgage Debt" means Indebtedness of Han Feng and certain of its Affiliates to East  West Bank in connection with the second mortgage financing of the R&N Holdings Real Estate in the  original aggregate principal amount of $1,673,333.17.  "Hazardous Materials" means:  (a) any substance, material, or waste that is included within the  definitions of "hazardous substances," "hazardous materials," "hazardous waste," "toxic substances," "toxic  materials," "toxic waste," or words of similar import in any Environmental Law; (b) those substances listed  as hazardous substances by the United States Department of Transportation (or any successor agency) (49  C.F.R. 172.101 and amendments thereto) or by the Environmental Protection Agency (or any successor  agency) (40 C.F.R. Part 302 and amendments thereto); and (c) any substance, material, or waste that is  petroleum, petroleum-related, or a petroleum by-product, asbestos or asbestos-containing material,  polychlorinated biphenyls, flammable, explosive, radioactive, freon gas, radon, or a pesticide, herbicide, or  any other agricultural chemical.  "HF Foods" means HF Foods Group, Inc., a Delaware corporation.  "HF Holding" means HF Group Holding Corporation, a North Carolina corporation.  "HF Industrial" means HF Foods Industrial, Inc., a North Carolina corporation.  "HG Realty" means HG Realty, LLC, a Georgia limited liability company.  "HG Realty Mortgage Debt" means Indebtedness of HG Realty and certain of its Affiliates to  Capital Bank Corporation in connection with the financing of the HG Realty Real Estate in the original  aggregate principal amount of $5,360,000.  "HG Realty Real Estate" means the real property owned by HG Realty and located at 80 Coleman  Blvd., Pooler, Georgia 31322.  "HG Realty Sale" means the sale by Han Feng to Coleman Boulevard, LLC, an Ohio limited  liability company, of 100% of the Equity Interests of HG Realty pursuant to the terms of the HG Realty  Sale Agreement.  "HG Realty Sale Agreement" means the certain Membership Interest Purchase Agreement dated as  of February 10, 2022 by and between Coleman Boulevard, LLC, an Ohio limited liability company, Han  Feng and HG Realty.  

 

-24-  "Hindenburg Claims" has the meaning assigned to such term in the definition of the term  "EBITDA".  "IBA" has the meaning assigned to such term in Section 1.05.  "Indebtedness" of any Person means, without duplication, (a) all obligations of such Person for  borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person  evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which  interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title  retention agreements relating to property acquired by such Person, (e) all obligations of such Person in  respect of the deferred purchase price of property or services (excluding current accounts payable incurred  in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of  such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property  owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed,  (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such  Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters  of credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in respect of  bankers' acceptances, (k) obligations under any earn-out (which for all purposes of this Agreement shall be  valued at the maximum potential amount payable with respect to such earn-out) and (l) any other Off- Balance Sheet Liability and (m) obligations, whether absolute or contingent and howsoever and  whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications  thereof and substitutions therefor), under (i) any and all Swap Agreements, and (ii) any and all  cancellations, buy backs, reversals, terminations or assignments of any Swap Agreement transaction. The  Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in  which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person's  ownership interest in or other relationship with such entity, except to the extent the terms of such  Indebtedness provide that such Person is not liable therefor.  "Indemnified Taxes" means (a) Taxes, other than Excluded Taxes, imposed on or with respect to  any payment made by, or on account of any obligation of any Loan Party under any Loan Document and  (b) to the extent not otherwise described in the foregoing clause (a) hereof, Other Taxes.  "Indemnitee" has the meaning assigned to such term in Section 9.03(b).  "Ineligible Institution" has the meaning assigned to such term in Section 9.04(b).  "Interest Election Request" means a request by the Borrower Representative to convert or continue  a Borrowing in accordance with Section 2.08.  "Interest Expense" means, for any period, total interest expense (including that attributable to  Capital Lease Obligations) of HF Foods and its Subsidiaries for such period with respect to all outstanding  Indebtedness of HF Foods and its Subsidiaries (including all commissions, discounts and other fees and  charges owed with respect to letters of credit and bankers' acceptances and net costs under Swap  Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance  with GAAP), calculated on a consolidated basis for HF Foods and its Subsidiaries for such period in  accordance with GAAP.  "Interest Payment Date" means (a) with respect to any CBFR Loan (other than a Swingline Loan),  the first Business Day of each calendar month and the Maturity Date (or in the case of (1) the Term A Loan,  the Term A Loan Maturity Date or (2) the Term B Loan, the Term B Loan Maturity Date), (b) with respect  to any RFR Loan, (1) each date that is on the numerically corresponding day in each calendar month that  is one month after the Borrowing of such Loan (or, if there is no such numerically corresponding day in  

 

-25-  such month, then the last day of such month) and (2) the Maturity Date, (c) with respect to any Term  Benchmark Loan, the last day of each Interest Period applicable to the Borrowing of which such Loan is a  part (and, in the case of a Term Benchmark Borrowing with an Interest Period of more than three months'  duration, each day prior to the last day of such Interest Period that occurs at intervals of three months'  duration after the first day of such Interest Period) and the Maturity Date and (d) with respect to all Loans  (other than the Term Loan) the Maturity Date (or in the case of (1) the Term A Loan, the Term A Loan  Maturity Date or (2) the Term B Loan, the Term B Loan Maturity Date).  "Interest Period" means, with respect to any Term Benchmark Borrowing, the period commencing  on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that  is one, three or six months thereafter (in each case, subject to the availability for the Benchmark applicable  to the relevant Loan or Commitment), as the Borrower Representative may elect; provided, that (a) if any  Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the  next succeeding Business Day unless, such next succeeding Business Day would fall in the next calendar  month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest  Period that commences on the last Business Day of a calendar month (or on a day for which there is no  numerically corresponding day in the last calendar month of such Interest Period) shall end on the last  Business Day of the last calendar month of such Interest Period, and (c) no tenor that has been removed  from this definition pursuant to Section 2.14(e) shall be available for specification in such Borrowing  Request or Interest Election Request.  For purposes hereof, the date of a Borrowing initially shall be the  date on which such Borrowing is made and thereafter shall be the effective date of the most recent  conversion or continuation of such Borrowing.  "Inventory" has the meaning assigned to such term in the Security Agreement.  "IRS" means the United States Internal Revenue Service.  "Irwindale" means Irwindale Poultry, LLC, a California limited liability company.  "Irwindale Sale" means the sale by B&R of up to 40% of the outstanding Equity Interests of  Irwindale.  "Irwindale Sale Date" means the date on which the Irwindale Sale is consummated.  "Issuing Bank" means, individually and collectively, each of JPMCB, in its capacity as the issuer  of Letters of Credit hereunder and any other Revolving Lender from time to time designated by the  Borrower Representative as an Issuing Bank, with the consent of such Revolving Lender and the  Administrative Agent, and their respective successors in such capacity as provided in Section 2.06(i).  Any  Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by its Affiliates,  in which case the term "Issuing Bank" shall include any such Affiliate with respect to Letters of Credit  issued by such Affiliate (it being agreed that such Issuing Bank shall, or shall cause such Affiliate to, comply  with the requirements of Section 2.06 with respect to such Letters of Credit).  At any time there is more  than one Issuing Bank, all singular references to the Issuing Bank shall mean any Issuing Bank, either  Issuing Bank, each Issuing Bank, the Issuing Bank that has issued the applicable Letter of Credit, or both  (or all) Issuing Banks, as the context may require.  "Issuing Bank Sublimits" means, as of the Effective Date, (a) $5,000,000, in the case of JPMCB,  and (b) such amount as shall be designated to the Administrative Agent and the Borrower Representative  in writing by an Issuing Bank; provided that any Issuing Bank shall be permitted at any time to increase or  reduce its Issuing Bank Sublimit upon providing five (5) days' prior written notice thereof to the  Administrative Agent and the Borrower Representative.  

 

-26-  "Joinder Agreement" means a Joinder Agreement in substantially the form of Exhibit E.  "JPMCB" means JPMorgan Chase Bank, N.A., a national banking association, in its individual  capacity, and its successors.  "LC Collateral Account" has the meaning assigned to such term in Section 2.06(j).  "LC Disbursement" means any payment made by an Issuing Bank pursuant to a Letter of Credit.  "LC Exposure" means, at any time, the sum of the Commercial LC Exposure and the Standby LC  Exposure at such time.  The LC Exposure of any Revolving Lender at any time shall be its Applicable  Percentage of the aggregate LC Exposure at such time.  "Lease Financing" means (a) a lease of specific Equipment as defined in Article 2-A of the UCC,  and (b) a secured financing transaction secured by specific Equipment, whether that transaction is called a  lease or a loan, entered into by any Loan Party with JPMCB or any of its Affiliates (in this context, the  "Lessor"), including without limitation the Chase Equipment Debt.  "Lenders" means the Persons listed on the Commitment Schedule and any other Person that shall  have become a Lender hereunder pursuant to Section 2.09 or an Assignment and Assumption or otherwise,  other than any such Person that ceases to be a Lender hereunder pursuant to an Assignment and Assumption  or otherwise.  Unless the context otherwise requires, the term "Lenders" includes the Swingline Lender and  the Issuing Bank.  "Letters of Credit" means the letters of credit issued pursuant to this Agreement, and the term  "Letter of Credit" means any one of them or each of them singularly, as the context may require.  "Letter of Credit Agreement" has the meaning assigned to it in Section 2.06(b).  "Lien" means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation,  encumbrance, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under  any conditional sale agreement, capital lease or title retention agreement (or any financing lease having  substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of  securities, any purchase option, call or similar right of a third party with respect to such securities.  "Loan Borrowing Option" has the meaning assigned to such term in the DDA Access Product  Agreement.  "Loan Documents" means, collectively, this Agreement, any promissory notes issued pursuant to  this Agreement, any Letter of Credit Agreement, the Collateral Documents, each Compliance Certificate,  the Loan Guaranty, any Obligation Guaranty, the Fee Letter, the B&R Realty Subordination Agreement  and all other agreements, instruments, documents and certificates executed and delivered to, or in favor of,  the Administrative Agent or any Lender and including all other pledges, powers of attorney, consents,  assignments, contracts, notices, letter of credit agreements, letter of credit applications and any agreements  between the Borrower Representative and the Issuing Bank regarding the Issuing Bank's Issuing Bank  Sublimit or the respective rights and obligations between the applicable Borrower and the Issuing Bank in  connection with the issuance by the Issuing Bank of Letters of Credit, and all other written matter whether  heretofore, now or hereafter executed by or on behalf of any Loan Party, or any employee of any Loan  Party, and delivered to the Administrative Agent or any Lender in connection with this Agreement, the  Existing Credit Agreement, the Prior Credit Agreement, the Original Credit Agreement or the transactions  contemplated hereby.  Any reference in this Agreement or any other Loan Document to a Loan Document  shall include all appendices, exhibits or schedules thereto, and all amendments, restatements, supplements  

 

-27-  or other modifications thereto, and shall refer to this Agreement or such Loan Document as the same may  be in effect at any and all times such reference becomes operative.  "Loan Guarantor" means each Loan Party.  "Loan Guaranty" means Article X of this Agreement and each separate Guarantee, in form and  substance satisfactory to the Administrative Agent, delivered by each Loan Guarantor.  "Loan Parties" means, collectively, the Borrowers, the Borrowers' Domestic Subsidiaries (other  than any Excluded Subsidiary and any Acquired Majority Owned Subsidiary) and any other Person who  becomes a party to this Agreement pursuant to a Joinder Agreement and their respective successors and  assigns, and the term "Loan Party" shall mean any one of them or all of them individually, as the context  may require.  "Loans" means the loans and advances made by the Lenders pursuant to this Agreement, including  Revolving Loans, the Term A Loan, the Term B Loan, Swingline Loans, Overadvances and Protective  Advances.  "Lock Box" has the meaning assigned to such term in the Security Agreement.  "Lock Box Agreement" has the meaning assigned to such term in the Security Agreement.  "Logistics" means B&R Group Logistics Holding LLC, a Delaware limited liability company.  "Margin Stock" means margin stock within the meaning of Regulations T, U and X, as applicable.  "Material Adverse Effect" means a material adverse effect on (a) the business, assets, operations,  prospects or condition, financial or otherwise, of the Loan Parties and their Subsidiaries taken as a whole,  (b) the ability of any Loan Party to perform any of its obligations under the Loan Documents to which it is  a party, (c) the Collateral, or the Administrative Agent's Liens (on behalf of itself and other Secured Parties)  on the Collateral or the priority of such Liens, or (d) the rights of or remedies available to the Administrative  Agent, the Issuing Bank or the Lenders under any of the Loan Documents.  "Material Agreements" means all material agreements and contracts listed on Schedule 3.12.  "Material Indebtedness" means Indebtedness (other than the Loans and Letters of Credit), or  obligations in respect of one or more Swap Agreements, of any one or more of the Loan Parties or any  Subsidiary in an aggregate principal amount exceeding $2,500,000 and specifically includes the Chase  Equipment Debt and the B&R Realty Seller Note.  For purposes of determining Material Indebtedness, the  "principal amount" of the obligations of the Loan Parties or any Subsidiary in respect of any Swap  Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements)  that such Loan Party or such Subsidiary would be required to pay if such Swap Agreement were terminated  at such time.  "Maturity Date" means March 31, 2027 or any earlier date on which the Commitments are reduced  to zero or otherwise terminated pursuant to the terms hereof.  "Maximum Rate" has the meaning assigned to such term in Section 9.17.  "Min Food" means Min Food Inc., a California corporation.  "Monterey" means Monterey Food Service, LLC, a California limited liability company.  

 

-28-  "Moody's" means Moody's Investors Service, Inc.  "Mortgage" means any mortgage, deed of trust or other agreement which conveys or evidences a  Lien in favor of the Administrative Agent, for the benefit of the Administrative Agent and the other Secured  Parties, on real property of a Loan Party, including any amendment, restatement, modification or  supplement thereto or thereof.  "Mountain" means Mountain Food, LLC, a Colorado limited liability company.  "Multiemployer Plan" means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.  "Net Income" means, for any period, the consolidated net income (or loss) of HF Foods and its  Subsidiaries, determined on a consolidated basis in accordance with GAAP; provided that there shall be  excluded (a) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary or is  merged into or consolidated with HF Foods or any of its Subsidiaries, (b) the income (or deficit) of any  Person (other than a Subsidiary) in which HF Foods or any of its Subsidiaries has an ownership interest,  except to the extent that any such income is actually received by HF Foods or such Subsidiary in the form  of distributions or dividends, (c) the undistributed earnings of any Subsidiary to the extent that the  declaration or payment of distributions or dividends by such Subsidiary is not at the time permitted by the  terms of any contractual obligation (other than under any Loan Document) or Requirement of Law  applicable to such Subsidiary and (d) the portion of the income (or deficit) of any Subsidiary (including an  Acquired Majority Owned Subsidiary) that is not wholly owned by HF Foods, that is attributable to the  owners of the minority interests in such Subsidiary.  "Net Orderly Liquidation Value" means, with respect to Inventory of any Person, the orderly  liquidation value thereof as determined in a manner acceptable to the Administrative Agent by an appraiser  acceptable to the Administrative Agent, net of all costs of liquidation thereof.  "Net Proceeds" means, with respect to any event, (a) the cash proceeds received in respect of such  event including (i) any cash received in respect of any non-cash proceeds (including any cash payments  received by way of deferred payment of principal pursuant to a note or installment receivable or purchase  price adjustment receivable or otherwise, but excluding any interest payments), but only as and when  received, (ii) in the case of a casualty, insurance proceeds and (iii) in the case of a condemnation or similar  event, condemnation awards and similar payments, minus (b) the sum of (i) all reasonable fees and out-of- pocket expenses paid to third parties (other than Affiliates) in connection with such event, (ii) in the case  of a Disposition of an asset (including pursuant to a Sale and Leaseback Transaction or a casualty or a  condemnation or similar proceeding), the amount of all payments required to be made as a result of such  event to repay Indebtedness (other than Loans) secured by such asset or otherwise subject to mandatory  prepayment as a result of such event and (iii) the amount of all taxes paid (or reasonably estimated to be  payable) and the amount of any reserves established to fund contingent liabilities reasonably estimated to  be payable, in each case during the year that such event occurred or the next succeeding year and that are  directly attributable to such event (as determined reasonably and in good faith by a Financial Officer of the  Borrower Representative).  "Non Loan Party Contributions" means investments in the form of capital contributions by Loan  Parties to Subsidiaries that are not Loan Parties.  "Non Loan Party Guarantees" means Guarantees of Indebtedness of Subsidiaries that are not Loan  Parties that are made by any Loan Party.  "Non Loan Party Loans" means loan or advances made by any Loan Party to any Subsidiary that  is not a Loan Party.  

 

-29-  "NSFD" means New Southern Food Distributors, Inc., a Florida corporation.  "NSFD 31st Avenue Mortgage Debt" means Indebtedness of NSFD and HF Foods to East West  Bank in connection with the financing of the NSFD 31st Avenue Real Estate in the original aggregate  principal amount of $1,050,000.  "NSFD 31st Avenue Real Estate" means the real property owned by NSFD and located at 520-530  SW 31st Avenue, Ocala, Florida 34474.  "NSFD 33rd Avenue Mortgage Debt" means Indebtedness of NSFD and HF Foods to East West  Bank in connection with the financing of the NSFD 33rd Avenue Real Estate in the original aggregate  principal amount of $2,625,000.  "NSFD 33rd Avenue Real Estate" means the real property owned by NSFD and located at 601 SW  33rd Avenue, Ocala, Florida 34474.  "NYFRB" means the Federal Reserve Bank of New York.  "NYFRB Rate" means, for any day, the greater of (a) the Federal Funds Effective Rate in effect on  such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a  Business Day, for the immediately preceding Business Day); provided that if none of such rates are  published for any day that is a Business Day, the term "NYFRB Rate" means the rate for a federal funds  transaction quoted at 11:00 a.m. on such day received by the Administrative Agent from a federal funds  broker of recognized standing selected by it; provided, further, that if any of the aforesaid rates as so  determined would be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.  "NYFRB's Website" means the website of the NYFRB at http://www.newyorkfed.org, or any  successor source.  "Obligated Party" has the meaning assigned to such term in Section 10.02.  "Obligation Guaranty" means any Guarantee of all or any portion of the Secured Obligations  executed and delivered to the Administrative Agent for the benefit of the Secured Parties by a guarantor  who is not a Loan Party.  "Obligations" means all unpaid principal of and accrued and unpaid interest on the Loans, all LC  Exposure, all accrued and unpaid fees and all expenses, reimbursements, indemnities and other obligations  and indebtedness (including interest and fees accruing during the pendency of any bankruptcy, insolvency,  receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding),  obligations and liabilities of any of the Loan Parties to any of the Lenders, the Administrative Agent, the  Issuing Bank or any indemnified party, individually or collectively, existing on the Effective Date or arising  thereafter, direct or indirect, joint or several, absolute or contingent, matured or unmatured, liquidated or  unliquidated, secured or unsecured, arising by contract, operation of law or otherwise, arising or incurred  under this Agreement or any of the other Loan Documents or in respect of any of the Loans made or  reimbursement or other obligations incurred or any of the Letters of Credit or other instruments at any time  evidencing any thereof.  For the avoidance of doubt, the "Existing Obligations" under the Existing Credit  Agreement existing immediately prior to the effectiveness of this Agreement shall constitute Obligations  hereunder.  "Ocean West" means Ocean West Food Services, LLC, a California limited liability company.  

 

-30-  "OFAC" means the Office of Foreign Assets Control of the United States Department of the  Treasury.  "Off-Balance Sheet Liability" of a Person means (a) any repurchase obligation or liability of such  Person with respect to accounts or notes receivable sold by such Person, (b) any indebtedness, liability or  obligation under any so-called "synthetic lease" transaction entered into by such Person, or (c) any  indebtedness, liability or obligation arising with respect to any other transaction which is the functional  equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheet  of such Person (other than operating leases).  "Original Closing Date" means November 16, 2017.  "Original Credit Agreement" means that certain Credit Agreement dated as of the Original Closing  Date by and among JPMCB, as the sole lender thereunder, and the Loan Parties party thereto.  "Original Indebtedness" has the meaning assigned to such term in Section 6.01.  "Original Term Loan" has the meaning assigned to such term in Section 2.01(b).  "Other Connection Taxes" means, with respect to any Recipient, Taxes imposed as a result of a  present or former connection between such Recipient and the jurisdiction imposing such Taxes (other than  a connection arising from such Recipient having executed, delivered, become a party to, performed its  obligations under, received payments under, received or perfected a security interest under, engaged in any  other transaction pursuant to, or enforced, any Loan Document, or sold or assigned an interest in any Loan,  Letter of Credit or any Loan Document).  "Other Restricted Payments" means Restricted Payments in the form of distributions and dividends,  in each case subject to (i) the satisfaction of the Payment Condition and (ii) if the Special Advance Amount  is greater than zero, the prior consent of the Required Lenders.  "Other Taxes" means all present or future stamp, court or documentary, intangible, recording, filing  or similar Taxes that arise from any payment made under, from the execution, delivery, performance,  enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with  respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with  respect to an assignment (other than an assignment made pursuant to Section 2.19).  "Overadvance" has the meaning assigned to such term in Section 2.05(b).  "Overnight Bank Funding Rate" means, for any day, the rate comprised of both overnight federal  funds and overnight eurodollar transactions by U.S.-managed banking offices of depository institutions (as  such composite rate shall be determined by the NYFRB as set forth on the NYFRB's Website from time to  time) and published on the next succeeding Business Day by the NYFRB as an overnight bank funding  rate.  "PACA" means the Perishable Agricultural Commodities Act of 1930, as amended and in effect  from time to time, and regulations issued from time to time thereunder.  "PACA Trust" means the trust established pursuant to PACA on any Loan Party's Inventory  consisting of perishable agricultural commodities and/or any other assets of such Loan Party, in favor of  sellers of perishable agricultural commodities to such Loan Party.  

 

-31-  "Paid in Full" or "Payment in Full" means, (a) the indefeasible payment in full in cash of all  outstanding Loans and LC Disbursements, together with accrued and unpaid interest thereon, (b) the  termination, expiration, or cancellation and return of all outstanding Letters of Credit (or alternatively, with  respect to each such Letter of Credit, the furnishing to the Administrative Agent of a cash deposit, or at the  discretion of the Administrative Agent a backup standby letter of credit satisfactory to the Administrative  Agent and the Issuing Bank, in an amount equal to 105% of the LC Exposure as of the date of such  payment), (c) the indefeasible payment in full in cash of the accrued and unpaid fees, (d) the indefeasible  payment in full in cash of all reimbursable expenses and other Secured Obligations (other than Unliquidated  Obligations for which no claim has been made and other obligations expressly stated to survive such  payment and termination of this Agreement), together with accrued and unpaid interest thereon, (e) the  termination of all Commitments, and (f) the termination of the Swap Agreement Obligations and the  Banking Services Obligations.  "Parent" means, with respect to any Lender, any Person as to which such Lender is, directly or  indirectly, a subsidiary.  "Participant" has the meaning assigned to such term in Section 9.04(c).  "Participant Register" has the meaning assigned to such term in Section 9.04(c).  "Payment Condition" shall be deemed to be satisfied in connection with a Restricted Payment, a  Permitted Acquisition or other transaction if:  (a) no Default or Event of Default has occurred and is continuing or would result immediately  after giving effect to such Restricted Payment, Permitted Acquisition or other transaction;  (b) immediately after giving effect to and at all times during the 90-day period immediately  prior to such Restricted Payment, Permitted Acquisition or other transaction, the Working Capital  Borrowers shall have Availability calculated on a pro forma basis after giving effect to such Restricted  Payment, Permitted Acquisition or other transaction of not less than the greater of (i) $12,500,000 and  (ii) 12.5% of the Revolving Commitment;  (c) immediately after giving effect to such Restricted Payment, Permitted Acquisition or other  transaction, the Fixed Charge Coverage Ratio for the most recently completed four fiscal quarter period  prior to the date of such Restricted Payment, Permitted Acquisition or other transaction for which the  Borrowers are then required to have delivered interim financial statements to the Administrative Agent in  accordance with the terms hereof, calculated on a pro forma basis, is not less than 1.10 to 1.00; and  (d) the Borrower Representative shall have delivered to the Administrative Agent a certificate  in form and substance reasonably satisfactory to the Administrative Agent certifying as to the items  described in (a), (b) and (c) above and attaching calculations for items (b) and (c).  "PBGC" means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and  any successor entity performing similar functions.  "Permitted Acquisition" means (i) the Third Amendment Effective Date Acquisition, (ii) the Great  Wall Virginia Acquisition and (iii) any Acquisition by any Loan Party in a transaction that satisfies each of  the following requirements:  (a) such Acquisition is not a hostile or contested acquisition;  

 

-32-  (b) the business acquired in connection with such Acquisition is (i) located in the U.S.,  (ii) organized under applicable U.S. and state laws, and (iii) not engaged, directly or indirectly, in any line  of business other than the businesses in which the Loan Parties are engaged on the Effective Date and any  business activities that are substantially similar, ancillary, complementary or otherwise reasonably related,  or incidental thereto, or that are a reasonable extension, development or expansion thereof, including all  activities and services pertaining to the acquisition, transportation, manufacture, production, processing,  marketing, sale and distribution of food, food-related items and restaurant and kitchen supplies, both  wholesale and retail;  (c) both before and after giving effect to such Acquisition and the Loans (if any) requested to  be made in connection therewith, each of the representations and warranties in the Loan Documents is true  and correct (except any such representation or warranty which relates to a specified prior date) and no  Default exists, will exist, or would result therefrom;  (d) as soon as available, but not less than thirty (30) days prior to such Acquisition, the  Borrower Representative has provided the Administrative Agent (i) notice of such Acquisition and (ii) a  copy of all business and financial information reasonably requested by the Administrative Agent including  pro forma financial statements, statements of cash flow, and Availability projections;  (e) if the Accounts and Inventory acquired in connection with such Acquisition are proposed  to be included in the determination of the Borrowing Base, the Administrative Agent shall have conducted  an audit and field examination of such Accounts and Inventory, and an appraisal of such Inventory, the  results of which shall be satisfactory to the Administrative Agent;  (g) if such Acquisition is an acquisition of the Equity Interests of a Person, such Acquisition  is structured so that the acquired Person shall become a wholly-owned subsidiary of a Loan Party and a  Loan Party pursuant to the terms of this Agreement, except that the Loan Parties may consummate  Acquisitions that are structured such that the acquired Person becomes an Acquired Majority Owned  Subsidiary;  (h) if such Acquisition is an acquisition of assets, such Acquisition is structured so that a Loan  Party shall acquire such assets;  (i) if such Acquisition is an acquisition of Equity Interests, such Acquisition will not result in  any violation of Regulation U;  (j) if such Acquisition involves a merger or a consolidation involving a Borrower or any other  Loan Party, such Borrower or such Loan Party, as applicable, shall be the surviving entity;  (k) no Loan Party shall, as a result of or in connection with any such Acquisition, assume or  incur any direct or contingent liabilities (whether relating to environmental, tax, litigation, or other matters)  that could have a Material Adverse Effect;  (l) in connection with an Acquisition of the Equity Interests of any Person, all Liens on  property of such Person shall be terminated unless the Administrative Agent and the Lenders in their sole  discretion consent otherwise, and in connection with an Acquisition of the assets of any Person, all Liens  on such assets shall be terminated;  (m) the Payment Condition shall have been satisfied;  

 

-33-  (n) all actions required to be taken with respect to any newly acquired or formed Wholly- Owned Subsidiary of a Borrower or a Loan Party, as applicable, required under Section 5.14 shall have  been taken;  (o) the Borrower Representative shall have delivered to the Administrative Agent the final  executed acquisition agreement and all other material documentation relating to such Acquisition within 10  days following the consummation thereof;  (p) if such Acquisition is structured such that the acquired Person becomes an Acquired  Majority Owned Subsidiary, the Total Consideration for such Acquisition shall not exceed $10,000,000;  and  (q) if the Special Advance Amount is greater than zero, the Required Lenders have consented  to such Acquisition.  "Permitted Charitable Contributions" means charitable contributions (as defined in Section 170(c)  of the Code, whether in the form of cash, securities or other property and without regard to whether such  charitable contributions are deductible for income tax purposes) made by any Loan Party or any Subsidiary,  whether directly (including to a donor advised fund) or through one or more Affiliates, and any binding  commitment with respect thereto; provided that the aggregate amount of such contributions made by the  Loan Parties and the Subsidiaries during any fiscal year, together with the aggregate amount of all binding  commitments of the Loan Parties and the Subsidiaries to make any such contributions during such fiscal  year, shall not exceed $10,000,000 in the aggregate.  "Permitted Discretion" means a determination made in good faith and in the exercise of reasonable  (from the perspective of a secured asset-based lender) business judgment.  "Permitted Encumbrances" means:  (a) Liens imposed by law for Taxes that are not yet delinquent or are being contested in  compliance with Section 5.04;  (b) carriers', warehousemen's, mechanics', materialmen's, repairmen's and other like Liens  imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by  more than thirty (30) days or are being contested in compliance with Section 5.04;  (c) pledges and deposits made in the ordinary course of business in compliance with workers'  compensation, unemployment insurance and other social security laws or regulations;  (d) deposits to secure the performance of bids, trade contracts, leases, statutory obligations,  surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the  ordinary course of business;  (e) judgment Liens in respect of judgments that do not constitute an Event of Default under  clause (k) of Article VII;   (f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property  imposed by law or arising in the ordinary course of business that do not secure any monetary obligations  and do not materially detract from the value of the affected property or interfere with the ordinary conduct  of business of any Loan Party or any Subsidiary;   

 

-34-  (g) PACA Trusts arising by operation of law under PACA in favor of vendors of perishable  agricultural commodities in the ordinary course of business and securing amounts owing to such vendors  that are not overdue by more than 5 days or are being contested in compliance with Section 6.04;  (h) FSA Liens arising under the FSA in favor of lenders to sellers of farm products in the  ordinary course of business and securing amounts owing to such lenders that are not overdue by more than  5 days or are being contested in compliance with Section 6.04; and  (i) State Agricultural Liens arising under applicable State Agricultural Laws in favor of sellers  of farm products in the ordinary course of business and securing amounts owing to such sellers that are not  overdue by more than 5 days or are being contested in compliance with Section 6.04;  provided that the term "Permitted Encumbrances" shall not include any Lien securing Indebtedness, except  with respect to clause (e) above.  "Permitted Investments" means:  (a) direct obligations of, or obligations the principal of and interest on which are  unconditionally guaranteed by, the U.S. (or by any agency thereof to the extent such obligations are backed  by the full faith and credit of the U.S.), in each case maturing within one year from the date of acquisition  thereof;  (b) investments in commercial paper maturing within 270 days from the date of acquisition  thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or from  Moody's;  (c) investments in certificates of deposit, bankers' acceptances and time deposits maturing  within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and money  market deposit accounts issued or offered by, any domestic office of any commercial bank organized under  the laws of the U.S. or any State thereof which has a combined capital and surplus and undivided profits of  not less than $500,000,000;  (d) fully collateralized repurchase agreements with a term of not more than 30 days for  securities described in clause (a) above and entered into with a financial institution satisfying the criteria  described in clause (c) above; and  (e) money market funds that (i) comply with the criteria set forth in Securities and Exchange  Commission Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa  by Moody's and (iii) have portfolio assets of at least $5,000,000,000.  "Person" means any natural person, corporation, limited liability company, trust, joint venture,  association, company, partnership, Governmental Authority or other entity.  "Plan" means any employee pension benefit plan (other than a Multiemployer Plan) subject to the  provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of  which any Loan Party or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069  of ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.  "Plan Asset Regulations" means 29 CFR § 2510.3-101 et seq., as modified by Section 3(42) of  ERISA, as amended from time to time.  

 

-35-  "PML Report" means a probable maximum loss report relating to each Seismic Risk Property,  which PML Report shall address (A) the probable maximum loss that is likely to be sustained by such  Seismic Risk Property in the event of an earthquake or other seismic casualty at or affecting such Seismic  Risk Property, and (B) the likelihood and likely intensity of an earthquake or other seismic casualty at or  affecting such Seismic Risk Property.  "Prepayment Event" means:  (a) any Disposition (including pursuant to a Sale and Leaseback Transaction) of any property  or asset of any Loan Party or any of its Subsidiaries, other than Dispositions described in Sections 6.05(a),  (b), (g), (i), (k) and (l); or  (b) any casualty or other insured damage to, or any taking under power of eminent domain or  by condemnation or similar proceeding of, any property or asset of any Loan Party or any of its Subsidiaries  with a fair value immediately prior to such event equal to or greater than $250,000; or  (c) the issuance by HF Foods of any Equity Interests, or the receipt by HF Foods of any capital  contribution; or  (d) the incurrence by any Loan Party or any of its Subsidiaries of any Indebtedness, other than  Indebtedness permitted under Section 6.01.  "Prime Rate" means the rate of interest last quoted by The Wall Street Journal as the "Prime Rate"  in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate  published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest  Rates) as the "bank prime loan" rate or, if such rate is no longer quoted therein, any similar rate quoted  therein (as determined by the Administrative Agent) or any similar release by the Federal Reserve Board  (as determined by the Administrative Agent).  Each change in the Prime Rate shall be effective from and  including the date such change is publicly announced or quoted as being effective.    "Prior Credit Agreement" means that certain Amended and Restated Credit Agreement dated as of  the First Amendment and Restatement Date by and among JPMCB, as administrative agent thereunder, the  Lenders party thereto and the Loan Parties party thereto.  "Projections" has the meaning assigned to such term in Section 5.01(f).  "Protective Advances" has the meaning assigned to such term in Section 2.04.  "PTE" means a prohibited transaction class exemption issued by the U.S. Department of Labor, as  any such exemption may be amended from time to time.  "Public-Sider" means a Lender whose representatives may trade in securities of HF Foods or its  Controlling Person or any of its Subsidiaries while in possession of the financial statements provided by  HF Foods under the terms of this Agreement.  "QFC" has the meaning assigned to the term "qualified financial contract" in, and shall be  interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).  "QFC Credit Support" has the meaning assigned to it in Section 9.21.  "Qualified ECP Guarantor" means, in respect of any Swap Obligation, each Loan Party that has  total assets exceeding $10,000,000 at the time the relevant Loan Guaranty or grant of the relevant security  

 

-36-  interest becomes or would become effective with respect to such Swap Obligation or such other person as  constitutes an "eligible contract participant" under the Commodity Exchange Act or any regulations  promulgated thereunder and can cause another person to qualify as an "eligible contract participant" at such  time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.  "R&N Charlotte" means R&N Charlotte, LLC, a North Carolina limited liability company.  "R&N Charlotte Mortgage Debt" means Indebtedness of R&N Charlotte and certain of its Affiliates  to Bank of America, N.A. in connection with the financing of the R&N Charlotte Real Estate in the original  aggregate principal amount of $2,741,250.  "R&N Charlotte Real Estate" means the real property owned by R&N Charlotte and located at 5119  Hovis Road, Charlotte, North Carolina 28208.  "R&N Holdings" means R&N Holdings, LLC, a North Carolina limited liability company.  "R&N Holdings Mortgage Debt" means Indebtedness of R&N Holdings and certain of its Affiliates  to East West Bank in connection with the first mortgage financing of the R&N Holdings Real Estate in the  original aggregate principal amount of $2,891,200.  "R&N Holdings Real Estate" means the real property owned by R&N Holdings and located at 6001  West Market Street, Greensboro, North Carolina 27409 and 204-210 Aloe Road, Greensboro, North  Carolina 27409.  "Reaffirmed Documents" has the meaning assigned to such term in Section 9.23.  "Real Estate Borrower" or "Real Estate Borrowers" has the meaning assigned to such term in the  preamble hereto.  "Receivables" has the meaning assigned to such term in the Security Agreement.  "Recipient" means, as applicable, (a) the Administrative Agent, (b) any Lender and (c) any Issuing  Bank, or any combination thereof (as the context requires).  "Reference Time" with respect to any setting of the then-current Benchmark means (1) if such  Benchmark is the Term SOFR Rate or the REVSOFR30 Rate, 5:00 a.m. (Chicago time) on the day that is  two (2) Business Days preceding the date of such setting, (2) if such Benchmark is Daily Simple SOFR,  then four (4) Business Days prior to such setting or (3) if such Benchmark is none of the Term SOFR Rate,  the REVSOFR30 Rate or Daily Simple SOFR, the time determined by the Administrative Agent in its  reasonable discretion.  "Refinance Indebtedness" has the meaning assigned to such term in Section 6.01(f).  "Register" has the meaning assigned to such term in Section 9.04(b).  "Regulation D" means Regulation D of the Federal Reserve Board, as in effect from time to time  and all official rulings and interpretations thereunder or thereof.  "Regulation T" means Regulation T of the Federal Reserve Board, as in effect from time to time  and all official rulings and interpretations thereunder or thereof.  

 

-37-  "Regulation U" means Regulation U of the Federal Reserve Board, as in effect from time to time  and all official rulings and interpretations thereunder or thereof.  "Regulation X" means Regulation X of the Federal Reserve Board, as in effect from time to time  and all official rulings and interpretations thereunder or thereof.  "Related Entity" means any Person of which more than 10% of the Equity Interests are owned by  a Person that owns more than 10% of the Equity Interests of HF Foods.  "Related Parties" means, with respect to any specified Person, such Person's Affiliates and the  respective directors, officers, partners, members, trustees, employees, agents, administrators, managers,  representatives and advisors of such Person and such Person's Affiliates.  "Release" means any releasing, spilling, leaking, pumping, pouring, emitting, emptying,  discharging, injecting, escaping, leaching, migrating, disposing or dumping of any substance into the  environment.  "Relevant Governmental Body" means the Federal Reserve Board and/or the NYFRB, the CME  Term SOFR Administrator, as applicable, or a committee officially endorsed or convened by the Federal  Reserve Board and/or the NYFRB or, in each case, any successor thereto.  "Relevant Rate" means (i) with respect to any Term Benchmark Borrowing, the Adjusted Term  SOFR Rate, (ii) with respect to any Adjusted REVSOFR30 Rate Borrowing, the Adjusted REVSOFR30  Rate, or (iii) with respect to any RFR Borrowing, the Adjusted Daily Simple SOFR, as applicable.  "Report" means reports prepared by the Administrative Agent or another Person showing the results  of appraisals, field examinations or audits pertaining to the assets of the Loan Parties from information  furnished by or on behalf of the Borrowers, after the Administrative Agent has exercised its rights of  inspection pursuant to this Agreement, which Reports may be distributed to the Lenders by the  Administrative Agent.  "Required Lenders" means, subject to Section 2.20, at any time prior to the earlier of the Loans  becoming due and payable pursuant to Article VII or the Commitments terminating or expiring, Lenders  having Revolving Exposures and Unfunded Commitments representing more than 50% of the sum of the  Aggregate Credit Exposure and Unfunded Commitments at such time; provided that, as long as there are  only two Lenders, Required Lenders shall mean both Lenders.  "Required Revolving Lenders" means, at any time, Revolving Lenders (other than Defaulting  Lenders) having Revolving Exposures and unused Revolving Commitments representing more than 50%  of the sum of the Aggregate Revolving Exposure and unused Revolving Commitments at such time;  provided that, as long as there are only two Revolving Lenders, Required Revolving Lenders shall mean  both Revolving Lenders.  "Requirement of Law" means, with respect to any Person, (a) the charter, articles or certificate of  organization or incorporation and bylaws or operating, management or partnership agreement, or other  organizational or governing documents of such Person and (b) any statute, law (including common law),  treaty, rule, regulation, code, ordinance, order, decree, writ, judgment, injunction or determination of any  arbitrator or court or other Governmental Authority (including Environmental Laws), in each case  applicable to or binding upon such Person or any of its property or to which such Person or any of its  property is subject.  

 

-38-  "Reserves" means any and all reserves which the Administrative Agent deems necessary, in its  Permitted Discretion, to maintain (including, without limitation, an availability reserve, reserves for accrued  and unpaid interest on the Secured Obligations, Banking Services Reserves, reserves in respect of  Agricultural Claims, volatility reserves, reserves for rent at locations leased by any Loan Party and for  consignee's, warehousemen's and bailee's charges, reserves for dilution of Accounts, reserves for Inventory  shrinkage, reserves for customs charges and shipping charges related to any Inventory in transit, reserves  for Swap Agreement Obligations, reserves for contingent liabilities of any Loan Party, reserves for  uninsured losses of any Loan Party, reserves for uninsured, underinsured, un-indemnified or under- indemnified liabilities or potential liabilities with respect to any litigation and reserves for taxes, fees,  assessments, and other governmental charges) with respect to the Collateral or any Loan Party.  "Resolution Authority" means an EEA Resolution Authority or, with respect to any UK Financial  Institution, a UK Resolution Authority.  "Responsible Officer" means the president, Financial Officer or other executive officer of the  Borrower Representative.  "Restricted Payment" means any dividend or distribution (whether in cash, securities or other  property) with respect to any Equity Interests in HF Foods or any Subsidiary, or any payment (whether in  cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase,  redemption, retirement, acquisition, cancellation or termination of any such Equity Interests or any option,  warrant or other right to acquire any such Equity Interests.  "REVSOFR30 Rate" means the Term SOFR Reference Rate for a one (1) month period, as such  rate is published by the CME Term SOFR Administrator, at approximately 5:00 a.m., Chicago time, two  (2) U.S. Government Securities Business Days prior to the first (1st) Business Day of each month, adjusted  monthly on the first (1st) Business Day of each month.  Any change in the REVSOFR Rate shall be effective  from and include the effective date of such change.  "Revolving Borrowing" means Revolving Loans of the same Type, made, converted or continued  on the same date and, in the case of Term Benchmark Loans, as to which a single Interest Period is in effect.  "Revolving Commitment" means, with respect to each Lender, the amount set forth on the  Commitment Schedule opposite such Lender's name, or in the Assignment and Assumption or other  documentation or record (as such term is defined in Section 9-102(a)(70) of the New York Uniform  Commercial Code) as provided in Section 9.04(b)(ii)(C) pursuant to which such Lender shall have assumed  its Revolving Commitment, as applicable, as such Revolving Commitment may be reduced or increased  from time to time pursuant to (a) Section 2.09 and (b) assignments by or to such Lender pursuant to Section  9.04; provided, that at no time shall the Revolving Exposure of any Lender exceed its Revolving  Commitment.  The initial aggregate amount of the Lenders' Revolving Commitment is $100,000,000.  "Revolving Exposure" means, with respect to any Lender at any time, the sum of (a) the outstanding  principal amount of such Lender's Revolving Loans, its LC Exposure and its Swingline Exposure at such  time, plus (b) an amount equal to its Applicable Percentage of the aggregate principal amount of Protective  Advances outstanding at such time, plus (c) an amount equal to its Applicable Percentage of the aggregate  principal amount of Overadvances outstanding at such time.  "Revolving Lender" means, as of any date of determination, a Lender with a Revolving  Commitment or, if the Revolving Commitments have terminated or expired, a Lender with Revolving  Exposure.  "Revolving Loan" means a Loan made pursuant to Section 2.01(a).  

 

-39-  "RFR Borrowing" means, as to any Borrowing, the RFR Loans comprising such Borrowing.  "RFR Loan" means a Loan that bears interest at a rate based on the Adjusted Daily Simple SOFR.  "Rongcheng" means Rongcheng Trading, LLC, a California limited liability company.  "S&P" means Standard & Poor's Ratings Services, a Standard & Poor's Financial Services LLC  business.  "Sale and Leaseback Transaction" has the meaning assigned to such term in Section 6.06.  "Sanctioned Country" means, at any time, a country, region or territory which is itself the subject  or target of any Sanctions (at the time of this Agreement, Crimea, Cuba, Iran, North Korea and Syria).  "Sanctioned Person" means, at any time, (a) any Person listed in any Sanctions-related list of  designated Persons maintained by OFAC or the U.S. Department of State, the United Nations Security  Council, the European Union or any European Union member state, Her Majesty's Treasury of the United  Kingdom or other relevant sanctions authority, (b) any Person operating, organized or resident in a  Sanctioned Country, (c) any Person owned or controlled by any such Person or Persons described in the  foregoing clauses (a) or (b), or (d) any Person otherwise the subject of any Sanctions.  "Sanctions" means all economic or financial sanctions or trade embargoes imposed, administered  or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the  U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European  Union member state, Her Majesty's Treasury of the United Kingdom or other relevant sanctions authority.  "SEC" means the Securities and Exchange Commission of the U.S.  "Second Amendment and Restatement Date" means January 17, 2020.  "Secured Obligations" means all Obligations, together with all (a) Banking Services Obligations  and (b) Swap Agreement Obligations owing to one or more Lenders or their respective Affiliates; provided,  however, that the definition of "Secured Obligations" shall not create any guarantee by any Guarantor of  (or grant of security interest by any Guarantor to support, as applicable) any Excluded Swap Obligations of  such Guarantor for purposes of determining any obligations of any Guarantor.  "Secured Parties" means (a) the Administrative Agent, (b) the Lenders, (c) the Issuing Bank,  (d) each provider of Banking Services, to the extent the Banking Services Obligations in respect thereof  constitute Secured Obligations, (e) each counterparty to any Swap Agreement, to the extent the obligations  thereunder constitute Secured Obligations, (f) the beneficiaries of each indemnification obligation  undertaken by any Loan Party under any Loan Document, and (g) the successors and assigns of each of the  foregoing.  "Security Agreement" means that certain Third Amended and Restated Pledge and Security  Agreement (including any and all supplements thereto), dated as of the Effective Date, among the Loan  Parties and the Administrative Agent, for the benefit of the Administrative Agent and the other Secured  Parties, and any other pledge or security agreement entered into, after the date of this Agreement by any  other Loan Party (as required by this Agreement or any other Loan Document) or any other Person for the  benefit of the Administrative Agent and the other Secured Parties, as the same may be amended, restated,  supplemented or otherwise modified from time to time.  

