Document:

Exhibit 10.29

 

EXECUTION VERSION

 

Published CUSIP Number: 09940MAA3

Revolving Credit CUSIP Number: 09940MAB1

Term Loan CUSIP Number: 09940MAC9

 

 

 

$150,000,000

 

CREDIT AGREEMENT

 

dated as of February 23, 2015,

 

by and among

 

BOOT BARN HOLDINGS, INC.,
  as Holdings,

 

BOOT BARN, INC.,
 as Borrower,

 

the Lenders from time to time party hereto,

 

and

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,
 as Administrative Agent,
 Swingline Lender and Issuing Lender

 

PNC BANK, NATIONAL ASSOCIATION,
 as Syndication Agent

 

WELLS FARGO SECURITIES, LLC

 

and

 

PNC CAPITAL MARKETS LLC,
 as Joint Lead Arrangers and Joint Bookrunners

 

 

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I                                     DEFINITIONS
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.1
    	
Definitions
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.2
    	
Other   Definitions and Provisions
    	
38
    
	
 
    	
 
    	
 
    
	
Section 1.3
    	
Accounting   Terms
    	
38
    
	
 
    	
 
    	
 
    
	
Section 1.4
    	
UCC   Terms
    	
39
    
	
 
    	
 
    	
 
    
	
Section 1.5
    	
Rounding
    	
39
    
	
 
    	
 
    	
 
    
	
Section 1.6
    	
References   to Agreement and Laws
    	
39
    
	
 
    	
 
    	
 
    
	
Section 1.7
    	
Times   of Day
    	
39
    
	
 
    	
 
    	
 
    
	
Section 1.8
    	
Letter   of Credit Amounts
    	
39
    
	
 
    	
 
    	
 
    
	
Section 1.9
    	
Guarantees
    	
39
    
	
 
    	
 
    	
 
    
	
Section 1.10
    	
Covenant   Compliance Generally
    	
40
    
	
 
    	
 
    	
 
    
	
ARTICLE II                                REVOLVING   CREDIT FACILITY
    	
40
    
	
 
    	
 
    	
 
    
	
Section 2.1
    	
Revolving   Credit Loans
    	
40
    
	
 
    	
 
    	
 
    
	
Section 2.2
    	
Swingline   Loans
    	
40
    
	
 
    	
 
    	
 
    
	
Section 2.3
    	
Procedure   for Advances of Revolving Credit Loans and Swingline Loans
    	
42
    
	
 
    	
 
    	
 
    
	
Section 2.4
    	
Repayment   and Prepayment of Revolving Credit and Swingline Loans
    	
44
    
	
 
    	
 
    	
 
    
	
Section 2.5
    	
Permanent   Reduction of the Revolving Credit Commitment
    	
45
    
	
 
    	
 
    	
 
    
	
Section 2.6
    	
Termination   of Revolving Facility; Swingline Credit Facility
    	
45
    
	
 
    	
 
    	
 
    
	
ARTICLE III                           LETTER OF   CREDIT FACILITY
    	
46
    
	
 
    	
 
    	
 
    
	
Section 3.1
    	
L/C   Facility
    	
46
    
	
 
    	
 
    	
 
    
	
Section 3.2
    	
Procedure   for Issuance of Letters of Credit
    	
47
    
	
 
    	
 
    	
 
    
	
Section 3.3
    	
Commissions   and Other Charges
    	
47
    
	
 
    	
 
    	
 
    
	
Section 3.4
    	
L/C   Participations
    	
48
    
	
 
    	
 
    	
 
    
	
Section 3.5
    	
Reimbursement   Obligation of the Borrower
    	
49
    
	
 
    	
 
    	
 
    
	
Section 3.6
    	
Obligations   Absolute
    	
49
    
	
 
    	
 
    	
 
    
	
Section 3.7
    	
Effect   of Letter of Credit Application
    	
50
    
	
 
    	
 
    	
 
    
	
Section 3.8
    	
Reporting   of Letter of Credit Information and L/C Commitment
    	
50
    
	
 
    	
 
    	
 
    
	
Section 3.9
    	
Letters   of Credit Issued for Subsidiaries
    	
50
    
	
 
    	
 
    	
 
    
	
ARTICLE IV                            TERM LOAN   FACILITY
    	
50
    

 

i

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 4.1
    	
Initial   Term Loan
    	
50
    
	
 
    	
 
    	
 
    
	