 

-40-  "Seismic Risk Properties" means, collectively, (a) the real estate owned by Realty and located at  19317 Arenth Avenue, City of Industry, California, (b) the real estate owned by Genstar Realty, LLC, a  California limited liability company, located at 31056 Genstar Road, Hayward, California and (c) any other  real estate owned by a Real Estate Borrower that is located in Seismic Zone 3 or 4 as designated by the  United States Geological Survey.  "Settlement Date" has the meaning assigned to such term in Section 2.05(d).  "SOFR" means a rate per annum equal to the secured overnight financing rate as administered by  the SOFR Administrator.  "SOFR Administrator" means the NYFRB (or a successor administrator of the secured overnight  financing rate).  "SOFR Administrator's Website" means the NYFRB's website, currently at  http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as  such by the SOFR Administrator from time to time.  "SOFR Determination Date" has the meaning specified in the definition of "Daily Simple SOFR".  "SOFR Rate Day" has the meaning specified in the definition of "Daily Simple SOFR".  "Special Advance Amount" means the amount set forth below for each applicable period set forth  below:  Period Amount  Third Amendment Effective Date through and including April 29, 2022 $10,000,000.00  April 30, 2022 through and including May 30, 2022 $  9,166,666.67  May 31, 2022 through and including June 29, 2022 $  8,333,333,34  June 30, 2022 through and including July 30, 2022 $  7,500,000.00  July 31, 2022 through and including August 30, 2022 $  6,666,666.67  August 31, 2022 through and including September 29, 2022 $  5,833,333.34  September 30, 2022 through and including October 30, 2022 $  5,000,000.00  October 31, 2022 through and including November 29, 2022 $  4,166,666,67  November 30, 2022 through and including December 30, 2022 $  3,333,333,34  December 31, 2022 through and including January 30, 2023 $  2,500,000.00  January 31, 2023 through and including February 27, 2023 $  1,666,666.67  February 28, 2023 through and including March 30, 2023 $     833,333.34  

 

-41-  March 31, 2023 and thereafter $                0.00    "Standby LC Exposure" means, at any time, the sum of (a) the aggregate undrawn amount of all  standby Letters of Credit outstanding at such time plus (b) the aggregate amount of all LC Disbursements  relating to standby Letters of Credit that have not yet been reimbursed by or on behalf of the Borrowers at  such time.  The Standby LC Exposure of any Revolving Lender at any time shall be its Applicable  Percentage of the aggregate Standby LC Exposure at such time.  "State Agricultural Laws" means the laws of any State, and regulations issued from time to time  thereunder, that provide for priority claims against, or Liens on, any assets of any Person in order to secure  or assure payment by such Person of amounts owing to suppliers of agricultural products or to the lenders  to such suppliers.  "State Agricultural Liens" means Liens on any Loan Party's Inventory consisting of farm products,  and/or any other assets of the any Loan Party, in favor of suppliers of agricultural products or the lenders  to such suppliers, that have been properly perfected under applicable law.  "Statements" has the meaning assigned to such term in Section 2.18(f).  "Subordinated Indebtedness" of a Person means any Indebtedness of such Person the payment of  which is subordinated to payment of the Secured Obligations to the written satisfaction of the  Administrative Agent.  "subsidiary" means, with respect to any Person (the "parent entity") at any date, any corporation,  limited liability company, partnership, association or other entity (a) of which securities or other ownership  interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in  the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned,  controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent entity and/or one or  more subsidiaries of the parent entity.  "Subsidiary" means any direct or indirect subsidiary of HF Foods or another Loan Party, as  applicable.  "Supermajority Revolving Lenders" means, at any time, Revolving Lenders (other than Defaulting  Lenders) having Revolving Exposures and unused Revolving Commitments representing more than 66  2/3% of the sum of the Aggregate Revolving Exposure and unused Revolving Commitments at such time.  "Supported QFC" has the meaning assigned to it in Section 9.21.  "Swap Agreement" means any agreement with respect to any swap, forward, spot, future, credit  default or derivative transaction or option or similar agreement involving, or settled by reference to, one or  more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or  pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any  combination of these transactions; provided that no phantom stock or membership interest or similar plan  providing for payments only on account of services provided by current or former managers, directors,  officers, employees or consultants of the Borrowers or the Subsidiaries shall be a Swap Agreement.  "Swap Agreement Obligations" means any and all obligations of the Loan Parties, whether absolute  or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all  renewals, extensions and modifications thereof and substitutions therefor), under (a) any and all Swap  Agreements permitted hereunder with a Lender or an Affiliate of a Lender, and (b) any and all cancellations,  

 

-42-  buy backs, reversals, terminations or assignments of any Swap Agreement transaction permitted hereunder  with a Lender or an Affiliate of a Lender.  "Swap Obligation" means, with respect to any Guarantor, any obligation to pay or perform under  any agreement, contract or transaction that constitutes a "swap" within the meaning of section 1a(47) of the  Commodity Exchange Act or any rules or regulations promulgated thereunder.  "Swingline Exposure" means, at any time, the aggregate principal amount of all Swingline Loans  outstanding at such time.  The Swingline Exposure of any Revolving Lender at any time shall be its  Applicable Percentage of the total Swingline Exposure at such time.  "Swingline Lender" means JPMCB, in its capacity as lender of Swingline Loans hereunder.  Any  consent required of the Administrative Agent or the Issuing Bank shall be deemed to be required of the  Swingline Lender and any consent given by JPMCB in its capacity as Administrative Agent or Issuing  Bank shall be deemed given by JPMCB in its capacity as Swingline Lender.  "Swingline Loan" has the meaning assigned to such term in Section 2.05(a).  "SynGlobal" means SynGlobal, Inc.  "Target Balance" has the meaning assigned to such term in the DDA Access Product Agreement.  "Taxes" means any and all present or future taxes, levies, imposts, duties, deductions, withholdings  (including backup withholding), value added taxes, or any other goods and services, use or sales taxes,  assessments, fees or other charges imposed by any Governmental Authority, including any interest,  additions to tax or penalties applicable thereto.  "Term A Lenders" means, as of any date of determination, Lenders having a Term A Loan  Commitment.  "Term A Loan" has the meaning assigned to such term in Section 2.01(b).  "Term A Loan Commitment" means as to any Term A Lender, such Term A Lender's Applicable  Percentage of the Term A Loan.  "Term A Loan Maturity Date" has the meaning assigned to such term in Section 2.10(a).  "Term B Lenders" means, as of any date of determination, Lenders having a Term B Loan  Commitment.  "Term B Loan" has the meaning assigned to such term in Section 2.01(c).  "Term B Loan Commitment" means as to any Term B Lender, such Term B Lender's Applicable  Percentage of the Term B Loan.  "Term B Loan Maturity Date" has the meaning assigned to such term in Section 2.10(a).  "Term Benchmark" when used in reference to any Loan or Borrowing, refers to whether such Loan,  or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the  Adjusted Term SOFR Rate.  "Term Loan" has the meaning assigned to such term in Section 2.01(c).  

 

-43-  "Term Loan Base" means at any time, (a) 75% multiplied by the aggregate fair market value of the  Real Estate Borrowers' Eligible Real Property identified in the most recent real property appraisal ordered  by the Administrative Agent, minus (b) applicable reserves established by the Administrative Agent in its  Permitted Discretion.  "Term SOFR Determination Day" has the meaning assigned to it under the definition of Term  SOFR Reference Rate.  "Term SOFR Rate" means, with respect to any Term Benchmark Borrowing and for any tenor  comparable to the applicable Interest Period, the Term SOFR Reference Rate at approximately 5:00 a.m.,  Chicago time, two (2) U.S. Government Securities Business Days prior to the commencement of such tenor  comparable to the applicable Interest Period, as such rate is published by the CME Term SOFR  Administrator.  "Term SOFR Reference Rate" means, for any day and time (such day, the "Term SOFR  Determination Day"), and for any tenor comparable to the applicable Interest Period, the rate per annum  determined by the Administrative Agent as the forward-looking term rate based on SOFR.  If by 5:00 pm  (New York City time) on such Term SOFR Determination Day, the "Term SOFR Reference Rate" for the  applicable tenor has not been published by the CME Term SOFR Administrator and a Benchmark  Replacement Date with respect to the Term SOFR Rate has not occurred, then the Term SOFR Reference  Rate for such Term SOFR Determination Day will be the Term SOFR Reference Rate as published in  respect of the first preceding U.S. Government Securities Business Day for which such Term SOFR  Reference Rate was published by the CME Term SOFR Administrator, so long as such first preceding  Business Day is not more than five (5) Business Days prior to such Term SOFR Determination Day.  "Third Amendment Effective Date" means December 30, 2021.  "Third Amendment Effective Date Acquisition" means the acquisition by Great Wall Illinois and  Great Wall Texas of certain assets of Third Amendment Effective Date Sellers pursuant to the terms of the  Third Amendment Effective Date Acquisition Agreement.  "Third Amendment Effective Date Acquisition Agreement" means the certain Asset Purchase  Agreement dated as of the Third Amendment Effective Date by and among Third Amendment Effective  Date Sellers, Great Wall Illinois, Great Wall Texas, HF Foods, Bo Chuan Wong and Qiu Xian Li.  "Third Amendment Effective Date Sellers" means, collectively, Great Wall Seafood Supply, Inc.,  Great Wall Restaurant Supplier, Inc. and First Mart Inc.  "Total Consideration" means, with respect to any Acquisition, all amounts paid or payable in  connection with such Acquisition, including all transaction costs and all Indebtedness, liabilities and  contingent obligations incurred or assumed in connection therewith, including the maximum amount  payable under any earn-out obligations.  "Transactions" means the execution, delivery and performance by the Borrowers of this Agreement  and the other Loan Documents, the borrowing of Loans and other credit extensions, the use of the proceeds  thereof and the issuance of Letters of Credit hereunder.  "Type", when used in reference to any Loan or Borrowing, refers to whether the rate of interest on  such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted Term  SOFR Rate, the REVSOFR30 Rate, the Adjusted Daily Simple SOFR or the CBFR.  

 

-44-  "UCC" means the Uniform Commercial Code as in effect from time to time in the State of Illinois  or in any other state the laws of which are required to be applied in connection with the issue of perfection  of security interests.  "UK Financial Institutions" means any BRRD Undertaking (as such term is defined under the PRA  Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation  Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time)  promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions  and investment firms, and certain affiliates of such credit institutions or investment firms.  "UK Resolution Authority" means the Bank of England or any other public administrative authority  having responsibility for the resolution of any UK Financial Institution.  "Unadjusted Benchmark Replacement" means the applicable Benchmark Replacement excluding  the related Benchmark Replacement Adjustment.  "Unfinanced Capital Expenditures" means, for any period, Capital Expenditures made during such  period which are not financed from the proceeds of any Indebtedness (other than the Revolving Loans; it  being understood and agreed that, to the extent any Capital Expenditures are financed with Revolving  Loans, such Capital Expenditures shall be deemed Unfinanced Capital Expenditures).  "Unfunded Commitment" means, with respect to each Revolving Lender, the Revolving  Commitment of such Lender less its Revolving Exposure.  "Unliquidated Obligations" means, at any time, any Secured Obligations (or portion thereof) that  are contingent in nature or unliquidated at such time, including any Secured Obligation that is: (a) an  obligation to reimburse a bank for drawings not yet made under a letter of credit issued by it; (b) any other  obligation (including any guarantee) that is contingent in nature at such time; or (c) an obligation to provide  collateral to secure any of the foregoing types of obligations.  "U.S." means the United States of America.  "U.S. Government Securities Business Day" means any day except for (i) a Saturday, (ii) a Sunday  or (iii) a day on which the Securities Industry and Financial Markets Association recommends that the fixed  income departments of its members be closed for the entire day for purposes of trading in United States  government securities.  "U.S. Person" means a "United States person" within the meaning of Section 7701(a)(30) of the  Code.  "U.S. Special Resolution Regime" has the meaning assigned to it in Section 9.21.  "U.S. Tax Compliance Certificate" has the meaning assigned to such term in  Section 2.17(f)(ii)(B)(3).  "USA PATRIOT Act" means the Uniting and Strengthening America by Providing Appropriate  Tools Required to Intercept and Obstruct Terrorism Act of 2001.  "Withdrawal Liability" means liability to a Multiemployer Plan as a result of a complete or partial  withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of  ERISA.  

 

-45-  "Working Capital Borrower" or "Working Capital Borrowers" has the meaning assigned to such  term in the preamble hereto.  "Write-Down and Conversion Powers" means, (a) with respect to any EEA Resolution Authority,  the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail- In Legislation for the applicable EEA Member Country, which write-down and conversion powers are  described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers  of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change  the form of a liability of any UK Financial Institution or any contract or instrument under which that liability  arises, to convert all or part of that liability into shares, securities or obligations of that person or any other  person, to provide that any such contract or instrument is to have effect as if a right had been exercised  under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In  Legislation that are related to or ancillary to any of those powers.  SECTION 1.02 Classification of Loans and Borrowings.  For purposes of this Agreement,  Loans may be classified and referred to by Class (e.g., a "Revolving Loan") or by Type (e.g., a "Term  Benchmark Loan", an "RFR Loan" or "an Adjusted REVSOFR30 Rate Loan") or by Class and Type (e.g.,  a "Term Benchmark Revolving Loan", an " RFR Revolving Loan" or "an Adjusted REVSOFR30 Rate  Revolving Loan").  Borrowings also may be classified and referred to by Class (e.g., a "Revolving  Borrowing") or by Type (e.g., a "Term Benchmark Borrowing", an "RFR Borrowing" or "an Adjusted  REVSOFR30 Rate Borrowing") or by Class and Type (e.g., a "Term Benchmark Revolving Borrowing",  an "RFR Revolving Borrowing" or "an Adjusted REVSOFR30 Rate Revolving Borrowing").  SECTION 1.03 Terms Generally. The definitions of terms herein shall apply equally to the  singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall  include the corresponding masculine, feminine and neuter forms.  The words "include", "includes" and  "including" shall be deemed to be followed by the phrase "without limitation".  The word "law" shall be  construed as referring to all statutes, rules, regulations, codes and other laws (including official rulings and  interpretations thereunder having the force of law or with which affected Persons customarily comply) and  all judgments, orders and decrees of all Governmental Authorities.  The word "will" shall be construed to  have the same meaning and effect as the word "shall".  Unless the context requires otherwise (a) any  definition of or reference to any agreement, instrument or other document herein shall be construed as  referring to such agreement, instrument or other document as from time to time amended, restated,  supplemented or otherwise modified (subject to any restrictions on such amendments, restatements,  supplements or modifications set forth herein), (b) any definition of or reference to any statute, rule or  regulation shall be construed as referring thereto as from time to time amended, supplemented or otherwise  modified (including by succession of comparable successor laws), (c) any reference herein to any Person  shall be construed to include such Person's successors and assigns (subject to any restrictions on  assignments set forth herein) and, in the case of any Governmental Authority, any other Governmental  Authority that shall have succeeded to any or all functions thereof, (d) the words "herein", "hereof" and  "hereunder", and words of similar import, shall be construed to refer to this Agreement in its entirety and  not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules  shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement,  (f) any reference in any definition to the phrase "at any time" or "for any period" shall refer to the same  time or period for all calculations or determinations within such definition, and (g) the words "asset" and  "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and  intangible assets and properties, including cash, securities, accounts and contract rights.  SECTION 1.04 Accounting Terms; GAAP.    (a) Except as otherwise expressly provided herein, all terms of an accounting or  financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that,  

 

-46-  if after the date hereof there occurs any change in GAAP or in the application thereof on the operation of  any provision hereof and the Borrower Representative notifies the Administrative Agent that the Borrowers  request an amendment to any provision hereof to eliminate the effect of such change in GAAP or in the  application thereof (or if the Administrative Agent notifies the Borrower Representative that the Required  Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such  notice is given before or after such change in GAAP or in the application thereof, then such provision shall  be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have  become effective until such notice shall have been withdrawn or such provision amended in accordance  herewith.  (b) Notwithstanding anything to the contrary contained in Section 1.04(a) or in the  definition of "Capital Lease Obligations," any change in accounting for leases pursuant to GAAP resulting  from the adoption of Financial Accounting Standards Board Accounting Standards Update No. 2016-02,  Leases (Topic 842) ("FAS 842"), to the extent such adoption would require treating any lease (or similar  arrangement conveying the right to use) as a capital lease where such lease (or similar arrangement) would  not have been required to be so treated under GAAP as in effect on December 31, 2015, such lease shall  not be considered a capital lease, and all calculations and deliverables under this Agreement or any other  Loan Document shall be made or delivered, as applicable, in accordance therewith.  SECTION 1.05 Interest Rates; Benchmark Notifications.  The interest rate on a Loan  denominated in dollars may be derived from an interest rate benchmark that may be discontinued or is, or  may in the future become, the subject of regulatory reform.  Upon the occurrence of a Benchmark Transition  Event, Section 2.14(b) provides a mechanism for determining an alternative rate of interest.  The  Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with  respect to, the administration, submission, performance or any other matter related to any interest rate used  in this Agreement, or with respect to any alternative or successor rate thereto, or replacement rate thereof,  including without limitation, whether the composition or characteristics of any such alternative, successor  or replacement reference rate will be similar to, or produce the same value or economic equivalence of, the  existing interest rate being replaced or have the same volume or liquidity as did any existing interest rate  prior to its discontinuance or unavailability.  The Administrative Agent and its affiliates and/or other related  entities may engage in transactions that affect the calculation of any interest rate used in this Agreement or  any alternative, successor or alternative rate (including any Benchmark Replacement) and/or any relevant  adjustments thereto, in each case, in a manner adverse to the Borrowers.  The Administrative Agent may  select information sources or services in its reasonable discretion to ascertain any interest rate used in this  Agreement, any component thereof, or rates referenced in the definition thereof, in each case pursuant to  the terms of this Agreement, and shall have no liability to the Borrowers, any Lender or any other person  or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential  damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity),  for any error or calculation of any such rate (or component thereof) provided by any such information  source or service.  SECTION 1.06 Effect of Amendment and Restatement; No Novation; Release.  Upon the  effectiveness of this Agreement, the Existing Credit Agreement shall be amended and restated in its entirety  by this Agreement.  The Existing Obligations outstanding on the Effective Date shall continue in full force  and effect and constitute Obligations, and the effectiveness of this Agreement shall not constitute a novation  or repayment of the Existing Obligations.  Such Existing Obligations, together with any and all additional  Obligations incurred by Borrowers under this Agreement or under any of the other Loan Documents, shall  continue to be secured by, among other things, the Collateral, whether now existing or hereafter acquired  and wheresoever located, all as more specifically set forth in this Agreement and the other Loan Documents.   Each Loan Party hereby reaffirms its obligations, liabilities, grants of security interests, pledges and the  validity of all covenants by it contained in the Existing Credit Agreement and in any and all Loan  Documents, as amended, supplemented or otherwise modified by this Agreement and by the Loan  

 

-47-  Documents delivered on the Effective Date.  Any and all references in any Loans Documents to the Existing  Credit Agreement shall be deemed to be amended to refer to this Agreement.  In consideration of Administrative Agent and Lenders entering into this Agreement and for other  good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, as of the  date hereof, each Loan Party hereby absolutely, unconditionally and irrevocably releases, remises and  forever discharges Administrative Agent, Issuer and Lenders, and their successors and assigns, and their  respective present and former shareholders, members, managers, affiliates, subsidiaries, divisions,  predecessors, directors, officers, attorneys, employees, agents, legal representatives and other  representatives (Administrative Agent, Issuer, each Lender and all such other Persons being hereinafter  referred to collectively as the "Releasees" and individually as a "Releasee"), of and from all demands,  actions, causes of action, suits, covenants, contracts, controversies and any and all other claims,  counterclaims, defenses, rights of set off, demands and liabilities whatsoever of every name and nature,  known or unknown, suspected or unsuspected, both at law and in equity, which any Loan Party may now  or hereafter own, hold, have or claim to have against the Releasees by reason of any circumstance, action,  cause or thing whatsoever which occurred on or prior to the date of this Agreement, including, without  limitation, for or on account of, or in relation to, or in any way in connection with the Existing Credit  Agreement, the Loan Documents or transactions directly related thereto between any Loan Party and the  Releasees; provided that nothing in this Section 1.06 shall affect or release any Lender from any liabilities  or obligations owing to any Loan Party by such Lender with respect to Banking Services provided by such  Lender.  ARTICLE II    The Credits  SECTION 2.01 Commitments.  (a) Immediately prior to the effectiveness of this Agreement, on the Effective Date,  the outstanding principal balance of the "Revolving Loans" made under (and as such term is defined in) the  Existing Credit Agreement was $70,818,427.80 (the "Outstanding Existing Revolving Loan Balance").  On  the Effective Date, the Outstanding Existing Revolving Loan Balance shall be continued, for all purposes  of this Agreement, as Revolving Loans (as such term is defined below) hereunder.  From and after the  Effective Date, subject to the terms and conditions set forth herein, each Lender severally (and not jointly)  agrees to make Revolving Loans to the Working Capital Borrowers from time to time during the  Availability Period in an aggregate principal amount that will not result in (i) such Lender's Revolving  Exposure exceeding such Lender's Revolving Commitment or (ii) the Aggregate Revolving Exposure  exceeding the lesser of (x) the Aggregate Revolving Commitment and (y) the Borrowing Base, subject to  the Administrative Agent's authority, in its sole discretion, to make Protective Advances and Overadvances  pursuant to the terms of Sections 2.04 and 2.05.  Within the foregoing limits and subject to the terms and  conditions set forth herein, the Borrowers may borrow, prepay and reborrow Revolving Loans.  (b) On the Original Closing Date, JPMCB funded to the Real Estate Borrowers the  "Term Loan" (as defined in the Original Credit Agreement) under the Original Credit Agreement in an  aggregate original principal amount of $60,000,000 (the "Original Term Loan").  On the Second  Amendment and Restatement Date, the Term A Lenders funded to the Real Estate Borrowers the  "Additional Term Loan Advance" (as defined in the Existing Credit Agreement) under the Existing Credit  Agreement in an aggregate original principal amount of $20,600,000 (the "Additional Term Loan"; the  Original Term Loan and the Additional Term Loan are collectively referred to as the "Term A Loan").   Immediately prior to the Effective Date, the outstanding principal balance of the Term A Loan was  $69,048,000.  Each Term A Lender's share of the outstanding Term A Loan as of the Effective Date is set  

 

-48-  forth on the Commitment Schedule.  Amounts repaid or prepaid in respect of the Term A Loan may not be  reborrowed.  (c) On the Effective Date, and subject to the terms and conditions of this Agreement,  each Term B Lender agrees to fund (on a several, not joint, basis) a term loan to the Real Estate Borrowers  (the "Term B Loan") in an amount equal to such Term B Lender's Term B Loan Commitment as set forth  on the Commitment Schedule, in each case by making immediately available funds available to the  Administrative Agent's designated account.  The aggregate original principal amount of the Term B Loan  is equal to $45,952,000.  Amounts repaid or prepaid in respect of the Term B Loan may not be reborrowed.   The Term A Loan and the Term B Loan are collectively referred to as the "Term Loan".  The aggregate  outstanding principal amount of the Term Loan (after giving effect to the funding of the Term B Loan) as  of the Effective Date is $115,000,000.  SECTION 2.02 Loans and Borrowings.  (a) Each Loan (other than a Swingline Loan) shall be made as part of a Borrowing  consisting of Loans of the same Class and Type made by the Lenders ratably in accordance with their  respective Commitments of the applicable Class.  The failure of any Lender to make any Loan required to  be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments  of the Lenders are several and no Lender shall be responsible for any other Lender's failure to make Loans  as required.  Any Protective Advance, any Overadvance and any Swingline Loan shall be made in  accordance with the procedures set forth in Sections 2.04 and 2.05.  (b) Subject to Section 2.14, each Borrowing shall be comprised entirely of CBFR  Loans or Term Benchmark Loans as the Borrower Representative may request in accordance herewith.   Each Swingline Loan shall be a CBFR Loan.  Each Lender at its option may make any Loan by causing  any domestic or foreign branch or Affiliate of such Lender to make such Loan (and in the case of an  Affiliate, the provisions of Sections 2.14, 2.15, 2.16 and 2.17 shall apply to such Affiliate to the same extent  as to such Lender); provided that any exercise of such option shall not affect the obligation of the Borrowers  to repay such Loan in accordance with the terms of this Agreement.  (c) At the commencement of each Interest Period for any Term Benchmark  Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $250,000 and  not less than $1,000,000.  CBFR Borrowings may be in any amount.  Borrowings of more than one Type  and Class may be outstanding at the same time; provided that there shall not at any time be more than a  total of 5 Term Benchmark Borrowings outstanding.  (d) Notwithstanding any other provision of this Agreement, the Borrower  Representative shall not be entitled to request, or to elect to convert or continue, any Borrowing if the  Interest Period requested with respect thereto would end after the Maturity Date (or in the case of (1) the  Term A Loan, the Term A Loan Maturity Date or (2) the Term B Loan, the Term B Loan Maturity Date).  SECTION 2.03 Requests for Revolving Borrowings.  To request a Revolving Borrowing, the  Borrower Representative shall notify the Administrative Agent of such request either in writing (delivered  by hand or fax) by delivering a Borrowing Request signed by a Responsible Officer of the Borrower  Representative or through an Electronic System if arrangements for doing so have been approved by the  Administrative Agent (or if an Extenuating Circumstance shall exist, by telephone) not later than (a) in the  case of a Term Benchmark Borrowing, 10:00 a.m., Chicago time, three (3) Business Days before the date  of the proposed Borrowing or (b) in the case of a CBFR Borrowing, noon, Chicago time, on the date of the  proposed Borrowing; provided that any such notice of a CBFR Revolving Borrowing to finance the  reimbursement of an LC Disbursement as contemplated by Section 2.06(e) must be given not later than  9:00 a.m., Chicago time, on the date of such proposed Borrowing.  Each such Borrowing Request shall be  

 

-49-  irrevocable and each such telephonic Borrowing Request, if permitted, shall be confirmed immediately  upon the cessation of the Extenuating Circumstance by hand delivery, facsimile or a communication  through an Electronic System to the Administrative Agent of a written Borrowing Request in a form  approved by the Administrative Agent and signed by a Responsible Officer of the Borrower Representative.   Each such written (or if permitted, telephonic) Borrowing Request shall specify the following information  in compliance with Section 2.02:  (i) the aggregate amount of the requested Revolving Borrowing;  (ii) the date of such Revolving Borrowing, which shall be a Business Day;  (iii) whether such Revolving Borrowing is to be a CBFR Borrowing or a Term  Benchmark Borrowing; and  (iv) in the case of a Term Benchmark Borrowing, the initial Interest Period to  be applicable thereto, which shall be a period contemplated by the definition of the term  "Interest Period."  If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be a CBFR  Borrowing.  If no Interest Period is specified with respect to any requested Term Benchmark Borrowing,  then the applicable Working Capital Borrower(s) shall be deemed to have selected an Interest Period of one  month's duration.  Promptly following receipt of a Borrowing Request in accordance with this Section, the  Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender's  Loan to be made as part of the requested Borrowing.  SECTION 2.04 Protective Advances.   (a) Subject to the limitations set forth below, the Administrative Agent is authorized  by the Working Capital Borrowers and the Lenders, from time to time in the Administrative Agent's sole  discretion (but shall have absolutely no obligation to), to make Loans to the Working Capital Borrowers,  on behalf of all Lenders, which the Administrative Agent, in its Permitted Discretion, deems necessary or  desirable (i) to preserve or protect the Collateral, or any portion thereof, (ii) to enhance the likelihood of,  or maximize the amount of, repayment of the Loans and other Obligations, or (iii) to pay any other amount  chargeable to or required to be paid by the Working Capital Borrowers pursuant to the terms of this  Agreement, including payments of reimbursable expenses (including costs, fees, and expenses as described  in Section 9.03) and other sums payable under the Loan Documents (any of such Loans are herein referred  to as "Protective Advances"); provided that, the aggregate amount of Protective Advances outstanding at  any time shall not at any time exceed $10,000,000; provided further that, the Aggregate Revolving  Exposure after giving effect to the Protective Advances being made shall not exceed the Aggregate  Revolving Commitment.  Protective Advances may be made even if the conditions precedent set forth in  Section 4.02 have not been satisfied.  The Protective Advances shall be secured by the Liens in favor of the  Administrative Agent in and to the Collateral and shall constitute Obligations hereunder.  All Protective  Advances shall be CBFR Borrowings.  The making of a Protective Advance on any one occasion shall not  obligate the Administrative Agent to make any Protective Advance on any other occasion.  The  Administrative Agent's authorization to make Protective Advances may be revoked at any time by the  Required Lenders.  Any such revocation must be in writing and shall become effective prospectively upon  the Administrative Agent's receipt thereof.  At any time that there is sufficient Availability and the  conditions precedent set forth in Section 4.02 have been satisfied, the Administrative Agent may request  the Revolving Lenders to make a Revolving Loan to repay a Protective Advance.  At any other time the  Administrative Agent may require the Lenders to fund their risk participations described in Section 2.04(b).  

 

-50-  (b) Upon the making of a Protective Advance by the Administrative Agent (whether  before or after the occurrence of a Default), each Lender shall be deemed, without further action by any  party hereto, to have unconditionally and irrevocably purchased from the Administrative Agent, without  recourse or warranty, an undivided interest and participation in such Protective Advance in proportion to  its Applicable Percentage.  From and after the date, if any, on which any Lender is required to fund its  participation in any Protective Advance purchased hereunder, the Administrative Agent shall promptly  distribute to such Lender, such Lender's Applicable Percentage of all payments of principal and interest and  all proceeds of Collateral received by the Administrative Agent in respect of such Protective Advance.  SECTION 2.05 Swingline Loans and Overadvances.  (a) The Administrative Agent, the Swingline Lender and the Revolving Lenders agree  that in order to facilitate the administration of this Agreement and the other Loan Documents, promptly  after the Borrower Representative requests a CBFR Borrowing, the Swingline Lender may elect to have the  terms of this Section 2.05(a) apply to such Borrowing Request by advancing, on behalf of the Revolving  Lenders and in the amount requested, same day funds to the Borrowers, on the date of the applicable  Borrowing to the Funding Account specified by the Borrower Representative (each such Loan made solely  by the Swingline Lender pursuant to this Section 2.05(a) is referred to in this Agreement as a "Swingline  Loan"), with settlement among them as to the Swingline Loans to take place on a periodic basis as set forth  in Section 2.05(d); provided that, the aggregate amount of Swingline Loans outstanding at any time shall  not at any time exceed $10,000,000.  Each Swingline Loan shall be subject to all the terms and conditions  applicable to other CBFR Loans funded by the Revolving Lenders, except that all payments thereon shall  be payable to the Swingline Lender solely for its own account.  In addition, the Working Capital Borrowers  hereby authorize the Swingline Lender to, and the Swingline Lender may, subject to the terms and  conditions set forth herein (but without any further written notice required), not later than 1:00 p.m.,  Chicago time, on each Business Day, make available to the Working Capital Borrowers by means of a  credit to the Funding Account specified by the Borrower Representative, the proceeds of a Swingline Loan  to the extent necessary to pay items to be drawn on any Controlled Disbursement Account that Business  Day; provided that, if on any Business Day there is insufficient borrowing capacity to permit the Swingline  Lender to make available to the Working Capital Borrowers a Swingline Loan in the amount necessary to  pay all items to be so drawn on any such Controlled Disbursement Account on such Business Day, then the  Working Capital Borrowers shall be deemed to have requested a CBFR Borrowing pursuant to Section 2.03  in the amount of such deficiency to be made on such Business Day. In addition, the Working Capital  Borrowers hereby authorize the Swingline Lender to, and the Swingline Lender shall, subject to the terms  and conditions set forth herein (but without any further written notice required), to the extent that from time  to time on any Business Day funds are required under the DDA Access Product to reach the Target Balance  (a "Deficiency Funding Date"), make available to the applicable Borrower the proceeds of a Swingline  Loan in the amount of such deficiency up to the Target Balance, by means of a credit to the applicable  Funding Account on or before the start of business on the next succeeding Business Day, and such  Swingline Loan shall be deemed made on such Deficiency Funding Date.  The Swingline Lender shall not  make any Swingline Loan if the requested Swingline Loan exceeds Availability (before or after giving  effect to such Swingline Loan).  All Swingline Loans shall be CBFR Borrowings.  (b) Any provision of this Agreement to the contrary notwithstanding, at the request of  the Borrower Representative, the Administrative Agent may in its sole discretion (but with absolutely no  obligation), on behalf of the Revolving Lenders, (x) make Revolving Loans to the Working Capital  Borrowers in amounts that exceed Availability (any such excess Revolving Loans are herein referred to  collectively as "Overadvances") or (y) deem the amount of Revolving Loans outstanding to the Working  Capital Borrowers that are in excess of Availability to be Overadvances; provided that, no Overadvance  shall result in a Default due to the Working Capital Borrowers' failure to comply with Section 2.01 for so  long as such Overadvance remains outstanding in accordance with the terms of this paragraph, but solely  with respect to the amount of such Overadvance.  In addition, Overadvances may be made even if the  

 

-51-  condition precedent set forth in Section 4.02(c) has not been satisfied.  All Overadvances shall constitute  CBFR Borrowings.  The making of an Overadvance on any one occasion shall not obligate the  Administrative Agent to make any Overadvance on any other occasion.  The authority of the Administrative  Agent to make Overadvances is limited to an aggregate amount not to exceed $10,000,000 at any time, no  Overadvance may remain outstanding for more than thirty days and no Overadvance shall cause any  Revolving Lender's Revolving Exposure to exceed its Revolving Commitment; provided that, the Required  Revolving Lenders may at any time revoke the Administrative Agent's authorization to make  Overadvances.  Any such revocation must be in writing and shall become effective prospectively upon the  Administrative Agent's receipt thereof.  (c) Upon the making of a Swingline Loan or an Overadvance (whether before or after  the occurrence of a Default and regardless of whether a Settlement has been requested with respect to such  Swingline Loan or Overadvance), each Revolving Lender shall be deemed, without further action by any  party hereto, to have unconditionally and irrevocably purchased from the Swingline Lender or the  Administrative Agent, as the case may be, without recourse or warranty, an undivided interest and  participation in such Swingline Loan or Overadvance in proportion to its Applicable Percentage of the  Revolving Commitment.  The Swingline Lender or the Administrative Agent may, at any time, require the  Revolving Lenders to fund their participations.  From and after the date, if any, on which any Revolving  Lender is required to fund its participation in any Swingline Loan or Overadvance purchased hereunder,  the Administrative Agent shall promptly distribute to such Lender, such Lender's Applicable Percentage of  all payments of principal and interest and all proceeds of Collateral received by the Administrative Agent  in respect of such Swingline Loan or Overadvance.  (d) The Administrative Agent, on behalf of the Swingline Lender, shall request  settlement (a "Settlement") with the Revolving Lenders on at least a weekly basis or on any date that the  Administrative Agent elects, by notifying the Revolving Lenders of such requested Settlement by facsimile,  telephone, or e-mail no later than 12:00 noon Chicago time on the date of such requested Settlement (the  "Settlement Date").  Each Revolving Lender (other than the Swingline Lender, in the case of the Swingline  Loans) shall transfer the amount of such Revolving Lender's Applicable Percentage of the outstanding  principal amount of the applicable Loan with respect to which Settlement is requested to the Administrative  Agent, to such account of the Administrative Agent as the Administrative Agent may designate, not later  than 2:00 p.m., Chicago time, on such Settlement Date.  Settlements may occur during the existence of a  Default and whether or not the applicable conditions precedent set forth in Section 4.02 have then been  satisfied.  Such amounts transferred to the Administrative Agent shall be applied against the amounts of the  Swingline Lender's Swingline Loans and, together with Swingline Lender's Applicable Percentage of such  Swingline Loan, shall constitute Revolving Loans of such Revolving Lenders, respectively.  If any such  amount is not transferred to the Administrative Agent by any Revolving Lender on such Settlement Date,  the Swingline Lender shall be entitled to recover from such  Lender on demand such amount, together with  interest thereon, as specified in Section 2.07.  (e) The Swingline Lender may by written notice given to the Administrative Agent  require the Revolving Lenders to acquire participations on such Business Day in all or a portion of the  Swingline Loans outstanding.  Such notice shall specify the aggregate amount of Swingline Loans in which  the Revolving Lenders will participate.  Promptly upon receipt of such notice, the Administrative Agent  will give notice thereof to each Revolving Lender, specifying in such notice such Lender's Applicable  Percentage of such Swingline Loan or Loans.  Each Revolving Lender hereby absolutely and  unconditionally agrees, promptly upon receipt of such notice from the Administrative Agent (and in any  event, if such notice is received by 11:00 a.m., Chicago time, on a Business Day no later than 4:00 p.m.,  Chicago time on such Business Day and if received after 11:00 a.m., Chicago time, "on a Business Day"  shall mean no later than 9:00 a.m. Chicago time on the immediately succeeding Business Day), to pay to  the Administrative Agent, for the account of the Swingline Lender, such Lender's Applicable Percentage  of such Swingline Loan or Loans.  Each Revolving Lender acknowledges and agrees that its obligation to  

 

-52-  acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall  not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or  reduction or termination of the Revolving Commitments, and that each such payment shall be made without  any offset, abatement, withholding or reduction whatsoever.  Each Revolving Lender shall comply with its  obligation under this paragraph by wire transfer of immediately available funds, in the same manner as  provided in Section 2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis  mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent shall  promptly pay to the Swingline Lender the amounts so received by it from the Revolving Lenders.  The  Administrative Agent shall notify the Borrower Representative of any participations in any Swingline Loan  acquired pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be  made to the Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline  Lender from the Working Capital Borrowers (or other party on behalf of the Working Capital Borrowers)  in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of  participations therein shall be promptly remitted to the Administrative Agent; any such amounts received  by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Revolving  Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as  their interests may appear; provided that any such payment so remitted shall be repaid to the Swingline  Lender or to the Administrative Agent, as applicable, if and to the extent such payment is required to be  refunded to the Working Capital Borrowers for any reason.  The purchase of participations in a Swingline  Loan pursuant to this paragraph shall not relieve the Working Capital Borrowers of any default in the  payment thereof.  SECTION 2.06 Letters of Credit.  (a) General.  Subject to the terms and conditions set forth herein, the Borrower  Representative may request the issuance of Letters of Credit for its own account or for the account of  another Working Capital Borrower denominated in dollars as the applicant thereof for the support of its or  its Subsidiaries' obligations, in a form reasonably acceptable to the Administrative Agent and the Issuing  Bank, at any time and from time to time during the Availability Period and the Issuing Bank may, but shall  have no obligation, to issue such requested Letters of Credit pursuant to this Agreement.  In the event of  any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any  Letter of Credit Agreement, the terms and conditions of this Agreement shall control. Notwithstanding  anything herein to the contrary, the Issuing Bank shall have no obligation hereunder to issue, and shall not  issue, any Letter of Credit (i) the proceeds of which would be made available to any Person (A) to fund any  activity or business of or with any Sanctioned Person, or in any country or territory that, at the time of such  funding, is the subject of any Sanctions or (B) in any manner that would result in a violation of any  Sanctions by any party to this Agreement, (ii) if any order, judgment or decree of any Governmental  Authority or arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank from issuing such  Letter of Credit, or any Requirement of Law relating to the Issuing Bank or any request or directive (whether  or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Bank  shall prohibit, or request that the Issuing Bank refrain from, the issuance of letters of credit generally or  such Letter of Credit in particular or shall impose upon the Issuing Bank with respect to such Letter of  Credit any restriction, reserve or capital requirement (for which the Issuing Bank is not otherwise  compensated hereunder) not in effect on the Effective Date, or shall impose upon the Issuing Bank any  unreimbursed loss, cost or expense which was not applicable on the Effective Date and which the Issuing  Bank in good faith deems material to it, or (iii) if the issuance of such Letter of Credit would violate one or  more policies of the Issuing Bank applicable to letters of credit generally; provided that, notwithstanding  anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and  all requests, rules, guidelines, requirements or directives thereunder or issued in connection therewith or in  the implementation thereof, and (y) all requests, rules, guidelines, requirements or directives promulgated  by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor  or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel  

 

-53-  III, shall in each case be deemed not to be in effect on the Effective Date for purposes of clause (ii) above,  regardless of the date enacted, adopted, issued or implemented.  The parties agree that any "Letters of  Credit" (as defined in the Existing Credit Agreement) outstanding under the Existing Credit Agreement on  the Effective Date shall be deemed for all purposes to be Letters of Credit issued under this Agreement.  (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.  To  request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter  of Credit), the Borrower Representative shall deliver by hand or facsimile (or transmit through an Electronic  System, if arrangements for doing so have been approved by the Issuing Bank) to the Issuing Bank and the  Administrative Agent (prior to 9:00 am, Chicago time, at least three (3) Business Days (or such shorter  period of time as the applicable Issuing Bank may agree in its sole discretion) prior to the requested date of  issuance, amendment, renewal or extension) a notice requesting the issuance of a Letter of Credit, or  identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance,  amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit  is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit,  the name and address of the beneficiary thereof and such other information as shall be necessary to prepare,  amend, renew or extend such Letter of Credit.  In addition, as a condition to any such Letter of Credit  issuance, the applicable Working Capital Borrower shall have entered into a continuing agreement (or other  letter of credit agreement) for the issuance of letters of credit and/or shall submit a letter of credit application  in each case, as required by the Issuing Bank and using such Issuing Bank's standard form (each, a "Letter  of Credit Agreement").  A Letter of Credit shall be issued, amended, renewed or extended only if (and upon  issuance, amendment, renewal or extension of each Letter of Credit the Working Capital Borrowers shall  be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or  extension (i) the aggregate LC Exposure shall not exceed $5,000,000, (ii) no Revolving Lender's Revolving  Exposure shall exceed its Revolving Commitment and (iii) the Aggregate Revolving Exposure shall not  exceed the lesser of the Aggregate Revolving Commitment and the Borrowing Base.  Notwithstanding the  foregoing or anything to the contrary contained herein, no Issuing Bank shall be obligated to issue or modify  any Letter of Credit if, immediately after giving effect thereto, the outstanding LC Exposure in respect of  all Letters of Credit issued by such Person and its Affiliates would exceed such Issuing Bank's Issuing Bank  Sublimit.  Without limiting the foregoing and without affecting the limitations contained herein, it is  understood and agreed that the Borrower Representative may from time to time request that an Issuing  Bank issue Letters of Credit in excess of its individual Issuing Bank Sublimit in effect at the time of such  request, and each Issuing Bank agrees to consider any such request in good faith.  Any Letter of Credit so  issued by an Issuing Bank in excess of its individual Issuing Bank Sublimit then in effect shall nonetheless  constitute a Letter of Credit for all purposes of this Agreement, and shall not affect the Issuing Bank  Sublimit of any other Issuing Bank, subject to the limitations on the aggregate LC Exposure set forth in  clause (i) of this Section 2.06(b).  (c) Expiration Date.  Each Letter of Credit shall expire (or be subject to termination  or non-renewal by notice from the Issuing Bank to the beneficiary thereof) at or prior to the close of business  on the earlier of (i) the date one year after the date of the issuance of such Letter of Credit (or, in the case  of any renewal or extension thereof, including, without limitation, any automatic renewal provision, one  year after such renewal or extension) and (ii) the date that is five Business Days prior to the Maturity Date.  (d) Participations.  By the issuance of a Letter of Credit (or an amendment to a Letter  of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or  the Revolving Lenders, the Issuing Bank hereby grants to each Revolving Lender, and each Revolving  Lender hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Lender's  Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit.  In  consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and  unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such  Lender's Applicable Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed  

 

-54-  by the Working Capital Borrowers on the date due as provided in paragraph (e) of this Section, or of any  reimbursement payment required to be refunded to the Working Capital Borrowers for any reason.  Each  Revolving Lender acknowledges and agrees that its obligation to acquire participations pursuant to this  paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any  circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the  occurrence and continuance of a Default or reduction or termination of the Commitments, and that each  such payment shall be made without any offset, abatement, withholding or reduction whatsoever.  (e) Reimbursement.  If the Issuing Bank shall make any LC Disbursement in respect  of a Letter of Credit, the Working Capital Borrowers shall reimburse such LC Disbursement by paying to  the Administrative Agent an amount equal to such LC Disbursement not later than 11:00 a.m., Chicago  time, on (i) the Business Day that the Borrower Representative receives notice of such LC Disbursement,  if such notice is received prior to 9:00 a.m., Chicago time, on the day of receipt, or (ii) the Business Day  immediately following the day that the Borrower Representative receives such notice, if such notice is  received after 9:00 a.m. Chicago time on the day of receipt; provided that the Working Capital Borrowers  may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 or 2.05  that such payment be financed with a CBFR Revolving Borrowing or Swingline Loan in an equivalent  amount and, to the extent so financed, the Working Capital Borrowers' obligation to make such payment  shall be discharged and replaced by the resulting CBFR Revolving Borrowing or Swingline Loan.  If the  Working Capital Borrowers fail to make such payment when due, the Administrative Agent shall notify  each Revolving Lender of the applicable LC Disbursement, the payment then due from the Working Capital  Borrowers in respect thereof and such Lender's Applicable Percentage thereof.  Promptly following receipt  of such notice, each Revolving Lender shall pay to the Administrative Agent its Applicable Percentage of  the payment then due from the Working Capital Borrowers, in the same manner as provided in Section 2.07  with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to the payment  obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank  the amounts so received by it from the Revolving Lenders.  Promptly following receipt by the  Administrative Agent of any payment from the Working Capital Borrowers pursuant to this paragraph, the  Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Revolving  Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to such  Lenders and the Issuing Bank as their interests may appear.  Any payment made by a Revolving Lender  pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding  of CBFR Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and  shall not relieve the Working Capital Borrowers of their obligation to reimburse such LC Disbursement.  (f) Obligations Absolute.  The Working Capital Borrowers' joint and several  obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute,  unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this  Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or  enforceability of any Letter of Credit, any Letter of Credit Agreement or this Agreement, or any term or  provision therein or herein, (ii) any draft or other document presented under a Letter of Credit proving to  be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any  respect, (iii) any payment by the Issuing Bank under a Letter of Credit against presentation of a draft or  other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or  circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions  of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Working  Capital Borrowers' obligations hereunder.  None of the Administrative Agent, the Revolving Lenders, the  Issuing Bank or any of their respective Related Parties, shall have any liability or responsibility by reason  of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make  any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or  any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other  communication under or relating to any Letter of Credit (including any document required to make a  

 

-55-  drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes  beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the  Issuing Bank from liability to the Working Capital Borrowers to the extent of any direct damages (as  opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby  waived by the Working Capital Borrowers to the extent permitted by applicable law) suffered by any  Working Capital Borrower that are caused by the Issuing Bank's failure to exercise care when determining  whether drafts and other documents presented under a Letter of Credit comply with the terms thereof.  The  parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of  the Issuing Bank (as finally determined by a court of competent jurisdiction), the Issuing Bank shall be  deemed to have exercised care in each such determination.  In furtherance of the foregoing and without  limiting the generality thereof, the parties agree that, with respect to documents presented which appear on  their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its  sole discretion, either accept and make payment upon such documents without responsibility for further  investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment  upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.  (g) Disbursement Procedures.  The Issuing Bank shall, promptly following its receipt  thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit.  The  Issuing Bank shall promptly notify the Administrative Agent and the applicable Working Capital Borrower  by telephone (confirmed by fax or through an Electronic System) of such demand for payment and whether  the Issuing Bank has made or will make an LC Disbursement thereunder and, upon request therefor by the  Borrower Representative, promptly provide to the Borrower Representative copies of all applicable drawing  documents; provided that any failure to give or delay in giving such notice or providing such copies shall  not relieve the Working Capital Borrowers of their obligation to reimburse the Issuing Bank and the  Revolving Lenders with respect to any such LC Disbursement.  (h) Interim Interest.  If the Issuing Bank shall make any LC Disbursement, then, unless  the Working Capital Borrowers shall reimburse such LC Disbursement in full on the date such LC  Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the  date such LC Disbursement is made to but excluding the date that the Working Capital Borrowers reimburse  such LC Disbursement, at the rate per annum then applicable to CBFR Revolving Loans and such interest  shall be payable on the date when such reimbursement is due; provided that, if the Working Capital  Borrowers fail to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then  Section 2.13(d) shall apply.  Interest accrued pursuant to this paragraph shall be for the account of the  Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender  pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of such  Lender to the extent of such payment.  (i) Replacement and Resignation of an Issuing Bank; Designation of Additional  Issuing Banks.  (i) Any Issuing Bank may be terminated at any time upon not less than ten  (10) Business Days' prior written notice by the Borrower Representative to the  Administrative Agent and such Issuing Bank.  The Administrative Agent shall notify the  Lenders of any such termination of an Issuing Bank.  After the termination of an Issuing  Bank hereunder, such Issuing Bank shall remain a party hereto and shall continue to have  all the rights and obligations of an Issuing Bank under the Agreement with respect to  Letters of Credit then outstanding and issued by it prior to such termination, but shall not  be required to amend, renew or extend any such Letters of Credit or to issue additional  Letters of Credit.  

 

-56-  (ii) The Issuing Bank may be replaced at any time by written agreement  among the Borrower Representative, the Administrative Agent, the replaced Issuing Bank  and the successor Issuing Bank.  The Administrative Agent shall notify the Revolving  Lenders of any such replacement of the Issuing Bank.  At the time any such replacement  shall become effective, the Borrowers shall pay all unpaid fees accrued for the account of  the replaced Issuing Bank pursuant to Section 2.12(b).  From and after the effective date  of any such replacement, (A) the successor Issuing Bank shall have all the rights and  obligations of the Issuing Bank under this Agreement with respect to Letters of Credit to  be issued thereafter and (B) references herein to the term "Issuing Bank" shall be deemed  to refer to such successor or to any previous Issuing Bank, or to such successor and all  previous Issuing Banks, as the context shall require.  After the replacement of an Issuing  Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue  to have all the rights and obligations of an Issuing Bank under this Agreement with respect  to Letters of Credit then outstanding and issued by it prior to such replacement, but shall  not be required to issue additional Letters of Credit.  (iii) Subject to the appointment and acceptance of a successor Issuing Bank,  the Issuing Bank may resign as an Issuing Bank at any time upon thirty days' prior written  notice to the Administrative Agent, the Borrower Representative and the Lenders, in which  case, such resigning Issuing Bank shall be replaced in accordance with clause (i) of  Section 2.06(i) above.  (iv) From time to time, the Borrower Representative may, by notice to the  Administrative Agent and the Issuing Bank, designate as additional Issuing Banks one or  more Lenders that agree to serve in such capacity as provided below. The acceptance by a  Lender of any appointment as an Issuing Bank hereunder shall be evidenced by an  agreement (an "Issuing Bank Agreement"), which shall be in a form reasonably satisfactory  to the Borrower Representative and the Administrative Agent, shall set forth the Issuing  Bank Sublimit of such Lender and shall be executed by such Lender, the Borrower  Representative and the Administrative Agent and, from and after the effective date of such  Issuing Bank Agreement, (i) such Lender shall have all the rights and obligations of an  Issuing Bank under this Agreement and the other Loan Documents and (ii) references  herein and in the other Loan Documents to the term "Issuing Bank" shall be deemed to  include such Lender in its capacity as an Issuing Bank.  (j) Cash Collateralization.  If any Default shall occur and be continuing, on the  Business Day that the Borrower Representative receives notice from the Administrative Agent or the  Required  Lenders demanding the deposit of cash collateral pursuant to this paragraph, the Working Capital  Borrowers shall deposit in an account with the Administrative Agent, in the name of the Administrative  Agent and for the benefit of the Revolving Lenders (the "LC Collateral Account"), an amount in cash equal  to 105% of the amount of the LC Exposure as of such date plus accrued and unpaid interest on the aggregate  amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Working Capital  Borrowers at such time; provided that the obligation to deposit such cash collateral shall become effective  immediately, and such deposit shall become immediately due and payable, without demand or other notice  of any kind, upon the occurrence of any Event of Default with respect to any Borrower described in  clause (h) or (i) of Article VII.  The Working Capital Borrowers also shall deposit cash collateral in  accordance with this paragraph as and to the extent required by Sections 2.10(b), 2.11(b) or 2.20.  Each  such deposit shall be held by the Administrative Agent as collateral for the payment and performance of  the Secured Obligations.  The Administrative Agent shall have exclusive dominion and control, including  the exclusive right of withdrawal, over the LC Collateral Account and the Working Capital Borrowers  hereby grant the Administrative Agent a security interest in the LC Collateral Account and all money or  other assets on deposit therein or credited thereto.  Other than any interest earned on the investment of such  

 

-57-  deposits, which investments shall be made at the option and sole discretion of the Administrative Agent  and at the Working Capital Borrowers' risk and expense, such deposits shall not bear interest.  Interest or  profits, if any, on such investments shall accumulate in the LC Collateral Account.  Moneys in the LC  Collateral Account shall be applied by the Administrative Agent to reimburse the Issuing Bank for LC  Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the  satisfaction of the reimbursement obligations of the Working Capital Borrowers for the LC Exposure at  such time or, if the maturity of the Loans has been accelerated, be applied to satisfy other Secured  Obligations.  If the Working Capital Borrowers are required to provide an amount of cash collateral  hereunder as a result of the occurrence of a Default, such amount (to the extent not applied as aforesaid)  shall be returned to the Working Capital Borrowers within three (3) Business Days after all such Defaults  have been cured or waived as confirmed in writing by the Administrative Agent.  (k) LC Exposure Determination.  For all purposes of this Agreement, the amount of a  Letter of Credit that, by its terms or the terms of any document related thereto, provides for one or more  automatic increases in the stated amount thereof shall be deemed to be the maximum stated amount of such  Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in  effect at the time of determination.  (l) Letters of Credit Issued for Account of Subsidiaries.  Notwithstanding that a Letter  of Credit issued or outstanding hereunder supports any obligations of, or is for the account of, a Subsidiary,  or states that a Subsidiary is the "account party," "applicant," "customer," "instructing party," or the like of  or for such Letter of Credit, and without derogating from any rights of the Issuing Bank (whether arising  by contract, at law, in equity or otherwise) against such Subsidiary in respect of such Letter of Credit, the  Working Capital Borrowers (i) shall reimburse, indemnify and compensate the Issuing Bank hereunder for  such Letter of Credit (including to reimburse any and all drawings thereunder) as if such Letter of Credit  had been issued solely for the account of a Working Capital Borrower and (ii) irrevocably waives any and  all defenses that might otherwise be available to it as a guarantor or surety of any or all of the obligations  of such Subsidiary in respect of such Letter of Credit.  Each Working Capital Borrower hereby  acknowledges that the issuance of such Letters of Credit for its Subsidiaries inures to the benefit of the  Working Capital Borrowers, and that each Borrower's business derives substantial benefits from the  businesses of such Subsidiaries.  SECTION 2.07 Funding of Borrowings.  (a) Each Lender shall make each Loan to be made by such Lender hereunder on the  proposed date thereof solely by wire transfer of immediately available funds by 2:00 p.m., Chicago time,  to the account of the Administrative Agent most recently designated by it for such purpose by notice to the  Lenders in an amount equal to such Lender's Applicable Percentage; provided that, Swingline Loans shall  be made as provided in Section 2.05.  The Administrative Agent will make such Loans available to the  Borrower Representative by promptly crediting the funds so received in the aforesaid account of the  Administrative Agent to the Funding Account(s); provided that CBFR Revolving Loans made to finance  the reimbursement of (i) an LC Disbursement as provided in Section 2.06(e) shall be remitted by the  Administrative Agent to the Issuing Bank and (ii) a Protective Advance or an Overadvance shall be retained  by the Administrative Agent.  (b) Unless the Administrative Agent shall have received notice from a Lender prior to  the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent  such Lender's share of such Borrowing, the Administrative Agent may assume that such Lender has made  such share available on such date in accordance with paragraph (a) of this Section and may, in reliance  upon such assumption, make available to the applicable Working Capital Borrower a corresponding  amount.  In such event, if a Lender has not in fact made its share of the applicable Borrowing available to  the Administrative Agent, then the applicable Lender and the Working Capital Borrowers each severally  

 

-58-  agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest  thereon, for each day from and including the date such amount is made available to the applicable Working  Capital Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of  such Lender, the greater of the NYFRB Rate and a rate determined by the Administrative Agent in  accordance with banking industry rules on interbank compensation and (ii) in the case of the Working  Capital Borrowers, the interest rate applicable to CBFR Loans.  If such Lender pays such amount to the  Administrative Agent, then such amount shall constitute such Lender's Loan included in such Borrowing,  provided, that any interest received from a Working Capital Borrower by the Administrative Agent during  the period beginning when Administrative Agent funded the Borrowing until such Lender pays such amount  shall be solely for the account of the Administrative Agent.  SECTION 2.08 Interest Elections.  (a) Each Borrowing initially shall be of the Type specified in the applicable Borrowing  Request and, in the case of a Term Benchmark Borrowing, shall have an initial Interest Period as specified  in such Borrowing Request.  Thereafter, the Borrower Representative may elect to convert such Borrowing  to a different Type or to continue such Borrowing and, in the case of a Term Benchmark Borrowing, may  elect Interest Periods therefor, all as provided in this Section.  The Borrower Representative may elect  different options with respect to different portions of the affected Borrowing, in which case each such  portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and  the Loans comprising each such portion shall be considered a separate Borrowing.  This Section shall not  apply to Swingline Borrowings, Overadvances or Protective Advances, which may not be converted or  continued.  (b) To make an election pursuant to this Section, the Borrower Representative shall  notify the Administrative Agent of such election either in writing (delivered by hand or fax) by delivering  an Interest Election Request signed by a Responsible Officer of the Borrower Representative, through an  Electronic System if arrangements for doing so have been approved by the Administrative Agent, or  telephonically, by the time that a Borrowing Request would be required under Section 2.03 if the Borrowers  were requesting a Borrowing of the Type resulting from such election to be made on the effective date of  such election.  Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed  promptly by hand delivery, Electronic System or facsimile to the Administrative Agent of a written Interest  Election Request in a form approved by the Administrative Agent and signed by a Responsible Officer of  the Borrower Representative.  (c) Each telephonic or written Interest Election Request (including requests submitted  through an Electronic System) shall specify the following information in compliance with Section 2.02:  (i) the name of the applicable Borrower and the Borrowing to which such  Interest Election Request applies and, if different options are being elected with respect to  different portions thereof, the portions thereof to be allocated to each resulting Borrowing  (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall  be specified for each resulting Borrowing);  (ii) the effective date of the election made pursuant to such Interest Election  Request, which shall be a Business Day;  (iii) whether the resulting Borrowing is to be a CBFR Borrowing or a Term  Benchmark Borrowing; and  

 

-59-  (iv) if the resulting Borrowing is a Term Benchmark Borrowing, the Interest  Period to be applicable thereto after giving effect to such election, which shall be a period  contemplated by the definition of the term "Interest Period".  If any such Interest Election Request requests a Term Benchmark Borrowing but does not specify an Interest  Period, then the Borrowers shall be deemed to have selected an Interest Period of one month's duration.  (d) Promptly following receipt of an Interest Election Request, the Administrative  Agent shall advise each Lender of the details thereof and of such Lender's portion of each resulting  Borrowing.  (e) If the Borrower Representative fails to deliver a timely Interest Election Request  with respect to a Term Benchmark Borrowing prior to the end of the Interest Period applicable thereto,  then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing  shall be converted to a CBFR Borrowing.  Notwithstanding any contrary provision hereof, if a Default has  occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies  the Borrower Representative, then, so long as a Default is continuing (i) no outstanding Borrowing may be  converted to or continued as a Term Benchmark Borrowing and (ii) unless repaid, each Term Benchmark  Borrowing shall be converted to a CBFR Borrowing at the end of the Interest Period applicable thereto.  SECTION 2.09 Termination of Commitments; Increase in Revolving Commitments.  (a) Unless previously terminated, (i) the applicable Term A Loan Commitments  terminated upon the making of each advance of the Term A Loan, (ii) the Term B Loan Commitments will  terminate upon the making of the Term B Loan on the Effective Date and (iii) the Revolving Commitments  shall terminate on the Maturity Date.  (b) The Working Capital Borrowers may at any time terminate the Revolving  Commitments upon the Payment in Full of the Secured Obligations.  (c) The Borrower Representative shall notify the Administrative Agent of any election  to terminate the Revolving Commitments under paragraph (b) of this Section at least five (5) Business Days  prior to the effective date of such termination, specifying such election and the effective date thereof.   Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents  thereof.  Each notice delivered by the Borrower Representative pursuant to this Section shall be irrevocable;  provided that a notice of termination of the Commitments delivered by the Borrower Representative may  state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such  notice may be revoked by the Borrower Representative (by notice to the Administrative Agent on or prior  to the specified effective date) if such condition is not satisfied.  Any termination of the Revolving  Commitments shall be permanent.  (d) The Working Capital Borrowers shall have the right to increase the Revolving  Commitments by obtaining additional Revolving Commitments, either from one or more of the Lenders or  another lending institution provided that (i) any such request for an increase shall be in a minimum amount  of $5,000,000, (ii) the Borrower Representative, on behalf of the Working Capital Borrowers, may make a  maximum of 4 such requests, (iii) after giving effect thereto, the sum of the total of the additional  Commitments does not exceed $30,000,000, (iv) the Administrative Agent and the Issuing Bank have  approved the identity of any such new Lender, such approvals not to be unreasonably withheld, (v) any such  new Lender assumes all of the rights and obligations of a "Lender" hereunder, and (vi) the procedure described  in Section 2.09(e) has been satisfied.  Nothing contained in this Section 2.09 shall constitute, or otherwise be  deemed to be, a commitment on the part of any Lender to increase its Revolving Commitment hereunder at  

 

-60-  any time and the Borrowers acknowledge that the Lenders may decline the request for any reason, or no  reason whatsoever, notwithstanding the absence of a Material Adverse Effect, Default or Event of Default.  (e) Any amendment hereto for such an increase or addition shall be in form and  substance satisfactory to the Administrative Agent and shall only require the written signatures of the  Administrative Agent, the Borrowers and each Lender being added or increasing its Commitment, subject  only to the approval of all Lenders if any such increase or addition would cause the Revolving Commitments  to exceed $130,000,000.  As a condition precedent to such an increase or addition, the Borrowers shall  deliver to the Administrative Agent (i) a certificate of each Loan Party signed by an authorized officer of  such Loan Party (A) certifying and attaching the resolutions adopted by such Loan Party approving or  consenting to such increase, and (B) in the case of the Working Capital Borrowers, certifying that, before  and after giving effect to such increase or addition, (1) the representations and warranties contained in  Article III and the other Loan Documents are true and correct, except to the extent that such representations  and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier  date, (2) no Default exists and (3) the Borrowers are in compliance (on a pro forma basis) with the covenant  contained in Section 6.13 and (ii) legal opinions and documents consistent with those delivered on the  Effective Date, to the extent requested by the Administrative Agent.  (f) On the effective date of any such increase or addition, (i) any Lender increasing (or,  in the case of any newly added Lender, extending) its Revolving Commitment shall make available to the  Administrative Agent such amounts in immediately available funds as the Administrative Agent shall  determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to  such increase or addition and the use of such amounts to make payments to such other Lenders, each  Lender's portion of the outstanding Revolving Loans of all the Lenders to equal its revised Applicable  Percentage of such outstanding Revolving Loans, and the Administrative Agent shall make such other  adjustments among the Lenders with respect to the Revolving Loans then outstanding and amounts of  principal, interest, commitment fees and other amounts paid or payable with respect thereto as shall be  necessary, in the opinion of the Administrative Agent, in order to effect such reallocation and (ii) the Working  Capital Borrowers shall be deemed to have repaid and reborrowed all outstanding Revolving Loans as of  the date of any increase (or addition) in the Revolving Commitments (with such reborrowing to consist of  the Types of Revolving Loans, with related Interest Periods if applicable, specified in a notice delivered by  the Borrower Representative, in accordance with the requirements of Section 2.03).  The deemed payments  made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all  accrued interest on the amount prepaid and, in respect of each Term Benchmark Loan, shall be subject to  indemnification by the Borrowers pursuant to the provisions of Section 2.16 if the deemed payment occurs  other than on the last day of the related Interest Periods.  Within a reasonable time after the effective date of  any increase or addition, the Administrative Agent shall, and is hereby authorized and directed to, revise the  Commitment Schedule to reflect such increase or addition and shall distribute such revised Commitment  Schedule to each of the Lenders and the Borrower Representative, whereupon such revised Commitment  Schedule shall replace the old Commitment Schedule and become part of this Agreement.  SECTION 2.10 Repayment and Amortization of Loans; Evidence of Debt.  (a) The Working Capital Borrowers hereby unconditionally promise to pay (i) to the  Administrative Agent for the account of each Revolving Lender the then unpaid principal amount of each  Revolving Loan on the Maturity Date, (ii) to the Administrative Agent the then unpaid amount of each  Protective Advance on the earlier of the Maturity Date and demand by the Administrative Agent, and (iii) to  the Administrative Agent the then unpaid principal amount of each Overadvance on the earlier of the  Maturity Date and demand by the Administrative Agent.  The Real Estate Borrowers hereby  unconditionally promise to pay to the Administrative Agent for the account of each Term A Lender on the  first Business Day of each calendar month following the Effective Date an amount equal to $230,160.00  and a final installment of the remaining principal balance of the Term A Loan on January 17, 2030 (the  

 

-61-  "Term A Loan Maturity Date").  To the extent not previously paid, the unpaid balance of the Term A Loan  shall be paid in full in cash by the Real Estate Borrowers on the Term Loan A Maturity Date.  The Real  Estate Borrowers hereby unconditionally promise to pay to the Administrative Agent for the account of  each Term B Lender on the first Business Day of each calendar month following the Effective Date an  amount equal to $191,466.67 and a final installment of the remaining principal balance of the Term B Loan  on January 17, 2030 (the "Term B Loan Maturity Date").  To the extent not previously paid, the unpaid  balance of the Term B Loan shall be paid in full in cash by the Real Estate Borrowers on the Term B Loan  Maturity Date.  (b) All funds deposited into a Collateral Deposit Account will be swept on a daily  basis into a Collection Account maintained by the Working Capital Borrowers with the Administrative  Agent.  At any time that an Event of Default occurs, at the Administrative Agent's election, the Working  Capital Borrowers shall establish and shall thereafter maintain Lock Boxes subject to Lock Box Agreements  for the direct deposit of payments in respect of Accounts.  All funds deposited into any Lock Box will be  swept on a daily basis into the Collection Account.  The Administrative Agent shall apply all funds credited  to the Collection Account on the immediately preceding Business Day (at the discretion of the  Administrative Agent, whether or not immediately available) first to prepay any Protective Advances and  Overadvances that may be outstanding, pro rata, and second to prepay the Revolving Loans (including  Swingline Loans) and to cash collateralize outstanding LC Exposure.  Notwithstanding the foregoing, to  the extent any funds credited to the Collection Account constitute Net Proceeds, the application of such Net  Proceeds shall be subject to Section 2.11(c).  (c) Each Lender shall maintain in accordance with its usual practice an account or  accounts evidencing the Indebtedness of the Borrowers to such Lender resulting from each Loan made by  such Lender, including the amounts of principal and interest payable and paid to such Lender from time to  time hereunder.  (d) The Administrative Agent shall maintain accounts in which it shall record (i) the  amount of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto,  (ii) the amount of any principal or interest due and payable or to become due and payable from the  applicable Borrowers to each Lender hereunder and (iii) the amount of any sum received by the  Administrative Agent hereunder for the account of the Lenders and each Lender's share thereof.  (e) The entries made in the accounts maintained pursuant to paragraph (c) or (d) of  this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein;  provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error  therein shall not in any manner affect the obligation of the Borrowers to repay the Loans in accordance with  the terms of this Agreement.  (f) Any Lender may request that Loans made by it be evidenced by a promissory note.   In such event, the applicable Borrowers shall prepare, execute and deliver to such Lender a promissory note  payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a  form approved by the Administrative Agent.  Thereafter, the Loans evidenced by such promissory note and  interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by  one or more promissory notes in such form.  SECTION 2.11 Prepayment of Loans.  (a) The Borrowers shall have the right at any time and from time to time to prepay any  Borrowing in whole or in part, subject to prior notice in accordance with paragraph (f) of this Section and,  if applicable, payment of any break funding expenses under Section 2.16.  All such partial prepayments of  the Term A Loan shall be applied to installments of principal in respect of the Term A Loan in the inverse  

 

-62-  order of their maturities and all such partial prepayments of the Term B Loan shall be applied to installments  of principal in respect of the Term B Loan in the inverse order of their maturities.  (b) Except for Overadvances permitted under Section 2.05, in the event and on such  occasion that the Aggregate Revolving Exposure exceeds the lesser of (i) the Aggregate Revolving  Commitment and (ii) the Borrowing Base, the Working Capital Borrowers shall prepay the Revolving  Loans, LC Exposure and/or Swingline Loans or cash collateralize LC Exposure in an account with the  Administrative Agent pursuant to Section 2.06(j), as applicable, in an aggregate amount equal to such  excess.  (c) In the event and on each occasion that any Net Proceeds are received by or on  behalf of any Loan Party in respect of any Prepayment Event, the Borrowers shall, immediately after such  Net Proceeds are received by any Loan Party, prepay the Obligations and cash collateralize the LC Exposure  as set forth in Section 2.11(e) below in an aggregate amount equal to 100% of such Net Proceeds, provided  that, in the case of any event described in clause (a) or (b) of the definition of the term "Prepayment Event",  if the Borrower Representative shall deliver to the Administrative Agent a certificate of its Financial Officer  to the effect that the Loan Parties intend to apply the Net Proceeds from such event (or a portion thereof  specified in such certificate), within 180 days after receipt of such Net Proceeds, to acquire (or replace or  rebuild) real property, Equipment or other tangible assets (excluding Inventory) to be used in the business  of the Loan Parties, and certifying that no Default has occurred and is continuing, then, if the Net Proceeds  specified in such certificate are to be applied to acquire, replace or rebuild such assets by (A) the Borrowers,  such Net Proceeds shall be applied by the Administrative Agent to reduce the outstanding principal balance  of the Revolving Loans (without a permanent reduction of the Revolving Commitment) and upon such  application, the Administrative Agent shall establish a Reserve against the Borrowing Base in an amount  equal to the amount of such proceeds so applied and (B) any Loan Party that is not a Borrower, such Net  Proceeds shall be deposited in a cash collateral account, and in the case of either (A) or (B), thereafter, such  funds shall be made available to the applicable Loan Party as follows:  (1) the Borrower Representative shall request a Borrowing  (specifying that the request is to use Net Proceeds pursuant to this Section)  or the applicable Loan Party shall request a release from the cash collateral  account be made in the amount needed;   (2) so long as the conditions set forth in Section 4.02 have  been met, the Revolving Lenders shall make such Borrowing or the  Administrative Agent shall release funds from the cash collateral account;  and  (3) in the case of Net Proceeds applied against the Borrowing,  the Reserve established with respect to such Net Proceeds shall be reduced  by the amount of such Borrowing;   provided that to the extent of any such Net Proceeds therefrom that have not been so applied by the end of  such 180-day period, a prepayment shall be required at such time in an amount equal to such Net Proceeds  that have not been so applied.  (d) In the event and on such occasion that the outstanding principal balance of the  Term Loan exceeds the Term Loan Base (including by virtue of values contained in a new or updated  appraisal of some or all of the Eligible Real Property), the Real Estate Borrowers shall prepay the Term  Loan in an aggregate amount equal to such excess.  Any such amounts of the Term Loan that are prepaid  hereunder may not be reborrowed.  

 

-63-  (e) All such amounts required to be prepaid pursuant to Section 2.11(c) arising out of  (i) any event described in clause (a) or (b) of the definition of the term "Prepayment Event", to the extent  of the Equipment, Fixtures and real property subject to such event, (ii) any event described in clause (c) or  (d) of the definition of the term "Prepayment Event, or (iii) any event described in Section 2.11(d), shall be  applied, first to prepay any Protective Advances and Overadvances that may be outstanding, pro rata,  second to prepay the Term Loan (to be applied to the Term A Loan and the Term B Loan on a pro rata  basis, and to installments thereof in the inverse order of maturity) and third to prepay the Revolving Loans  (including Swingline Loans) without a corresponding reduction in the Revolving Commitments and to cash  collateralize outstanding LC Exposure.  All such amounts required to be prepaid pursuant to Section 2.11(c)  arising out of any event described in clause (a) or (b) of the definition of the term "Prepayment Event", to  the extent of the property other than Equipment, Fixtures and real property subject to such event, shall be  applied, first to prepay any Protective Advances and Overadvances that may be outstanding, pro rata and  second to prepay the Revolving Loans (including Swingline Loans) without a corresponding reduction in  the Revolving Commitments and to cash collateralize outstanding LC Exposure.  If the precise amount of  insurance or condemnation proceeds allocable to Inventory as compared to Equipment, Fixtures and real  property is not otherwise determined, the allocation and application of those proceeds shall be determined  by the Administrative Agent, in its Permitted Discretion.  (f) The Borrower Representative shall notify the Administrative Agent (and, in the  case of prepayment of a Swingline Loan, the Swingline Lender) by telephone (confirmed by fax) or through  an Electronic System, if arrangements for doing so have been approved by the Administrative Agent of any  prepayment hereunder not later than (i) 10:00 a.m., Chicago time, (A) in the case of prepayment of a Term  Benchmark Borrowing, three (3) Business Days before the date of prepayment, and (B) in the case of  prepayment of a CBFR Borrowing, on the date of prepayment.  Each such notice shall be irrevocable and  shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be  prepaid; provided that, if a notice of prepayment is given in connection with a conditional notice of  termination of the Revolving Commitments as contemplated by Section 2.09, then such notice of  prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.09.   Promptly following receipt of any such notice relating to a Borrowing, the Administrative Agent shall  advise the Lenders of the contents thereof.   Each partial prepayment of any Borrowing shall be in an amount  that would be permitted in the case of an advance of a Borrowing of the same Type as provided in  Section 2.02.  Each prepayment of a Borrowing shall be applied ratably to the Revolving Loans included  in the prepaid Borrowing.  Prepayments shall be accompanied by (i) accrued interest to the extent required  by Section 2.13 and (ii) break funding payments pursuant to Section 2.16.  SECTION 2.12 Fees.  (a) The Working Capital Borrowers agree to pay to the Administrative Agent for the  account of each Lender a commitment fee, which shall accrue at the Applicable Rate on the average daily  amount of the Available Revolving Commitment of such Lender during the period from and including the  Original Closing Date to but excluding the date on which the Revolving Commitments terminate.  Accrued  commitment fees shall be payable in arrears on the first Business Day of each calendar month and on the  date on which the Revolving Commitments terminate, commencing on the first such date to occur after the  date hereof.  All commitment fees shall be computed on the basis of a year of 360 days and shall be payable  for the actual number of days elapsed (including the first day but excluding the last day).  (b) The Working Capital Borrowers agree to pay (i) to the Administrative Agent for  the account of each Revolving Lender a participation fee with respect to its participations in Letters of  Credit, which shall accrue at the same Applicable Rate used to determine the interest rate applicable to  Term Benchmark Revolving Loans on the average daily amount of such Lender's LC Exposure (excluding  any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including  the Original Closing Date to but excluding the later of the date on which such Lender's Revolving  

 

-64-  Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) to the  Issuing Bank a fronting fee, which shall accrue at the rate of 0.125% per annum on the average daily amount  of the LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements)  attributable to Letters of Credit issued by the Issuing Bank during the period from and including the Original  Closing Date to but excluding the later of the date of termination of the Revolving Commitments and the  date on which there ceases to be any LC Exposure, as well as the Issuing Bank's standard fees and  commissions with respect to the issuance, amendment, cancellation, negotiation, transfer, presentment,  renewal or extension of any Letter of Credit or processing of drawings thereunder.  Participation fees and  fronting fees accrued through and including the last day of each calendar month shall be payable on the  first Business Day of each calendar month following such last day, commencing on the first such date to  occur after the Effective Date; provided that all such fees shall be payable on the date on which the  Revolving Commitments terminate and any such fees accruing after the date on which the Revolving  Commitments terminate shall be payable on demand.  Any other fees payable to the Issuing Bank pursuant  to this paragraph shall be payable within ten (10) days after demand.  All participation fees and fronting  fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days  elapsed (including the first day but excluding the last day).  (c) The Borrowers agree to pay to the Administrative Agent, for its own account, fees  payable in the amounts and at the times separately agreed upon in the Fee Letter.  (d) All fees payable hereunder shall be paid on the dates due, in dollars in immediately  available funds, to the Administrative Agent (or to the Issuing Bank, in the case of fees payable to it) for  distribution, in the case of commitment fees and participation fees, to the Lenders.  Fees paid shall not be  refundable under any circumstances.  SECTION 2.13 Interest.  (a) The Loans comprising CBFR Borrowings (including Swingline Loans) shall bear  interest at the CBFR plus the Applicable Rate.  (b) The Loans comprising each Term Benchmark Borrowing shall bear interest at the  Adjusted Term SOFR Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.   If applicable, each RFR Loan shall bear interest at a rate per annum equal to the Adjusted Daily Simple  SOFR plus the Applicable Rate.  (c) Each Protective Advance and each Overadvance shall bear interest at the CBFR  plus the Applicable Rate for Revolving Loans plus 2%.  (d) Notwithstanding the foregoing, during the occurrence and continuance of a  Default, the Administrative Agent or the Required Lenders may, at their option, by notice to the Borrower  Representative (which notice may be revoked at the option of the Required Lenders notwithstanding any  provision of Section 9.02 requiring the consent of "each Lender affected thereby" for reductions in interest  rates), declare that (i) all Loans shall bear interest at 2% plus the rate otherwise applicable to such Loans as  provided in the preceding paragraphs of this Section or (ii) in the case of any other amount outstanding  hereunder, such amount shall accrue at 2% plus the rate applicable to such fee or other obligation as  provided hereunder.  (e) Accrued interest on each Loan (for CBFR Loans, accrued through the last day of  the prior calendar month) shall be payable in arrears on each Interest Payment Date for such Loan and upon  termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (d) of this  Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other  than a prepayment of a CBFR Revolving Loan prior to the end of the Availability Period), accrued interest  

 

-65-  on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment  and (iii) in the event of any conversion of any Term Benchmark Loan prior to the end of the current Interest  Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.  (f) Interest computed by reference to the Term SOFR Rate, REVSOFR30 Rate or  Daily Simple SOFR shall be computed on the basis of a year of 360 days.  Interest computed by reference  to the CB Floating Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year).   In each case interest shall be payable for the actual number of days elapsed (including the first day but  excluding the last day).  All interest hereunder on any Loan shall be computed on a daily basis based upon  the outstanding principal amount of such Loan as of the applicable date of determination.  The applicable  CB Floating Rate, Adjusted Daily Simple SOFR, Daily Simple SOFR, Adjusted REVSOFR30 Rate,  REVSOFR30 Rate, Adjusted Term SOFR Rate or Term SOFR Rate shall be determined by the  Administrative Agent, and such determination shall be conclusive absent manifest error.  (g) For the avoidance of doubt, the CB Floating Rate shall only be applicable if the  REVSOFR30 Rate is not available.  SECTION 2.14 Alternate Rate of Interest; Illegality.  (a) Subject to clauses (b), (c), (d), (e), and (f) of this Section 2.14, if:  (i) the Administrative Agent determines (which determination shall be  conclusive and binding absent manifest error) (A) prior to commencement of any Interest  Period for a Term Benchmark Borrowing, that adequate and reasonable means do not exist  for ascertaining the Adjusted Term SOFR Rate or the Term SOFR Rate  (including because  the Term SOFR Reference Rate is not available or published on a current basis), for such  Interest Period, (B) at any time, that adequate and reasonable means do not exist for  ascertaining the Adjusted REVSOFR30 Rate or the REVSOFR30 Rate (including because  the Term SOFR Reference Rate is not available or published on a current basis) or (C) at  any time, that adequate and reasonable means do not exist for ascertaining the applicable  Adjusted Daily Simple SOFR or Daily Simple SOFR; or  (ii) the Administrative Agent is advised by the Required Lenders that (A) prior  to the commencement of any Interest Period for a Term Benchmark Borrowing, the  Adjusted Term SOFR Rate for such Interest Period will not adequately and fairly reflect  the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan)  included in such Borrowing for such Interest Period, (B) at any time, the Adjusted  REVSOFR30 Rate or the REVSOFR30 Rate will not adequately and fairly reflect the cost  to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in  such Borrowing or (C) at any time, the Adjusted Daily Simple SOFR will not adequately  and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans  (or Loan) included in such Borrowing;  then the Administrative Agent shall give notice thereof to the Borrower Representative and the Lenders  through an Electronic System as provided in Section 9.01 as promptly as practicable thereafter and, until  (x) the Administrative Agent notifies the Borrower Representative and the Lenders that the circumstances  giving rise to such notice no longer exist with respect to the relevant Benchmark and (y) the Borrowers  deliver a new Interest Election Request in accordance with the terms of Section 2.08 or a new Borrowing  Request in accordance with the terms of Section 2.03, (1) any Interest Election Request that requests the  conversion of any Borrowing to, or continuation of any Borrowing as, a Term Benchmark Borrowing and  any Borrowing Request that requests a Term Benchmark Borrowing shall instead be deemed to be an  Interest Election Request or a Borrowing Request, as applicable, for (x) an RFR Borrowing so long as the  

 

-66-  Adjusted Daily Simple SOFR is not also the subject of Section 2.14(a)(i) or (ii) above or (y) a CBFR  Borrowing if the Adjusted Daily Simple SOFR also is the subject of Section 2.14(a)(i) or (ii) above and  (2) any Borrowing Request that requests an Adjusted REVSOFR30 Rate Borrowing or an RFR Borrowing  shall instead be deemed to be a Borrowing Request, as applicable, for a CBFR Borrowing; provided that if  the circumstances giving rise to such notice affect only one Type of Borrowings, then all other Types of  Borrowings shall be permitted.  Furthermore, if any Term Benchmark Loan, Adjusted REVSOFR30 Rate  Loan or RFR Loan is outstanding on the date of the Borrower Representative's receipt of the notice from  the Administrative Agent referred to in this Section 2.14(a) with respect to a Relevant Rate applicable to  such Term Benchmark Loan, Adjusted REVSOFR30 Rate Loan or RFR Loan, then until (x) the  Administrative Agent notifies the Borrower Representative and the Lenders that the circumstances giving  rise to such notice no longer exist with respect to the relevant Benchmark and (y) the Borrowers deliver a  new Interest Election Request in accordance with the terms of Section 2.08 or a new Borrowing Request in  accordance with the terms of Section 2.03, (1) any Term Benchmark Loan shall on the last day of the  Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business  Day), be converted by the Administrative Agent to, and shall constitute, (x) an RFR Borrowing so long as  the Adjusted Daily Simple SOFR is not also the subject of Section 2.14(a)(i) or (ii) above or (y) a CBFR  Loan if the Adjusted Daily Simple SOFR also is the subject of Section 2.14(a)(i) or (ii) above, on such day,  and (2) any Adjusted REVSOFR30 Rate Loan or any RFR Loan shall on and from such day be converted  by the Administrative Agent to, and shall constitute a CBFR Loan.  (b) Notwithstanding anything to the contrary herein or in any other Loan Document  (and any Swap Agreement shall be deemed not to be a "Loan Document" for purposes of this Section 2.14),  if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the  Reference Time in respect of any setting of the then-current Benchmark, then (x) if a Benchmark  Replacement is determined in accordance with clause (1) of the definition of "Benchmark Replacement"  for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all  purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent  Benchmark settings without any amendment to, or further action or consent of any other party to, this  Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance  with clause (2) of the definition of "Benchmark Replacement" for such Benchmark Replacement Date, such  Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan  Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th)  Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any  amendment to, or further action or consent of any other party to, this Agreement or any other Loan  Document so long as the Administrative Agent has not received, by such time, written notice of objection  to such Benchmark Replacement from Lenders comprising the Required Lenders.  (c) Notwithstanding anything to the contrary herein or in any other Loan Document,  the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from  time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any  amendments implementing such Benchmark Replacement Conforming Changes will become effective  without any further action or consent of any other party to this Agreement or any other Loan Document.  (d) The Administrative Agent will promptly notify the Borrower Representative and  the Lenders of (i) any occurrence of a Benchmark Transition Event, (ii) the implementation of any  Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes,  (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (f) below and (v) the  commencement or conclusion of any Benchmark Unavailability Period.  Any determination, decision or  election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders)  pursuant to this Section 2.14, including any determination with respect to a tenor, rate or adjustment or of  the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from  taking any action or any selection, will be conclusive and binding absent manifest error and may be made  

 

-67-  in its or their sole discretion and without consent from any other party to this Agreement or any other Loan  Document, except, in each case, as expressly required pursuant to this Section 2.14.  (e) Notwithstanding anything to the contrary herein or in any other Loan Document,  at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then- current Benchmark is a term rate (including the Term SOFR Rate or the REVSOFR30 Rate) and either  (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes  such rate from time to time as selected by the Administrative Agent in its reasonable discretion or (B) the  regulatory supervisor for the administrator of such Benchmark has provided a public statement or  publication of information announcing that any tenor for such Benchmark is or will be no longer  representative, then the Administrative Agent may modify the definition of "Interest Period" for any  Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if  a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or  information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer,  subject to an announcement that it is or will no longer be representative for a Benchmark (including a  Benchmark Replacement), then the Administrative Agent may modify the definition of "Interest Period"  for all Benchmark settings at or after such time to reinstate such previously removed tenor.  (f) Upon the Borrower Representative's receipt of notice of the commencement of a  Benchmark Unavailability Period, the Borrowers may revoke any request for a Term Benchmark  Borrowing, Adjusted REVSOFR30 Rate Borrowing or RFR Borrowing of, conversion to or continuation  of Term Benchmark Loans to be made, converted or continued during any Benchmark Unavailability Period  and, failing that, the Borrowers will be deemed to have converted (1) any such request for a Term  Benchmark Borrowing into a request for a Borrowing of or conversion to (A) an RFR Borrowing so long  as the Adjusted Daily Simple SOFR is not the subject of a Benchmark Transition Event or (B) a CBFR  Borrowing if the Adjusted Daily Simple SOFR is the subject of a Benchmark Transition Event or (2) any  such request for an Adjusted REVSOFR30 Rate Borrowing or an RFR Borrowing into a request for a CBFR  Borrowing.  Furthermore, if any Term Benchmark Loan, Adjusted REVSOFR30 Rate Loan or RFR Loan  is outstanding on the date of the Borrower Representative's receipt of notice of the commencement of a  Benchmark Unavailability Period with respect to a Relevant Rate applicable to such Term Benchmark  Loan, Adjusted REVSOFR30 Rate Loan or RFR Loan, then until such time as a Benchmark Replacement  is implemented pursuant to this Section 2.15(f), (1) any Term Benchmark Loan shall on the last day of the  Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business  Day), be converted by the Administrative Agent to, and shall constitute, (x) an RFR Loan so long as the  Adjusted Daily Simple SOFR is not the subject of a Benchmark Transition Event or (y) a CBFR Loan if  the Adjusted Daily Simple SOFR is the subject of a Benchmark Transition Event, on such day and (2) any  Adjusted REVSOFR30 Rate Loan or RFR Loan shall on and from such day be converted by the  Administrative Agent to, and shall constitute a CBFR Loan.  SECTION 2.15 Increased Costs.  (a) If any Change in Law shall:  (i) impose, modify or deem applicable any reserve, special deposit, liquidity  or similar requirement (including any compulsory loan requirement, insurance charge or  other assessment) against assets of, deposits with or for the account of, or credit extended  by, any Lender (except any such reserve requirement reflected in the Adjusted Term SOFR  Rate or the Adjusted REVSOFR30 Rate) or the Issuing Bank;  (ii) impose on any Lender or the Issuing Bank or the London interbank market  any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans  made by such Lender or any Letter of Credit or participation therein; or  

 

-68-  (iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,  (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and  (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments,  or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;  and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of  making, continuing, converting into or maintaining any Loan (or of maintaining its obligation to make any  such Loan) or to increase the cost to such Lender, the Issuing Bank or such other Recipient of participating  in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable  by such Lender, the Issuing Bank or such other Recipient hereunder (whether of principal, interest or  otherwise), then the Borrowers will pay to such Lender, the Issuing Bank or such other Recipient, as the  case may be, such additional amount or amounts as will compensate such Lender, the Issuing Bank or such  other Recipient, as the case may be, for such additional costs incurred or reduction suffered.  (b) If any Lender or the Issuing Bank determines that any Change in Law regarding  capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender's  or the Issuing Bank's capital or on the capital of such Lender's or the Issuing Bank's holding company, if  any, as a consequence of this Agreement, the Commitment of, or the Loans made by, or participations in  Letters of Credit or Swingline Loans held by, such Lender, or the Letters of Credit issued by the Issuing  Bank, to a level below that which such Lender or the Issuing Bank or such Lender's or the Issuing Bank's  holding company could have achieved but for such Change in Law (taking into consideration such Lender's  or the Issuing Bank's policies and the policies of such Lender's or the Issuing Bank's holding company with  respect to capital adequacy and liquidity), then from time to time the Borrowers will pay to such Lender or  the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender  or the Issuing Bank or such Lender's or the Issuing Bank's holding company for any such reduction suffered.  (c) A certificate of a Lender or the Issuing Bank setting forth the amount or amounts  necessary to compensate such Lender or the Issuing Bank or its holding company, as the case may be, as  specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower Representative and shall  be conclusive absent manifest error.  The Borrowers shall pay such Lender or the Issuing Bank, as the case  may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.    (d) Failure or delay on the part of any Lender or the Issuing Bank to demand  compensation pursuant to this Section shall not constitute a waiver of such Lender's or the Issuing Bank's  right to demand such compensation; provided that the Borrowers shall not be required to compensate a  Lender or the Issuing Bank pursuant to this Section for any increased costs or reductions incurred more  than 270 days prior to the date that such Lender or the Issuing Bank, as the case may be, notifies the  Borrower Representative of the Change in Law giving rise to such increased costs or reductions and of such  Lender's or the Issuing Bank's intention to claim compensation therefor; provided further that, if the Change  in Law giving rise to such increased costs or reductions is retroactive, then the 270-day period referred to  above shall be extended to include the period of retroactive effect thereof.  SECTION 2.16 Break Funding Payments.    (a) With respect to Loans that are not RFR Loans, in the event of (a) the payment of  any principal of any Term Benchmark Loan other than on the last day of an Interest Period applicable  thereto (including as a result of an Event of Default or as a result of any prepayment pursuant to  Section 2.11), (b) the conversion of any Term Benchmark Loan other than on the last day of the Interest  Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Term Benchmark Loan  on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be  revoked under Section 2.09(c) and is revoked in accordance therewith), or (d) the assignment of any Term  Benchmark Loan other than on the last day of the Interest Period applicable thereto as a result of a request  

 

-69-  by the Borrower Representative pursuant to Section 2.19 or 9.02(d), then, in any such event, the Borrowers  shall compensate each Lender for the loss, cost and expense attributable to such event.  A certificate of any  Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this  Section shall be delivered to the Borrower Representative and shall be conclusive absent manifest error.   The Borrowers shall pay such Lender the amount shown as due on any such certificate within ten (10) days  after receipt thereof.  (b) With respect to RFR Loans, in the event of (i) the payment of any principal of any  RFR Loan other than on the Interest Payment Date applicable thereto (including as a result of an Event of  Default or an optional or mandatory prepayment of Loans), (ii) the failure to borrow or prepay any RFR  Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may  be revoked under Section 2.09(c) and is revoked in accordance therewith) or (iii) the assignment of any  RFR Loan other than on the Interest Payment Date applicable thereto as a result of a request by the  Borrowers pursuant to Section 2.18, then, in any such event, the Borrowers shall compensate each Lender  for the loss, cost and expense attributable to such event.  A certificate of any Lender setting forth any  amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the  Borrower Representative and shall be conclusive absent manifest error.  The Borrowers shall pay such  Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.  SECTION 2.17 Withholding of Taxes; Gross-Up.  (a) Payments Free of Taxes.  Any and all payments by or on account of any obligation  of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes,  except as required by applicable law.  If any applicable law (as determined in the good faith discretion of  an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment  by a withholding agent, then the applicable withholding agent shall be entitled to make such deduction or  withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental  Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable  by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has  been made (including such deductions and withholdings applicable to additional sums payable under this  Section 2.17) the applicable Recipient receives an amount equal to the sum it would have received had no  such deduction or withholding been made.   (b) Payment of Other Taxes by the Loan Parties.  The Loan Parties shall timely pay to  the relevant Governmental Authority in accordance with applicable law, or at the option of the  Administrative Agent timely reimburse it for, Other Taxes.  (c) Evidence of Payment.  As soon as practicable after any payment of Taxes by any  Loan Party to a Governmental Authority pursuant to this Section 2.17, such Loan Party shall deliver to the  Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority  evidencing such payment, a copy of the return reporting such payment or other evidence of such payment  reasonably satisfactory to the Administrative Agent.  (d) Indemnification by the Loan Parties.  The Loan Parties shall jointly and severally  indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any  Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable  under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment  to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not  such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental  Authority.  A certificate as to the amount of such payment or liability delivered to any Loan Party by a  Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on  behalf of a Lender, shall be conclusive absent manifest error.  