Section 4.2
    	
Procedure   for Advance of Term Loan
    	
51
    
	
 
    	
 
    	
 
    
	
Section 4.3
    	
Repayment   of Term Loans
    	
51
    
	
 
    	
 
    	
 
    
	
Section 4.4
    	
Prepayments   of Term Loans
    	
52
    
	
 
    	
 
    	
 
    
	
ARTICLE V                                 GENERAL LOAN   PROVISIONS
    	
54
    
	
 
    	
 
    	
 
    
	
Section 5.1
    	
Interest
    	
54
    
	
 
    	
 
    	
 
    
	
Section 5.2
    	
Notice   and Manner of Conversion or Continuation of Loans
    	
55
    
	
 
    	
 
    	
 
    
	
Section 5.3
    	
Fees
    	
56
    
	
 
    	
 
    	
 
    
	
Section 5.4
    	
Manner   of Payment
    	
56
    
	
 
    	
 
    	
 
    
	
Section 5.5
    	
Evidence   of Indebtedness
    	
57
    
	
 
    	
 
    	
 
    
	
Section 5.6
    	
Sharing   of Payments by Lenders
    	
58
    
	
 
    	
 
    	
 
    
	
Section 5.7
    	
Administrative   Agent’s Clawback
    	
58
    
	
 
    	
 
    	
 
    
	
Section 5.8
    	
Changed   Circumstances
    	
59
    
	
 
    	
 
    	
 
    
	
Section 5.9
    	
Indemnity
    	
60
    
	
 
    	
 
    	
 
    
	
Section 5.10
    	
Increased   Costs
    	
61
    
	
 
    	
 
    	
 
    
	
Section 5.11
    	
Taxes
    	
62
    
	
 
    	
 
    	
 
    
	
Section 5.12
    	
Mitigation   Obligations; Replacement of Lenders
    	
66
    
	
 
    	
 
    	
 
    
	
Section 5.13
    	
Incremental   Term Loans
    	
67
    
	
 
    	
 
    	
 
    
	
Section 5.14
    	
Cash   Collateral
    	
69
    
	
 
    	
 
    	
 
    
	
Section 5.15
    	
Defaulting   Lenders
    	
70
    
	
 
    	
 
    	
 
    
	
Section 5.16
    	
Refinancing   Amendment
    	
73
    
	
 
    	
 
    	
 
    
	
ARTICLE VI                            CONDITIONS OF   CLOSING AND BORROWING
    	
74
    
	
 
    	
 
    	
 
    
	
Section 6.1
    	
Conditions   to Closing and Initial Extensions of Credit
    	
74
    
	
 
    	
 
    	
 
    
	
Section 6.2
    	
Conditions   to All Extensions of Credit
    	
78
    
	
 
    	
 
    	
 
    
	
ARTICLE VII                       REPRESENTATIONS   AND WARRANTIES OF THE CREDIT PARTIES
    	
79
    
	
 
    	
 
    	
 
    
	
Section 7.1
    	
Organization;   Power; Qualification
    	
79
    
	
 
    	
 
    	
 
    
	
Section 7.2
    	
Ownership
    	
80
    
	
 
    	
 
    	
 
    
	
Section 7.3
    	
Authorization;   Enforceability
    	
80
    
	
 
    	
 
    	
 
    
	
Section 7.4
    	
Compliance   of Agreement, Loan Documents and Borrowing with Laws, Etc.
    	
80
    

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 7.5
    	
Compliance   with Law; Governmental Approvals
    	
81
    
	
 
    	
 
    	
 
    
	
Section 7.6
    	
Tax   Returns and Payments
    	
81
    
	
 
    	
 
    	
 
    
	
Section 7.7
    	
Intellectual   Property Matters
    	
81
    
	
 
    	
 
    	
 
    
	
Section 7.8
    	
Environmental   Matters
    	
82
    
	
 
    	
 
    	
 
    
	
Section 7.9
    	
Employee   Benefit Matters
    	
82
    
	
 
    	
 
    	
 
    
	
Section 7.10
    	
Margin   Stock
    	
83
    
	
 
    	
 
    	
 
    
	
Section 7.11
    	
Government   Regulation
    	
84
    
	
 
    	
 
    	
 
    
	
Section 7.12
    	
Material   Contracts
    	
84
    
	
 
    	
 
    	
 
    
	
Section 7.13
    	
Employee   Relations
    	
84
    
	
 
    	
 
    	
 
    
	