 

-70-  (e) Indemnification by the Lenders.  Each Lender shall severally indemnify the  Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable  to such Lender (but only to the extent that any Loan Party has not already indemnified the Administrative  Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any  Taxes attributable to such Lender's failure to comply with the provisions of Section 9.04(c) relating to the  maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each  case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any  reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or  legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such  payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent  manifest error.  Each Lender hereby authorizes the Administrative Agent to setoff and apply any and all  amounts at any time owing to such Lender under any Loan Document or otherwise payable by the  Administrative Agent to such Lender from any other source against any amount due to the Administrative  Agent under this paragraph (e).  (f) Status of Lenders.  (i) Any Lender that is entitled to an exemption from or reduction of  withholding Tax with respect to payments made under any Loan Document shall deliver  to the Borrower Representative and the Administrative Agent, at the time or times  reasonably requested by the Borrower Representative or the Administrative Agent, such  properly completed and executed documentation reasonably requested by the Borrower  Representative or the Administrative Agent as will permit such payments to be made  without withholding or at a reduced rate of withholding.  In addition, any Lender, if  reasonably requested by the Borrower Representative or the Administrative Agent, shall  deliver such other documentation prescribed by applicable law or reasonably requested by  the Borrower Representative or the Administrative Agent as will enable the Borrowers or  the Administrative Agent to determine whether or not such Lender is subject to backup  withholding or information reporting requirements.  Notwithstanding anything to the  contrary in the preceding two sentences, the completion, execution and submission of such  documentation (other than such documentation set forth in Section 2.17(f)(ii)(A), (ii)(B)  and (ii)(D) below) shall not be required if in the Lender's reasonable judgment such  completion, execution or submission would subject such Lender to any material  unreimbursed cost or expense or would materially prejudice the legal or commercial  position of such Lender.  (ii) Without limiting the generality of the foregoing, in the event that any  Borrower is a U.S. Person,  (A) any Lender that is a U.S. Person shall deliver to the Borrower  Representative and the Administrative Agent on or prior to the date on which such  Lender becomes a Lender under this Agreement (and from time to time thereafter  upon the reasonable request of the Borrower Representative or the Administrative  Agent), an executed copy of IRS Form W-9 certifying that such Lender is exempt  from U.S. federal backup withholding tax;  (B) any Foreign Lender shall, to the extent it is legally entitled to do  so, deliver to the Borrower Representative and the Administrative Agent (in such  number of copies as shall be requested by the recipient) on or prior to the date on  which such Foreign Lender becomes a Lender under this Agreement (and from  time to time thereafter upon the reasonable request of the Borrower Representative  or the Administrative Agent), whichever of the following is applicable:  

 

-71-  (1) in the case of a Foreign Lender claiming the benefits of  an income tax treaty to which the United States is a party (x) with respect  to payments of interest under any Loan Document, an executed copy of  IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing  an exemption from, or reduction of, U.S. federal withholding Tax pursuant  to the "interest" article of such tax treaty and (y) with respect to any other  applicable payments under any Loan Document, IRS Form W-8BEN or  IRS Form W-8BEN-E, as applicable, establishing an exemption from, or  reduction of, U.S. Federal withholding Tax pursuant to the "business  profits" or "other income" article of such tax treaty;  (2) in the case of a Foreign Lender claiming that its extension  of credit will generate U.S. effectively connected income, an executed  copy of IRS Form W-8ECI;  (3) in the case of a Foreign Lender claiming the benefits of  the exemption for portfolio interest under Section 881(c) of the Code, (x) a  certificate substantially in the form of Exhibit F-1 to the effect that such  Foreign Lender is not a "bank" within the meaning of Section 881(c)(3)(A)  of the Code, a "10 percent shareholder" of a Borrower within the meaning  of Section 881(c)(3)(B) of the Code, or a "controlled foreign corporation"  described in Section 881(c)(3)(C) of the Code (a "U.S. Tax Compliance  Certificate") and (y) an executed copy of IRS Form W-8BEN or IRS Form  W-8BEN-E, as applicable; or  (4) to the extent a Foreign Lender is not the beneficial owner,  an executed copy of IRS Form W-8IMY, accompanied by IRS Form W- 8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, a U.S.  Tax Compliance Certificate substantially in the form of Exhibit F-2 or  Exhibit F-3, IRS Form W-9, and/or other certification documents from  each beneficial owner, as applicable; provided that if the Foreign Lender  is a partnership and one or more direct or indirect partners of such Foreign  Lender are claiming the portfolio interest exemption, such Foreign Lender  may provide a U.S. Tax Compliance Certificate substantially in the form  of Exhibit F-4 on behalf of each such direct and indirect partner;  (C) any Foreign Lender shall, to the extent it is legally entitled to do  so, deliver to the Borrower Representative and the Administrative Agent (in such  number of copies as shall be requested by the recipient) on or prior to the date on  which such Foreign Lender becomes a Lender under this Agreement (and from  time to time thereafter upon the reasonable request of the Borrower Representative  or the Administrative Agent), executed copies of any other form prescribed by  applicable law as a basis for claiming exemption from or a reduction in U.S. federal  withholding Tax, duly completed, together with such supplementary  documentation as may be prescribed by applicable law to permit the Borrowers or  the Administrative Agent to determine the withholding or deduction required to be  made; and  (D) if a payment made to a Lender under any Loan Document would  be subject to U.S. Federal withholding Tax imposed by FATCA if such Lender  were to fail to comply with the applicable reporting requirements of FATCA  (including those contained in Section 1471(b) or 1472(b) of the Code, as  

 

-72-  applicable), such Lender shall deliver to the Borrower Representative and the  Administrative Agent at the time or times prescribed by law and at such time or  times reasonably requested by the Borrower Representative or the Administrative  Agent such documentation prescribed by applicable law (including as prescribed  by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation  reasonably requested by the Borrower Representative or the Administrative Agent  as may be necessary for the Borrowers and the Administrative Agent to comply  with their obligations under FATCA and to determine that such Lender has  complied with such Lender's obligations under FATCA or to determine the amount  to deduct and withhold from such payment.  Solely for purposes of this clause (D),  "FATCA" shall include any amendments made to FATCA after the date of this  Agreement.  Each Lender agrees that if any form or certification it previously delivered expires or becomes  obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the  Borrower Representative and the Administrative Agent in writing of its legal inability to do so.  (g) Treatment of Certain Refunds.  If any party determines, in its sole discretion  exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified  pursuant to this Section (including by the payment of additional amounts pursuant to this Section), it shall  pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments  made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket  expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by  the relevant Governmental Authority with respect to such refund).  Such indemnifying party, upon the  request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to  this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant Governmental  Authority) in the event that such indemnified party is required to repay such refund to such Governmental  Authority.  Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified  party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment  of which would place the indemnified party in a less favorable net after-Tax position than the indemnified  party would have been in if the Tax subject to indemnification and giving rise to such refund had not been  deducted, withheld or otherwise imposed and the indemnification payments or additional amounts giving  rise to such refund had never been paid.  This paragraph (g) shall not be construed to require any  indemnified party to make available its Tax returns (or any other information relating to its Taxes that it  deems confidential) to the indemnifying party or any other Person.  (h) Survival.  Each party's obligations under this Section shall survive the resignation  or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender,  the termination of the Revolving Commitments and the repayment, satisfaction or discharge of all  obligations under any Loan Document (including the Payment in Full of the Secured Obligations).  (i) Defined Terms.  For purposes of this Section 2.17, and the term "applicable law"  includes FATCA.  SECTION 2.18 Payments Generally; Allocation of Proceeds; Sharing of Setoffs.  (a) The Borrowers shall make each payment or prepayment required to be made by  them hereunder (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts  payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to 2:00 p.m., Chicago time, on the date when  due or the date fixed for any prepayment hereunder, in immediately available funds, without setoff,  recoupment or counterclaim.  Any amounts received after such time on any date may, in the discretion of  the Administrative Agent, be deemed to have been received on the next succeeding Business Day for  

 

-73-  purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent at  its offices at 10 South Dearborn Street, Floor L2, Chicago, Illinois, except payments to be made directly to  the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to  Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons entitled thereto.  The Administrative  Agent shall distribute any such payments received by it for the account of any other Person to the  appropriate recipient promptly following receipt thereof.  Unless otherwise provided for herein, if any  payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended  to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon  shall be payable for the period of such extension.  All payments hereunder shall be made in dollars.  (b) All payments and any proceeds of Collateral received by the Administrative Agent  (i) not constituting either (A) a specific payment of principal, interest, fees or other sum payable under the  Loan Documents (which shall be applied as specified by the Borrowers), (B) a mandatory prepayment  (which shall be applied in accordance with Section 2.11) or (C) amounts to be applied from the Collection  Account (which shall be applied in accordance with Section 2.10(b)) or (ii) after an Event of Default has  occurred and is continuing and the Administrative Agent so elects or the Required Lenders so direct, shall  be applied ratably first, to pay any fees, indemnities, or expense reimbursements then due to the  Administrative Agent and the Issuing Bank from the Borrowers (other than in connection with Banking  Services Obligations or Swap Agreement Obligations), second, to pay any fees, indemnities, or expense  reimbursements then due to the Lenders from the Borrowers (other than in connection with Banking  Services Obligations or Swap Agreement Obligations), third, to pay interest due in respect of the  Overadvances and Protective Advances, fourth, to pay the principal of the Overadvances and Protective  Advances, fifth, to pay interest then due and payable on the Loans (other than the Overadvances and  Protective Advances) ratably, sixth, to prepay principal on the Loans (other than the Overadvances and  Protective Advances) and unreimbursed LC Disbursements, ratably (with amounts applied to the Term  Loan applied to the Term A Loan and the Term B Loan on a pro rata basis, and to installments thereof in  the inverse order of maturity), seventh, to pay an amount to the Administrative Agent equal to one hundred  five percent (105%) of the aggregate LC Exposure, to be held as cash collateral for such Obligations, eighth,  to payment of any amounts owing in respect of Swap Agreement Obligations and Banking Service  Obligations up to and including the amount most recently provided to the Administrative Agent pursuant  to Section 2.22, and ninth, to the payment of any other Secured Obligation due to the Administrative Agent  or any Lender by the Borrowers.  Notwithstanding the foregoing amounts received from any Loan Party  shall not be applied to any Excluded Swap Obligation of such Loan Party.  Notwithstanding anything to the  contrary contained in this Agreement, unless so directed by the Borrower Representative, or unless a  Default is in existence, neither the Administrative Agent nor any Lender shall apply any payment which it  receives to any Term Benchmark Loan of a Class, except (a) on the expiration date of the Interest Period  applicable thereto or (b) in the event, and only to the extent, that there are no outstanding CBFR Loans of  the same Class and, in any such event, the Borrowers shall pay the break funding payment required in  accordance with Section 2.16. The Administrative Agent and the Lenders shall have the continuing and  exclusive right to apply and reverse and reapply any and all such proceeds and payments to any portion of  the Secured Obligations.  (c) At the election of the Administrative Agent, all payments of principal, interest, LC  Disbursements, fees, premiums, reimbursable expenses (including, without limitation, all reimbursement  for fees, costs and expenses pursuant to Section 9.03), and other sums payable under the Loan Documents,  may be paid from the proceeds of Borrowings made hereunder whether made following a request by the  Borrower Representative pursuant to Section 2.03 or a deemed request as provided in this Section or may  be deducted from any deposit account of any Borrower maintained with the Administrative Agent.  Each  Working Capital Borrower hereby irrevocably authorizes (i) the Administrative Agent to make a Borrowing  for the purpose of paying each payment of principal, interest and fees as it becomes due hereunder or any  other amount due under the Loan Documents and agrees that all such amounts charged shall constitute  Loans (including Swingline Loans and Overadvances, but such a Borrowing may only constitute a  

 

-74-  Protective Advance if it is to reimburse costs, fees and expenses as described in Section 9.03) and that all  such Borrowings shall be deemed to have been requested pursuant to Section 2.03, 2.04 or 2.05, as  applicable, and (ii) the Administrative Agent to charge any deposit account of any Borrower maintained  with the Administrative Agent for each payment of principal, interest and fees as it becomes due hereunder  or any other amount due under the Loan Documents.  (d) If, except as otherwise expressly provided herein, any Lender shall, by exercising  any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on  any of its Loans or participations in LC Disbursements resulting in such Lender receiving payment of a  greater proportion of the aggregate amount of its Loans and participations in LC Disbursements and  Swingline Loans and accrued interest thereon than the proportion received by any other similarly situated  Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value)  participations in the Loans and participations in LC Disbursements and Swingline Loans of other Lenders  to the extent necessary so that the benefit of all such payments shall be shared by all such Lenders ratably  in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and  participations in LC Disbursements and Swingline Loans; provided that (i) if any such participations are  purchased and all or any portion of the payment giving rise thereto is recovered,  such participations shall  be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the  provisions of this paragraph shall not be construed to apply to any payment made by the Borrowers pursuant  to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as  consideration for the assignment of or sale of a participation in any of its Loans or participations in LC  Disbursements or Swingline Loans to any assignee or participant, other than to the Borrowers or any  Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply).  Each Borrower  consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any  Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such  Borrower rights of setoff and counterclaim with respect to such participation as fully as if such Lender were  a direct creditor of such Borrower in the amount of such participation.  (e) Unless the Administrative Agent shall have received, prior to any date on which  any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank pursuant  to the terms hereof or any other Loan Document (including any date that is fixed for prepayment by notice  from the Borrower Representative to the Administrative Agent pursuant to Section 2.11(e)), notice from  the Borrower Representative that the Borrowers will not make such payment or prepayment, the  Administrative Agent may assume that the Borrowers have made such payment on such date in accordance  herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the  case may be, the amount due.  In such event, if the Borrowers have not in fact made such payment, then  each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative  Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon,  for each day from and including the date such amount is distributed to it to but excluding the date of payment  to the Administrative Agent, at the greater of the NYFRB Rate and a rate determined by the Administrative  Agent in accordance with banking industry rules on interbank compensation.  (f) The Administrative Agent may from time to time provide the Borrower  Representative with account statements or invoices with respect to any of the Secured Obligations (the  "Statements").  The Administrative Agent is under no duty or obligation to provide Statements, which, if  provided, will be solely for the Borrowers' convenience.  Statements may contain estimates of the amounts  owed during the relevant billing period, whether of principal, interest, fees or other Secured Obligations.   If the Borrowers pay the full amount indicated on a Statement on or before the due date indicated on such  Statement, the Borrowers shall not be in default of payment with respect to the billing period indicated on  such Statement; provided, that acceptance by the Administrative Agent, on behalf of the Lenders, of any  payment that is less than the total amount actually due at that time (including but not limited to any past  

 

-75-  due amounts) shall not constitute a waiver of the Administrative Agent's or the Lenders' right to receive  payment in full at another time.  SECTION 2.19 Mitigation Obligations; Replacement of Lenders.  (a) If any Lender requests compensation under Section 2.15, or if the Borrowers are  required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority  for the account of any Lender pursuant to Section 2.17, then such Lender shall use reasonable efforts to  designate a different lending office for funding or booking its Loans hereunder or to assign its rights and  obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender,  such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or  2.17, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or  expense and would not otherwise be disadvantageous to such Lender.  The Borrowers hereby agree to pay  all reasonable costs and expenses incurred by any Lender in connection with any such designation or  assignment.  (b) If any Lender requests compensation under Section 2.15, or if the Borrowers are  required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority  for the account of any Lender pursuant to Section 2.17, if in connection with any proposed amendment,  modification, termination, waiver or consent with respect to any of the provisions hereof as contemplated  by Section 9.02(b), the consent of Required Lenders shall have been obtained but the consent of one or  more of such other Lenders (each a "Non-Consenting Lender") whose consent is required shall not have  been obtained, or if any Lender becomes a Defaulting Lender, then the Borrowers may, at their sole expense  and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and  delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all  its interests, rights (other than its existing rights to payments pursuant to Section 2.15 or 2.17) and  obligations under this Agreement and other Loan Documents to an assignee (a "Replacement Lender") that  shall assume such obligations (which assignee may be another Lender, if a Lender accepts such  assignment); provided that (i) the Borrowers shall have received the prior written consent of the  Administrative Agent (and in circumstances where its consent would be required under Section 9.04, the  Issuing Bank and the Swingline Lender), which consent shall not unreasonably be withheld, (ii) such  Lender shall have received payment of an amount equal to the outstanding principal of its Loans and funded  participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all  other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and  accrued interest and fees) or the Borrowers (in the case of all other amounts), (iii) in the case of any such  assignment resulting from a claim for compensation under Section 2.15 or payments required to be made  pursuant to Section 2.17, such assignment will result in a reduction in such compensation or payments and  (iv) in the case of a Non-Consenting Lender, each Replacement Lender shall consent, at the time of such  assignment, to each matter in respect of which such terminated Lender was a Non-Consenting Lender.  A  Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a  waiver by such Lender or otherwise, the circumstances entitling the Borrowers to require such assignment  and delegation cease to apply.  Each party hereto agrees that (x) an assignment required pursuant to this  paragraph may be effected pursuant to an Assignment and Assumption executed by the Borrower  Representative, the Administrative Agent and the assignee (or, to the extent applicable, an agreement  incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform  as to which the Administrative Agent and such parties are participants), and (y) the Lender required to make  such assignment need not be a party thereto in order for such assignment to be effective and shall be deemed  to have consented to an be bound by the terms thereof; provided that, following the effectiveness of any  such assignment, the other parties to such assignment agree to execute and deliver such documents  necessary to evidence such assignment as reasonably requested by the applicable Lender, provided that any  such documents shall be without recourse to or warranty by the parties thereto.  

 

-76-  SECTION 2.20 Defaulting Lenders.  Notwithstanding any provision of this Agreement to the  contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long  as such Lender is a Defaulting Lender:  (a) fees shall cease to accrue on the unfunded portion of the Revolving Commitment  of such Defaulting Lender pursuant to Section 2.12(a);  (b) any payment of principal, interest, fees or other amounts received by the  Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at  maturity, pursuant to Section 2.18(b) or otherwise) or received by the Administrative Agent from a  Defaulting Lender pursuant to Section 9.08 shall be applied at such time or times as may be determined by  the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender  to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing  by such Defaulting Lender to any Issuing Bank or Swingline Lender hereunder; third, to cash collateralize  the Issuing Bank's LC Exposure with respect to such Defaulting Lender in accordance with this Section;  fourth, as the Borrower Representative may request (so long as no Default or Event of Default exists), to  the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof  as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the  Administrative Agent and the Borrower Representative, to be held in a deposit account and released pro  rata in order to (x) satisfy such Defaulting Lender's potential future funding obligations with respect to  Loans under this Agreement and (y) cash collateralize the Issuing Bank's future LC Exposure with respect  to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in  accordance with this Section; sixth, to the payment of any amounts owing to the Lenders, the Issuing Bank  or Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender,  the Issuing Bank or Swingline Lender against such Defaulting Lender as a result of such Defaulting  Lender's breach of its obligations under this Agreement or under any other Loan Document; seventh, so  long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrowers as a  result of any judgment of a court of competent jurisdiction obtained by any Borrower against such  Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement or  under any other Loan Document; and eighth, to such Defaulting Lender or as otherwise directed by a court  of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any  Loans or LC Disbursements in respect of which such Defaulting Lender has not fully funded its appropriate  share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the  conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay  the Loans of, and LC Disbursements owed to, all non-Defaulting Lenders on a pro rata basis prior to being  applied to the payment of any Loans of, or LC Disbursements owed to, such Defaulting Lender until such  time as all Loans and funded and unfunded participations in the Borrowers' obligations corresponding to  such Defaulting Lender's LC Exposure and Swingline Loans are held by the Lenders pro rata in accordance  with the Commitments without giving effect to clause (d) below. Any payments, prepayments or other  amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a  Defaulting Lender or to post cash collateral pursuant to this Section shall be deemed paid to and redirected  by such Defaulting Lender, and each Lender irrevocably consents hereto;   (c) such Defaulting Lender shall not have the right to vote on any issue on which  voting is required (other than to the extent expressly provided in Section 9.02(b)) and the Commitment and  Revolving Exposure and, if applicable, Term Loan of such Defaulting Lender shall not be included in  determining whether the Required Lenders, the Required Revolving Lenders or the Supermajority  Revolving Lenders, as applicable, have taken or may take any action hereunder (including any consent to  any amendment, waiver or other modification pursuant to Section 9.02) or under any other Loan Document;  provided, that, except as otherwise provided in Section 9.02, this clause (c) shall not apply to the vote of a  Defaulting Lender in the case of an amendment, waiver or other modification requiring the consent of such  Lender or each Lender directly affected thereby;  

 

-77-  (d) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes a  Defaulting Lender then:  (i) all or any part of the Swingline Exposure and LC Exposure of such  Defaulting Lender shall be reallocated among the non-Defaulting Lenders in accordance  with their respective Applicable Percentages but only to the extent that such reallocation  does not, as to any non-Defaulting Lender, cause such non-Defaulting Lender's Revolving  Exposure to exceed its Revolving Commitment;  (ii) if the reallocation described in clause (i) above cannot, or can only  partially, be effected, the Borrowers shall within one (1) Business Day following notice by  the Administrative Agent (x) first, prepay such Swingline Exposure and (y) second, cash  collateralize, for the benefit of the Issuing Bank, the Borrowers' obligations corresponding  to such Defaulting Lender's LC Exposure (after giving effect to any partial reallocation  pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.06(j)  for so long as such LC Exposure is outstanding;  (iii) if the Borrowers cash collateralize any portion of such Defaulting Lender's  LC Exposure pursuant to clause (ii) above, the Borrowers shall not be required to pay any  fees to such Defaulting Lender pursuant to Section 2.12(b) with respect to such Defaulting  Lender's LC Exposure during the period such Defaulting Lender's LC Exposure is cash  collateralized;  (iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant  to clause (i) above, then the fees payable to the Lenders pursuant to Sections 2.12(a) and  2.12(b) shall be adjusted in accordance with such non-Defaulting Lenders' Applicable  Percentages; and  (v) if all or any portion of such Defaulting Lender's LC Exposure is neither  reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then, without  prejudice to any rights or remedies of the Issuing Bank or any other Lender hereunder, all  letter of credit fees payable under Section 2.12(b) with respect to such Defaulting Lender's  LC Exposure shall be payable to the Issuing Bank until and to the extent that such LC  Exposure is reallocated and/or cash collateralized; and  (e) so long as such Lender is a Defaulting Lender, the Issuing Bank shall not be  required to issue, amend, renew, extend or increase any Letter of Credit, unless it is satisfied that such  Defaulting Lender's then outstanding LC Exposure will be 100% covered by the Commitments of the non- Defaulting Lenders and/or cash collateral will be provided by the Borrowers in accordance with  Section 2.20(d), and LC Exposure related to any newly issued or increased Letter of Credit shall be  allocated among non-Defaulting Lenders in a manner consistent with Section 2.20(d)(i) (and such  Defaulting Lender shall not participate therein).  If (i) a Bankruptcy Event or a Bail-In Action with respect to the Parent of any Lender shall occur  following the date hereof and for so long as such event shall continue or (ii) the Issuing Bank has a good  faith belief that any Lender has defaulted in fulfilling its obligations under one or more other agreements  in which such Lender commits to extend credit, the Issuing Bank shall not be required to issue, amend or  increase any Letter of Credit, unless the Issuing Bank shall have entered into arrangements with the  Borrowers or such Lender, satisfactory to the Issuing Bank to defease any risk  to it in respect of such  Lender hereunder.  

 

-78-  In the event that each of the Administrative Agent, the Borrowers, the Swingline Lender and the  Issuing Bank agrees that a Defaulting Lender has adequately remedied all matters that caused such Lender  to be a Defaulting Lender, then the Swingline Exposure and LC Exposure of the Lenders shall be readjusted  to reflect the inclusion of such Lender's Revolving Commitment and on the date of such readjustment such  Lender shall purchase at par such of the Loans of the other Lenders (other than Swingline Loans) as the  Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in  accordance with its Applicable Percentage.  SECTION 2.21 Returned Payments.  If after receipt of any payment which is applied to the  payment of all or any part of the Obligations (including a payment effected through exercise of a right of  setoff), the Administrative Agent or any Lender is for any reason compelled to surrender such payment or  proceeds to any Person because such payment or application of proceeds is invalidated, declared fraudulent,  set aside, determined to be void or voidable as a preference, impermissible setoff, or a diversion of trust  funds, or for any other reason (including pursuant to any settlement entered into by the Administrative  Agent or such Lender in its discretion), then the Obligations or part thereof intended to be satisfied shall be  revived and continued and this Agreement shall continue in full force as if such payment or proceeds had  not been received by the Administrative Agent or such Lender.  The provisions of this Section 2.21 shall  be and remain effective notwithstanding any contrary action which may have been taken by the  Administrative Agent or any Lender in reliance upon such payment or application of proceeds.  The  provisions of this Section 2.21 shall survive the termination of this Agreement.  SECTION 2.22 Banking Services and Swap Agreements.  Each Lender or Affiliate thereof  providing Banking Services for, or having Swap Agreements with, any Loan Party or any Subsidiary or  Affiliate of a Loan Party shall deliver to the Administrative Agent, promptly after entering into such  Banking Services or Swap Agreements, written notice setting forth the aggregate amount of all Banking  Services Obligations and Swap Agreement Obligations of such Loan Party or Subsidiary or Affiliate thereof  to such Lender or Affiliate (whether matured or unmatured, absolute or contingent).  In addition, each such  Lender or Affiliate thereof shall deliver to the Administrative Agent, following the end of each calendar  month, a summary of the amounts due or to become due in respect of such Banking Services Obligations  and Swap Agreement Obligations.  The most recent information provided to the Administrative Agent shall  be used in determining the amounts to be applied in respect of such Banking Services Obligations and/or  Swap Agreement Obligations pursuant to Section 2.18(b) and which tier of the waterfall, contained in  Section 2.18(b), such Banking Services Obligations and/or Swap Agreement Obligations will be placed.  ARTICLE III    Representations and Warranties.  Each Loan Party represents and warrants to the Lenders that:   SECTION 3.01 Organization; Powers.  Each Loan Party and each Subsidiary is duly  organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has  all requisite power and authority to carry on its business as now conducted and is qualified to do business,  and is in good standing, in every jurisdiction where such qualification is required.  SECTION 3.02 Authorization; Enforceability.  The Transactions are within each Loan Party's  organizational powers and have been duly authorized by all necessary organizational actions and, if  required, actions by equity holders.  Each Loan Document to which each Loan Party is a party has been  duly executed and delivered by such Loan Party and constitutes a legal, valid and binding obligation of  such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency,  reorganization, moratorium or other laws affecting the enforcement of creditors' rights generally and subject  

 

-79-  to general principles of equity, regardless of whether considered in a proceeding in equity or at law and  obligations of good faith and fair dealing.  SECTION 3.03 Governmental Approvals; No Conflicts.  The Transactions (a) do not require  any consent or approval of, registration or filing with, or any other action by, any Governmental Authority,  except such as have been obtained or made and are in full force and effect and except for filings necessary  to perfect Liens created pursuant to the Loan Documents, (b) will not violate any Requirement of Law  applicable to any Loan Party or any Subsidiary, (c) will not violate or result in a default under any indenture,  agreement or other instrument binding upon any Loan Party or any Subsidiary or the assets of any Loan  Party or any Subsidiary, which in any case could reasonably be expected to result in a Material Adverse  Effect, or give rise to a right thereunder to require any payment to be made by any Loan Party or any  Subsidiary, and (d) will not result in the creation or imposition of, or the requirement to create, any Lien on  any asset of any Loan Party or any Subsidiary, except Liens created pursuant to the Loan Documents.  SECTION 3.04 Financial Condition; No Material Adverse Change.  (a) HF Foods has heretofore furnished to the Lenders the consolidated balance sheet  and statements of income, stockholders equity and cash flows of HF Foods and its consolidated Subsidiaries  (i) as of and for the fiscal year ended December 31, 2020, reported on by Freidman LLP, and (ii) as of and  for the portion of the fiscal year ended January 31, 2022, certified by its Financial Officer.  Such financial  statements present fairly, in all material respects, the financial position and results of operations and cash  flows of HF Foods and its consolidated Subsidiaries as of such dates and for such periods in accordance  with GAAP, subject to year-end audit adjustments (all of which, when taken as a whole, would not be  materially adverse) and the absence of footnotes in the case of the statements referred to in clause (ii) above.  (b) [Reserved].  (c) B&R Realty has heretofore furnished to the Administrative Agent its consolidated  and consolidating balance sheet and statements of income, members' equity and cash flows (i) as of and for  the fiscal year ended December 31, 2020, certified by its Financial Officer and (ii) as of and for the one  fiscal month period ended January 31, 2022, certified by its Financial Officer.  Such financial statements  present fairly, in all material respects, the financial position and results of operations and cash flows of  B&R Realty and its consolidated Subsidiaries as of such dates and for such periods in accordance with  GAAP, subject to the absence of footnotes.  (d) No event, change or condition has occurred that has had, or could reasonably be  expected to have, a Material Adverse Effect on (i) HF Foods and its Subsidiaries since December 31, 2020  or (ii) B&R Realty and its Subsidiaries, since December 31, 2020.  SECTION 3.05 Properties.  (a) As of the date of this Agreement, Schedule 3.05 sets forth the address of each  parcel of real property that is owned or leased by any Loan Party.  Each of such leases and subleases is  valid and enforceable in accordance with its terms and is in full force and effect, and no default by any  party to any such lease or sublease exists.  Each of the Loan Parties and each of its Subsidiaries has good  and indefeasible title to, or valid leasehold interests in, all of its real and personal property, free of all Liens  except for those which failure of such title or leasehold interest, individually or in the aggregate, would not  reasonably have a Material Adverse Effect and except those permitted by Section 6.02.  (b) Each Loan Party and each Subsidiary owns, or is licensed to use, all trademarks,  tradenames, copyrights, patents and other intellectual property necessary to its business as currently  conducted, a correct and complete list of which, as of the date of this Agreement, is set forth on Schedule  

 

-80-  3.05, and the use thereof by each Loan Party and each Subsidiary does not infringe in any material respect  upon the rights of any other Person, and each Loan Party's and each Subsidiary's rights thereto are not  subject to any licensing agreement or similar arrangement.  SECTION 3.06 Litigation and Environmental Matters.   (a) There are no actions, suits or proceedings by or before any arbitrator or  Governmental Authority pending against or, to the knowledge of any Loan Party, threatened against or  affecting any Loan Party or any Subsidiary (i) as to which there is a reasonable possibility of an adverse  determination and that, if adversely determined, could reasonably be expected, individually or in the  aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) that involve any  Loan Document or the Transactions.  (b) Except for the Disclosed Matters (i) no Loan Party or any Subsidiary has received  notice of any claim with respect to any Environmental Liability or knows of any basis for any  Environmental Liability and (ii) except with respect to any other matters that, individually or in the  aggregate, could not reasonably be expected to result in a Material Adverse Effect, no Loan Party or any  Subsidiary (A) has failed to comply with any Environmental Law or to obtain, maintain or comply with  any permit, license or other approval required under any Environmental Law, (B) has become subject to  any Environmental Liability, (C) has received notice of any claim with respect to any Environmental  Liability or (D) knows of any basis for any Environmental Liability.  (c) Since the date of this Agreement, there has been no change in the status of the  Disclosed Matters that, individually or in the aggregate, has resulted in, or materially increased the  likelihood of, a Material Adverse Effect.  SECTION 3.07 Compliance with Laws and Agreements; No Default.  Except where the failure  to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse  Effect, each Loan Party and each Subsidiary is in compliance with (a) all Requirements of Law applicable  to it or its property and (b) all indentures, agreements and other instruments binding upon it or its property.   No Default has occurred and is continuing.  SECTION 3.08 Investment Company Status.  No Loan Party or any Subsidiary is an  "investment company" as defined in, or subject to regulation under, the Investment Company Act of 1940.  SECTION 3.09 Taxes.  Each Loan Party and each Subsidiary has timely filed or caused to be  filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes  required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate  proceedings and for which such Loan Party or such Subsidiary, as applicable, has set aside on its books  adequate reserves or (b) to the extent that the failure to do so could not be expected to result in a Material  Adverse Effect.  No Liens have been filed and no claims are being asserted with respect to any such taxes.  SECTION 3.10 ERISA.  No ERISA Event has occurred or is reasonably expected to occur  that, when taken together with all other such ERISA Events for which liability is reasonably expected to  occur, could reasonably be expected to result in a Material Adverse Effect.  The present value of all  accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement  of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements  reflecting such amounts, exceed by more than $50,000 the fair market value of the assets of such Plan, and  the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions  used for purposes of Statement of Financial Accounting Standards No. 87 or subsequent recodification  thereof, as applicable) did not, as of the date of the most recent financial statements reflecting such amounts,  exceed by more than $50,000 the fair market value of the assets of all such underfunded Plans.  

 

-81-  SECTION 3.11 Disclosure.    (a) The Loan Parties have disclosed to the Lenders all agreements, instruments and  corporate or other restrictions to which any Loan Party or any Subsidiary is subject, and all other matters  known to them, that, individually or in the aggregate, could reasonably be expected to result in a Material  Adverse Effect.  None of the reports, financial statements, certificates or other information furnished by or  on behalf of any Loan Party or any Subsidiary to the Administrative Agent or any Lender in connection  with the negotiation of this Agreement or any other Loan Document (as modified or supplemented by other  information so furnished) contains any material misstatement of fact or omits to state any material fact  necessary to make the statements therein, in the light of the circumstances under which they were made,  not misleading; provided that, with respect to projected financial information, the Loan Parties represent  only that such information was prepared in good faith based upon assumptions believed to be reasonable at  the time delivered and, if such projected financial information was delivered prior to the Effective Date, as  of the Effective Date.  (b) As of the Effective Date, to the best knowledge of each Loan Party, the information  included in the Beneficial Ownership Certification provided on or prior to the Effective Date to any Lender  in connection with this Agreement is true and correct in all respects.  SECTION 3.12 Material Agreements.  All Material Agreements to which any Loan Party is a  party or is bound as of the date of this Agreement are listed on Schedule 3.12.  No Loan Party is in default  in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained  in (a) any Material Agreement to which it is a party or (b) any agreement or instrument evidencing or  governing Indebtedness.  SECTION 3.13 Solvency.  (a) Immediately after the effectiveness of this Agreement and the consummation of  the Transactions to occur on the Effective Date, (i) the fair value of the assets of each Loan Party, at a fair  valuation, will exceed its debts and liabilities, subordinated, contingent or otherwise; (ii) the present fair  saleable value of the property of each Loan Party will be greater than the amount that will be required to  pay the probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as such  debts and other liabilities become absolute and matured; (iii) each Loan Party will be able to pay its debts  and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and  matured; and (iv) no Loan Party will have unreasonably small capital with which to conduct the business  in which it is engaged as such business is now conducted and is proposed to be conducted after the Effective  Date.  (b) No Loan Party intends to, nor will permit any Subsidiary to, and no Loan Party  believes that it or any Subsidiary will, incur debts beyond its ability to pay such debts as they mature, taking  into account the timing of and amounts of cash to be received by it or any such Subsidiary and the timing  of the amounts of cash to be payable on or in respect of its Indebtedness or the Indebtedness of any such  Subsidiary.  SECTION 3.14 Insurance.  Schedule 3.14 sets forth a description of all insurance maintained  by or on behalf of the Loan Parties and their Subsidiaries as of the Effective Date.  As of the Effective Date,  all premiums in respect of such insurance have been paid.  Each Loan Party maintains, and has caused each  Subsidiary to maintain, with financially sound and reputable insurance companies, insurance on all their  real and personal property in such amounts, subject to such deductibles and self-insurance retentions and  covering such properties and risks as are adequate and customarily maintained by companies engaged in  the same or similar businesses operating in the same or similar locations.  

 

-82-  SECTION 3.15 Capitalization and Subsidiaries.  Schedule 3.15 sets forth (a) a correct and  complete list of the name and relationship to the Loan Parties of each Subsidiary, (b) a true and complete  listing of each class of each Loan Party's authorized Equity Interests, all of which issued Equity Interests  are validly issued, outstanding, fully paid and non-assessable, and owned beneficially and of record by the  Persons identified on Schedule 3.15, and (c) the type of entity of each Loan Party and each of its  Subsidiaries.  All of the issued and outstanding Equity Interests owned by any Loan Party have been (to the  extent such concepts are relevant with respect to such ownership interests) duly authorized and issued and  are fully paid and non-assessable.  There are no outstanding commitments or other obligations of any Loan  Party to issue, and no options, warrants or other rights of any Person to acquire, any shares of any class of  membership interests or units, capital stock or other Equity Interests of any Loan Party.  SECTION 3.16 Security Interest in Collateral.  The provisions of this Agreement and the other  Loan Documents create legal and valid Liens on all of the Collateral in favor of the Administrative Agent,  for the benefit of the Secured Parties, and such Liens constitute perfected and continuing Liens on the  Collateral, securing the Secured Obligations, enforceable against the applicable Loan Party and all third  parties, and having priority over all other Liens on the Collateral except in the case of (a) Permitted  Encumbrances, to the extent any such Permitted Encumbrances would have priority over the Liens in favor  of the Administrative Agent pursuant to any applicable law or agreement and (b) Liens perfected only by  possession (including possession of any certificate of title) to the extent the Administrative Agent has not  obtained or does not maintain possession of such Collateral.  SECTION 3.17 Employment Matters.  As of the Effective Date, there are no strikes, lockouts  or slowdowns against any Loan Party or any Subsidiary pending or, to the knowledge of any Loan Party,  threatened.  The hours worked by and payments made to employees of the Loan Parties and their  Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable Federal,  state, local or foreign law dealing with such matters.  All payments due from any Loan Party or any  Subsidiary, or for which any claim may be made against any Loan Party or any Subsidiary, on account of  wages and employee health and welfare insurance and other benefits, have been paid or accrued as a liability  on the books of such Loan Party or such Subsidiary.  SECTION 3.18 Margin Regulations.  No Loan Party is engaged and will not engage,  principally or as one of its important activities, in the business of purchasing or carrying Margin Stock, or  extending credit for the purpose of purchasing or carrying Margin Stock, and no part of the proceeds of any  Borrowing or Letter of Credit hereunder will be used to buy or carry any Margin Stock.  Following the  application of the proceeds of each Borrowing or drawing under each Letter of Credit, not more than 25%  of the value of the assets (either of any Loan Party only or of the Loan Parties and their Subsidiaries on a  consolidated basis) will be Margin Stock.  SECTION 3.19 Use of Proceeds.  The proceeds of the Loans have been used and will be used,  whether directly or indirectly as set forth in Section 5.08.  SECTION 3.20 No Burdensome Restrictions.  No Loan Party is subject to any Burdensome  Restrictions except Burdensome Restrictions permitted under Section 6.10.  SECTION 3.21 Anti-Corruption Laws and Sanctions.  Each Loan Party has implemented and  maintains in effect policies and procedures designed to ensure compliance by such Loan Party, its  Subsidiaries and their respective managers, directors, officers, employees and agents with Anti-Corruption  Laws and applicable Sanctions, and such Loan Party, its Subsidiaries and their respective managers, officers  and directors and, to the knowledge of such Loan Party, its employees and agents, are in compliance with  Anti-Corruption Laws and applicable Sanctions in all material respects and are not knowingly engaged in  any activity that would reasonably be expected to result in any Loan Party being designated as a Sanctioned  Person.  None of (a) any Loan Party, any Subsidiary or, to the knowledge of any such Loan Party or  

 

-83-  Subsidiary, any of their respective managers, directors, officers or employees, or (b) to the knowledge of  any such Loan Party or Subsidiary, any agent of such Loan Party or any Subsidiary that will act in any  capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person.   No Borrowing or Letter of Credit, use of proceeds, Transaction or other transaction contemplated by this  Agreement or the other Loan Documents will violate Anti-Corruption Laws or applicable Sanctions.  SECTION 3.22 Affiliate Transactions.  Except as set forth on Schedule 3.22, as of the date of  this Agreement, there are no existing or proposed agreements, arrangements, understandings or transactions  between any Loan Party and any of the officers, members, managers, directors, employees or Related  Entities of any Loan Party or any members of their respective immediate families.  SECTION 3.23 Common Enterprise.  The successful operation and condition of each of the  Loan Parties is dependent on the continued successful performance of the functions of the group of the  Loan Parties as a whole and the successful operation of each of the Loan Parties is dependent on the  successful performance and operation of each other Loan Party.  Each Loan Party expects to derive benefit  (and its board of managers, board of directors or other governing body has determined that it may  reasonably be expected to derive benefit), directly and indirectly, from (a) successful operations of each of  the other Loan Parties and (b) the credit extended by the Lenders to the Borrowers hereunder, both in their  separate capacities and as members of the group of companies.  Each Loan Party has determined that  execution, delivery, and performance of this Agreement and any other Loan Documents to be executed by  such Loan Party is within its purpose, in furtherance of its direct and/or indirect business interests, will be  of direct and/or indirect benefit to such Loan Party, and is in its best interest.  SECTION 3.24 Holding Companies.  Each of B&R, HF Foods and HF Holding is a holding  company that does not conduct any business, own any material assets or have any material liabilities, other  than (i) ownership of the Equity Interests of its Subsidiaries, (ii) its obligations under the Loan Documents,  and (iii) maintenance of its existence.  SECTION 3.25 Agricultural Matters.  The Working Capital Borrowers have previously  delivered to the Administrative Agent copies of all notifications received by any Loan Party, whether  pursuant to the UCC, the FSA, PACA, State Agricultural Laws or otherwise, and whether sent by a seller  of any "farm products" (as defined in the FSA), a lender to such seller, the Secretary of State of any State  or any other Person, of any FSA Lien or State Agricultural Lien or the imposition of a PACA Trust.  The  Loan Parties have complied with all payment instructions contained in any such notifications.  As of the  date of this Agreement, the Loan Parties purchase farm products only from Persons located in the States set  forth on Schedule 3.25 and only from the Persons listed on such Schedule 3.25 (which list includes the  address of each such Person, as well as an explanation of whether such Person is a producer of farm  products, a cooperative, a broker, a distributor or otherwise).  The Working Capital Borrowers agree to  promptly inform the Administrative Agent if any Loan Party purchases farm products from Persons located  in any additional States and to update such Schedule 3.25 to reflect any other changes to the information  contained therein.  No Loan Party has received any notice of non-payment or notice of dishonored checks  from any Person from whom such Loan Party has purchased farm products.  No Loan Party has received  notice (written or otherwise) from any producer, unpaid seller, supplier or agent indicating such Person's  intent to preserve the benefits of the trust created under any PACA or any State Agricultural Laws, nor has  any action been commenced by (i) any beneficiary of any trust created under PACA or any State  Agricultural Laws to enforce payment from such trust, or (ii) any Governmental Authority against any Loan  Party to enforce payment from a trust created under PACA or any State Agricultural Lien Statute.  No Loan  Party is required to maintain any licenses, and does not presently maintain any licenses, under any the FSA,  PACA or any State Agricultural Laws.  SECTION 3.26 [Reserved].    

 

-84-  SECTION 3.27 [Reserved].    SECTION 3.28 Affected Financial Institutions.  No Loan Party is an Affected Financial  Institution.  SECTION 3.29 Plan Assets; Prohibited Transactions.  No Loan Party or any of its Subsidiaries  is an entity deemed to hold "plan assets" (within the meaning of the Plan Asset Regulations), and neither  the execution, delivery nor performance of the transactions contemplated under this Agreement, including  the making of any Loan and the issuance of any Letter of Credit hereunder, will give rise to a non-exempt  prohibited transaction under Section 406 of ERISA or Section 4975 of the Code.  SECTION 3.30 Possible Financial Statement Restatement.  Notwithstanding anything to the  contrary contained herein, the Administrative Agent and the Lenders hereby (i) acknowledge and agree that  the Loan Parties have previously disclosed to the Administrative Agent and the Lenders that the 2019 annual  financial statements of HF Foods may be restated to include the results and operations of B&R Realty in  the event that B&R Realty is determined to be a "variable interest entity" with respect to HF Foods (the  "2019 Financial Statement Restatement"), and (ii) provided that the 2019 Financial Statement Restatement  does not otherwise result in or reflect a Material Adverse Effect, hereby waive any and all Events of Default  that may arise directly or indirectly as a result of the 2019 Financial Statement Restatement.  ARTICLE IV    Conditions.  SECTION 4.01 Effective Date.  The obligations of the Lenders to make Loans and of the  Issuing Bank to issue Letters of Credit hereunder shall not become effective until the date on which each  of the following conditions is satisfied (or waived in accordance with Section 9.02):  (a) Credit Agreement and Other Loan Documents.  The Administrative Agent (or its  counsel) shall have received (i) from each party hereto either (A) a counterpart of this Agreement signed  on behalf of such party or (B) written evidence satisfactory to the Administrative Agent (which may include  facsimile or other electronic transmission of a signed signature page of this Agreement) that such party has  signed a counterpart of this Agreement, (ii) either (A) a counterpart of each other Loan Document signed  on behalf of each party thereto or (B) written evidence satisfactory to the Administrative Agent (which may  include facsimile or other electronic transmission of a signed signature page thereof) that each such party  has signed a counterpart of such Loan Document and (iii) such other certificates, documents, instruments  and agreements as the Administrative Agent shall reasonably request in connection with the transactions  contemplated by this Agreement and the other Loan Documents, including any promissory notes requested  by a Lender pursuant to Section 2.10 payable to the order of each such requesting Lender, all in form and  substance satisfactory to the Administrative Agent and its counsel.  (b) Projections.  The Administrative Agent shall have received updated consolidated  projected monthly income statements, balance sheets and cash flows of HF Foods and its Subsidiaries,  including Great Wall Virginia, for the period beginning on March 1, 2022 and ending on December 31,  2022.  (c) Closing Certificates; Certified Certificates of Organization; Good Standing  Certificates.  The Administrative Agent shall have received (i) a certificate of each Loan Party, dated the  Effective Date and executed by its Secretary or Assistant Secretary, which shall (A) certify the resolutions  of its board of managers or directors, members or other body authorizing the execution, delivery and  performance of the Loan Documents to which it is a party, (B) identify by name and title and bear the  signatures of the officers of such Loan Party authorized to sign the Loan Documents to which it is a party  

 

-85-  and, in the case of each Borrower, its Financial Officers, and (C) contain appropriate attachments, including  the certificate or articles of incorporation or organization of each Loan Party certified by the relevant  authority of the jurisdiction of organization of such Loan Party and a true and correct copy of its by-laws  or operating, management or partnership agreement, or other organizational or governing documents, and  (ii) a good standing certificate for each Loan Party from its jurisdiction of organization or the substantive  equivalent available in the jurisdiction of organization for each Loan Party from the appropriate  governmental officer in such jurisdiction.  (d) No Default Certificate.  The Administrative Agent shall have received a certificate,  signed by the Financial Officer of HF Foods, dated as of the Effective Date (i) stating that no Default has  occurred and is continuing, (ii) stating that the representations and warranties contained in the Loan  Documents are true and correct as of such date, and (iii) certifying as to any other factual matters as may  be reasonably requested by the Administrative Agent.  (e) Fees.  The Lenders and the Administrative Agent shall have received all fees  required to be paid, and all expenses for which invoices have been presented (including the reasonable fees  and expenses of legal counsel), on or before the Effective Date.  All such amounts will be paid with proceeds  of Loans made on the Effective Date and will be reflected in the funding instructions given by the Borrower  Representative to the Administrative Agent on or before the Effective Date.  (f) Solvency.  The Administrative Agent shall have received a solvency certificate  signed by the Financial Officer of HF Foods dated the Effective Date.  (g) Real Estate.  The Real Estate Borrowers shall have delivered to the Administrative  Agent with respect to each Mortgage in existence as of the Effective Date, each in form and substance  reasonably satisfactory to the Administrative Agent: (i) an amendment to such Mortgage, (ii) a date down  endorsement to the title insurance policy relating to each such Mortgage, (iii) if any such real property is  located in an area identified by the Federal Emergency Management Agency as a "special flood hazard  area" with respect to which flood insurance has been made available pursuant to applicable laws, a flood  notification form executed by the applicable Real Estate Borrower and evidence that flood insurance is in  place for the building and contents in compliance with all applicable laws and this Agreement, and (iv) such  other items as the Administrative Agent shall require in connection with such Mortgages.  (h) Insurance.  The Administrative Agent shall have received evidence of insurance  coverage in form, scope, and substance reasonably satisfactory to the Administrative Agent and otherwise  in compliance with the terms of Section 5.10 hereof and Section 4.12 of the Security Agreement.  (i) Appraisals.  The Administrative Agent shall have received appraisals of the  Eligible Real Property, in each case from one or more firms satisfactory to the Administrative Agent, which  appraisals shall be satisfactory to the Administrative Agent in its sole discretion.  (j) Opinions of Counsel.  The Administrative Agent shall have received written  opinions of counsel to each Loan Party, addressed to the Administrative Agent and the Lenders, each in  form and substance satisfactory to the Administrative Agent and its counsel.  (k) USA PATRIOT Act, Etc.  (i) The Administrative Agent shall have received, at  least five (5) days prior to the Effective Date, all documentation and other information regarding the  Borrowers requested in connection with applicable "know your customer" and anti-money laundering rules  and regulations, including the USA PATRIOT Act, to the extent requested in writing of the Borrowers at  least ten (10) days prior to the Effective Date, and (ii) to the extent any Borrower qualifies as a "legal entity  customer" under the Beneficial Ownership Regulation, at least five (5) days prior to the Effective Date, any  Lender that has requested, in a written notice to the Borrowers at least ten (10) days prior to the Effective  

 

-86-  Date, a Beneficial Ownership Certification in relation to each Borrower shall have received such Beneficial  Ownership Certification (provided that, upon the execution and delivery by such Lender of its signature  page to this Agreement, the condition set forth in this clause (ii) shall be deemed to be satisfied).  (l) Other Documents.  The Administrative Agent shall have received such other  documents as the Administrative Agent, the Issuing Bank, any Lender or their respective counsel may have  reasonably requested.  The Administrative Agent shall notify the Borrower Representative, the Lenders and the Issuing Bank of  the Effective Date, and such notice shall be conclusive and binding.  Notwithstanding the foregoing, the  obligations of the Lenders to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall  not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to  Section 9.02) at or prior to 2:00 p.m., Chicago time, on the 5th Business Day following the date of this  Agreement (and, in the event such conditions are not so satisfied or waived, the Commitments shall  terminate at such time).  SECTION 4.02 Each Credit Event.  The obligation of each Lender to make a Loan on the  occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit,  is subject to the satisfaction of the following conditions:  (a) The representations and warranties of the Loan Parties set forth in the Loan  Documents shall be true and correct with the same effect as though made on and as of the date of such  Borrowing or the date of issuance, amendment, renewal or extension of such Letter of Credit, as applicable  (it being understood and agreed that any representation or warranty which by its terms is made as of a  specified date shall be required to be true and correct only as of such specified date).   (b) At the time of and immediately after giving effect to such Borrowing or the  issuance, amendment, renewal or extension of such Letter of Credit, as applicable, (i) no Default shall have  occurred and be continuing and (ii) no Protective Advance shall be outstanding.  (c) After giving effect to any Revolving Borrowing or the issuance, amendment,  renewal or extension of any Letter of Credit, Availability shall not be less than zero.  Each Borrowing and each issuance, amendment, renewal or extension of a Letter of Credit shall be deemed  to constitute a representation and warranty by each Loan Party on the date thereof as to the matters specified  in paragraphs (a), (b) and (c) of this Section.  ARTICLE V    Affirmative Covenants.  Until all of the Secured Obligations have been Paid in Full, each Loan Party executing this  Agreement covenants and agrees, jointly and severally with all of the other Loan Parties, with the Lenders  that:  SECTION 5.01 Financial Statements; Borrowing Base and Other Information.  The Borrowers  will furnish to the Administrative Agent and each Lender:  (a) within 120 days after the end of each fiscal year of HF Foods, its audited  consolidated and consolidating balance sheet and related statements of operations, stockholders' equity and  cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for  the previous fiscal year, all reported on by independent public accountants of recognized standing (without  

 

-87-  a "going concern" or like qualification, commentary or exception and without any qualification or exception  as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all  material respects the financial condition and results of operations of HF Foods and its Consolidated  Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, accompanied by any  management letter prepared by said accountants; provided, that notwithstanding the foregoing, in the event  that HF Foods is required to restate its 2020 and 2021 financial statements in connection with accounting  issues related to the merger of B&R Merger Sub Inc. and B&R, the audited financial statements of HF  Foods for the fiscal year ended December 31, 2021 and the 10-K filing of HF Foods for the fiscal year  ended December 31, 2021, shall be delivered within 180 days after the SEC has notified HF Foods that  such financial statements must be restated, but in any event, no more than 210 days after the Effective Date;  (b) within forty-five (45) days after the end of each of fiscal quarters of HF Foods, its  consolidated and consolidating balance sheet and related statements of operations, stockholders' equity and  cash flows as of the end of and for such fiscal quarter and the then elapsed portion of such fiscal year,  setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in  the case of the balance sheet, as of the end of) the previous fiscal year, all certified by a Financial Officer  of the Borrower Representative as presenting fairly in all material respects the financial condition and  results of operations of HF Foods and its Consolidated Subsidiaries on a consolidated and consolidating  basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments;  provided, that such financial statements shall be delivered regardless of whether HF Foods is  contemporaneously filing a form 10-q statement relative to such fiscal quarter;  (c) within thirty (30) days after the end of each fiscal month of HF Foods, other than  the last month of a fiscal quarter, its unconsolidated balance sheet and related statements of operations, as  of the end of and for such fiscal month and the then elapsed portion of the fiscal year;  (d) [reserved];  (e) [reserved];  (f) concurrently with any delivery of financial statements under clause (a) or (b) above  with respect to a fiscal month that is the last fiscal month of a fiscal quarter, a Compliance Certificate  executed by the Financial Officer of Borrower Representative, (i) certifying, in the case of the financial  statements delivered under clause (b), as presenting fairly in all material respects the financial condition  and results of operations of HF Foods and its Consolidated Subsidiaries on a consolidated and consolidating  basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the  absence of footnotes, (ii) certifying as to whether a Default has occurred and, if a Default has occurred,  specifying the details thereof and any action taken or proposed to be taken with respect thereto, (iii) setting  forth reasonably detailed calculations demonstrating compliance with Section 6.13, and (iv) stating whether  any change in GAAP or in the application thereof has occurred since the date of the audited financial  statements referred to in Section 3.04 and, if any such change has occurred, specifying the effect of such  change on the financial statements accompanying such certificate;  (g) within 30 days after the beginning of each fiscal year of HF Foods, a copy of the  plan and forecast (including a projected consolidated and consolidating balance sheet, income statement  and cash flow statement) of HF Foods and its Subsidiaries for each month of the upcoming fiscal year (the  "Projections") in form and detail reasonably satisfactory to the Administrative Agent;  (h) within 20 days of the end of each calendar month or within 3 days of the end of  each week in the event that Availability falls below the greater of (i) $12,500,000 and (ii) 12.5% of the  Revolving Commitment, and at such other times as may be necessary to re-determine Availability or as  requested by the Administrative Agent, as of the period then ended, a Borrowing Base Certificate and  

 

-88-  supporting information in connection therewith, together with any additional reports with respect to the  Borrowing Base as the Administrative Agent may reasonably request; provided, that unless otherwise  reasonably required by the Administrative Agent, weekly Borrowing Base Certificates shall contain only  updated information with respect to Eligible Accounts;  (i) together with each Borrowing Base Certificate delivered pursuant to clause (h), as  of the period then ended, all delivered electronically in a text formatted file acceptable to the Administrative  Agent (not in Adobe *.pdf file):  (i) a detailed aging of the Working Capital Borrowers' Accounts, including  all invoices aged by invoice date and due date (with an explanation of the terms offered),  prepared in a manner reasonably acceptable to the Administrative Agent, together with a  summary specifying the name, address, and balance due for each Account Debtor;  (ii) a schedule detailing the Working Capital Borrowers' Inventory, in form  satisfactory to the Administrative Agent, (1) by location (showing Inventory in transit, any  Inventory located with a third party under any consignment, bailee arrangement, or  warehouse agreement), by class (raw material, work-in-process and finished goods), by  product type, and by volume on hand, which Inventory shall be valued at the lower of cost  (determined on a first-in, first-out basis) or market and adjusted for Reserves as the  Administrative Agent has previously indicated to the Borrower Representative are deemed  by the Administrative Agent to be appropriate, and (2) including a report of any variances  or other results of Inventory counts performed by the Working Capital Borrowers since the  last Inventory schedule (including information regarding sales or other reductions,  additions, returns, credits issued by Borrowers and complaints and claims made against the  Working Capital Borrowers);  (iii) a worksheet of calculations prepared by the Working Capital Borrowers  to determine Eligible Accounts and Eligible Inventory, such worksheets detailing the  Accounts and Inventory excluded from Eligible Accounts and Eligible Inventory and the  reason for such exclusion;  (iv) a reconciliation of the Working Capital Borrowers' Accounts and  Inventory between (A) the amounts shown in the Working Capital Borrowers' general  ledger and financial statements and the reports delivered pursuant to clauses (i) and (ii)  above and (B) the amounts and dates shown in the reports delivered pursuant to clauses (i)  and (ii) above and the Borrowing Base Certificate delivered pursuant to clause (h) above  as of such date;  (v) a reconciliation of the loan balance per the Working Capital Borrowers'  general ledger to the loan balance under this Agreement; and  (vi) a schedule and aging of the Working Capital Borrowers' accounts payable,  delivered electronically in a text formatted file acceptable to the Administrative Agent;  (j) promptly upon the Administrative Agent's request:  (i) copies of invoices issued by the Working Capital Borrowers in connection  with any Accounts, credit memos, shipping and delivery documents, and other information  related thereto;  

 

-89-  (ii) copies of purchase orders, invoices, and shipping and delivery documents  in connection with any Inventory or Equipment purchased by any Loan Party;  (iii) a schedule detailing the balance of all intercompany accounts of the Loan  Parties;   (iv) an updated customer list for the Working Capital Borrowers and their  Subsidiaries, which list shall state the customer's name, mailing address and phone number,  delivered electronically in a text formatted file acceptable to the Administrative Agent and  certified as true and correct by a Financial Officer of the Borrower Representative;  (v) the Working Capital Borrowers' sales journal, cash receipts journal  (identifying trade and non-trade cash receipts) and debit memo/credit memo journal;  (vi) copies of all Tax returns filed by any Loan Party with the IRS; and  (vii) a certificate of good standing or the substantive equivalent available in the  jurisdiction of incorporation, formation or organization for each Loan Party from the  appropriate governmental officer in such jurisdiction;  (k) promptly after the same become publicly available, copies of all periodic and other  reports, proxy statements and other materials filed by any Loan Party or any Subsidiary with the SEC, or  any Governmental Authority succeeding to any or all of the functions of the SEC, or with any national  securities exchange, or distributed by any Borrower to its shareholders generally, as the case may be;   (l) promptly after any request therefor by the Administrative Agent or any Lender,  copies of (i) any documents described in Section 101(k)(1) of ERISA that any Loan Party or any ERISA  Affiliate may request with respect to any Multiemployer Plan and (ii) any notices described in  Section 101(l)(1) of ERISA that any Loan Party or any ERISA Affiliate may request with respect to any  Multiemployer Plan; provided that if any Loan Party or any ERISA Affiliate has not requested such  documents or notices from the administrator or sponsor of the applicable Multiemployer Plan, the  applicable Loan Party or the applicable ERISA Affiliate shall promptly make a request for such documents  and notices from such administrator or sponsor and shall provide copies of such documents and notices  promptly after receipt thereof;  (m) promptly following any request therefor, (i) such other information regarding the  operations, assets, liabilities, changes in ownership of Equity Interests, business affairs and financial  condition of any Loan Party or any Subsidiary, or compliance with the terms of the Loan Documents, as  the Administrative Agent or any Lender may reasonably request and (ii) information and documentation  reasonably requested by the Administrative Agent or any Lender for purposes of compliance with  applicable "know your customer" and anti-money laundering rule and regulations, including the USA  PATRIOT Act and the Beneficial Ownership Regulation; and  (n) promptly after receipt thereof by any Borrower or any Subsidiary, copies of each  notice or other correspondence received from the SEC concerning any investigation or possible  investigation or other inquiry by the SEC regarding financial or other operational results of any Borrower  or any Subsidiary thereof.  Documents required to be delivered pursuant to Section 5.01(a), (b) or (n) (to the extent any such documents  are included in materials otherwise filed with the SEC) may be delivered electronically and, if so delivered,  shall be deemed to have been delivered on the date (i) on which such materials are publicly available as  posted on the Electronic Data Gathering, Analysis and Retrieval system (EDGAR); or (ii) on which such  

 

-90-  documents are posted on a Borrower's behalf on an Internet or intranet website, if any, to which each Lender  and the Administrative Agent have access (whether a commercial, third-party website or whether made  available by the Administrative Agent); provided that: (A) upon written request by the Administrative  Agent (or any Lender through the Administrative Agent) to the Borrower Representative, the Borrower  Representative shall deliver paper copies of such documents to the Administrative Agent or such Lender  until a written request to cease delivering paper copies is given by the Administrative Agent or such Lender  and (B) the Borrower Representative shall notify the Administrative Agent and each Lender (by fax or  through an Electronic System) of the posting of any such documents and provide to the Administrative  Agent through an Electronic System electronic versions (i.e., soft copies) of such documents. The  Administrative Agent shall have no obligation to request the delivery of or to maintain paper copies of the  documents referred to above, and in any event shall have no responsibility to monitor compliance by any  Borrower with any such request by a Lender for delivery, and each Lender shall be solely responsible for  timely accessing posted documents or requesting delivery of paper copies of such documents to it and  maintaining its copies of such documents.  SECTION 5.02 Notices of Material Events.  The Borrower Representative will furnish to the  Administrative Agent and each Lender prompt (but in any event within any time period that may be  specified below) written notice of the following:  (a) the occurrence of any Default;  (b) receipt of any notice of any investigation by a Governmental Authority or any  litigation or proceeding commenced or threatened against any Loan Party or any Subsidiary that (i) seeks  damages in excess of $2,500,000, (ii) seeks injunctive relief, (iii) is asserted or instituted against any Plan,  its fiduciaries or its assets and involves an amount in excess of $2,500,000, (iv) alleges criminal misconduct  by any Loan Party or any Subsidiary, (v) alleges the violation of, or seeks to impose remedies under, any  Environmental Law or related Requirement of Law, or seeks to impose Environmental Liability, (vi) asserts  liability on the part of any Loan Party or any Subsidiary in excess of $2,500,000 in respect of any tax, fee,  assessment, or other governmental charge, or (vii) involves any product recall;  (c) any Lien (other than Permitted Encumbrances) or claim made or asserted against  any of the Collateral with an value or in an amount in excess of $1,000,000;  (d) any loss, damage, or destruction to the Collateral in the amount of $1,000,000 or  more, whether or not covered by insurance;  (e) within two (2) Business Days of receipt thereof, any and all default notices  received under or with respect to any leased location or public warehouse where Collateral with a value in  excess of $1,000,000 is located;  (f) all material amendments to any Material Agreement, together with a copy of each  such amendment, if such amendment could reasonably be determined to be materially disadvantageous to  the Lenders;  (g) the occurrence of any ERISA Event that, alone or together with any other ERISA  Events that have occurred, could reasonably be expected to result in liability of the Loan Parties and their  Subsidiaries in an aggregate amount exceeding $2,500,000;  (h) within five Business Days following receipt thereof, copies of all notifications  received by any Loan Party, whether pursuant to the UCC, the FSA, PACA or a State Agricultural Law, or  otherwise, and whether sent by a seller of farm products, a lender to such seller, the Secretary of State of  any state or any other Person (including, without limitation, a broker or other third party intermediary), of  

 

-91-  any FSA Lien or a State Agricultural Lien, or the imposition of a PACA Trust; and at such times as may be  requested by the Administrative Agent, a report regarding the total amount of outstanding payables with  respect to farm and agricultural products purchased by the Loan Parties, separately showing amounts owing  to each supplier and identifying the location and state of each such supplier, whether with respect to farm  products purchased directly by a Loan Party or through a third party intermediary;  (i) any other development that results, or could reasonably be expected to result in, a  Material Adverse Effect;  (j) any material change in accounting or financial reporting practices by any Loan  Party of any Subsidiary that is not otherwise required to be disclosed in a filing with the SEC; and  (k) any change in the information provided in the Beneficial Ownership Certification  delivered to the Administrative Agent that would result in a change to the list of beneficial owners identified  in such certification.  Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other  executive officer of the Borrower Representative setting forth the details of the event or development  requiring such notice and any action taken or proposed to be taken with respect thereto.  SECTION 5.03 Existence; Conduct of Business.  Each Loan Party will, and will cause each  Subsidiary to, (a) do or cause to be done all things necessary to preserve, renew and keep in full force and  effect its legal existence and the rights, qualifications, licenses, permits, franchises, governmental  authorizations, intellectual property rights, licenses and permits material to the conduct of its business, and  maintain all requisite authority to conduct its business in each jurisdiction in which its business is  conducted, provided that the foregoing shall not prohibit any merger, consolidation, liquidation or  dissolution permitted under Section 6.03, and (b) carry on and conduct its business in substantially the same  manner and in substantially the same fields of enterprise as it is presently conducted.  SECTION 5.04 Payment of Obligations.  Each Loan Party will, and will cause each Subsidiary  to, pay or discharge all Material Indebtedness and all other material liabilities and obligations, including  Taxes, before the same shall become delinquent or in default, except where (a) the validity or amount  thereof is being contested in good faith by appropriate proceedings, (b) such Loan Party or Subsidiary has  set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c)  the failure  to make payment pending such contest could not reasonably be expected to result in a Material Adverse  Effect; provided, however, that each Loan Party will, and will cause each Subsidiary to, remit withholding  taxes and other payroll taxes to appropriate Governmental Authorities as and when claimed to be due,  notwithstanding the foregoing exceptions.  SECTION 5.05 Maintenance of Properties.  Each Loan Party will, and will cause each  Subsidiary to, keep and maintain all property material to the conduct of its business in good working order  and condition, ordinary wear and tear excepted.  SECTION 5.06 Books and Records; Inspection Rights.  Each Loan Party will, and will cause  each Subsidiary to, (a) keep proper books of record and account in which full, true and correct entries are  made of all dealings and transactions in relation to its business and activities and (b) permit any  representatives designated by the Administrative Agent or any Lender (including employees of the  Administrative Agent, any Lender or any consultants, accountants, lawyers, agents and appraisers retained  by the Administrative Agent), upon reasonable prior notice, to visit and inspect its properties, to conduct at  such Loan Party's premises field examinations of such Loan Party's assets, liabilities, books and records,  including examining and making extracts from its books and records, environmental assessment reports  and Phase I or Phase II studies, and to discuss its affairs, finances and condition with its officers and  

 

-92-  independent accountants, all at such reasonable times and as often as reasonably requested.  Each Loan  Party acknowledges that the Administrative Agent, after exercising its rights of inspection, may prepare  and distribute to the Lenders certain Reports pertaining to the Loan Parties' assets for internal use by the  Administrative Agent and the Lenders.  The Loan Parties shall be responsible for the costs and expenses of  one field examination, per location, during any 12-month period (in addition to the separate field  examinations of Great Wall Illinois, Great Wall Texas and Great Wall Virginia conducted after the  consummation of the Great Wall Virginia Acquisition, as required pursuant to Section 5.18); provided, that  the Loan Parties shall be responsible for the costs and expenses of all field examinations conducted while  a Default is in existence.  SECTION 5.07 Compliance with Laws and Material Contractual Obligations.  Each Loan  Party will, and will cause each Subsidiary to, (a) comply with each Requirement of Law applicable to it or  its property (including without limitation Environmental Laws, the FSA, the PACA and State Agricultural  Laws) and (b) perform in all material respects its obligations under Material Agreements to which it is a  party, except, in each case, where the failure to do so, individually or in the aggregate, could not reasonably  be expected to result in a Material Adverse Effect.  Each Loan Party will maintain in effect and enforce  policies and procedures designed to ensure compliance by such Loan Party, its Subsidiaries and their  respective managers, directors, officers, employees and agents with Anti-Corruption Laws and applicable  Sanctions.  SECTION 5.08 Use of Proceeds.    (a) The proceeds of the Loans and the Letters of Credit will be used after the Effective  Date for working capital and general corporate purposes in the ordinary course of business, including  without limitation to pay the purchase of price of the Great Wall Virginia Acquisition and other Permitted  Acquisitions, and to make payments on the B&R Realty Seller Note to the extent permitted by the B&R  Realty Subordination Agreement.  No part of the proceeds of any Loan and no Letter of Credit will be used,  whether directly or indirectly, (A) for any purpose that entails a violation of any of the regulations of the  Federal Reserve Board, including Regulations T, U and X or (B) to make any Acquisition other than a  Permitted Acquisition.  (b) No Borrower will request any Borrowing or Letter of Credit, and no Borrower  shall use, and each Borrower shall procure that its Subsidiaries and its and their respective managers,  directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit  (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money,  or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of  funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person,  or in any Sanctioned Country, except to the extent permitted for a Person required to comply with Sanctions,  or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.   SECTION 5.09 Accuracy of Information.  The Loan Parties will ensure that any information,  including financial statements or other documents, furnished to the Administrative Agent or the Lenders in  connection with this Agreement or any other Loan Document or any amendment or modification hereof or  thereof or waiver hereunder or thereunder (as modified or supplemented by other information so furnished)  contains no material misstatement of fact or omits to state any material fact necessary to make the  statements therein, in the light of the circumstances under which they were made, not misleading, and the  furnishing of such information shall be deemed to be a representation and warranty by the Borrowers on  the date thereof as to the matters specified in this Section; provided that, with respect to projected financial  information, the Loan Parties will only ensure that such information was prepared in good faith based upon  assumptions believed to be reasonable at the time.  

 

-93-  SECTION 5.10 Insurance.  (a) Each Loan Party will, and will cause each Subsidiary to, maintain with financially  sound and reputable carriers having a financial strength rating of at least A- by A.M. Best Company  (i) insurance in such amounts (with no greater risk retention) and against such risks (including, without  limitation: loss or damage by fire and loss in transit; theft, burglary, pilferage, larceny, embezzlement, and  other criminal activities; business interruption; and general liability) and such other hazards, as is  customarily maintained by companies of established repute engaged in the same or similar businesses  operating in the same or similar locations and (ii) all insurance required pursuant to the Collateral  Documents.  The Borrowers will furnish to the Administrative Agent, upon request of the Administrative  Agent, but no less frequently than annually, information in reasonable detail as to the insurance so  maintained.  (b) In the event any Collateral is located in any area that has been designated by the  Federal Emergency Management Agency as a "Special Flood Hazard Area", the applicable Loan Party shall  purchase and maintain flood insurance on such Collateral (including any personal property which is located  on any real property leased by such Loan Party within a "Special Flood Hazard Area").  The amount of  flood insurance required by this Section shall be in an amount equal to the lesser of the Commitment or the  total replacement cost value of the improvements.  (c) Except to the extent otherwise agreed to in writing by Administrative Agent in its  sole discretion, each applicable Loan Party or Subsidiary will maintain with financially sound and reputable  carriers having a financial strength rating of at least A- by A.M. Best Company, earthquake insurance for  each Seismic Risk Property in an amount acceptable to the Lender, based on the PML Report for such  Seismic Risk Property, and with deductible amounts acceptable to the Administrative Agent, together with  seismic business interruption insurance coverage acceptable to the Administrative Agent.  The Borrowers  will furnish to the Administrative Agent information in reasonable detail as to the insurance so maintained.  (d) All insurance policies required hereunder or under this Section 5.10 shall name the  Administrative Agent as an additional insured or as lender loss payee, as applicable, and shall contain lender  loss payable clauses or mortgagee clauses, through endorsements in form and substance satisfactory to the  Administrative Agent, which provide that: (i) all proceeds thereunder with respect to any Collateral,  including without limitation any proceeds of earthquake insurance, shall be payable to the Administrative  Agent; (ii) no such insurance shall be affected by any act or neglect of the insured or owner of the property  described in such policy; and (iii) such policy and lender loss payable or mortgagee clauses may be  canceled, amended, or terminated only upon at least 30 days prior written notice given to the Administrative  Agent.  (e) All premiums on such insurance shall be paid when due, and copies of the policies  delivered to the Administrative Agent.  If a Loan Party fails to obtain any insurance as required by this  Section 5.10, the Administrative Agent may obtain such insurance at the Borrowers' expense.  By  purchasing such insurance, the Administrative Agent shall not be deemed to have waived any Default  arising from the applicable Loan Party's failure to maintain such insurance or pay any premiums therefor.  SECTION 5.11 Casualty and Condemnation.  The Borrower Representative will (a) furnish to  the Administrative Agent and the Lenders prompt written notice of any casualty or other insured damage  to any material portion of the Collateral or the commencement of any action or proceeding for the taking  of any material portion of the Collateral or interest therein under power of eminent domain or by  condemnation or similar proceeding and (b) ensure that the Net Proceeds of any such event (whether in the  form of insurance proceeds, condemnation awards or otherwise) are collected and applied in accordance  with the applicable provisions of this Agreement and the Collateral Documents.  

 

-94-  SECTION 5.12 Appraisals.  At any time that the Administrative Agent requests, each Loan  Party will, and will cause each Subsidiary to, provide the Administrative Agent with appraisals or updates  thereof of its Inventory from an appraiser selected and engaged by the Administrative Agent, and prepared  on a basis satisfactory to the Administrative Agent, such appraisals and updates to include, without  limitation, information required by any applicable Requirement of Law.  The Loan Parties shall be  responsible for the costs and expenses of one (1) Inventory appraisal during any 12-month period (in  addition to the separate appraisals of the Inventory of Great Wall Illinois, Great Wall Texas and Great Wall  Virginia conducted after the consummation of the Great Wall Virginia Acquisition, as required pursuant to  Section 5.18).  The Loan Parties shall be responsible for the costs and expenses of any real property  appraisals required pursuant to any applicable Requirement of Law, in addition to the real property  appraisals conducted prior to the Effective Date of the real property of the Real Estate Borrowers.   Additionally, there shall be no limitation on the number or frequency of Inventory and real property  appraisals conducted while a Default is in existence, and the Loan Parties shall be responsible for the costs  and expenses of such appraisals.  SECTION 5.13 Depository Banks.  Each Borrower and each Subsidiary will maintain the  Administrative Agent as its principal depository bank, including for the maintenance of operating,  administrative, cash management, collection activity, investment and other deposit accounts for the conduct  of its business.  SECTION 5.14 Additional Collateral; Further Assurances.   (a) Subject to any applicable Requirement of Law, each Loan Party will cause each  Domestic Subsidiary in existence on the Effective Date, other than an Excluded Subsidiary, and each  Domestic Subsidiary formed or acquired after the Effective Date, other than an Acquired Majority Owned  Subsidiary, to become a Loan Party by executing a Joinder Agreement. In connection therewith, the  Administrative Agent shall have received all documentation and other information regarding such newly  formed or acquired Subsidiaries as may be required to comply with the applicable "know your customer"  rules and regulations, including the USA Patriot Act.  Upon execution and delivery thereof, each such  Person (i) shall automatically become a Loan Guarantor hereunder and thereupon shall have all of the rights,  benefits, duties and obligations in such capacity under the Loan Documents and (ii) will grant Liens to the  Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, in any  property of such Loan Party which constitutes Collateral, including any parcel of real property located in  the U.S. owned by any Loan Party, other than real property subject to financing on the Effective Date that  is permitted under Section 6.01.  (b) Each Loan Party will cause (i) 100% of the issued and outstanding Equity Interests  of each of its Domestic Subsidiaries (other than an Excluded Subsidiary or an Acquired Majority Owned  Subsidiary) and (ii) 65% of the issued and outstanding Equity Interests entitled to vote (within the meaning  of Treas. Reg. Section 1.956-2(c)(2)) and 100% of the issued and outstanding Equity Interests not entitled  to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2) in each Foreign Subsidiary directly owned  by such Loan Party or any Domestic Subsidiary to be subject at all times to a first priority, perfected Lien  in favor of the Administrative Agent, for the benefit of the Administrative Agent and the other Secured  Parties, pursuant to the terms and conditions of the Loan Documents or other security documents as the  Administrative Agent shall reasonably request.  (c) Without limiting the foregoing, each Loan Party will, and will cause each  Subsidiary (other than an Excluded Subsidiary or an Acquired Majority Owned Subsidiary) to, execute and  deliver, or cause to be executed and delivered, to the Administrative Agent such documents, agreements  and instruments, and will take or cause to be taken such further actions (including the filing and recording  of financing statements, fixture filings, mortgages, deeds of trust and other documents and such other  actions or deliveries of the type required by Section 4.01, as applicable), which may be required by any  

 

-95-  Requirement of Law or which the Administrative Agent may, from time to time, reasonably request to carry  out the terms and conditions of this Agreement and the other Loan Documents and to ensure perfection and  priority of the Liens created or intended to be created by the Collateral Documents, all in form and substance  reasonably satisfactory to the Administrative Agent and all at the expense of the Loan Parties.  (d) If any material assets (including any real property or improvements thereto or any  interest therein) are acquired by any Loan Party after the Effective Date (other than assets constituting  Collateral under the Security Agreement that become subject to the Lien under the Security Agreement  upon acquisition thereof), the Borrower Representative will (i) notify the Administrative Agent and the  Lenders thereof and, if requested by the Administrative Agent or the Required Lenders, cause such assets  to be subjected to a Lien securing the Secured Obligations and (ii) take, and cause each applicable Loan  Party to take, such actions as shall be necessary or reasonably requested by the Administrative Agent to  grant and perfect such Liens, including actions described in paragraph (c) of this Section, all at the expense  of the Loan Parties.  SECTION 5.15 Receivables.  (a) Certain Agreements on Receivables.  No Loan Party will make or agree to make  any discount, credit, rebate or other reduction in the original amount owing on a Receivable or accept in  satisfaction of a Receivable less than the original amount thereof, except that, prior to the occurrence of an  Event of Default, the Loan Parties may reduce the amount of Accounts arising from the sale of Inventory  in accordance with their present policies and in the ordinary course of business.  (b) Collection of Receivables.  Except as otherwise provided in this Agreement or the  Security Agreement, each Loan Party will collect and enforce, at the Loan Party's sole expense, all amounts  due or hereafter due to such Loan Party under the Receivables.  (c) Delivery of Invoices.  The Borrowers will deliver to the Administrative Agent  immediately upon its request after the occurrence and during the continuation of an Event of Default  duplicate invoices with respect to each Account of the Loan Parties bearing such language of assignment  as the Administrative Agent shall specify.  (d) Disclosure of Counterclaims on Receivables.  If (i) any discount, credit or  agreement to make a rebate or to otherwise reduce the amount owing on a Receivable exists or (ii) if, to the  knowledge of any Loan Party, any dispute, setoff, claim, counterclaim or defense exists or has been asserted  or threatened with respect to a Receivable, the applicable Borrower will promptly disclose such fact to the  Administrative Agent in writing, if such dispute, setoff, claim, counterclaim or defense exceeds, or seeks  damages or setoff in an amount in excess of $1,000,000.  The applicable Borrower shall send the  Administrative Agent a copy of each credit memorandum in excess of $1,000,000 as soon as issued by any  Loan Party, and the Borrowers shall promptly report each credit memo and each of the facts required to be  disclosed to the Administrative Agent in accordance with this Section 5.15(d) on the Borrowing Base  Certificates delivered hereunder.  SECTION 5.16 Inventory and Equipment.  (a) Maintenance of Goods.  Each Loan Party will do all things necessary to maintain,  preserve, protect and keep its Inventory and Equipment in good repair and working and saleable condition,  except for damaged or defective goods arising in the ordinary course of the Loan Party's business and except  for ordinary wear and tear in respect of its Equipment.  (b) Returned Inventory.  If an Account Debtor returns any Inventory to a Loan Party  when no Event of Default exists, then such Loan Party shall promptly determine the reason for such return  

 

-96-  and shall issue a credit memorandum to the Account Debtor in the appropriate amount.  The Borrowers  shall immediately report to the Administrative Agent any return involving an amount in excess of  $1,000,000.  Each such report shall indicate the reasons for the returns and the locations and condition of  the returned Inventory.  In the event any Account Debtor returns Inventory to a Loan Party when an Event  of Default exists, such Loan Party, upon the request of the Administrative Agent, shall: (i) hold the returned  Inventory in trust for the Administrative Agent; (ii) segregate all returned Inventory from all of its other  property; (iii) dispose of the returned Inventory solely according to the Administrative Agent's written  instructions; and (iv) not issue any credits or allowances with respect thereto without the Administrative  Agent's prior written consent.  All returned Inventory shall be subject to the Administrative Agent's Liens  thereon.  Whenever any Inventory is returned, the related Account shall be deemed ineligible to the extent  of the amount owing by the Account Debtor with respect to such returned Inventory and such returned  Inventory shall not be Eligible Inventory.  (c) Inventory Count; Perpetual Inventory System.  Each Loan Party will conduct  sufficient physical cycle counts of the Inventory of such Loan Party in order to render unqualified opinions  on its financial statements in accordance with the terms of the Credit Agreement. Unless waived by the  Administrative Agent, each Loan Party will maintain at all times a reporting system, in form and substance  satisfactory to Administrative Agent, to report Inventory values to Administrative Agent.  (d) Equipment.  Each Loan Party shall promptly inform the Administrative Agent of  any additions to or deletions from the Equipment which individually exceed $1,000,000.  Each Loan Party  shall not permit any Equipment to become a fixture with respect to real property or to become an accession  with respect to other personal property with respect to which real or personal property the Administrative  Agent does not have a Lien.  Each Loan Party will not, without the Administrative Agent's prior written  consent, alter or remove any identifying symbol or number on any of such Loan Party's Equipment  constituting Collateral.  SECTION 5.17 Agricultural Matters.  Each applicable Loan Party shall promptly register as a  buyer of farm products with the office of the Secretary of State or such other designated office of each State  that maintains a central filing system under the FSA and from which such Loan Party purchases farm  products produced in such State.  Each Loan Party will comply with all payment instructions imposed on  such Loan Party in any notification received by such Loan Party, whether pursuant to the UCC, the FSA,  PACA, State Agricultural Law, or otherwise, and whether sent by a seller of farm products, a lender to such  seller, the Secretary of State of any state or any other Person, of any FSA Lien or State Agricultural Lien  or the imposition of a PACA Trust.  Each Loan Party shall pay each of its invoices from vendors and  suppliers of farm products in a manner and within a time period consistent with such Loan Party's past  practices, except for invoices being contested in good faith by appropriate proceedings and as to which  adequate reserves have been taken in accordance with GAAP.  SECTION 5.18 Post-Closing Covenant.  Each applicable Loan Party shall deliver each item  designated as "Post-Closing" on the Closing Checklist attached hereto as Exhibit G on or before the date  specified therefor on such Closing Checklist (or such later date as may be agreed to by Administrative  Agent in its sole discretion), each of which shall be in form and substance satisfactory to Administrative  Agent.  ARTICLE VI    Negative Covenants.  Until all of the Secured Obligations have been Paid in Full, each Loan Party executing this  Agreement covenants and agrees, jointly and severally with all of the other Loan Parties, with the Lenders  that:  

 

-97-  SECTION 6.01 Indebtedness.  No Loan Party will, nor will it permit any Subsidiary to, create,  incur, assume or suffer to exist any Indebtedness, except:  (a) the Secured Obligations;  (b) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and any  extensions, renewals, refinancings and replacements of any such Indebtedness in accordance with clause  (f) hereof;  (c) Indebtedness of any Borrower to any Subsidiary and of any Subsidiary to any  Borrower or any other Subsidiary, provided that (i) Indebtedness of any Subsidiary that is not a Loan Party  to any Borrower or any other Loan Party shall be subject to Section 6.04 and (ii) Indebtedness of any Loan  Party to any Subsidiary that is not a Loan Party shall be subordinated to the Secured Obligations on terms  reasonably satisfactory to the Administrative Agent;  (d) Guarantees by any Borrower of Indebtedness of any Subsidiary and by any  Subsidiary of Indebtedness of any Borrower or any other Subsidiary, provided that (i) the Indebtedness so  Guaranteed is permitted by this Section 6.01, (ii) Guarantees by any Borrower or any other Loan Party of  Indebtedness of any Subsidiary that is not a Loan Party shall be subject to Section 6.04 and (iii) Guarantees  permitted under this clause (d) shall be subordinated to the Secured Obligations on the same terms as the  Indebtedness so Guaranteed is subordinated to the Secured Obligations;  (e) Indebtedness of any Borrower or any Subsidiary incurred to finance the  acquisition, construction or improvement of any fixed or capital assets (whether or not constituting purchase  money Indebtedness), including Capital Lease Obligations and any Indebtedness assumed in connection  with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition  thereof, and extensions, renewals and replacements of any such Indebtedness in accordance with clause (f)  below; provided that (i) such Indebtedness is incurred prior to or within 90 days after such acquisition or  the completion of such construction or improvement and (ii) the aggregate principal amount of  Indebtedness permitted by this clause (e) together with any Refinance Indebtedness in respect thereof  permitted by clause (f) below, shall not exceed $5,000,000 at any time outstanding;  (f) Indebtedness which represents extensions, renewals, refinancing or replacements  (such Indebtedness being so extended, renewed, refinanced or replaced being referred to herein as the  "Refinance Indebtedness") of any of the Indebtedness described in clauses (b), (e), (i), (j) and (l) hereof  (such Indebtedness being referred to herein as the "Original Indebtedness"); provided that (i) such  Refinance Indebtedness does not increase the principal amount or interest rate of the Original Indebtedness,  (ii) any Liens securing such Refinance Indebtedness are not extended to any additional property of any  Loan Party or any Subsidiary, (iii) no Loan Party or any Subsidiary that is not originally obligated with  respect to repayment of such Original Indebtedness is required to become obligated with respect to such  Refinance Indebtedness, (iv) such Refinance Indebtedness does not result in a shortening of the average  weighted maturity of such Original Indebtedness, (v) the terms of such Refinance Indebtedness are not less  favorable to the obligor thereunder than the original terms of such Original Indebtedness and (vi) if such  Original Indebtedness was subordinated in right of payment to the Secured Obligations, then the terms and  conditions of such Refinance Indebtedness must include subordination terms and conditions that are at least  as favorable to the Administrative Agent and the Lenders as those that were applicable to such Original  Indebtedness;  (g) Indebtedness owed to any Person providing workers' compensation, health,  disability or other employee benefits or property, casualty or liability insurance, pursuant to reimbursement  or indemnification obligations to such Person, in each case incurred in the ordinary course of business;  