Section 7.14
    	
No   Burdensome Restrictions
    	
84
    
	
 
    	
 
    	
 
    
	
Section 7.15
    	
Financial   Statements
    	
84
    
	
 
    	
 
    	
 
    
	
Section 7.16
    	
No   Material Adverse Change
    	
85
    
	
 
    	
 
    	
 
    
	
Section 7.17
    	
Solvency
    	
85
    
	
 
    	
 
    	
 
    
	
Section 7.18
    	
Title   to Properties
    	
85
    
	
 
    	
 
    	
 
    
	
Section 7.19
    	
Litigation
    	
85
    
	
 
    	
 
    	
 
    
	
Section 7.20
    	
Anti-Corruption   Laws and Sanctions
    	
85
    
	
 
    	
 
    	
 
    
	
Section 7.21
    	
Absence   of Defaults
    	
85
    
	
 
    	
 
    	
 
    
	
Section 7.22
    	
Senior   Indebtedness Status
    	
86
    
	
 
    	
 
    	
 
    
	
Section 7.23
    	
Disclosure
    	
86
    
	
 
    	
 
    	
 
    
	
Section 7.24
    	
Flood   Hazard Insurance
    	
86
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII                  AFFIRMATIVE COVENANTS
    	
86
    
	
 
    	
 
    	
 
    
	
Section 8.1
    	
Financial   Statements and Budgets
    	
86
    
	
 
    	
 
    	
 
    
	
Section 8.2
    	
Certificates;   Other Reports
    	
87
    
	
 
    	
 
    	
 
    
	
Section 8.3
    	
Notice   of Litigation and Other Matters
    	
89
    
	
 
    	
 
    	
 
    
	
Section 8.4
    	
Preservation   of Corporate Existence and Related Matters
    	
90
    
	
 
    	
 
    	
 
    
	
Section 8.5
    	
Maintenance   of Property and Licenses
    	
90
    
	
 
    	
 
    	
 
    
	
Section 8.6
    	
Insurance
    	
90
    
	
 
    	
 
    	
 
    
	
Section 8.7
    	
Accounting   Methods and Financial Records
    	
91
    
	
 
    	
 
    	
 
    
	
Section 8.8
    	
Payment   of Taxes and Other Obligations
    	
91
    
	
 
    	
 
    	
 
    
	
Section 8.9
    	
Compliance   with Laws and Approvals
    	
91
    

 

iii

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 8.10
    	
Environmental   Laws
    	
91
    
	
 
    	
 
    	
 
    
	
Section 8.11
    	
Compliance   with ERISA
    	
91
    
	
 
    	
 
    	
 
    
	
Section 8.12
    	
Visits   and Inspections
    	
92
    
	
 
    	
 
    	
 
    
	
Section 8.13
    	
Additional   Subsidiaries
    	
92
    
	
 
    	
 
    	
 
    
	
Section 8.14
    	
Use   of Proceeds
    	
94
    
	
 
    	
 
    	
 
    
	
Section 8.15
    	
Compliance   with Anti-Corruption Laws and Sanctions
    	
94
    
	
 
    	
 
    	
 
    
	
Section 8.16
    	
Reserved
    	
94
    
	
 
    	
 
    	
 
    
	
Section 8.17
    	
Further   Assurances
    	
94
    
	
 
    	
 
    	
 
    
	
Section 8.18
    	
Post-Closing   Matters
    	
95
    
	
 
    	
 
    	
 
    
	
ARTICLE IX                            NEGATIVE   COVENANTS
    	
95
    
	
 
    	
 
    	
 
    
	
Section 9.1
    	
Indebtedness
    	
95
    
	
 
    	
 
    	
 
    
	
Section 9.2
    	
Liens
    	
98
    
	
 
    	
 
    	
 
    
	
Section 9.3
    	
Investments
    	
101
    
	
 
    	
 
    	
 
    
	
Section 9.4
    	
Fundamental   Changes
    	
103
    
	
 
    	
 
    	
 
    
	
Section 9.5
    	
Asset   Dispositions
    	
104
    
	
 
    	
 
    	
 
    
	
Section 9.6
    	
Restricted   Payments
    	
105
    
	
 
    	
 
    	
 
    
	
Section 9.7
    	
Transactions   with Affiliates
    	
107
    
	
 
    	
 
    	
 
    
	
Section 9.8
    	
Accounting   Changes; Organizational Documents
    	
108
    
	
 
    	
 
    	
 
    
	