 

-98-  (h) Indebtedness of any Loan Party in respect of performance bonds, bid bonds, appeal  bonds, surety bonds and similar obligations, in each case provided in the ordinary course of business;  (i) Subordinated Indebtedness in an aggregate principal amount not exceeding  $10,000,000 at any time outstanding;   (j) Indebtedness of any Person that becomes a Loan Party after the date hereof in  connection with a Permitted Acquisition or that is assumed by a Loan Party in connection with a Permitted  Acquisition; provided that (i) such Indebtedness exists at the time such Permitted Acquisition is  consummated and is not created in contemplation of or in connection therewith, and (ii) the aggregate  principal amount of Indebtedness permitted by clause (i) above, together with any Refinance Indebtedness  in respect thereof permitted by Section 6.01(f) (it being understood that Indebtedness under clause (i) above  shall constitute "Original Indebtedness" for purposes of Section 6.01(f)), shall not exceed $5,000,000 at any  time outstanding;  (k) other unsecured Indebtedness in an aggregate principal amount not exceeding  $5,000,000 at any time outstanding;  (l) the Chase Equipment Debt;  (m) [reserved];  (n) the NSFD 33rd Avenue Mortgage Debt and NSFD 31st Avenue Mortgage Debt;  (o) the Han Feng Mortgage Debt;  (p) the R&N Holdings Mortgage Debt;  (q) [reserved];  (r) the HG Realty Mortgage Debt;  (s) the R&N Charlotte Mortgage Debt;  (t) Indebtedness owing under the B&R Realty Seller Note so long as such  Indebtedness remains subordinated to the Obligations pursuant to and in accordance with the B&R Realty  Subordination Agreement;  (u) Indebtedness consisting of (i) the financing of insurance premiums or (ii) take or  pay obligations contained in supply arrangements, in each case incurred in the ordinary course of business;  (v) Indebtedness representing deferred compensation to employees incurred in the  ordinary course of business;  (w) Indebtedness consisting of any purchase price adjustment, earnout or deferred  payment of a similar nature incurred  by any Loan Party or Subsidiary in connection with any Permitted  Acquisition or other Investment permitted hereunder;  (x) overdrafts paid within five Business Days;  

 

-99-  (y) all premium (if any), interest (including post-petition interest), fees, expenses,  charges and additional or contingent interest on obligations described in the other clauses of this Section  6.01;  (z) obligations under Swap Agreements that are entered into to hedge or mitigate risks  to which any Loan Party or any Subsidiary has actual or anticipated exposure (other than in respect of  Equity Interests or Indebtedness of any Loan Party or any Subsidiary) or to cap, collar or exchange interest  rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise) or exchange  rates with respect to any interest bearing or non-Dollar denominated liability or Investment of any Loan  Party or any Subsidiary, and not for speculative purposes; and  (aa) Indebtedness of Excluded Subsidiaries in an aggregate principal amount not to  exceed $5,000,000 at any time outstanding.  SECTION 6.02 Liens.  No Loan Party will, nor will it permit any Subsidiary to, create, incur,  assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign  or sell any income or revenues (including Accounts) or rights in respect of any thereof, except:  (a) Liens created pursuant to any Loan Document;  (b) Permitted Encumbrances;  (c) any Lien on any property or asset of any Borrower or any Subsidiary existing on  the date hereof and set forth in Schedule 6.02; provided that (i) such Lien shall not apply to any other  property or asset of such Borrower or Subsidiary or any other Borrower or Subsidiary and (ii) such Lien  shall secure only those obligations which it secures on the date hereof, and extensions, renewals and  replacements thereof that do not increase the outstanding principal amount thereof;  (d) Liens on fixed or capital assets acquired, constructed or improved by any Borrower  or any Subsidiary; provided that (i) such Liens secure Indebtedness permitted by clause (e) of Section 6.01,  (ii) such Liens and the Indebtedness secured thereby are incurred prior to or within 90 days after such  acquisition or the completion of such construction or improvement, (iii) the Indebtedness secured thereby  does not exceed 100% of the cost of acquiring, constructing or improving such fixed or capital assets and  (iv) such Liens shall not apply to any other property or assets of such Borrower or Subsidiary or any other  Borrower or Subsidiary;  (e) any Lien existing on any property or asset (other than Accounts and Inventory)  prior to the acquisition thereof by any Loan Party or existing on any property or asset (other than Accounts  and Inventory) of any Person that becomes a Loan Party after the date hereof prior to the time such Person  becomes a Loan Party; provided that (i) such Lien is not created in contemplation of or in connection with  such acquisition or such Person becoming a Loan Party, as the case may be, (ii) such Lien shall not apply  to any other property or assets of the Loan Party and (iii) such Lien shall secure only those obligations  which it secures on the date of such acquisition or the date such Person becomes a Loan Party, as the case  may be, and extensions, renewals and replacements thereof that do not increase the outstanding principal  amount thereof;  (f) Liens of a collecting bank arising in the ordinary course of business under  Section 4-210 of the UCC in effect in the relevant jurisdiction covering only the items being collected upon;  (g) Liens arising out of Sale and Leaseback Transactions permitted by Section 6.06;   

 

-100-  (h) Liens granted by a Subsidiary that is not a Loan Party in favor of any Borrower or  another Loan Party in respect of Indebtedness owed by such Subsidiary;  (i) Liens securing the Chase Equipment Debt;  (j) [reserved];  (k) Liens on the NSFD 33rd Avenue Real Estate securing the NSFD 33rd Avenue  Mortgage Debt and Liens on the NSFD 31st Avenue Real Estate securing the NSFD 31st Avenue Mortgage  Debt;  (l) Liens on the R&N Holdings Real Estate securing the Han Feng Mortgage Debt  and the R&N Holdings Mortgage Debt;   (m) [reserved];  (n) Liens on the HG Realty Real Estate securing the HG Realty Mortgage Debt;  (o) Liens on the R&N Charlotte Real Estate securing the R&N Charlotte Mortgage  Debt;  (p) licenses, sublicenses, leases and subleases entered into in the ordinary course of  business that do not interfere in any material respect with the business of any Loan Party or Subsidiary;  (q) any interest or title of a lessor or sublessor under leases and subleases permitted  hereunder;  (r) customary rights of setoff upon cash deposits and other Liens originating solely by  virtue of any statutory or common law provision relating to bankers liens, rights of setoff or similar rights  in favor of banks or other depository institutions, and not securing any Indebtedness; and  (s) Liens solely on cash earnest money deposits made by any Loan Party or Subsidiary  in connection with any letter of intent or purchase agreement in respect of any Permitted Acquisition or  other Investment permitted hereunder.  Notwithstanding the foregoing, none of the Liens permitted pursuant to this Section 6.02 may at any time  attach to any Loan Party's (1) Accounts, other than those permitted under clause (a) of the definition of  Permitted Encumbrances and clauses (a) and (h) above and (2) Inventory, other than those permitted under  clauses (a) and (b) of the definition of Permitted Encumbrances and clauses (a) and (h) above.   SECTION 6.03 Fundamental Changes.  (a) No Loan Party will, nor will it permit any Subsidiary to, merge into or consolidate  with any other Person, or permit any other Person to merge into or consolidate with it, or otherwise Dispose  of all or any substantial part of its assets, or all or substantially all of the stock of any of its Subsidiaries (in  each case, whether now owned or hereafter acquired), or liquidate or dissolve, except that, if at the time  thereof and immediately after giving effect thereto no Event of Default shall have occurred and be  continuing (i) any Subsidiary of any Borrower (other than an Excluded Subsidiary) may merge into a  Borrower in a transaction in which such Borrower is the surviving entity, (ii) any Loan Party (other than a  Borrower) may merge into any other Loan Party in a transaction in which the surviving entity is a Loan  Party, (iii) any Guarantor may liquidate or dissolve so long as any remaining assets of such Guarantor are  transferred to another Loan Party concurrently with such liquidation or dissolution and (iv) any Subsidiary  

 

-101-  that is not a Loan Party may liquidate or dissolve if the Borrower which owns such Subsidiary determines  in good faith that such liquidation or dissolution is in the best interests of such Borrower and is not  materially disadvantageous to the Lenders; provided that any such merger involving a Person that is not a  wholly owned Subsidiary immediately prior to such merger shall not be permitted unless also permitted by  Section 6.04.  (b) No Loan Party will, nor will it permit any Subsidiary to, consummate a Division  as the Dividing Person, without the prior written consent of Administrative Agent.  Without limiting the  foregoing, if any Loan Party that is a limited liability company consummates a Division (with or without  the prior consent of Administrative Agent as required above), each Division Successor shall be required to  comply with the obligations set forth in Section 5.14 and the other further assurances obligations set forth  in the Loan Documents and become a Loan Party under this Agreement and the other Loan Documents.  (c) No Loan Party will, nor will it permit any Subsidiary (other than an Excluded  Subsidiary) to, engage to any material extent in any business other than businesses of the type conducted  by the Borrowers and their Subsidiaries on the date hereof and businesses similar, ancillary, complementary  or otherwise reasonably related thereto, or that are a reasonable extension, development or expansion  thereof, including (i) all activities and services pertaining to the acquisition, transportation, manufacture,  production, processing, marketing, sale and distribution of food, food-related items and restaurant and  kitchen supplies, both wholesale and retail and (ii) the leasing of owned real property by any Loan Party or  Subsidiary to any other Loan Party or Subsidiary or to a third party.  (d) None of B&R, HF Foods or HF Holding will engage in any business or activity,  own any material assets or incur any material liabilities other than (i) ownership of the Equity Interests of  its Subsidiaries, (ii) its obligations under the Loan Documents, (iii) maintenance of its existence, and  (iv) the leasing of executive office space and the engagement of services related to its corporate  management functions.  (e) No Loan Party will, nor will it permit any Subsidiary to, change its fiscal year from  the basis in effect on the Effective Date.  (f) No Loan Party will change the accounting basis upon which its financial  statements are prepared.  (g) No Loan Party will change the tax filing elections it has made under the Code  unless the Administrative Agent shall have received at least 30 days' prior written notice of such change.  (h) No Loan Party will change its organization identification number, if any, issued by  its state of incorporation or other organization unless the Administrative Agent shall have received at least  30 days' prior written notice of such change.  (i) No Loan Party will change its state of incorporation or organization, in each case,  unless the Administrative Agent shall have received at least 15 days prior written notice of such change and  the Administrative Agent shall have acknowledged in writing that either (1) such change will not adversely  affect the validity, perfection or priority of the Administrative Agent's security interest in the Collateral, or  (2) any reasonable action requested by the Administrative Agent in connection therewith has been  completed or taken (including any action to continue the perfection of any Liens in favor of the  Administrative Agent in any Collateral), provided that, any new location of incorporation or organization  shall be in the continental U.S.  SECTION 6.04 Investments, Loans, Advances, Guarantees and Acquisitions.  No Loan Party  will, nor will it permit any Subsidiary to, purchase, hold or acquire (including pursuant to any merger with  

 

-102-  any Person that was not a Loan Party and a wholly owned Subsidiary prior to such merger) any evidences  of Indebtedness or Equity Interests or other securities (including any option, warrant or other right to acquire  any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, or  make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise  acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business  unit (whether through purchase of assets, merger or otherwise), except:  (a) Permitted Investments, subject to Deposit Account Control Agreements in favor  of the Administrative Agent for the benefit of the Secured Parties or otherwise subject to a perfected security  interest in favor of the Administrative Agent for the benefit of the Secured Parties;  (b) investments in existence on the date hereof and described in Schedule 6.04;  (c) investments by the Borrowers and their Subsidiaries in Equity Interests in their  respective Subsidiaries, provided that (i) any such Equity Interests held by a Loan Party shall be pledged  pursuant to the Security Agreement (subject to the limitations applicable to Equity Interests of a Foreign  Subsidiary, an Excluded Subsidiary or an Acquired Majority Owned Subsidiary referred to in Section 5.14)  and (ii) Non Loan Party Contributions (A) may not be made unless immediately after giving effect to such  investment, the Payment Condition is satisfied (provided, that for purposes of determining compliance with  the Payment Condition in connection with the making of any Non Loan Party Contribution, Fixed Charges  shall include the amount of such Non Loan Party Contribution and all other Non Loan Party Contributions,  Non Loan Party Loans and Affiliate Loans made within the applicable period), (B) may not exceed  $10,000,000 in the aggregate at any time outstanding (determined without regard to any write-downs or  write-offs) and (C) shall be subject to the last paragraph of this Section 6.04;  (d) loans or advances made by any Loan Party to any Subsidiary and made by any  Subsidiary to a Loan Party or any other Subsidiary, provided that (i) any such loans and advances made by  a Loan Party shall be evidenced by a promissory note pledged pursuant to the Security Agreement, and  (ii) Non Loan Party Loans (A) may not be made unless immediately after giving effect to such Non Loan  Party Loan, the Payment Condition is satisfied (provided, that for purposes of determining compliance with  the Payment Condition in connection with the making of any Non Loan Party Loan, Fixed Charges shall  include the amount of such Non Loan Party Loan and all other Non Loan Party Contributions, Non Loan  Party Loans and Affiliate Loans made within the applicable period), (B) may not exceed $10,000,000 at  any time outstanding (determined without regard to any write-downs or write-offs) and (C) shall be subject  to the last paragraph of this Section 6.04;  (e) Guarantees constituting Indebtedness permitted by Section 6.01, provided that  Non Loan Party Guarantees (A) no Default or Event of Default has occurred and is continuing or would  result immediately after giving effect to such Non Loan Party Guarantee, (B) may not be secured by Liens  on any assets of the Loan Parties, (C) may not exceed $20,000,000 in the aggregate at any time outstanding  (determined without regard to any write-downs or write-offs) and (D) shall be subject to the last paragraph  of this Section 6.04;  (f) loans or advances made by a Loan Party to its employees on an arms-length basis  in the ordinary course of business consistent with past practices for travel and entertainment expenses,  relocation costs and similar purposes up to a maximum of $2,000,000 at any one time outstanding;   (g) notes payable, or stock or other securities issued by Account Debtors to a Loan  Party pursuant to negotiated agreements with respect to settlement of such Account Debtor's Accounts in  the ordinary course of business, consistent with past practices;  (h) investments in the form of Swap Agreements permitted by Section 6.07;  

 

-103-  (i) investments of any Person existing at the time such Person becomes a Subsidiary  of a Borrower or consolidates or merges with a Borrower or any of the Subsidiaries (including in connection  with a permitted acquisition) so long as such investments were not made in contemplation of such Person  becoming a Subsidiary or of such merger;  (j) investments received in connection with Dispositions permitted by Section 6.05;  (k) investments constituting deposits described in clauses (c) and (d) of the definition  of the term "Permitted Encumbrances";  (l) Permitted Acquisitions; provided, that Permitted Acquisitions of Acquired  Majority Owned Subsidiaries shall be subject to the last paragraph of this Section 6.04;  (m) Affiliate Loans made by HF Foods after the Effective Date, provided that (i) any  such Affiliate Loan shall be evidenced by a promissory note pledged pursuant to the Security Agreement,  (ii) no Default or Event of Default has occurred and is continuing or would result immediately after giving  effect to such Affiliate Loan, (iii) immediately after giving effect to such Affiliate Loan, the Payment  Condition is satisfied, (iv) if the Special Advance Amount is greater than zero, the Required Lenders have  consented to such loan or advance, and (v) such Affiliate Loans shall be subject to the last paragraph of this  Section 6.04; and  (n) investments in or used to consummate joint ventures (but not Acquisitions);  provided that (i) any Equity Interests held by a Loan Party in such joint venture shall be pledged pursuant  to the Security Agreement (to the extent such pledge is not prohibited by the applicable joint venture  agreement, partnership agreement or other similar agreement with respect to such joint venture) and (ii) the  aggregate amount of investments made pursuant to this clause (n) shall not to exceed $5,000,000 at any  time outstanding.  Notwithstanding anything to the contrary contained herein, the sum of (1) the aggregate amount of Non  Loan Party Contributions made during any 12 month period, (2) the aggregate amount of Non Loan Party  Loans made during such 12 month period, (3) the aggregate Indebtedness guaranteed by Non Loan Party  Guarantees made during such 12 month period, (4) the aggregate amount of Affiliate Loans made during  such 12 month period and (5) the aggregate amount of the Total Consideration in connection with Permitted  Acquisitions of Acquired Majority Owned Subsidiaries that have been consummated during such 12 month  period (in each case in clauses (1)-(4), determined without regard to any write-downs or write-offs), shall  not at any time exceed $40,000,000.  SECTION 6.05 Asset Sales.  No Loan Party will, nor will it permit any Subsidiary to, Dispose  of any asset, including any Equity Interest owned by it, nor will any Borrower permit any Subsidiary to  issue any additional Equity Interest in such Subsidiary (other than to another Borrower or another  Subsidiary in compliance with Section 6.04), except:  (a) Dispositions of (i) Inventory in the ordinary course of business and (ii) used,  obsolete, worn out or surplus Equipment or property in the ordinary course of business;  (b) Dispositions of assets to any Borrower or any Subsidiary, provided that any such  Dispositions made to a Subsidiary that is not a Loan Party shall be made in compliance with Section 6.09;  (c) Dispositions of Accounts in connection with the compromise, settlement or  collection thereof;  

 

-104-  (d) Dispositions of Permitted Investments and other investments permitted by  clauses (i) and (j) of Section 6.04;  (e) Sale and Leaseback Transactions permitted by Section 6.06;  (f) Dispositions resulting from any casualty or other insured damage to, or any taking  under power of eminent domain or by condemnation or similar proceeding of, any property or asset of any  Borrower or any Subsidiary;   (g) the use of cash in the ordinary course of business;  (h) the leasing of owned real property by any Loan Party; provided, that if the owned  real property so leased is Eligible Real Property, the lease shall be (i) collaterally assigned to the  Administrative Agent as security for the Secured Obligations and (ii) subordinate to the Mortgage on such  real property in favor of the Administrative Agent;  (i) Dispositions of real property that is not Eligible Real Property, so long as (i) no  Default or Event of Default has occurred and is continuing or would result therefrom and (ii) the aggregate  fair market value of all such real property Disposed of in reliance upon this paragraph (i) shall not exceed  $10,000,000 during any fiscal year of the Borrowers;  (j) Dispositions of assets (other than Equity Interests in a Subsidiary unless all Equity  Interests in such Subsidiary are sold) that are not permitted by any other clause of this Section, so long as  (i) no Default or Event of Default has occurred and is continuing or would result therefrom and (ii) the  aggregate fair market value of all assets Disposed of in reliance upon this paragraph (j) shall not exceed  $2,500,000 during any fiscal year of the Borrowers;  (k) Permitted Charitable Contributions; and  (l) the HG Realty Sale so long as (i) the HG Realty Sale is consummated on or prior  to June 30, 2022 (or such later date as agreed to in writing by the Administrative Agent), (ii) no Default or  Event of Default is in existence at the time of the consummation of the HG Realty Sale or would be caused  thereby, and (iii) the HG Realty Sale is consummated pursuant to the terms of the HG Realty Sale  Agreement in all material respects.  provided that all Dispositions permitted hereby (other than those permitted by paragraphs (b) and (f) above)  shall be made for fair value and for at least 75% cash consideration.  For the avoidance of doubt, no loan  by any Loan Party or Subsidiary to any other Loan Party or Subsidiary shall constitute a Disposition subject  to the restrictions set forth in this Section 6.05.  SECTION 6.06 Sale and Leaseback Transactions.  No Loan Party will, nor will it permit any  Subsidiary to, enter into any arrangement, directly or indirectly, whereby it shall sell or transfer any  property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and  thereafter rent or lease such property or other property that it intends to use for substantially the same  purpose or purposes as the property sold or transferred (a "Sale and Leaseback Transaction"), except for  any such sale of any fixed or capital assets by any Borrower or any Subsidiary other than Eligible Real  Property that is made for cash consideration in an amount not less than the fair value of such fixed or capital  asset.  SECTION 6.07 Swap Agreements. No Loan Party will, nor will it permit any Subsidiary to,  enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks to  which any Borrower or any Subsidiary has actual exposure (other than those in respect of Equity Interests  

 

-105-  or Indebtedness of any Borrower or any of its Subsidiaries), and (b) Swap Agreements entered into in order  to effectively cap, collar or exchange interest rates (from floating to fixed rates, from one floating rate to  another floating rate or otherwise) with respect to any interest-bearing liability or investment of any  Borrower or any Subsidiary.  SECTION 6.08 Restricted Payments; Certain Payments of Indebtedness.  (a) No Loan Party will, nor will it permit any Subsidiary to, declare or make, or agree  to declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or  otherwise) to do so, except:  (i) HF Foods may declare and make dividends or distributions with respect to  its Equity Interests payable solely in additional shares of its Equity Interests;  (ii) so long as no Event of Default is then in existence or would be caused  thereby, HF Foods may declare and make Restricted Payments with the Net Proceeds of a  substantially concurrent issuance of new Equity Interests of HF Foods;  (iii) so long as HF Industrial is a "pass through" entity for federal income Tax  purposes, HF Industrial may make distributions to the holders of its Equity Interests, in an  aggregate amount not greater than the amount necessary for such holders to pay their actual  state and U.S. federal income Tax liabilities in respect of income earned by HF Industrial,  after deducting any unused prior losses;  (iv) so long as Monterey is a "pass through" entity for federal income Tax  purposes, Monterey may make distributions to the holders of its Equity Interests, in an  aggregate amount not greater than the amount necessary for such holders to pay their actual  state and U.S. federal income Tax liabilities in respect of income earned by Monterey, after  deducting any unused prior losses;  (v) so long as Ocean West is a "pass through" entity for federal income Tax  purposes, Ocean West may make distributions to the holders of its Equity Interests, in an  aggregate amount not greater than the amount necessary for such holders to pay their actual  state and U.S. federal income Tax liabilities in respect of income earned by Ocean West,  after deducting any unused prior losses;  (vi) so long as Irwindale is a "pass through" entity for federal income Tax  purposes, Irwindale may make distributions to the holders of its Equity Interests, in an  aggregate amount not greater than the amount necessary for such holders to pay their actual  state and U.S. federal income Tax liabilities in respect of income earned by Irwindale, after  deducting any unused prior losses;  (vii) so long as SynGlobal is a "pass through" entity for federal income Tax  purposes, SynGlobal may make distributions to the holders of its Equity Interests, in an  aggregate amount not greater than the amount necessary for such holders to pay their actual  state and U.S. federal income Tax liabilities in respect of income earned by SynGlobal,  after deducting any unused prior losses;  (viii) any Acquired Majority Owned Subsidiary that is a "pass through" entity  for federal income Tax purposes may make distributions to the holders of its Equity  Interests, in an aggregate amount not greater than the amount necessary for such holders to  

 

-106-  pay their actual state and U.S. federal income Tax liabilities in respect of income earned  by such Acquired Majority Owned Subsidiary, after deducting any unused prior losses;  (ix) HF Food's Subsidiaries (other than Ocean West, Monterey, Min Food, HF  Industrial, SynGlobal, Irwindale, and any Acquired Majority Owned Subsidiary) may  make distributions to HF Foods, and HF Foods may make distributions to the holders of  its Equity Interests, in each case constituting Other Restricted Payments;  (x) Ocean West may make distributions to the holders of its Equity Interests,  Rongcheng may make distributions to the holders of its Equity Interests of its portion of  such distributions from Ocean West, B&R may pay dividends to HF Foods in the same  amount, and HF Foods may pay dividends to the holders of its Equity Interests in the same  amount, in each case constituting Other Restricted Payments;  (xi) Min Food may pay dividends to the holders of its Equity Interests, B&R  may pay dividends to HF Foods in the same amount and HF Foods may pay dividends to  the holders of its Equity Interests of its portion of such dividends from Min Food, in each  case constituting Other Restricted Payments;  (xii) Monterey may make distributions to the holders of its Equity Interests,  Rongcheng may make distributions to the holders of its Equity Interests of its portion of  such distributions from Monterey, B&R may pay dividends to HF Foods in the same  amount and HF Foods may pay dividends to the holders of its Equity Interests in the same  amount, in each case constituting Other Restricted Payments;   (xiii) HF Industrial may pay dividends to the holders of its Equity Interests, Han  Feng may pay dividends to HF Holding in the same amount, HF Holding may pay  dividends to HF Foods in the same amount and HF Foods may pay dividends to the holders  of its Equity Interests of its portion of such dividends from HF Industrial, in each case  constituting Other Restricted Payments;  (xiv) Irwindale may pay dividends to the holders of its Equity Interests, B&R  may pay dividends to HF Foods in the same amount and HF Foods may pay dividends to  the holders of its Equity Interests of its portion of such dividends from Irwindale, in each  case constituting Other Restricted Payments;  (xv) SynGlobal may make distributions to the holders of its Equity Interests,  and such holders may make dividends or distributions to the holders of its Equity Interests  of its portion of such distributions from SynGlobal, in each case constituting Other  Restricted Payments; and  (xvi) any Acquired Majority Owned Subsidiary may make distributions to the  holders of its Equity Interests, and such holders may make dividends or distributions to the  holders of its Equity Interests of its portion of such distributions from such Acquired  Majority Owned Subsidiary, in each case constituting Other Restricted Payments.  (b) No Loan Party will, nor will it permit any Subsidiary to, make or agree to pay or  make, directly or indirectly, any payment or other distribution (whether in cash, securities or other property)  of or in respect of principal of or interest on any Indebtedness, or any payment or other distribution (whether  in cash, securities or other property), including any sinking fund or similar deposit, on account of the  purchase, redemption, retirement, acquisition, cancellation or termination of any Indebtedness, except:  

 

-107-  (i) payment of Indebtedness created under the Loan Documents;  (ii) payment of the Chase Equipment Debt;  (iii) payment of regularly scheduled interest and principal payments as and  when due in respect of any Indebtedness permitted under Section 6.01, other than payments  in respect of the Subordinated Indebtedness (other than the B&R Realty Seller Note)  prohibited by the subordination provisions thereof or the subordination agreement relating  thereto;  (iv) refinancings of Indebtedness to the extent permitted by Section 6.01;   (v) payment of secured Indebtedness that becomes due as a result of the  voluntary sale or transfer of the property or assets securing such Indebtedness to the extent  such sale or transfer is permitted by the terms of Section 6.05;  (vi) payment of regularly scheduled interest as and when due in respect of the  B&R Realty Seller Note, other than payments in respect thereof prohibited by the B&R  Realty Subordination Agreement; and  (vii) voluntary payments of principal in respect of the B&R Realty Seller Note,  so long as (a) immediately after giving effect to such payment the Payment Condition shall  be satisfied, (b) such payment is not prohibited by the B&R Realty Subordination  Agreement and (c) if the Special Advance Amount is greater than zero, the Required  Lenders have consented to such payment.  SECTION 6.09 Transactions with Affiliates.  No Loan Party will, nor will it permit any  Subsidiary to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise  acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates,  except (a) transactions that (i) are in the ordinary course of business and (ii) are at prices and on terms and  conditions not less favorable to such Loan Party or such Subsidiary than could be obtained on an arm's- length basis from unrelated third parties, (b) transactions between or among any Borrower and any  Subsidiary that is a Loan Party not involving any other Affiliate, (c) any investment permitted by  Sections 6.04(c) or 6.04(d), (d) any Indebtedness permitted under Section 6.01(c), (e) any Restricted  Payment permitted by Section 6.08, (f) loans or advances to employees permitted under Section 6.04,  (g) the payment of reasonable fees to members of the board of managers or directors of any Borrower or  any Subsidiary who are not employees of such Borrower or Subsidiary, and compensation and employee  benefit arrangements paid to, and indemnities provided for the benefit of, managers, directors, officers or  employees of the Borrowers or their Subsidiaries in the ordinary course of business, (h) any issuances of  securities or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding  of, employment agreements, stock or membership interest options and stock or membership interest  ownership plans approved by HF Foods' board of directors and (i) payment by each applicable Working  Capital Borrower to the applicable Subsidiary that owns the real property on which such Working Capital  Borrower operates of lease amounts not less favorable to such Working Capital Borrower than could be  obtained on an arm's-length basis from unrelated third parties.  No Loan Party will, nor will it permit any  Subsidiary to, make any advance or loan to any of its suppliers that are Affiliates, except loans and advances  that are at prices and on terms and conditions not less favorable to such Loan Party or such Subsidiary than  could be obtained on an arm's-length basis from unrelated third parties.  SECTION 6.10 Restrictive Agreements. No Loan Party will, nor will it permit any Subsidiary  to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that  prohibits, restricts or imposes any condition upon (a) the ability of such Loan Party or any Subsidiary to  

 

-108-  create, incur or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary  to make distributions or pay dividends with respect to any of its Equity Interests or to make or repay loans  or advances to any Borrower or any other Subsidiary or to Guarantee Indebtedness of any Borrower or any  other Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by  any Requirement of Law, by any Loan Document or by the agreements evidencing the Chase Equipment  Debt, (ii) the foregoing shall not apply to restrictions and conditions existing on the date hereof identified  on Schedule 6.10 (but shall apply to any extension or renewal of, or any amendment or modification  expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary  restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale,  provided that such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale  is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or conditions imposed  by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or  conditions apply only to the property or assets securing such Indebtedness, (v) clause (a) of the foregoing  shall not apply to customary provisions in leases and other contracts restricting the assignment thereof and  (vi) the foregoing shall not apply to customary restrictions contained in joint venture agreements,  partnership agreements and other similar agreements with respect to a joint ownership arrangement  restricting the disposition or distribution of assets or property of such joint venture, partnership or other  joint ownership entity, so long as such encumbrances or restrictions are applicable solely to such joint  venture and are not applicable to the property or assets of any other Person.  SECTION 6.11 Amendment of Material Documents.  No Loan Party will, nor will it permit  any Subsidiary to, amend, modify or waive any of its rights under (a) (i) any agreement relating to any  Subordinated Indebtedness, except to the extent permitted in the subordination provisions thereof or the  subordination agreement relating thereto or (ii) the B&R Realty Seller Note, except to the extent permitted  by the B&R Realty Subordination Agreement, (b) its charter, articles or certificate of incorporation or  organization, by-laws, operating, management or partnership agreement or other organizational or  governing documents, to the extent any such amendment, modification or waiver would be adverse to the  rights or interests of Lenders, or (c) any other Material Agreement, to the extent any such amendment,  modification or waiver would be adverse to the rights or interests of Lenders.  SECTION 6.12 [Reserved].  SECTION 6.13 Fixed Charge Coverage Ratio.  The Borrowers will not permit the Fixed  Charge Coverage Ratio of HF Foods and its consolidated Subsidiaries, as of the end of any fiscal quarter  to be less than 1.10 to 1.00.  ARTICLE VII    Events of Default.  If any of the following events ("Events of Default") shall occur:  (a) the Borrowers shall fail to pay any principal of any Loan or any reimbursement  obligation in respect of any LC Disbursement when and as the same shall become due and payable, whether  at the due date thereof or at a date fixed for prepayment thereof or otherwise;   (b) the Borrowers shall fail to pay any interest on any Loan or any fee or any other  amount (other than an amount referred to in clause (a) of this Article) payable under this Agreement or any  other Loan Document, when and as the same shall become due and payable, and such failure shall continue  unremedied for a period of five (5) days;  

 

-109-  (c) any representation or warranty made or deemed made by or on behalf of any Loan  Party or any Subsidiary in, or in connection with, this Agreement or any other Loan Document or any  amendment or modification hereof or thereof or waiver hereunder or thereunder, or in any report, certificate,  financial statement or other document furnished pursuant to or in connection with this Agreement or any  other Loan Document or any amendment or modification hereof or thereof or waiver hereunder or  thereunder, shall prove to have been materially incorrect when made or deemed made (or in any respect  with respect to any representation or warranty qualified by materiality or Material Adverse Effect);  (d) any Loan Party shall fail to observe or perform any covenant, condition or  agreement contained in Section 5.02(a), 5.03 (with respect to a Loan Party's existence), 5.08 or 5.18 or in  Article VI;  (e) any Loan Party shall fail to observe or perform any covenant, condition or agree- ment contained in this Agreement (other than those which constitute a default under another Section of this  Article), and such failure shall continue unremedied for a period of (i) 5 days after the earlier of any Loan  Party's knowledge of such breach or notice thereof from the Administrative Agent (which notice will be  given at the request of any Lender) if such breach relates to terms or provisions of Section 5.01, 5.02 (other  than Section 5.02(a)), 5.03 through 5.07, 5.10, 5.11, 5.13, 5.15 or 5.16 of this Agreement or (ii) 15 days  after the earlier of any Loan Party's knowledge of such breach or notice thereof from the Administrative  Agent (which notice will be given at the request of any Lender) if such breach relates to terms or provisions  of any other Section of this Agreement;  (f) any Loan Party or Subsidiary shall fail to make any payment (whether of principal  or interest and regardless of amount) in respect of any Material Indebtedness, when and as the same shall  become due and payable;  (g) any event or condition occurs that results in any Material Indebtedness becoming  due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse  of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their  behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase,  redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not  apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property  or assets securing such Indebtedness to the extent such sale or transfer is permitted by Section 6.05;  (h) an involuntary proceeding shall be commenced or an involuntary petition shall be  filed seeking (i) liquidation, reorganization or other relief in respect of a Loan Party or Subsidiary or its  debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency,  receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian,  sequestrator, conservator or similar official for any Loan Party or Subsidiary or for a substantial part of its  assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or  an order or decree approving or ordering any of the foregoing shall be entered;  (i) any Loan Party or Subsidiary shall (i) voluntarily commence any proceeding or  file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign  bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution  of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h)  of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator,  conservator or similar official for such Loan Party or Subsidiary or for a substantial part of its assets, (iv) file  an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make  a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of  the foregoing;  

 

-110-  (j) any Loan Party or Subsidiary shall become unable, admit in writing its inability,  or publicly declare its intention not to, or fail generally to pay its debts as they become due;  (k) (i) one or more judgments for the payment of money in an aggregate amount in  excess of $1,000,000 shall be rendered against any Loan Party, any Subsidiary or any combination thereof  and the same shall remain undischarged for a period of thirty (30) consecutive days during which execution  shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy  upon any assets of any Loan Party or Subsidiary to enforce any such judgment; or (ii) any Loan Party or  Subsidiary  shall fail within thirty (30) days to discharge one or more non-monetary judgments or orders  which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect,  which judgments or orders, in any such case, are not stayed on appeal or otherwise being appropriately  contested in good faith by proper proceedings diligently pursued;  (l) an ERISA Event shall have occurred that, in the opinion of the Required Lenders,  when taken together with all other ERISA Events that have occurred, could reasonably be expected to result  in a Material Adverse Effect;  (m) a Change in Control shall occur;  (n) the occurrence of any "default", as defined in any Loan Document (other than this  Agreement) or the breach of any of the terms or provisions of any Loan Document (other than this  Agreement), which default or breach continues beyond any period of grace therein provided;  (o) the Loan Guaranty or any Obligation Guaranty shall fail to remain in full force or  effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of the Loan  Guaranty or any Obligation Guaranty, or any Loan Guarantor shall fail to comply with any of the terms or  provisions of the Loan Guaranty or any Obligation Guaranty to which it is a party, or any Loan Guarantor  shall deny that it has any further liability under the Loan Guaranty or any Obligation Guaranty to which it  is a party, or shall give notice to such effect, including, but not limited to notice of termination delivered  pursuant to Section 10.08 or any notice of termination delivered pursuant to the terms of any Obligation  Guaranty;  (p) except as permitted by the terms of any Collateral Document, (i) any Collateral  Document shall for any reason fail to create a valid security interest in any Collateral purported to be  covered thereby, or (ii) any Lien securing any Secured Obligation shall cease to be a perfected, first priority  Lien;  (q) any Collateral Document shall fail to remain in full force or effect or any action  shall be taken to discontinue or to assert the invalidity or unenforceability of any Collateral Document;   (r) any material provision of any Loan Document for any reason ceases to be valid,  binding and enforceable in accordance with its terms (or any Loan Party shall challenge the enforceability  of any Loan Document or shall assert in writing, or engage in any action or inaction that  evidences its  assertion, that any provision of any of the Loan Documents has ceased to be or otherwise is not valid,  binding and enforceable in accordance with its terms); or  (s) any Loan Party is criminally indicted or convicted under any law that may  reasonably be expected to lead to a forfeiture of any property of such Loan Party having a fair market value  in excess of $250,000;  then, and in every such event (other than an event with respect to the Borrowers described in clause (h) or  (i) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent  

 

-111-  may, and at the request of the Required Lenders shall, by notice to the Borrower Representative, take any  or all of the following actions, at the same or different times:  (i) terminate the Commitments, whereupon  the Commitments shall terminate immediately, (ii) declare the Loans then outstanding to be due and  payable in whole (or in part, but ratably as among the Classes of Loans and the Loans of each Class at the  time outstanding, in which case any principal not so declared to be due and payable may thereafter be  declared to be due and payable), whereupon the principal of the Loans so declared to be due and payable,  together with accrued interest thereon and all fees (including, for the avoidance of doubt, any break funding  payments) and other obligations of the Borrowers accrued hereunder and under any other Loan Document,  shall become due and payable immediately, in each case without presentment, demand, protest or other  notice of any kind, all of which are hereby waived by the Borrowers, and (iii) require cash collateral for the  LC Exposure in accordance with Section 2.06(j) hereof; and in the case of any event with respect to the  Borrowers described in clause (h) or (i) of this Article, the Commitments shall automatically terminate and  the principal of the Loans then outstanding and the cash collateral for the LC Exposure, together with  accrued interest thereon and all fees (including, for the avoidance of doubt, any break funding payments)  and other obligations of the Borrowers accrued hereunder and under any other Loan Documents, shall  automatically become due and payable, in each case without presentment, demand, protest or other notice  of any kind, all of which are hereby waived by the Borrowers.  Upon the occurrence and during the  continuance of an Event of Default, the Administrative Agent may, and at the request of the Required  Lenders shall, increase the rate of interest applicable to the Loans and other Obligations as set forth in this  Agreement and exercise any rights and remedies provided to the Administrative Agent under the Loan  Documents or at law or equity, including all remedies provided under the UCC.  ARTICLE VIII    The Administrative Agent.  SECTION 8.01 Authorization and Action.    (a) Each Lender, on behalf of itself and any of its Affiliates that are Secured Parties  and the Issuing Bank hereby irrevocably appoints the entity named as Administrative Agent in the heading  of this Agreement and its successors and assigns to serve as the administrative agent and collateral agent  under the Loan Documents and each Lender and the Issuing Bank authorizes the Administrative Agent to  take such actions as agent on its behalf and to exercise such powers under this Agreement and the other  Loan Documents as are delegated to the Administrative Agent under such agreements and to exercise such  powers as are reasonably incidental thereto. In addition, to the extent required under the laws of any  jurisdiction other than within the United States, each Lender and the Issuing Bank hereby grants to the  Administrative Agent any required powers of attorney to execute and enforce any Collateral Document  governed by the laws of such jurisdiction on such Lender's or such Issuing Bank's behalf.  Without limiting  the foregoing, each Lender and the Issuing Bank hereby authorizes the Administrative Agent to execute  and deliver, and to perform its obligations under, each of the Loan Documents to which the Administrative  Agent is a party, and to exercise all rights, powers and remedies that the Administrative Agent may have  under such Loan Documents.  (b) As to any matters not expressly provided for herein and in the other Loan  Documents (including enforcement or collection), the Administrative Agent shall not be required to  exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be  fully protected in so acting or refraining from acting) upon the written instructions of the Required Lenders  (or such other number or percentage of the Lenders as shall be necessary, pursuant to the terms in the Loan  Documents), and, unless and until revoked in writing, such instructions shall be binding upon each Lender  and the Issuing Bank; provided, however, that the Administrative Agent shall not be required to take any  action that (i) the Administrative Agent in good faith believes exposes it to liability unless the  Administrative Agent receives an indemnification and is exculpated in a manner satisfactory to it from the  

 

-112-  Lenders and the Issuing Bank with respect to such action or (ii) is contrary to this Agreement or any other  Loan Document or applicable law, including any action that may be in violation of the automatic stay under  any requirement of law relating to bankruptcy, insolvency or reorganization or relief of debtors or that may  effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any  requirement of law relating to bankruptcy, insolvency or reorganization or relief of debtors; provided,  further, that the Administrative Agent may seek clarification or direction from the Required Lenders prior  to the exercise of any such instructed action and may refrain from acting until such clarification or direction  has been provided.  Except as expressly set forth in the Loan Documents, the Administrative Agent shall  not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to  any Borrower, any other Loan Party, any Subsidiary or any Affiliate of any of the foregoing that is  communicated to or obtained by the Person serving as Administrative Agent or any of its Affiliates in any  capacity. Nothing in this Agreement shall require the Administrative Agent to expend or risk its own funds  or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise  of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds  or adequate indemnity against such risk or liability is not reasonably assured to it.  (c) In performing its functions and duties hereunder and under the other Loan  Documents, the Administrative Agent is acting solely on behalf of the Lenders and the Issuing Bank (except  in limited circumstances expressly provided for herein relating to the maintenance of the Register), and its  duties are entirely mechanical and administrative in nature. Without limiting the generality of the foregoing:  (i) the Administrative Agent does not assume and shall not be deemed to have  assumed any obligation or duty or any other relationship as the agent, fiduciary or trustee  of or for any Lender, Issuing Bank or Secured Party or holder of any other obligation other  than as expressly set forth herein and in the other Loan Documents, regardless of whether  a Default or an Event of Default has occurred and is continuing (and it is understood and  agreed that the use of the term "agent" (or any similar term) herein or in any other Loan  Document with reference to the Administrative Agent is not intended to connote any  fiduciary duty or other implied (or express) obligations arising under agency doctrine of  any applicable law, and that such term is used as a matter of market custom and is intended  to create or reflect only an administrative relationship between contracting parties);  additionally, each Lender agrees that it will not assert any claim against the Administrative  Agent based on an alleged breach of fiduciary duty by the Administrative Agent in  connection with this Agreement and/or the transactions contemplated hereby; and  (ii) nothing in this Agreement or any Loan Document shall require the  Administrative Agent to account to any Lender for any sum or the profit element of any  sum received by the Administrative Agent for its own account.  (d) The Administrative Agent may perform any of its duties and exercise its rights and  powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed  by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any of their  respective duties and exercise their respective rights and powers through their respective Related Parties.  The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of  the Administrative Agent and any such sub-agent, and shall apply to their respective activities pursuant to  this Agreement. The Administrative Agent shall not be responsible for the negligence or misconduct of any  sub agent except to the extent that a court of competent jurisdiction determines in a final and non-appealable  judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection  of such sub-agent.  (e) No Arranger shall have obligations or duties whatsoever in such capacity under  this Agreement or any other Loan Document and no Arranger shall incur any liability hereunder or  

 

-113-  thereunder in such capacity, but all such persons shall have the benefit of the indemnities provided for  hereunder.  (f) In case of the pendency of any proceeding with respect to any Loan Party under  any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect,  the Administrative Agent (irrespective of whether the principal of any Loan or any reimbursement  obligation in respect of any LC Disbursement shall then be due and payable as herein expressed or by  declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand  on any Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding  or otherwise:  (i) to file and prove a claim for the whole amount of the principal and interest  owing and unpaid in respect of the Loans, LC Disbursements and all other Obligations that  are owing and unpaid and to file such other documents as may be necessary or advisable  in order to have the claims of the Lenders, the Issuing Bank and the Administrative Agent  (including any claim under Sections 2.12, 2.13, 2.15, 2.17 and 9.03) allowed in such  judicial proceeding; and  (ii) to collect and receive any monies or other property payable or deliverable  on any such claims and to distribute the same;  and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such  proceeding is hereby authorized by each Lender, the Issuing Bank and each other Secured Party to make  such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to  the making of such payments directly to the Lenders, the Issuing Bank or the other Secured Parties, to pay  to the Administrative Agent any amount due to it, in its capacity as the Administrative Agent, under the  Loan Documents (including under Section 9.03). Nothing contained herein shall be deemed to authorize  the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or Issuing  Bank any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the  rights of any Lender or Issuing Bank or to authorize the Administrative Agent to vote in respect of the claim  of any Lender or Issuing Bank in any such proceeding.  The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the  Issuing Bank, and, except solely to the extent of the Borrowers' right to consent pursuant to and subject to  the conditions set forth in this Article, no Borrower nor any Subsidiary, or any of their respective Affiliates,  shall have any rights as a third party beneficiary under any such provisions. Each Secured Party, whether  or not a party hereto, will be deemed, by its acceptance of the benefits of the Collateral and of the Guarantees  of the Secured Obligations provided under the Loan Documents, to have agreed to the provisions of this  Article.  SECTION 8.02 Administrative Agent's Reliance, Indemnification, Etc.  (a) Neither the Administrative Agent nor any of its Related Parties shall be (i) liable  for any action taken or omitted to be taken by such party, the Administrative Agent or any of its Related  Parties under or in connection with this Agreement or the other Loan Documents (x) with the consent of or  at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be  necessary, or as the Administrative Agent shall believe in good faith to be necessary, under the  circumstances as provided in the Loan Documents) or (y) in the absence of its own gross negligence or  willful misconduct (such absence to be presumed unless otherwise determined by a court of competent  jurisdiction by a final and non-appealable judgment) or (ii) responsible in any manner to any of the Lenders  for any recitals, statements, representations or warranties made by any Loan Party or any officer thereof  contained in this Agreement or any other Loan Document or in any certificate, report, statement or other  

 

-114-  document referred to or provided for in, or received by the Administrative Agent under or in connection  with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness,  enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of any Loan  Party to perform its obligations hereunder or thereunder.  (b) The Administrative Agent shall be deemed not to have knowledge of any Default  unless and until written notice thereof (stating that it is a "notice of default") is given to the Administrative  Agent by the Borrower Representative, a Lender or the Issuing Bank, and the Administrative Agent shall  not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or  representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report  or other document delivered thereunder or in connection therewith, (iii) the performance or observance of  any of the covenants, agreements or other terms or conditions set forth in any Loan Document or the  occurrence of any Default, (iv) the sufficiency, validity, enforceability, effectiveness or genuineness of any  Loan Document or any other agreement, instrument or document, (v) the satisfaction of any condition set  forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt of items (which on  their face purport to be such items) expressly required to be delivered to the Administrative Agent or  satisfaction of any condition that expressly refers to the matters described therein being acceptable or  satisfactory to the Administrative Agent, or (vi) the creation, perfection or priority of Liens on the  Collateral.  (c) Without limiting the foregoing, the Administrative Agent (i) may treat the payee  of any promissory note as its holder until such promissory note has been assigned in accordance with  Section 9.04, (ii) may rely on the Register to the extent set forth in Section 9.04(b), (iii) may consult with  legal counsel (including counsel to the Borrowers), independent public accountants and other experts  selected by it, and shall not be liable for any action taken or omitted to be taken in good faith by it in  accordance with the advice of such counsel, accountants or experts, (iv) makes no warranty or  representation to any Lender or Issuing Bank and shall not be responsible to any Lender or Issuing Bank  for any statements, warranties or representations made by or on behalf of any Loan Party in connection  with this Agreement or any other Loan Document, (v) in determining compliance with any condition  hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled  to the satisfaction of a Lender or an Issuing Bank, may presume that such condition is satisfactory to such  Lender or Issuing Bank unless the Administrative Agent shall have received notice to the contrary from  such Lender or Issuing Bank sufficiently in advance of the making of such Loan or the issuance of such  Letter of Credit and (vi) shall be entitled to rely on, and shall incur no liability under or in respect of this  Agreement or any other Loan Document by acting upon, any notice, consent, certificate or other instrument  or writing (which writing may be a fax, any electronic message, Internet or intranet website posting or other  distribution) or any statement made to it orally or by telephone and believed by it to be genuine and signed  or sent or otherwise authenticated by the proper party or parties (whether or not such Person in fact meets  the requirements set forth in the Loan Documents for being the maker thereof).  SECTION 8.03 Posting of Communications.  (a) The Borrowers agree that the Administrative Agent may, but shall not be obligated  to, make any Communications available to the Lenders and the Issuing Bank by posting the  Communications on IntraLinksTM, DebtDomain, SyndTrak, ClearPar or any other electronic system chosen  by the Administrative Agent to be its electronic transmission system (the "Approved Electronic Platform").  (b) Although the Approved Electronic Platform and its primary web portal are secured  with generally-applicable security procedures and policies implemented or modified by the Administrative  Agent from time to time (including, as of the Effective Date, a user ID/password authorization system) and  the Approved Electronic Platform is secured through a per-deal authorization method whereby each user  may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lenders, the Issuing  

 

-115-  Bank and each Borrower acknowledges and agrees that the distribution of material through an electronic  medium is not necessarily secure, that the Administrative Agent is not responsible for approving or vetting  the representatives or contacts of any Lender that are added to the Approved Electronic Platform, and that  there may be confidentiality and other risks associated with such distribution. Each of the Lenders, the  Issuing Bank and each Borrower hereby approves distribution of the Communications through the  Approved Electronic Platform and understands and assumes the risks of such distribution.  (c) THE APPROVED ELECTRONIC PLATFORM AND THE  COMMUNICATIONS ARE PROVIDED "AS IS" AND "AS AVAILABLE". THE APPLICABLE  PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF  THE COMMUNICATIONS, OR THE ADEQUACY OF THE APPROVED ELECTRONIC PLATFORM  AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED  ELECTRONIC PLATFORM AND THE COMMUNICATIONS. NO WARRANTY OF ANY KIND,  EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY,  FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR  FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE APPLICABLE  PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE APPROVED ELECTRONIC  PLATFORM.  IN NO EVENT SHALL THE ADMINISTRATIVE AGENT, ANY ARRANGER OR ANY  OF THEIR RESPECTIVE RELATED PARTIES (COLLECTIVELY, "APPLICABLE PARTIES") HAVE  ANY LIABILITY TO ANY LOAN PARTY, ANY LENDER, ANY ISSUING BANK OR ANY OTHER  PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT,  SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER  IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY LOAN PARTY'S OR THE  ADMINISTRATIVE AGENT'S TRANSMISSION OF COMMUNICATIONS THROUGH THE  INTERNET OR THE APPROVED ELECTRONIC PLATFORM.  "Communications" means, collectively, any notice, demand, communication, information,  document or other material provided by or on behalf of any Loan Party pursuant to any Loan  Document or the transactions contemplated therein which is distributed by the Administrative  Agent, any Lender or Issuing Bank by means of electronic communications pursuant to this  Section, including through an Approved Electronic Platform.  (d) Each Lender and Issuing Bank agrees that notice to it (as provided in the next  sentence) specifying that Communications have been posted to the Approved Electronic Platform shall  constitute effective delivery of the Communications to such Lender for purposes of the Loan Documents.  Each Lender and Issuing Bank agrees (i) to notify the Administrative Agent in writing (which could be in  the form of electronic communication) from time to time of such Lender's or Issuing Bank's (as applicable)  email address to which the foregoing notice may be sent by electronic transmission and (ii) that the  foregoing notice may be sent to such email address.  (e) Each of the Lenders, Issuing Bank and each Borrower agrees that the  Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to,  store the Communications on the Approved Electronic Platform in accordance with the Administrative  Agent's generally applicable document retention procedures and policies.  (f) Nothing herein shall prejudice the right of the Administrative Agent, any Lender  or Issuing Bank to give any notice or other communication pursuant to any Loan Document in any other  manner specified in such Loan Document.  SECTION 8.04 The Administrative Agent Individually.  With respect to its Commitment,  Loans (including Swingline Loans) and Letters of Credit, the Person serving as the Administrative Agent  shall have and may exercise the same rights and powers hereunder and is subject to the same obligations  

 

-116-  and liabilities as and to the extent set forth herein for any other Lender or Issuing Bank, as the case may be.  The terms "Issuing Bank", "Lenders", "Required Lenders", "Required Revolving Lenders", "Supermajority  Revolving Lenders" and any similar terms shall, unless the context clearly otherwise indicates, include the  Administrative Agent in its individual capacity as a Lender, Issuing Bank or as one of the Required Lenders,  Required Revolving Lenders or Supermajority Revolving Lenders, as applicable. The Person serving as the  Administrative Agent and its Affiliates may accept deposits from, lend money to, own securities of, act as  the financial advisor or in any other advisory capacity for and generally engage in any kind of banking,  trust or other business with, any Loan Party, any Subsidiary or any Affiliate of any of the foregoing as if  such Person was not acting as the Administrative Agent and without any duty to account therefor to the  Lenders or the Issuing Bank.  SECTION 8.05 Successor Administrative Agent.  (a) The Administrative Agent may resign at any time by giving 30 days' prior written  notice thereof to the Lenders, the Issuing Bank and the Borrower Representative, whether or not a successor  Administrative Agent has been appointed.  Upon any such resignation, the Required Lenders shall have the  right, to appoint a successor Administrative Agent.  If no successor Administrative Agent shall have been  so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the  retiring Administrative Agent's giving of notice of resignation, then the retiring Administrative Agent may,  on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent which shall be a  bank with an office in New York, New York or an Affiliate of any such bank.  In either case, such  appointment shall be subject to the prior written approval of the Borrower Representative (which approval  may not be unreasonably withheld and shall not be required while an Event of Default has occurred and is  continuing). Upon the acceptance of any appointment as Administrative Agent by a successor  Administrative Agent, such successor Administrative Agent shall succeed to and become vested with, all  the rights, powers, privileges and duties of the retiring Administrative Agent.  Upon the acceptance of  appointment as Administrative Agent by a successor Administrative Agent, the retiring Administrative  Agent shall be discharged from its duties and obligations under this Agreement and the other Loan  Documents.  Prior to any retiring Administrative Agent's resignation hereunder as Administrative Agent,  the retiring Administrative Agent shall take such action as may be reasonably necessary to assign to the  successor Administrative Agent its rights as Administrative Agent under the Loan Documents.    (b) Notwithstanding paragraph (a) of this Section, in the event no successor  Administrative Agent shall have been so appointed and shall have accepted such appointment within 30  days after the retiring Administrative Agent gives notice of its intent to resign, the retiring Administrative  Agent may give notice of the effectiveness of its resignation to the Lenders, the Issuing Bank and the  Borrowers, whereupon, on the date of effectiveness of such resignation stated in such notice, (i) the retiring  Administrative Agent shall be discharged from its duties and obligations hereunder and under the other  Loan Documents; provided that, solely for purposes of maintaining any security interest granted to the  Administrative Agent under any Collateral Document for the benefit of the Secured Parties, the retiring  Administrative Agent shall continue to be vested with such security interest as collateral agent for the  benefit of the Secured Parties and continue to be entitled to the rights set forth in such Collateral Document  and Loan Document, and, in the case of any Collateral in the possession of the Administrative Agent, shall  continue to hold such Collateral, in each case until such time as a successor Administrative Agent is  appointed and accepts such appointment in accordance with this Section (it being understood and agreed  that the retiring Administrative Agent shall have no duty or obligation to take any further action under any  Collateral Document, including any action required to maintain the perfection of any such security interest),  and (ii) the Required Lenders shall succeed to and become vested with all the rights, powers, privileges and  duties of the retiring Administrative Agent; provided that (A) all payments required to be made hereunder  or under any other Loan Document to the Administrative Agent for the account of any Person other than  the Administrative Agent shall be made directly to such Person and (B) all notices and other  communications required or contemplated to be given or made to the Administrative Agent shall directly  

 

-117-  be given or made to each Lender and Issuing Bank.  Following the effectiveness of the Administrative  Agent's resignation from its capacity as such, the provisions of this Article, Section 2.17(d) and  Section 9.03, as well as any exculpatory, reimbursement and indemnification provisions set forth in any  other Loan Document, shall continue in effect for the benefit of such retiring Administrative Agent, its  sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any  of them while the retiring Administrative Agent was acting as Administrative Agent and in respect of the  matters referred to in the proviso under clause (a) above.  SECTION 8.06 Acknowledgements of Lenders and Issuing Bank.  (a) Each Lender represents that it is engaged in making, acquiring or holding  commercial loans in the ordinary course of its business and that it has, independently and without reliance  upon the Administrative Agent, any Arranger, or any other Lender , or any of the Related Parties of any of  the foregoing, and based on such documents and information as it has deemed appropriate, made its own  credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans  hereunder.  Each Lender also acknowledges that it will, independently and without reliance upon the  Administrative Agent, any Arranger, or any other Lender, or any of the Related Parties of any of the  foregoing, and based on such documents and information (which may contain material, non-public  information within the meaning of the United States securities laws concerning the Borrowers and their  Affiliates) as it shall from time to time deem appropriate, continue to make its own decisions in taking or  not taking action under or based upon this Agreement, any other Loan Document or any related agreement  or any document furnished hereunder or thereunder.  (b) Each Lender, by delivering its signature page to this Agreement on the Effective  Date, or delivering its signature page to an Assignment and Assumption or any other Loan Document  pursuant to which it shall become a Lender hereunder, shall be deemed to have acknowledged receipt of,  and consented to and approved, each Loan Document and each other document required to be delivered to,  or be approved by or satisfactory to, the Administrative Agent or the Lenders on the Effective Date or the  effective date of any such Assignment and Assumption or any other Loan Document pursuant to which it  shall have become a Lender hereunder.  (c) Each Lender hereby agrees that (i) it has requested a copy of each Report prepared  by or on behalf of the Administrative Agent; (ii) the Administrative Agent (A) makes no representation or  warranty, express or implied, as to the completeness or accuracy of any Report or any of the information  contained therein or any inaccuracy or omission contained in or relating to a Report and (B) shall not be  liable for any information contained in any Report; (iii) the Reports are not comprehensive audits or  examinations, and that any Person performing any field examination will inspect only specific information  regarding the Loan Parties and will rely significantly upon the Loan Parties' books and records, as well as  on representations of the Loan Parties' personnel and that the Administrative Agent undertakes no  obligation to update, correct or supplement the Reports; (iv) it will keep all Reports confidential and strictly  for its internal use, not share the Report with any Loan Party or any other Person except as otherwise  permitted pursuant to this Agreement; and (v) without limiting the generality of any other indemnification  provision contained in this Agreement, (A) it will hold the Administrative Agent and any such other Person  preparing a Report harmless from any action the indemnifying Lender may take or conclusion the  indemnifying Lender may reach or draw from any Report in connection with any extension of credit that  the indemnifying Lender has made or may make to a Borrower, or the indemnifying Lender's participation  in, or the indemnifying Lender's purchase of, a Loan or Loans; and (B) it will pay and protect, and  indemnify, defend, and hold the Administrative Agent and any such other Person preparing a Report  harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts  (including reasonable attorneys' fees) incurred by the Administrative Agent or any such other Person as the  direct or indirect result of any third parties who might obtain all or part of any Report through the  indemnifying Lender.  

 

-118-  (d) (i) Each Lender hereby agrees that (x) if the Administrative Agent  notifies such Lender that the Administrative Agent has determined in its sole discretion that any funds  received by such Lender from the Administrative Agent or any of its Affiliates (whether as a payment,  prepayment or repayment of principal, interest, fees or otherwise; individually and collectively, a  "Payment") were erroneously transmitted to such Lender (whether or not known to such Lender), and  demands the return of such Payment (or a portion thereof), such Lender shall promptly, but in no event later  than one (1) Business Day thereafter, return to the Administrative Agent the amount of any such Payment  (or portion thereof) as to which such a demand was made in same day funds, together with interest thereon  in respect of each day from and including the date such Payment (or portion thereof) was received by such  Lender to the date such amount is repaid to the Administrative Agent at the greater of the NYFRB Rate and  a rate determined by the Administrative Agent in accordance with banking industry rules on interbank  compensation from time to time in effect, and (y) to the extent permitted by applicable law, such Lender  shall not assert, and hereby waives, as to the Administrative Agent, any claim, counterclaim, defense or  right of set-off or recoupment with respect to any demand, claim or counterclaim by the Administrative  Agent for the return of any Payments received, including without limitation any defense based on  "discharge for value" or any similar doctrine.  A notice of the Administrative Agent to any Lender under  this Section 8.06(d) shall be conclusive, absent manifest error.  (ii) Each Lender hereby further agrees that if it receives a Payment from the  Administrative Agent or any of its Affiliates (x) that is in a different amount than, or on a  different date from, that specified in a notice of payment sent by the Administrative Agent  (or any of its Affiliates) with respect to such Payment (a "Payment Notice") or (y) that was  not preceded or accompanied by a Payment Notice, it shall be on notice, in each such case,  that an error has been made with respect to such Payment.  Each Lender agrees that, in  each such case, or if it otherwise becomes aware a Payment (or portion thereof) may have  been sent in error, such Lender shall promptly notify the Administrative Agent of such  occurrence and, upon demand from the Administrative Agent, it shall promptly, but in no  event later than one (1) Business Day thereafter, return to the Administrative Agent the  amount of any such Payment (or portion thereof) as to which such a demand was made in  same day funds, together with interest thereon in respect of each day from and including  the date such Payment (or portion thereof) was received by such Lender to the date such  amount is repaid to the Administrative Agent at the greater of the NYFRB Rate and a rate  determined by the Administrative Agent in accordance with banking industry rules on  interbank compensation from time to time in effect.  (iii) Each Borrower and each other Loan Party hereby agrees that (x) in the  event an erroneous Payment (or portion thereof) are not recovered from any Lender that  has received such Payment (or portion thereof) for any reason, the Administrative Agent  shall be subrogated to all the rights of such Lender with respect to such amount and (y) an  erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any  Obligations owed by any Borrower or any other Loan Party.  (iv) Each party's obligations under this Section 8.06(d) shall survive the  resignation or replacement of the Administrative Agent or any transfer of rights or  obligations by, or the replacement of, a Lender, the termination of the Commitments or the  repayment, satisfaction or discharge of all Obligations under any Loan Document.  SECTION 8.07 Collateral Matters.  (a) Except with respect to the exercise of setoff rights in accordance with Section 9.08  or with respect to a Secured Party's right to file a proof of claim in an insolvency proceeding, no Secured  Party shall have any right individually to realize upon any of the Collateral or to enforce any Guarantee of  

 

-119-  the Secured Obligations, it being understood and agreed that all powers, rights and remedies under the Loan  Documents may be exercised solely by the Administrative Agent on behalf of the Secured Parties in  accordance with the terms thereof. In its capacity, the Administrative Agent is a "representative" of the  Secured Parties within the meaning of the term "secured party" as defined in the UCC. In the event that any  Collateral is hereafter pledged by any Person as collateral security for the Secured Obligations, the  Administrative Agent is hereby authorized, and hereby granted a power of attorney, to execute and deliver  on behalf of the Secured Parties any Loan Documents necessary or appropriate to grant and perfect a Lien  on such Collateral in favor of the Administrative Agent on behalf of the Secured Parties.  (b) In furtherance of the foregoing and not in limitation thereof, no arrangements in  respect of Banking Services the obligations under which constitute Secured Obligations and no Swap  Agreement the obligations under which constitute Secured Obligations, will create (or be deemed to create)  in favor of any Secured Party that is a party thereto any rights in connection with the management or release  of any Collateral or of the obligations of any Loan Party under any Loan Document. By accepting the  benefits of the Collateral, each Secured Party that is a party to any such arrangement in respect of Banking  Services or Swap Agreement, as applicable, shall be deemed to have appointed the Administrative Agent  to serve as administrative agent and collateral agent under the Loan Documents and agreed to be bound by  the Loan Documents as a Secured Party thereunder, subject to the limitations set forth in this paragraph.  (c) The Secured Parties irrevocably authorize the Administrative Agent, at its option  and in its discretion, to subordinate any Lien on any property granted to or held by the Administrative Agent  under any Loan Document to the holder of any Lien on such property that is permitted by Section 6.02(b).  The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any  representation or warranty regarding the existence, value or collectability of the Collateral, the existence,  priority or perfection of the Administrative Agent's Lien thereon or any certificate prepared by any Loan  Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders or  any other Secured Party for any failure to monitor or maintain any portion of the Collateral.  SECTION 8.08 Credit Bidding.  The Secured Parties hereby irrevocably authorize the  Administrative Agent, at the direction of the Required Lenders, to credit bid all or any portion of the  Obligations (including by accepting some or all of the Collateral in satisfaction of some or all of the  Obligations pursuant to a deed in lieu of foreclosure or otherwise) and in such manner purchase (either  directly or through one or more acquisition vehicles) all or any portion of the Collateral (a) at any sale  thereof conducted under the provisions of the Bankruptcy Code, including under Sections 363, 1123 or  1129 of the Bankruptcy Code, or any similar laws in any other jurisdictions to which a Loan Party is subject,  or (b) at any other sale, foreclosure or acceptance of collateral in lieu of debt conducted by (or with the  consent or at the direction of) the Administrative Agent (whether by judicial action or otherwise) in  accordance with any applicable law. In connection with any such credit bid and purchase, the Obligations  owed to the Secured Parties shall be entitled to be, and shall be, credit bid by the Administrative Agent at  the direction of the Required Lenders on a ratable basis (with Obligations with respect to contingent or  unliquidated claims receiving contingent interests in the acquired assets on a ratable basis that shall vest  upon the liquidation of such claims in an amount proportional to the liquidated portion of the contingent  claim amount used in allocating the contingent interests) for the asset or assets so purchased (or for the  equity interests or debt instruments of the acquisition vehicle or vehicles that are issued in connection with  such purchase). In connection with any such bid (i) the Administrative Agent shall be authorized to form  one or more acquisition vehicles and to assign any successful credit bid to such acquisition vehicle or  vehicles, (ii) each of the Secured Parties' ratable interests in the Obligations which were credit bid shall be  deemed without any further action under this Agreement to be assigned to such vehicle or vehicles for the  purpose of closing such sale, (iii) the Administrative Agent shall be authorized to adopt documents  providing for the governance of the acquisition vehicle or vehicles (provided that any actions by the  Administrative Agent with respect to such acquisition vehicle or vehicles, including any disposition of the  assets or equity interests thereof, shall be governed, directly or indirectly, by, and the governing documents  

 

-120-  shall provide for, control by the vote of the Required Lenders or their permitted assignees under the terms  of this Agreement or the governing documents of the applicable acquisition vehicle or vehicles, as the case  may be, irrespective of the termination of this Agreement and without giving effect to the limitations on  actions by the Required Lenders contained in Section 9.02 of this Agreement), (iv) the Administrative  Agent on behalf of such acquisition vehicle or vehicles shall be authorized to issue to each of the Secured  Parties, ratably on account of the relevant Obligations which were credit bid, interests, whether as equity,  partnership interests, limited partnership interests or membership interests, in any such acquisition vehicle  and/or debt instruments issued by such acquisition vehicle, all without the need for any Secured Party or  acquisition vehicle to take any further action, and (v) to the extent that Obligations that are assigned to an  acquisition vehicle are not used to acquire Collateral for any reason (as a result of another bid being higher  or better, because the amount of Obligations assigned to the acquisition vehicle exceeds the amount of  Obligations credit bid by the acquisition vehicle or otherwise), such Obligations shall automatically be  reassigned to the Secured Parties pro rata with their original interest in such Obligations and the equity  interests and/or debt instruments issued by any acquisition vehicle on account of such Obligations shall  automatically be cancelled, without the need for any Secured Party or any acquisition vehicle to take any  further action.  Notwithstanding that the ratable portion of the Obligations of each Secured Party are deemed  assigned to the acquisition vehicle or vehicles as set forth in clause (ii) above, each Secured Party shall  execute such documents and provide such information regarding the Secured Party (and/or any designee of  the Secured Party which will receive interests in or debt instruments issued by such acquisition vehicle) as  the Administrative Agent may reasonably request in connection with the formation of any acquisition  vehicle, the formulation or submission of any credit bid or the consummation of the transactions  contemplated by such credit bid.  SECTION 8.09 Certain ERISA Matters.  (a) Each Lender (x) represents and warrants, as of the date such Person became a  Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the  date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and its  respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of any Borrower or any other  Loan Party, that at least one of the following is and will be true:  (i) such Lender is not using "plan assets" (within the meaning of the Plan  Asset Regulations) of one or more Benefit Plans in connection with the Loans, the Letters  of Credit or the Commitments,  (ii) the transaction exemption set forth in one or more PTEs, such as  PTE 84-14 (a class exemption for certain transactions determined by independent qualified  professional asset managers), PTE 95-60 (a class exemption for certain transactions  involving insurance company general accounts), PTE 90-1 (a class exemption for certain  transactions involving insurance company pooled separate accounts), PTE 91-38 (a class  exemption for certain transactions involving bank collective investment funds) or PTE 96- 23 (a class exemption for certain transactions determined by in-house asset managers), is  applicable with respect to such Lender's entrance into, participation in, administration of  and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,  (iii) (A) such Lender is an investment fund managed by a "Qualified  Professional Asset Manager" (within the meaning of Part VI of PTE 84-14), (B) such  Qualified Professional Asset Manager made the investment decision on behalf of such  Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit,  the Commitments and this Agreement, (C) the entrance into, participation in,  administration of and performance of the Loans, the Letters of Credit, the Commitments  and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of  

 

-121-  PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection  (a) of Part I of PTE 84-14 are satisfied with respect to such Lender's entrance into,  participation in, administration of and performance of the Loans, the Letters of Credit, the  Commitments and this Agreement, or  (iv) such other representation, warranty and covenant as may be agreed in  writing between the Administrative Agent, in its sole discretion, and such Lender.  (b) In addition, unless sub-clause (i) in the immediately preceding clause (a) is true  with respect to a Lender or such Lender has not provided another representation, warranty and covenant as  provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and  warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such  Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the  benefit of, the Administrative Agent and their respective Affiliates, and not, for the avoidance of doubt, to  or for the benefit of any Borrower or any other Loan Party, that none of the Administrative Agent, any  Arranger, or any of their respective Affiliates is a fiduciary with respect to the Collateral or the assets of  such Lender (including in connection with the reservation or exercise of any rights by the Administrative  Agent under this Agreement, any Loan Document or any documents related to hereto or thereto).  (c) The Administrative Agent and each Arranger hereby informs the Lenders that each  such Person is not undertaking to provide investment advice or to give advice in a fiduciary capacity, in  connection with the transactions contemplated hereby, and that such Person has a financial interest in the  transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other  payments with respect to the Loans, the Letters of Credit, the Commitments, this Agreement and any other  Loan Documents, (ii) may recognize a gain if it extended the Loans, the Letters of Credit or the  Commitments for an amount less than the amount being paid for an interest in the Loans, the Letters of  Credit or the Commitments by such Lender or (iii) may receive fees or other payments in connection with  the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees,  commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees,  administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees,  fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums,  banker's acceptance fees, breakage or other early termination fees or fees similar to the foregoing.  SECTION 8.10 Flood Laws.  JPMCB has adopted internal policies and procedures that address  requirements placed on federally regulated lenders under the National Flood Insurance Reform Act of 1994  and related legislation (the "Flood Laws"). JPMCB, as administrative agent or collateral agent on a  syndicated facility, will post on the applicable electronic platform (or otherwise distribute to each Lender  in the syndicate) documents that it receives in connection with the Flood Laws.  However, JPMCB reminds  each Lender and Participant in the facility that, pursuant to the Flood Laws, each federally regulated Lender  (whether acting as a Lender or Participant in the facility) is responsible for assuring its own compliance  with the flood insurance requirements.  ARTICLE IX    Miscellaneous.  SECTION 9.01 Notices.  (a) Except in the case of notices and other communications expressly permitted to be  given by telephone or Electronic Systems (and subject in each case to paragraph (b) below), all notices and  other communications provided for herein shall be in writing and shall be delivered by hand or overnight  courier service, mailed by certified or registered mail or sent by facsimile, as follows:  

 

-122-  (i) if to any Loan Party, to the Borrower Representative at:  HF Foods Group Inc.  6325 South Rainbow Boulevard, Suite 420  Las Vegas, Nevada  89118  Facsimile:  (626) 338-7133  Electronic Mail:  peterzhang@hffoodsgroup.com   Attention:  Xiao Mou Zhang, Chief Executive Officer    with a copy to:    HF Foods Group Inc.  19319 Arenth Avenue  City of Industry, California  91748  Facsimile:  (626) 338-7133  Electronic Mail:  christinechang@hffoodsgroup.com   Attention:  Christine Chang, General Counsel  (ii) if to the Administrative Agent, JPMCB in its capacity as an Issuing Bank  or the Swingline Lender, to JPMorgan Chase Bank, N.A. at:  JPMorgan Chase Bank, N.A.  10 South Dearborn Street  Chicago, Illinois  60603  Attention:  ABL Credit Risk Manager for                       HF Foods Group Inc., Michael Fine  Electronic Mail:  michael.fine@jpmorgan.com   Facsimile:  (312) 256-9206  (iii) if to any other Lender or Issuing Bank, to it at its address or facsimile  number set forth in its Administrative Questionnaire.  All such notices and other communications (A) sent by hand or overnight courier service, or mailed by  certified or registered mail, shall be deemed to have been given when received, (B) sent by facsimile shall  be deemed to have been given when sent, provided that if not given during normal business hours of the  recipient, such notice or communication shall be deemed to have been given at the opening of business on  the next Business Day of the recipient, or (C) delivered through Electronic Systems or Approved Electronic  Platforms, as applicable, to the extent provided in paragraph (b) below shall be effective as provided in  such paragraph.  (b) Notices and other communications to the Lenders hereunder may be delivered or  furnished by using Electronic Systems or Approved Electronic Platforms, as applicable, or pursuant to  procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices  pursuant to Article II or to Compliance Certificates delivered pursuant to Section 5.01(d) unless otherwise  agreed by the Administrative Agent and the applicable Lender.  Each of the Administrative Agent and the  Borrower Representative (on behalf of the Loan Parties) may, in its discretion, agree to accept notices and  other communications to it hereunder by Electronic Systems or Approved Electronic Platforms, as  applicable, pursuant to procedures approved by it; provided that approval of such procedures may be limited  to particular notices or communications. Unless the Administrative Agent otherwise proscribes, all such  notices and other communications (i) sent to an e-mail address shall be deemed received upon the sender's  receipt of an acknowledgement from the intended recipient (such as by the "return receipt requested"  function, as available, return e-mail or other written acknowledgement), provided that if not given during  

 

-123-  the normal business hours of the recipient, such notice or communication shall be deemed to have been  given at the opening of business on the next Business Day for the recipient, and (ii) posted to an Internet or  intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail  address as described in the foregoing clause (i), of notification that such notice or communication is  available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if  such notice, e-mail or other communication is not sent during the normal business hours of the recipient,  such notice or communication shall be deemed to have been sent at the opening of business on the next  Business Day of the recipient.  (c) Any party hereto may change its address, facsimile number or e-mail address for  notices and other communications hereunder by notice to the other parties hereto.    SECTION 9.02 Waivers; Amendments.  (a) No failure or delay by the Administrative Agent, the Issuing Bank or any Lender  in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver  thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or  discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or  the exercise of any other right or power.  The rights and remedies of the Administrative Agent, the Issuing  Bank and the Lenders hereunder and under any other Loan Document are cumulative and are not exclusive  of any rights or remedies that they would otherwise have.  No waiver of any provision of any Loan  Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless  the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be  effective only in the specific instance and for the purpose for which given.  Without limiting the generality  of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver  of any Default, regardless of whether the Administrative Agent, any Lender or the Issuing Bank may have  had notice or knowledge of such Default at the time.  (b) Except as provided in the first sentence of Section 2.09(f) (with respect to any  commitment increase) and subject to Section 2.14(c) and Section 9.02(e) below, neither this Agreement nor  any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except  (x) in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the  Borrowers and the Required Lenders or (y) in the case of any other Loan Document, pursuant to an  agreement or agreements in writing entered into by the Administrative Agent and the Loan Party or Loan  Parties that are parties thereto, with the consent of the Required Lenders; provided that no such agreement  shall (i) increase the Commitment of any Lender without the written consent of such Lender (including any  such Lender that is a Defaulting Lender), (ii) reduce or forgive the principal amount of any Loan or LC  Disbursement or reduce the rate of interest thereon, or reduce or forgive any interest or fees payable  hereunder, without the written consent of each Lender (including any such Lender that is a Defaulting  Lender) directly affected thereby (provided that any amendment or modification of the financial covenants  in this Agreement (or any defined term used therein) shall not constitute a reduction in the rate of interest  or fees for purposes of this clause (ii)), (iii) postpone any scheduled date of payment of the principal amount  of any Loan or LC Disbursement, or any date for the payment of any interest, fees or other Obligations  payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled  date of expiration of any Commitment, without the written consent of each Lender (including any such  Lender that is a Defaulting Lender) directly affected thereby, (iv) change Section 2.09(c) or Section 2.18(b)  or (d) in a manner that would alter the ratable reduction of Commitments or the manner in which payments  are shared, without the written consent of each Lender (other than any Defaulting Lender), (v) increase the  advance rates set forth in the definition of Borrowing Base or add new categories of eligible assets, without  the written consent of the Supermajority Revolving Lenders, (vi) change any of the provisions of this  Section or the definition of "Required Lenders" or any other provision of any Loan Document specifying  the number or percentage of Lenders (or Lenders of any Class) required to waive, amend or modify any  

 

-124-  rights thereunder or make any determination or grant any consent thereunder, without the written consent  of each Lender (other than any Defaulting Lender) directly affected thereby, (vii) release any Loan  Guarantor from its obligation under its Loan Guaranty or Obligation Guaranty (except as otherwise  permitted herein or in the other Loan Documents), without the written consent of each Lender (other than  any Defaulting Lender), or (viii) except as provided in clause (c) of this Section or in any Collateral  Document, release all or substantially all of the Collateral, without the written consent of each Lender (other  than any Defaulting Lender); provided, further, that no such agreement shall amend, modify or otherwise  affect the rights or duties of the Administrative Agent, the Issuing Bank or the Swingline Lender hereunder  without the prior written consent of the Administrative Agent, the Issuing Bank or the Swingline Lender,  as the case may be (it being understood that any amendment to Section 2.20 shall require the consent of the  Administrative Agent, the Issuing Bank and the Swingline Lender); provided further that no such agreement  shall amend or modify the provisions of Section 2.07 or any letter of credit application and any bilateral  agreement between the Borrower Representative and the Issuing Bank regarding the Issuing Bank's Issuing  Bank Sublimit or the respective rights and obligations between any Borrower and the Issuing Bank in  connection with the issuance of Letters of Credit without the prior written consent of the Administrative  Agent and the Issuing Bank, respectively.  The Administrative Agent may also amend the Commitment  Schedule to reflect assignments entered into pursuant to Section 9.04.  Any amendment, waiver or other  modification of this Agreement or any other Loan Document that by its terms affects the rights or duties  under this Agreement of the Lenders of one or more Classes (but not the Lenders of any other Class), may  be effected by an agreement or agreements in writing entered into by the Borrowers and the requisite  number or percentage in interest of each affected Class of Lenders that would be required to consent thereto  under this Section if such Class of Lenders were the only Class of Lenders hereunder at the time.  (c) The Lenders and the Issuing Bank hereby irrevocably authorize the Administrative  Agent, at its option and in its sole discretion, to release any Liens granted to the Administrative Agent by  the Loan Parties on any Collateral (i) upon the Payment in Full of all Secured Obligations, and the cash  collateralization of all Unliquidated Obligations in a manner satisfactory to each affected Lender,  (ii) constituting property being sold or disposed of if the Loan Party disposing of such property certifies to  the Administrative Agent that the sale or disposition is made in compliance with the terms of this Agreement  (and the Administrative Agent may rely conclusively on any such certificate, without further inquiry), and  to the extent that the property being sold or disposed of constitutes 100% of the Equity Interests of a  Subsidiary, the Administrative Agent is authorized to release any Loan Guaranty or Obligation Guaranty  provided by such Subsidiary, (iii) constituting property leased to a Loan Party under a lease which has  expired or been terminated in a transaction permitted under this Agreement, or (iv) as required to effect any  sale or other disposition of such Collateral in connection with any exercise of remedies of the  Administrative Agent and the Lenders pursuant to Article VII.  Except as provided in the preceding  sentence, the Administrative Agent will not release any Liens on Collateral without the prior written  authorization of the Required Lenders; provided that, the Administrative Agent may in its discretion, release  its Liens on Collateral valued in the aggregate not in excess of $5,000,000 during any calendar year without  the prior written authorization of the Required Lenders(it being agreed that the Administrative Agent may  rely conclusively on one or more certificates of the Borrowers as to the value of any Collateral to be so  released, without further inquiry).  Any such release shall not in any manner discharge, affect, or impair the  Obligations or any Liens (other than those expressly being released) upon (or obligations of the Loan Parties  in respect of) all interests retained by the Loan Parties, including the proceeds of any sale, all of which shall  continue to constitute part of the Collateral.  Any execution and delivery by the Administrative Agent of  documents in connection with any such release shall be without recourse to or warranty by the  Administrative Agent.  (d) Notwithstanding anything to the contrary herein the Administrative Agent may,  with the consent of the Borrower Representative only, amend, modify or supplement this Agreement or any  of the other Loan Documents to cure any ambiguity, omission, mistake, defect or inconsistency.  

 

-125-  SECTION 9.03 Expenses; Indemnity; Damage Waiver.   (a) The Loan Parties shall, jointly and severally, pay all (i) reasonable out-of-pocket  expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges  and disbursements of counsel for the Administrative Agent, in connection with the syndication and  distribution (including, without limitation, via the internet or through any Electronic System or Approved  Electronic Platform) of the credit facilities provided for herein, the preparation and administration of the  Loan Documents and any amendments, modifications or waivers of the provisions of the Loan Documents  (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) reasonable out- of-pocket expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or  extension of any Letter of Credit or any demand for payment thereunder and (iii) out-of-pocket expenses  incurred by the Administrative Agent, the Issuing Bank or any Lender, including the fees, charges and  disbursements of any counsel for the Administrative Agent, the Issuing Bank or any Lender, in connection  with the enforcement, collection or protection of its rights in connection with the Loan Documents,  including its rights under this Section, or in connection with the Loans made or Letters of Credit issued  hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or  negotiations in respect of such Loans or Letters of Credit.  Expenses being reimbursed by the Loan Parties  under this Section include, without limiting the generality of the foregoing, fees, costs and expenses  incurred in connection with:  (A) collateral monitoring, collateral reviews, environmental reviews,  appraisals (subject to the reimbursement limitations contained in Section 5.12),  and insurance reviews and PML Reports and other seismic reviews;  (B) field examinations and the preparation of Reports based on the  fees charged by a third party retained by the Administrative Agent or the internally  allocated fees for each Person employed by the Administrative Agent with respect  to each field examination, including field examination fees currently equal to $125  per hour per examiner, plus out-of-pocket expenses, subject to the reimbursement  limitations contained in Section 5.06;  (C) background checks regarding senior management and/or key  investors, as deemed necessary or appropriate in the sole discretion of the  Administrative Agent;   (D) Taxes, fees and other charges for (1) lien and title searches and  title insurance, (2) periodic searches of central filing locations under the FSA and  periodic searches under any applicable State Agricultural Laws and (3) recording  the Mortgages, filing financing statements and continuations, and other actions to  perfect, protect, and continue the Administrative Agent's Liens;  (E) sums paid or incurred to take any action required of any Loan  Party under the Loan Documents that such Loan Party fails to pay or take;   (F) forwarding loan proceeds, collecting checks and other items of  payment, and establishing and maintaining the accounts and lock boxes, and costs  and expenses of preserving and protecting the Collateral; and  (G) fees and expenses of other advisors and professionals engaged by  the Administrative Agent.  

 

-126-  All of the foregoing fees, costs and expenses may be charged to the Working Capital Borrowers as  Revolving Loans or to another deposit account, all as described in Section 2.18(c).  (b) The Loan Parties shall, jointly and severally, indemnify the Administrative Agent,  each Arranger, the Issuing Bank and each Lender, and each Related Party of any of the foregoing Persons  (each such Person being called an "Indemnitee") against, and hold each Indemnitee harmless from, any and  all losses, claims, damages, penalties, incremental taxes, liabilities and related expenses, including the fees,  charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any  Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of the Loan  Documents or any agreement or instrument contemplated thereby, the performance by the parties hereto of  their respective obligations thereunder or the consummation of the Transactions or any other transactions  contemplated hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any  refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit if the documents  presented in connection with such demand do not strictly comply with the terms of such Letter of Credit),  (iii) any actual or alleged presence or Release of Hazardous Materials on or from any property owned or  operated by a Loan Party or a Subsidiary, or any Environmental Liability related in any way to a Loan Party  or a Subsidiary, (iv) the failure of a Loan Party to deliver to the Administrative Agent the required receipts  or other required documentary evidence with respect to a payment made by a Loan Party for Taxes pursuant  to Section 2.17, or (v) any actual or prospective claim, litigation, investigation, arbitration or proceeding  relating to any of the foregoing, whether or not such claim, litigation, investigation, arbitration or  proceeding is brought by any Loan Party or their respective equity holders, Affiliates, creditors or any other  third Person and whether based on contract, tort or any other theory and regardless of whether any  Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to  the extent that such losses, claims, damages, penalties, liabilities or related expenses are determined by a  court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross  negligence or willful misconduct of such Indemnitee.  This Section 9.03(b) shall not apply with respect to  Taxes other than any Taxes that represent losses or damages arising from any non-Tax claim.  (c) Each Lender severally agrees to pay any amount required to be paid by any Loan  Party under paragraph (a) or (b) of this Section 9.03 to the Administrative Agent, each Issuing Bank and  the Swingline Lender, and each Related Party of any of the foregoing Persons (each, an "Agent  Indemnitee") (to the extent not reimbursed by a Loan Party and without limiting the obligation of any Loan  Party to do so), ratably according to their respective Applicable Percentage in effect on the date on which  indemnification is sought under this Section (or, if indemnification is sought after the date upon which the  Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with  such Applicable Percentage immediately prior to such date), from and against any and all losses, claims,  damages, liabilities and related expenses, including the fees, charges and disbursements of any kind  whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred  by or asserted against such Agent Indemnitee in any way relating to or arising out of the Commitments, this  Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or  therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent  Indemnitee under or in connection with any of the foregoing; provided that the unreimbursed expense or  indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted  against such Agent Indemnitee in its capacity as such; provided, further, that no Lender shall be liable for  the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments,  suits, costs, expenses or disbursements that are found by a final and non-appealable decision of a court of  competent jurisdiction to have resulted from such Agent Indemnitee's gross negligence or willful  misconduct.  The agreements in this Section shall survive the termination of this Agreement and the  Payment in Full of the Secured Obligations.  (d) To the extent permitted by applicable law, no Loan Party shall assert, and each  Loan Party hereby waives, any claim against any Indemnitee (i) for any damages arising from the use by  

 

-127-  others of information or other materials obtained through telecommunications, electronic or other  information transmission systems (including the Internet) or (ii) on any theory of liability, for special,  indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in  connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument  contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds  thereof; provided that, nothing in this paragraph (d) shall relieve any Loan Party of any obligation it may  have to indemnify an Indemnitee against special, indirect, consequential or punitive damages asserted  against such Indemnitee by a third party.  (e) All amounts due under this Section shall be payable promptly after written demand  therefor.  SECTION 9.04 Successors and Assigns.  (a) The provisions of this Agreement shall be binding upon and inure to the benefit of  the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of  the Issuing Bank that issues any Letter of Credit), except that (i) no Borrower or Loan Party may assign or  otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender  (and any attempted assignment or transfer by any Borrower or Loan Party without such consent shall be  null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except  in accordance with this Section.  Nothing in this Agreement, expressed or implied, shall be construed to  confer upon any Person (other than the parties hereto, their respective successors and assigns permitted  hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit), Participants (to the  extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated hereby, the  Related Parties of each of the Administrative Agent, the Issuing Bank and the Lenders) any legal or  equitable right, remedy or claim under or by reason of this Agreement.  (b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender  may assign to one or more Persons (other than an Ineligible Institution) all or a portion of its rights and  obligations under this Agreement (including all or a portion of its Commitment, participations in Letters of  Credit and the Loans at the time owing to it) with the prior written consent (such consent not to be  unreasonably withheld) of:  (A) the Borrower Representative, provided that the Borrower  Representative shall be deemed to have consented to any such assignment of all or  a portion of the Revolving Loans and Commitments unless it shall object thereto  by written notice to the Administrative Agent within five (5) Business Days after  having received notice thereof, and provided further that no consent of the  Borrower Representative shall be required for an assignment to a Lender, an  Affiliate of a Lender, an Approved Fund or, if an Event of Default has occurred  and is continuing, any other assignee;  (B) the Administrative Agent, provided that no consent of the  Administrative Agent shall be required for an assignment of all or any portion of  the Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund;  (C) the Issuing Bank, provided, that no consent of the Issuing Bank  shall be required for an assignment of all or any portion of the Term Loan; and  (D) the Swingline Lender, provided, that no consent of the Swingline  Lender shall be required for an assignment of all or any portion of the Term Loan.  

 

-128-  (ii) Assignments shall be subject to the following additional conditions:  (A) except in the case of an assignment to a Lender or an Affiliate of  a Lender or an Approved Fund or an assignment of the entire remaining amount of  the assigning Lender's Commitment or Loans of any Class, the amount of the  Commitment or Loans of the assigning Lender subject to each such assignment  (determined as of the date the Assignment and Assumption with respect to such  assignment is delivered to the Administrative Agent) shall not be less than  $5,000,000 unless each of the Borrower Representative and the Administrative  Agent otherwise consent, provided that no such consent of the Borrower  Representative shall be required if an Event of Default has occurred and is  continuing;  (B) each partial assignment shall be made as an assignment of a  proportionate part of all the assigning Lender's rights and obligations under this  Agreement;   (C) the parties to each assignment shall execute and deliver to the  Administrative Agent (x) an Assignment and Assumption or (y) to the extent  applicable, an agreement incorporating an Assignment and Assumption by  reference pursuant to an Approved Electronic Platform as to which the  Administrative Agent and the parties to the Assignment and Assumption are  participants, together with a processing and recordation fee of $3,500; and  (D) the assignee, if it shall not be a Lender, shall deliver to the  Administrative Agent an Administrative Questionnaire in which the assignee  designates one or more credit contacts to whom all syndicate-level information  (which may contain material non-public information about HF Foods, the other  Loan Parties and their Related Parties or their respective securities) will be made  available and who may receive such information in accordance with the assignee's  compliance procedures and applicable laws, including Federal and state securities  laws.  (E) no assignment shall be permitted if, as of the date hereof, any  event or circumstance exists which would result in the Borrowers being obligated  to pay any greater amount hereunder to the assignee than the Borrowers would be  obligated to pay to the assigning Lender if such assignment were not to occur.  For the purposes of this Section 9.04(b), the terms "Approved Fund" and "Ineligible Institution"  have the following meanings:  "Approved Fund" means any Person (other than a natural person) that is engaged in making,  purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its  business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity  or an Affiliate of an entity that administers or manages a Lender.  "Ineligible Institution" means (a) a natural person, (b) a Defaulting Lender or its Parent, (c) a  holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural  person or relative(s) thereof; provided that, with respect to clause (c), such holding company, investment  vehicle or trust shall not constitute an Ineligible Institution if it (x) has not been established for the primary  purpose of acquiring any Loans or portions of the Commitment, (y) is managed by a professional advisor,  who is not such natural person or a relative thereof, having significant experience in the business of making  

 

-129-  or purchasing commercial loans, and (z) has assets greater than $25,000,000 and a significant part of its  activities consist of making or purchasing commercial loans and similar extensions of credit in the ordinary  course of its business or (d) a Loan Party or a Subsidiary or other Affiliate of a Loan Party.  (iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)  of this Section, from and after the effective date specified in each Assignment and  Assumption, the assignee thereunder shall be a party hereto and, to the extent of the interest  assigned by such Assignment and Assumption, have the rights and obligations of a Lender  under this Agreement, and the assigning Lender thereunder shall, to the extent of the  interest assigned by such Assignment and Assumption, be released from its obligations  under this Agreement (and, in the case of an Assignment and Assumption covering all of  the assigning Lender's rights and obligations under this Agreement, such Lender shall cease  to be a party hereto but shall continue to be entitled to the benefits of Sections 2.15, 2.16,  2.17 and 9.03).  Any assignment or transfer by a Lender of rights or obligations under this  Agreement that does not comply with this Section shall be treated for purposes of this  Agreement as a sale by such Lender of a participation in such rights and obligations in  accordance with paragraph (c) of this Section.  (iv) The Administrative Agent, acting for this purpose as a non-fiduciary agent  of the Borrowers, shall maintain at one of its offices a copy of each Assignment and  Assumption delivered to it and a register for the recordation of the names and addresses of  the Lenders, and the Commitment of, and principal amount of the Loans and LC  Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the  "Register").  The entries in the Register shall be conclusive, and the Borrowers, the  Administrative Agent, the Issuing Bank and the Lenders shall treat each Person whose  name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all  purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be  available for inspection by the Borrowers, the Issuing Bank and any Lender, at any  reasonable time and from time to time upon reasonable prior notice.  (v) Upon its receipt of (x) a duly completed Assignment and Assumption  executed by an assigning Lender and an assignee, or (y) to the extent applicable, an  agreement incorporating an Assignment and Assumption by reference pursuant to an  Approved Electronic Platform as to which the Administrative Agent and the parties to the  Assignment and Assumption are participants, the assignee's completed Administrative  Questionnaire (unless the assignee shall already be a Lender hereunder), the processing  and recordation fee referred to in paragraph (b) of this Section and any written consent to  such assignment required by paragraph (b) of this Section, the Administrative Agent shall  accept such Assignment and Assumption and record the information contained therein in  the Register; provided that if either the assigning Lender or the assignee shall have failed  to make any payment required to be made by it pursuant to Section 2.05, 2.06(d) or (e),  2.07(b), 2.18(d) or 9.03(c), the Administrative Agent shall have no obligation to accept  such Assignment and Assumption and record the information therein in the Register unless  and until such payment shall have been made in full, together with all accrued interest  thereon.  No assignment shall be effective for purposes of this Agreement unless it has  been recorded in the Register as provided in this paragraph.  (c) Any Lender may, without the consent of, or notice to, the Borrowers, the  Administrative Agent, the Issuing Bank or the Swingline Lender, sell participations to one or more banks  or other entities (a "Participant") other than an Ineligible Institution in all or a portion of such Lender's  rights and obligations under this Agreement (including all or a portion of its Commitment and/or the Loans  owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged;  

 

-130-  (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such  obligations; and (iii) the Loan Parties, the Administrative Agent, the Issuing Bank and the other Lenders  shall continue to deal solely and directly with such Lender in connection with such Lender's rights and  obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a  participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to  approve any amendment, modification or waiver of any provision of this Agreement; provided that such  agreement or instrument may provide that such Lender will not, without the consent of the Participant,  agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects  such Participant.  The Loan Parties agree that each Participant shall be entitled to the benefits of  Sections 2.15, 2.16 and 2.17 (subject to the requirements and limitations therein, including the requirements  under Section 2.17(f) and (g) (it being understood that the documentation required under Section 2.17(f)  shall be delivered to the participating Lender and the information and documentation required under  Section 2.17(g) will be delivered to the Borrowers and the Administrative Agent)) to the same extent as if  it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section;  provided that such Participant (A) agrees to be subject to the provisions of Sections 2.18 and 2.19 as if it  were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater  payment under Section 2.15 or 2.17, with respect to any participation, than its participating Lender would  have been entitled to receive, except to the extent such entitlement to receive a greater payment results from  a Change in Law that occurs after the Participant acquired the applicable participation.  No Participant shall  have any direct or indirect voting rights hereunder except that no amendment, modification, waiver or  consent hereunder may, without the consent of such Participant, (A) increase such Participant's  participation interest hereunder, (B) extend the date scheduled for payment of any amount due to such  Participant hereunder, or (C) reduce the principal amount of the Loans in which such Participant has a  participation interest hereunder, or reduce the amount or rate of interest or any fees payable to such  Participant (other than any increase in interest during the continuance of an Event of Default, which may  be waived by the Administrative Agent).  Each Lender that sells a participation agrees, at the Borrowers' request and expense, to use  reasonable efforts to cooperate with the Borrowers to effectuate the provisions of Section 2.19(b) with  respect to any Participant.  To the extent permitted by law, each Participant also shall be entitled to the  benefits of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to  Section 2.18(c) as though it were a Lender.  Each Lender that sells a participation shall, acting solely for  this purpose as a non-fiduciary agent of the Borrowers, maintain a register on which it enters the name and  address of each Participant and the principal amounts (and stated interest) of each Participant's interest in  the Loans or other obligations under this Agreement or any other Loan Document (the "Participant  Register"); provided that no Lender shall have any obligation to disclose all or any portion of the Participant  Register (including the identity of any Participant or any information relating to a Participant's interest in  any Commitments, Loans, Letters of Credit or its other obligations under any Loan Document) to any  Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan,  Letter of Credit or other obligation is in registered form under Section 5f.103-1(c) of the United States  Treasury Regulations.  The entries in the Participant Register shall be conclusive absent manifest error, and  such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such  participation for all purposes of this Agreement notwithstanding any notice to the contrary.  For the  avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no  responsibility for maintaining a Participant Register.  (d) Any Lender may at any time pledge or assign a security interest in all or any portion  of its rights under this Agreement to secure obligations of such Lender, including without limitation any  pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to  any such pledge or assignment of a security interest; provided that no such pledge or assignment of a  security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee  or assignee for such Lender as a party hereto.  

 

-131-  SECTION 9.05 Survival.  All covenants, agreements, representations and warranties made by  the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection  with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied  upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and  the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any  such other party or on its behalf and notwithstanding that the Administrative Agent, the Issuing Bank or  any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the  time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of  or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is  outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not  expired or terminated.  The provisions of Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive  and remain in full force and effect regardless of the consummation of the transactions contemplated hereby,  the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or  the termination of this Agreement or any other Loan Document or any provision hereof or thereof.  SECTION 9.06 Counterparts; Integration; Effectiveness; Electronic Execution.  (a) This Agreement may be executed in counterparts (and by different parties hereto  on different counterparts), each of which shall constitute an original, but all of which when taken together  shall constitute a single contract.  This Agreement, the other Loan Documents and any separate letter  agreements with respect to (i) fees payable to the Administrative Agent and (ii) increases or reductions of  the Issuing Bank Sublimit of the Issuing Bank constitute the entire contract among the parties relating to  the subject matter hereof and supersede any and all previous agreements and understandings, oral or written,  relating to the subject matter hereof.  Except as provided in Section 4.01, this Agreement shall become  effective when it shall have been executed by the Administrative Agent and when the Administrative Agent  shall have received counterparts hereof which, when taken together, bear the signatures of each of the other  parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their  respective successors and assigns.  (b) Delivery of an executed counterpart of a signature page of this Agreement by  telecopy, emailed pdf. or any other electronic means that reproduces an image of the actual executed  signature page shall be effective as delivery of a manually executed counterpart of this Agreement.  The  words "execution," "signed," "signature," "delivery," and words of like import in or relating to any  document to be signed in connection with this Agreement and the transactions contemplated hereby or  thereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic  form, each of which shall be of the same legal effect, validity or enforceability as a manually executed  signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be,  to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global  and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other  similar state laws based on the Uniform Electronic Transactions Act; provided that nothing herein shall  require the Administrative Agent to accept electronic signatures in any form or format without its prior  written consent.  SECTION 9.07 Severability.  Any provision of any Loan Document held to be invalid, illegal  or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such  invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the  remaining provisions thereof; and the invalidity of a particular provision in a particular jurisdiction shall  not invalidate such provision in any other jurisdiction.  SECTION 9.08 Right of Setoff.  If an Event of Default shall have occurred and be continuing,  each Lender, the Issuing Bank and each of their respective Affiliates is hereby authorized at any time and  from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general  

 

-132-  or special, time or demand, provisional or final) at any time held, and other obligations at any time owing,  by such Lender, the Issuing Bank or any such Affiliate, to or for the credit or the account of any Loan Party  against any and all of the Secured Obligations held by such Lender, the Issuing Bank or their respective  Affiliates, irrespective of whether or not such Lender, the Issuing Bank or their respective Affiliates shall  have made any demand under the Loan Documents and although such obligations may be contingent or  unmatured or are owed to a branch office or Affiliate of such Lender or the Issuing Bank different from the  branch office or Affiliate holding such deposit or obligated on such indebtedness; provided that in the event  that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid  over immediately to the Administrative Agent for further application in accordance with the provisions of  Section 2.20 and, pending such payment, shall be segregated by such Defaulting Lender from its other  funds and deemed held in trust for the benefit of the Administrative Agent, the Issuing Bank, and the  Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement  describing in reasonable detail the Secured Obligations owing to such Defaulting Lender as to which it  exercised such right of setoff. The applicable Lender, the Issuing Bank or such Affiliate shall notify the  Borrower Representative and the Administrative Agent of such setoff or application, provided that any  failure to give or any delay in giving such notice shall not affect the validity of any such setoff or application  under this Section.  The rights of each Lender, the Issuing Bank and their respective Affiliates under this  Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, the  Issuing Bank or their respective Affiliates may have.  SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process.  (a) The Loan Documents (other than those containing a contrary express choice of law  provision) shall be governed by and construed in accordance with the internal laws of the State of Illinois, but  giving effect to federal laws applicable to national banks.  (b) Each of the Lenders and the Administrative Agent hereby irrevocably and  unconditionally agrees that, notwithstanding the governing law provisions of any applicable Loan  Document, any claims brought against the Administrative Agent by any Lender relating to this Agreement,  any other Loan Document, the Collateral or the consummation or administration of the transactions  contemplated hereby or thereby shall be construed in accordance with and governed by the law of the State  of Illinois.  (c) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself  and its property, to the exclusive jurisdiction of any U.S. federal or Illinois state court sitting in Chicago,  Illinois, and any appellate court from any thereof, in any action or proceeding arising out of or relating to  any Loan Documents, the transactions relating hereto or thereto, or for recognition or enforcement of any  judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in  respect of any such action or proceeding may (and any such claims, cross-claims or third party claims  brought against the Administrative Agent or any of its Related Parties may only) be heard and determined  in such Illinois State or, to the extent permitted by law, in such Federal court.  Each of the parties hereto  agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in  other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this  Agreement or any other Loan Document shall affect any right that the Administrative Agent, the Issuing  Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or  any other Loan Document against any Loan Party or its properties in the courts of any jurisdiction.  (d) Each Loan Party hereby irrevocably and unconditionally waives, to the fullest  extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying  of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan  Document in any court referred to in paragraph (c) of this Section.  Each of the parties hereto hereby  

 

-133-  irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the  maintenance of such action or proceeding in any such court.  (e) Each party to this Agreement irrevocably consents to service of process in the  manner provided for notices in Section 9.01.  Nothing in this Agreement or any other Loan Document will  affect the right of any party to this Agreement to serve process in any other manner permitted by law.  SECTION 9.10 WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES,  TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO  A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT  OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE  TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON  CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT  NO REPRESENTATIVE OR OTHER AGENT (INCLUDING ANY ATTORNEY) OF ANY OTHER  PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY  WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER  AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN  INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL  WAIVERS AND CERTIFICATIONS IN THIS SECTION.  SECTION 9.11 Headings.  Article and Section headings and the Table of Contents used herein  are for convenience of reference only, are not part of this Agreement and shall not affect the construction  of, or be taken into consideration in interpreting, this Agreement.  SECTION 9.12 Confidentiality.  Each of the Administrative Agent, the Issuing Bank and the  Lenders agrees to maintain the confidentiality of the Information (as defined below), except that  Information may be disclosed (a) to its and its Affiliates' directors, officers, employees and agents,  including accountants, legal counsel and other advisors (it being understood that the Persons to whom such  disclosure is made will be informed of the confidential nature of such Information and instructed to keep  such Information confidential), (b) to the extent requested by any Governmental Authority (including any  self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent  required by any Requirement of Law or by any subpoena or similar legal process, (d) to any other party to  this Agreement, (e) in connection with the exercise of any remedies under this Agreement or any other  Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Document  or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions  substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective  assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or  prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Loan Parties  and their obligations, (g) with the consent of the Borrower Representative, (h) to holders of Equity Interests  in any Loan Party, (i) to any Person providing a Guarantee of all or any portion of the Secured Obligations,  or (j) to the extent such Information (i) becomes publicly available other than as a result of a breach of this  Section or (ii) becomes available to the Administrative Agent, the Issuing Bank or any Lender on a non- confidential basis from a source other than the Loan Parties, or (k) on a confidential basis to (1) any rating  agency in connection with rating HF Foods or its Subsidiaries or the credit facilities provided for herein or  (2) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of  identification numbers with respect to the credit facilities provided for herein.  For the purposes of this Section, "Information" means all information received from any Loan Party relating  to the Loan Parties or their business, other than any such information that is available to the Administrative  Agent, the Issuing Bank or any Lender on a non-confidential basis prior to disclosure by the Loan Parties  and other than information pertaining to this Agreement provided by arrangers to data service providers,  including league table providers, that serve the lending industry; provided that, in the case of information  

 

-134-  received from the Loan Parties after the date hereof, such information is clearly identified at the time of  delivery as confidential.  Any Person required to maintain the confidentiality of Information as provided in  this Section shall be considered to have complied with its obligation to do so if such Person has exercised  the same degree of care to maintain the confidentiality of such Information as such Person would accord to  its own confidential information.  EACH LENDER ACKNOWLEDGES THAT INFORMATION (AS DEFINED IN THIS  SECTION 9.12) FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE  MATERIAL NON-PUBLIC INFORMATION CONCERNING HF FOODS, AND ITS  AFFILIATES, THE OTHER LOAN PARTIES AND THEIR RELATED PARTIES OR THEIR  RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE  PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND  THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN  ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING  FEDERAL AND STATE SECURITIES LAWS.  ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS,  FURNISHED BY THE BORROWERS OR THE ADMINISTRATIVE AGENT PURSUANT TO,  OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE- LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION  ABOUT HF FOODS, THE LOAN PARTIES AND THEIR RELATED PARTIES OR THEIR  RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE  BORROWERS AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS  ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE  INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN  ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW,  INCLUDING FEDERAL AND STATE SECURITIES LAWS.  SECTION 9.13 Several Obligations; Nonreliance; Violation of Law.  The respective  obligations of the Lenders hereunder are several and not joint and the failure of any Lender to make any  Loan or perform any of its obligations hereunder shall not relieve any other Lender from any of its  obligations hereunder. Each Lender hereby represents that it is not relying on or looking to any margin  stock (as defined in Regulation U of the Federal Reserve Board) for the repayment of the Borrowings  provided for herein.  Anything contained in this Agreement to the contrary notwithstanding, neither the  Issuing Bank nor any Lender shall be obligated to extend credit to the Borrowers in violation of any  Requirement of Law.  SECTION 9.14 USA PATRIOT Act.  Each Lender that is subject to the requirements of the  USA PATRIOT Act hereby notifies each Loan Party that pursuant to the requirements of the USA  PATRIOT Act, it is required to obtain, verify and record information that identifies such Loan Party, which  information includes the name and address of such Loan Party and other information that will allow such  Lender to identify such Loan Party in accordance with the USA PATRIOT Act.  SECTION 9.15 Disclosure.  Each Loan Party, each Lender and the Issuing Bank hereby  acknowledges and agrees that the Administrative Agent and/or its Affiliates from time to time may hold  investments in, make other loans to or have other relationships with any of the Loan Parties and their  respective Affiliates.  SECTION 9.16 Appointment for Perfection.  Each Lender hereby appoints each other Lender  as its agent for the purpose of perfecting Liens, for the benefit of the Administrative Agent and the other  Secured Parties, in assets which, in accordance with Article 9 of the UCC or any other applicable law can  be perfected only by possession or control.  Should any Lender (other than the Administrative Agent) obtain  

 

-135-  possession or control of any such Collateral, such Lender shall notify the Administrative Agent thereof,  and, promptly upon the Administrative Agent's request therefor shall deliver such Collateral to the  Administrative Agent or otherwise deal with such Collateral in accordance with the Administrative Agent's  instructions.  SECTION 9.17 Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if  at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which  are treated as interest on such Loan under applicable law (collectively the "Charges"), shall exceed the  maximum lawful rate (the "Maximum Rate") which may be contracted for, charged, taken, received or  reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in  respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the  Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect  of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the  interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not  above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the  NYFRB Rate to the date of repayment, shall have been received by such Lender.  SECTION 9.18 Marketing Consent.  The Borrowers hereby authorize JPMCB and its affiliates  (collectively, the "JPMCB Parties"), at their respective sole expense, but without any prior approval by the  Borrowers, to publish such tombstones and give such other publicity to this Agreement as each may from  time to time determine in its sole discretion.  The foregoing authorization shall remain in effect unless and  until the Borrower Representative notifies JPMCB in writing that such authorization is revoked.  SECTION 9.19 Acknowledgement and Consent to Bail-In of Affected Financial Institutions.   Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement  or understanding among any such parties, each party hereto acknowledges that any liability of any Affected  Financial Institution arising under any Loan Document may be subject to the Write-Down and Conversion  Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to  be bound by:  (a) the application of any Write-Down and Conversion Powers by the applicable  Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party  hereto that is an Affected Financial Institution; and  (b) the effects of any Bail-In Action on any such liability, including, if applicable:  (i) a reduction in full or in part or cancellation of any such liability;  (ii) a conversion of all, or a portion of, such liability into shares or other  instruments of ownership in such Affected Financial Institution, its parent entity, or a  bridge institution that may be issued to it or otherwise conferred on it, and that such shares  or other instruments of ownership will be accepted by it in lieu of any rights with respect  to any such liability under this Agreement or any other Loan Document; or  (iii) the variation of the terms of such liability in connection with the exercise  of the Write-Down and Conversion Powers of the applicable Resolution Authority.  SECTION 9.20 No Fiduciary Duty, etc..  (a) Each Borrower acknowledges and agrees, and acknowledges its Subsidiaries'  understanding, that no Credit Party will have any obligations except those obligations expressly set forth  herein and in the other Loan Documents and each Credit Party is acting solely in the capacity of an arm's  

 

-136-  length contractual counterparty to each Borrower with respect to the Loan Documents and the transactions  contemplated herein and  therein and not as a financial advisor or a fiduciary to, or an agent of, any Borrower  or any other person.  Each Borrower agrees that it will not assert any claim against any Credit Party based  on an alleged breach of fiduciary duty by such Credit Party in connection with this Agreement and the  transactions contemplated hereby.  Additionally, each Borrower acknowledges and agrees that no Credit  Party is advising any Borrower as to any legal, tax, investment, accounting, regulatory or any other matters  in any jurisdiction.  Each Borrower shall consult with its own advisors concerning such matters and shall  be responsible for making its own independent investigation and appraisal of the transactions contemplated  herein or in the other Loan Documents, and the Credit Parties shall have no responsibility or liability to any  Borrower with respect thereto.  (b) Each Borrower further acknowledges and agrees, and acknowledges its  Subsidiaries' understanding, that each Credit Party, together with its Affiliates, is a full service securities or  banking firm engaged in securities trading and brokerage activities as well as providing investment banking  and other financial services.  In the ordinary course of business, any Credit Party may provide investment  banking and other financial services to, and/or acquire, hold or sell, for its own accounts and the accounts  of customers, equity, debt and other securities and financial instruments (including bank loans and other  obligations) of, any Borrower and other companies with which any Borrower may have commercial or  other relationships.  With respect to any securities and/or financial instruments so held by any Credit Party  or any of its customers, all rights in respect of such securities and financial instruments, including any  voting rights, will be exercised by the holder of the rights, in its sole discretion.  (c) In addition, each Borrower acknowledges and agrees, and acknowledges its  Subsidiaries' understanding, that each Credit Party and its affiliates may be providing debt financing, equity  capital or other services (including financial advisory services) to other companies in respect of which a  Borrower may have conflicting interests regarding the transactions described herein and otherwise.  No  Credit Party will use confidential information obtained from any Borrower by virtue of the transactions  contemplated by the Loan Documents or its other relationships with such Borrower in connection with the  performance by such Credit Party of services for other companies, and no Credit Party will furnish any such  information to other companies.  Each Borrower also acknowledges that no Credit Party has any obligation  to use in connection with the transactions contemplated by the Loan Documents, or to furnish to any  Borrower, confidential information obtained from other companies.  SECTION 9.21 Hazard Insurance Disclosure.  This Section is being furnished by the  Administrative Agent in compliance with Section 2955.5(b) of the California Civil Code. California Civil  Code Section 2955.5(a) reads as follows:  "No lender shall require a borrower, as a condition of receiving  or maintaining a loan secured by real property, to provide hazard insurance coverage against risks to the  improvements on that real property in an amount exceeding the replacement value of the improvements on  the property".  Each Borrower acknowledges and agrees that the above disclosure was made by the  Administrative Agent to the Borrowers prior to execution of this Agreement and the other Loan Documents.  SECTION 9.22 Acknowledgement Regarding Any Supported QFCs.  To the extent that the  Loan Documents provide support, through a guarantee or otherwise, for Swap Agreements or any other  agreement or instrument that is a QFC (such support "QFC Credit Support" and each such QFC a  "Supported QFC"), the parties acknowledge and agree as follows with respect to the resolution power of  the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the  Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated  thereunder, the "U.S. Special Resolution Regimes") in respect of such Supported QFC and QFC Credit  Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported  QFC may in fact be stated to be governed by the laws of the State of Illinois and/or of the United States or  any other state of the United States):  

 

-137-  In the event a Covered Entity that is party to a Supported QFC (each, a "Covered Party") becomes  subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and  the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC  and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit  Support) from such Covered Party will be effective to the same extent as the transfer would be effective  under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any  such interest, obligation and rights in property) were governed by the laws of the United States or a state of  the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject  to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that  might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against  such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be  exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were  governed by the laws of the United States or a state of the United States. Without limitation of the foregoing,  it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall  in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit  Support.  SECTION 9.23 Reaffirmation.  Each Borrower and each Guarantor that is a party thereto  hereby acknowledges and reaffirms its obligations under each of the Loan Documents delivered in  connection with or pursuant to the Existing Credit Agreement to which it is a party, including, without  limitation, any grant of security interest, as applicable, contained therein, in each case as amended, restated,  supplemented or otherwise modified prior to or as of the date hereof (collectively, the "Reaffirmed  Documents").  Each such Borrower and Guarantor further acknowledges and confirms that the  Administrative Agent's Liens in the Collateral of such Persons shall be deemed to be continuously granted  and perfected from the earliest date of the granting and perfection thereof under the Existing Credit  Agreement and the other Reaffirmed Documents.  Each of the Reaffirmed Documents to which it is a party  shall remain in full force and effect following the execution and delivery of this Agreement.  All references  in any of the Reaffirmed Documents to the "Credit Agreement" shall be deemed to refer to this Agreement.   Except as set forth in the immediately preceding paragraph, and except as otherwise expressly amended on  or prior to the date hereof, each of the Reaffirmed Documents shall remain in full force and effect.  ARTICLE X    Loan Guaranty  SECTION 10.01 Guaranty.  Each Loan Guarantor (other than those that have delivered a  separate Guaranty) hereby agrees that it is jointly and severally liable for, and absolutely, unconditionally  and irrevocably guarantees to the Secured Parties, the prompt payment when due, whether at stated  maturity, upon acceleration or otherwise, and at all times thereafter, of the Secured Obligations and all costs  and expenses, including, without limitation, all court costs and attorneys' and paralegals' fees (including  allocated costs of in-house counsel and paralegals) and expenses paid or incurred by the Administrative  Agent, the Issuing Bank and the Lenders in endeavoring to collect all or any part of the Secured Obligations  from, or in prosecuting any action against, any Borrower, any Loan Guarantor or any other guarantor of all  or any part of the Secured Obligations (such costs and expenses, together with the Secured Obligations,  collectively the "Guaranteed Obligations"; provided, however, that the definition of "Guaranteed  Obligations" shall not create any guarantee by any Loan Guarantor of (or grant of security interest by any  Loan Guarantor to support, as applicable) any Excluded Swap Obligations of such Loan Guarantor for  purposes of determining any obligations of any Loan Guarantor).  Each Loan Guarantor further agrees that  the Guaranteed Obligations may be extended or renewed in whole or in part without notice to or further  assent from it, and that it remains bound upon its guarantee notwithstanding any such extension or renewal.   All terms of this Loan Guaranty apply to and may be enforced by or on behalf of any domestic or foreign  branch or Affiliate of any Lender that extended any portion of the Guaranteed Obligations.  

 

-138-  SECTION 10.02 Guaranty of Payment.  This Loan Guaranty is a guaranty of payment and not of  collection.  Each Loan Guarantor waives any right to require the Administrative Agent, the Issuing Bank or  any Lender to sue any Borrower, any Loan Guarantor, any other guarantor of, or any other Person obligated  for, all or any part of the Guaranteed Obligations (each, an "Obligated Party"), or otherwise to enforce its  payment against any collateral securing all or any part of the Guaranteed Obligations.  SECTION 10.03 No Discharge or Diminishment of Loan Guaranty.  (a) Except as otherwise provided for herein, the obligations of each Loan Guarantor  hereunder are unconditional and absolute and not subject to any reduction, limitation, impairment or  termination for any reason (other than Payment in Full of the Guaranteed Obligations), including:  (i) any  claim of waiver, release, extension, renewal, settlement, surrender, alteration or compromise of any of the  Guaranteed Obligations, by operation of law or otherwise; (ii) any change in the corporate existence,  structure or ownership of any Borrower or any other Obligated Party liable for any of the Guaranteed  Obligations; (iii) any insolvency, bankruptcy, reorganization or other similar proceeding affecting any  Obligated Party or their assets or any resulting release or discharge of any obligation of any Obligated Party;  or (iv) the existence of any claim, setoff or other rights which any Loan Guarantor may have at any time  against any Obligated Party, the Administrative Agent, the Issuing Bank, any Lender or any other Person,  whether in connection herewith or in any unrelated transactions.  (b) The obligations of each Loan Guarantor hereunder are not subject to any defense  or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or  unenforceability of any of the Guaranteed Obligations or otherwise, or any provision of applicable law or  regulation purporting to prohibit payment by any Obligated Party, of the Guaranteed Obligations or any  part thereof.    (c) Further, the obligations of any Loan Guarantor hereunder are not discharged or  impaired or otherwise affected by: (i) the failure of the Administrative Agent, the Issuing Bank or any  Lender to assert any claim or demand or to enforce any remedy with respect to all or any part of the  Guaranteed Obligations; (ii) any waiver or modification of or supplement to any provision of any agreement  relating to the Guaranteed Obligations; (iii) any release, non-perfection or invalidity of any indirect or direct  security for the obligations of any Borrower for all or any part of the Guaranteed Obligations or any  obligations of any other Obligated Party liable for any of the Guaranteed Obligations; (iv) any action or  failure to act by the Administrative Agent, the Issuing Bank or any Lender with respect to any collateral  securing any part of the Guaranteed Obligations; or (v) any default, failure or delay, willful or otherwise,  in the payment or performance of any of the Guaranteed Obligations, or any other circumstance, act,  omission or delay that might in any manner or to any extent vary the risk of such Loan Guarantor or that  would otherwise operate as a discharge of any Loan Guarantor as a matter of law or equity (other than  Payment in Full of the Guaranteed Obligations).  SECTION 10.04 Defenses Waived.  To the fullest extent permitted by applicable law, each Loan  Guarantor hereby waives any defense based on or arising out of any defense of any Borrower or any Loan  Guarantor or the unenforceability of all or any part of the Guaranteed Obligations from any cause, or the  cessation from any cause of the liability of any Borrower, any Loan Guarantor or any other Obligated Party,  other than Payment in Full of the Guaranteed Obligations. Without limiting the generality of the foregoing,  each Loan Guarantor irrevocably waives acceptance hereof, presentment, demand, protest and, to the fullest  extent permitted by law, any notice not provided for herein, as well as any requirement that at any time any  action be taken by any Person against any Obligated Party or any other Person.  The Administrative Agent  may, at its election, foreclose on any Collateral held by it by one or more judicial or nonjudicial sales, accept  an assignment of any such Collateral in lieu of foreclosure or otherwise act or fail to act with respect to any  collateral securing all or a part of the Guaranteed Obligations, compromise or adjust any part of the  Guaranteed Obligations, make any other accommodation with any Obligated Party or exercise any other right  

 

-139-  or remedy available to it against any Obligated Party, without affecting or impairing in any way the liability  of such Loan Guarantor under this Loan Guaranty except to the extent the Guaranteed Obligations have been  Paid in Full.  To the fullest extent permitted by applicable law, each Loan Guarantor waives any defense  arising out of any such election even though that election may operate, pursuant to applicable law, to impair  or extinguish any right of reimbursement or subrogation or other right or remedy of any Loan Guarantor  against any Obligated Party or any security.  SECTION 10.05 Rights of Subrogation.  No Loan Guarantor will assert any right, claim or cause  of action, including, without limitation, a claim of subrogation, contribution or indemnification, that it has  against any Obligated Party or any collateral, until the Loan Parties and the Loan Guarantors have fully  performed all their obligations to the Administrative Agent, the Issuing Bank and the Lenders.  SECTION 10.06 Reinstatement; Stay of Acceleration.  If at any time any payment of any portion  of the Guaranteed Obligations (including a payment effected through exercise of a right of setoff) is rescinded,  or must otherwise be restored or returned upon the insolvency, bankruptcy or reorganization of any Borrower  or otherwise (including pursuant to any settlement entered into by a Secured Party in its discretion), each Loan  Guarantor's obligations under this Loan Guaranty with respect to that payment shall be reinstated at such time  as though the payment had not been made and whether or not the Administrative Agent, the Issuing Bank and  the Lenders are in possession of this Loan Guaranty. If acceleration of the time for payment of any of the  Guaranteed Obligations is stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all such  amounts otherwise subject to acceleration under the terms of any agreement relating to the Guaranteed  Obligations shall nonetheless be payable by the Loan Guarantors forthwith on demand by the Administrative  Agent.  SECTION 10.07 Information.  Each Loan Guarantor assumes all responsibility for being and  keeping itself informed of the Borrowers' financial condition and assets, and of all other circumstances  bearing upon the risk of nonpayment of the Guaranteed Obligations and the nature, scope and extent of the  risks that each Loan Guarantor assumes and incurs under this Loan Guaranty, and agrees that none of the  Administrative Agent, the Issuing Bank or any Lender shall have any duty to advise any Loan Guarantor  of information known to it regarding those circumstances or risks.  SECTION 10.08 Termination.  Each of the Lenders and the Issuing Bank may continue to make  loans or extend credit to the Borrowers based on this Loan Guaranty until five (5) days after it receives written  notice of termination from any Loan Guarantor.  Notwithstanding receipt of any such notice, each Loan  Guarantor will continue to be liable to the Lenders for any Guaranteed Obligations created, assumed or  committed to prior to the fifth day after receipt of the notice, and all subsequent renewals, extensions,  modifications and amendments with respect to, or substitutions for, all or any part of such Guaranteed  Obligations.  Nothing in this Section 10.08 shall be deemed to constitute a waiver of, or eliminate, limit,  reduce or otherwise impair any rights or remedies the Administrative Agent or any Lender may have in respect  of, any Default or Event of Default that shall exist under Article VII hereof as a result of any such notice of  termination.  SECTION 10.09 Taxes.  Each payment of the Guaranteed Obligations will be made by each  Loan Guarantor without withholding for any Taxes, unless such withholding is required by law.  If any  Loan Guarantor determines, in its sole discretion exercised in good faith, that it is so required to withhold  Taxes, then such Loan Guarantor may so withhold and shall timely pay the full amount of withheld Taxes  to the relevant Governmental Authority in accordance with applicable law.  If such Taxes are Indemnified  Taxes, then the amount payable by such Loan Guarantor shall be increased as necessary so that, net of such  withholding (including such withholding applicable to additional amounts payable under this Section), the  Administrative Agent, Lender or Issuing Bank (as the case may be) receives the amount it would have  received had no such withholding been made.  

 

-140-  SECTION 10.10 Maximum Liability.  Notwithstanding any other provision of this Loan  Guaranty, the amount guaranteed by each Loan Guarantor hereunder shall be limited to the extent, if any,  required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the  Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent  Conveyance Act, Uniform Voidable Transactions Act or similar statute or common law.  In determining  the limitations, if any, on the amount of any Loan Guarantor's obligations hereunder pursuant to the  preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification  or contribution which such Loan Guarantor may have under this Loan Guaranty, any other agreement or  applicable law shall be taken into account.  SECTION 10.11 Contribution.  (a) To the extent that any Loan Guarantor shall make a payment under this Loan  Guaranty (a "Guarantor Payment") which, taking into account all other Guarantor Payments then previously  or concurrently made by any other Loan Guarantor, exceeds the amount which otherwise would have been  paid by or attributable to such Loan Guarantor if each Loan Guarantor had paid the aggregate Guaranteed  Obligations satisfied by such Guarantor Payment in the same proportion as such Loan Guarantor's "Allocable  Amount" (as defined below) (as determined immediately prior to such Guarantor Payment) bore to the  aggregate Allocable Amounts of each of the Loan Guarantors as determined immediately prior to the making  of such Guarantor Payment, then, following indefeasible payment in full in cash of the Guarantor Payment  and the Payment in Full of the Guaranteed Obligations and the termination of this Agreement, such Loan  Guarantor shall be entitled to receive contribution and indemnification payments from, and be reimbursed by,  each other Loan Guarantor for the amount of such excess, pro rata based upon their respective Allocable  Amounts in effect immediately prior to such Guarantor Payment.  (b) As of any date of determination, the "Allocable Amount" of any Loan Guarantor  shall be equal to the excess of the fair saleable value of the property of such Loan Guarantor over the total  liabilities of such Loan Guarantor (including the maximum amount reasonably expected to become due in  respect of contingent liabilities, calculated, without duplication, assuming each other Loan Guarantor that is  also liable for such contingent liability pays its ratable share thereof), giving effect to all payments made by  other Loan Guarantors as of such date in a manner to maximize the amount of such contributions.  (c) This Section 10.11 is intended only to define the relative rights of the Loan  Guarantors, and nothing set forth in this Section 10.11 is intended to or shall impair the obligations of the  Loan Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and  payable in accordance with the terms of this Loan Guaranty.  (d) The parties hereto acknowledge that the rights of contribution and indemnification  hereunder shall constitute assets of the Loan Guarantor or Loan Guarantors to which such contribution and  indemnification is owing.  (e) The rights of the indemnifying Loan Guarantors against other Loan Guarantors  under this Section 10.11 shall be exercisable upon the Payment in Full of the Guaranteed Obligations and the  termination of this Agreement.  SECTION 10.12 Liability Cumulative.  The liability of each Loan Party as a Loan Guarantor  under this Article X is in addition to and shall be cumulative with all liabilities of each Loan Party to the  Administrative Agent, the Issuing Bank and the Lenders under this Agreement and the other Loan  Documents to which such Loan Party is a party or in respect of any obligations or liabilities of the other  Loan Parties, without any limitation as to amount, unless the instrument or agreement evidencing or creating  such other liability specifically provides to the contrary.  

 

-141-  SECTION 10.13 Keepwell.  Each Qualified ECP Guarantor hereby jointly and severally  absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be  needed from time to time by each other Loan Party to honor all of its obligations under this Guarantee in  respect of a Swap Obligation (provided, however, that each Qualified ECP Guarantor shall only be liable  under this Section 10.13 for the maximum amount of such liability that can be hereby incurred without  rendering its obligations under this Section 10.13 or otherwise under this Loan Guaranty voidable under  applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount).  Except as otherwise provided herein, the obligations of each Qualified ECP Guarantor under this  Section 10.13 shall remain in full force and effect until the termination of all Swap Obligations.  Each  Qualified ECP Guarantor intends that this Section 10.13 constitute, and this Section 10.13 shall be deemed  to constitute, a "keepwell, support, or other agreement" for the benefit of each other Loan Party for all  purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.  SECTION 10.14 Waivers of Other Rights and Defenses.  If any Loan Guarantor is not the  primary obligor under the Obligations, such Loan Guarantor agrees as follows:  (a) SUCH LOAN GUARANTOR HEREBY WAIVES ANY RIGHTS OF  SUBROGATION, REIMBURSEMENT, INDEMNIFICATION, AND CONTRIBUTION OF ANY  OTHER RIGHTS AND DEFENSES THAT ARE OR MAY BECOME AVAILABLE TO LOAN  GUARANTOR BY REASON OF SECTIONS 2787 TO 2855, INCLUSIVE, SECTION 2899 OR  SECTION 3433 OF THE CALIFORNIA CIVIL CODE OR SECTION 3605 OF THE CALIFORNIA  COMMERCIAL CODE.  SUCH LOAN GUARANTOR HAS BEEN MADE AWARE OF THE  PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 2856, HAS READ AND UNDERSTANDS  THE PROVISIONS OF THAT STATUTE, HAS BEEN ADVISED BY ITS COUNSEL AS TO THE  SCOPE, PURPOSE AND EFFECT OF THAT STATUTE, AND BASED THEREON, AND WITHOUT  LIMITING THE FOREGOING WAIVERS, SUCH LOAN GUARANTOR AGREES TO WAIVE ALL  SURETYSHIP RIGHTS AND DEFENSES DESCRIBED IN CALIFORNIA CIVIL CODE SECTION  2856(a);  (b) The provisions of this Section 9.14(b) are applicable if any Obligation is or  becomes secured by California real property;  (c) Each Loan Guarantor waives all rights and defenses that such Loan Guarantor may  have because any of the Obligations is secured by real property.  This means, among other things:  (i) the  Administrative Agent may collect from such Loan Guarantor without first foreclosing on any real or  personal property Collateral pledged by any Borrower; and (ii) if the Administrative Agent forecloses on  any real property Collateral pledged by any Borrower:  (1) the amount of the Obligations may be reduced  only by the price for which that Collateral is sold at the foreclosure sale, even if the Collateral is worth  more than the sale price, and (2) the Administrative Agent may collect from such Loan Guarantor even if  the Administrative Agent, by foreclosing on the real property Collateral, has destroyed any right such Loan  Guarantor may have to collect from the Borrowers.  This is an irrevocable and unconditional waiver of any  rights and defenses each Loan Guarantor may have because any of the Obligations is secured by real  property.  THESE RIGHTS AND DEFENSES INCLUDE, BUT ARE NOT LIMITED TO, ANY RIGHTS  OR DEFENSES BASED UPON SECTION 580a, 580b, 580d, OR 726 OF THE CALIFORNIA CODE OF  CIVIL PROCEDURE.  (d) Each Loan Guarantor waives all rights and defenses arising out of an election of  remedies by the Administrative Agent, even though the election of remedies, such as non-judicial  foreclosure with respect to security for any Obligation, has destroyed such Loan Guarantor's rights of  subrogation and reimbursement against the principal under the Obligation by the operation of Section 580d  of the Code of Civil Procedure or otherwise.  

 

-142-  ARTICLE XI    The Borrower Representative.  SECTION 11.01 Appointment; Nature of Relationship.  HF Foods is hereby appointed by each of the Borrowers as its contractual representative  (herein referred to as the "Borrower Representative") hereunder and under each other Loan Document, and  each of the Borrowers irrevocably authorizes the Borrower Representative to act as the contractual  representative of such Borrower with the rights and duties expressly set forth herein and in the other Loan  Documents.  The Borrower Representative agrees to act as such contractual representative upon the express  conditions contained in this Article XI.  Additionally, the Borrowers hereby appoint the Borrower  Representative as their agent to receive all of the proceeds of the Loans in the Funding Account(s), at which  time the Borrower Representative shall promptly disburse such Loans to the appropriate Borrower(s).  The  Administrative Agent and the Lenders, and their respective officers, directors, agents or employees, shall  not be liable to the Borrower Representative or any Borrower for any action taken or omitted to be taken  by the Borrower Representative or the Borrowers pursuant to this Section 11.01.  SECTION 11.02 Powers.  The Borrower Representative shall have and may exercise such  powers under the Loan Documents as are specifically delegated to the Borrower Representative by the  terms of each thereof, together with such powers as are reasonably incidental thereto.  The Borrower  Representative shall have no implied duties to the Borrowers, or any obligation to the Lenders to take any  action thereunder except any action specifically provided by the Loan Documents to be taken by the  Borrower Representative.  SECTION 11.03 Employment of Agents.  The Borrower Representative may execute any of its  duties as the Borrower Representative hereunder and under any other Loan Document by or through  authorized officers.  SECTION 11.04 Notices.  Each Borrower shall immediately notify the Borrower  Representative of the occurrence of any Default or Event of Default hereunder referring to this Agreement  describing such Default or Event of Default and stating that such notice is a "notice of default".   In the  event that the Borrower Representative receives such a notice, the Borrower Representative shall give  prompt notice thereof to the Administrative Agent and the Lenders.  Any notice provided to the Borrower  Representative hereunder shall constitute notice to each Borrower on the date received by the Borrower  Representative.  SECTION 11.05 Successor Borrower Representative.  Upon the prior written consent of the  Administrative Agent, the Borrower Representative may resign at any time, such resignation to be effective  upon the appointment of a successor Borrower Representative.  The Administrative Agent shall give prompt  written notice of such resignation to the Lenders.  SECTION 11.06 Execution of Loan Documents; Borrowing Base Certificate.  The Borrowers  hereby empower and authorize the Borrower Representative, on behalf of the Borrowers, to execute and  deliver to the Administrative Agent and the Lenders the Loan Documents and all related agreements,  certificates, documents, or instruments as shall be necessary or appropriate to effect the purposes of the  Loan Documents, including, without limitation, the Borrowing Base Certificates and the Compliance  Certificates.  Each Borrower agrees that any action taken by the Borrower Representative or the Borrowers  in accordance with the terms of this Agreement or the other Loan Documents, and the exercise by the  Borrower Representative of its powers set forth therein or herein, together with such other powers that are  reasonably incidental thereto, shall be binding upon all of the Borrowers.  

 

-143-  SECTION 11.07 Reporting.  Each Borrower hereby agrees that such Borrower shall furnish  promptly after each fiscal month to the Borrower Representative a copy of its separate portion of the  Borrowing Base Certificate and any other certificate or report required hereunder or requested by the  Borrower Representative on which the Borrower Representative shall rely to prepare the Borrowing Base  Certificates and Compliance Certificate required pursuant to the provisions of this Agreement.  (Signature Pages Follow)

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