Section 9.9
    	
Payments   and Modifications of Subordinated Indebtedness; Prepayments of Indebtedness
    	
108
    
	
 
    	
 
    	
 
    
	
Section 9.10
    	
No   Further Negative Pledges; Restrictive Agreements
    	
108
    
	
 
    	
 
    	
 
    
	
Section 9.11
    	
Nature   of Business
    	
109
    
	
 
    	
 
    	
 
    
	
Section 9.12
    	
Sale   and Leasebacks
    	
109
    
	
 
    	
 
    	
 
    
	
Section 9.13
    	
Financial   Covenants
    	
110
    
	
 
    	
 
    	
 
    
	
Section 9.14
    	
Limitations   on Holdings
    	
110
    
	
 
    	
 
    	
 
    
	
Section 9.15
    	
Disposal   of Subsidiary Interests
    	
111
    
	
 
    	
 
    	
 
    
	
ARTICLE X                                 DEFAULT AND   REMEDIES
    	
111
    
	
 
    	
 
    	
 
    
	
Section 10.1
    	
Events   of Default
    	
111
    
	
 
    	
 
    	
 
    
	
Section 10.2
    	
Remedies
    	
113
    
	
 
    	
 
    	
 
    
	
Section 10.3
    	
Rights   and Remedies Cumulative; Non-Waiver; etc.
    	
114
    

 

iv

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 10.4
    	
Crediting   of Payments and Proceeds
    	
115
    
	
 
    	
 
    	
 
    
	
Section 10.5
    	
Administrative   Agent May File Proofs of Claim
    	
116
    
	
 
    	
 
    	
 
    
	
Section 10.6
    	
Credit   Bidding
    	
117
    
	
 
    	
 
    	
 
    
	
Section 10.7
    	
Intercreditor   and Subordination Agreements
    	
117
    
	
 
    	
 
    	
 
    
	
Section 10.8
    	
Lender   Action
    	
117
    
	
 
    	
 
    	
 
    
	
ARTICLE XI                            THE   ADMINISTRATIVE AGENT
    	
118
    
	
 
    	
 
    	
 
    
	
Section 11.1
    	
Appointment   and Authority
    	
118
    
	
 
    	
 
    	
 
    
	
Section 11.2
    	
Rights   as a Lender
    	
118
    
	
 
    	
 
    	
 
    
	
Section 11.3
    	
Exculpatory   Provisions
    	
118
    
	
 
    	
 
    	
 
    
	
Section 11.4
    	
Reliance   by the Administrative Agent
    	
119
    
	
 
    	
 
    	
 
    
	
Section 11.5
    	
Delegation   of Duties
    	
120
    
	
 
    	
 
    	
 
    
	
Section 11.6
    	
Resignation   of Administrative Agent
    	
120
    
	
 
    	
 
    	
 
    
	
Section 11.7
    	
Non-Reliance   on Administrative Agent and Other Lenders
    	
121
    
	
 
    	
 
    	
 
    
	
Section 11.8
    	
No   Other Duties, Etc.
    	
122
    
	
 
    	
 
    	
 
    
	
Section 11.9
    	
Collateral   and Guaranty Matters
    	
122
    
	
 
    	
 
    	
 
    
	
Section 11.10
    	
Secured   Hedge Agreements and Secured Cash Management Agreements
    	
123
    
	
 
    	
 
    	
 
    
	
ARTICLE XII                       MISCELLANEOUS
    	
123
    
	
 
    	
 
    	
 
    
	
Section 12.1
    	
Notices
    	
123
    
	
 
    	
 
    	
 
    
	
Section 12.2
    	
Amendments,   Waivers and Consents
    	
126
    
	
 
    	
 
    	
 
    
	
Section 12.3
    	
Expenses;   Indemnity
    	
128
    
	
 
    	
 
    	
 
    
	
Section 12.4
    	
Right   of Setoff
    	
131
    
	
 
    	
 
    	
 
    
	
Section 12.5
    	
Governing   Law; Jurisdiction, Etc.
    	
131
    
	
 
    	
 
    	
 
    
	
Section 12.6
    	
Waiver   of Jury Trial
    	
132
    
	
 
    	
 
    	
 
    
	
Section 12.7
    	
Reversal   of Payments
    	
132
    
	
 
    	
 
    	
 
    
	
Section 12.8
    	
Reserved
    	
133
    
	
 
    	
 
    	
 
    
	
Section 12.9
    	
Successors   and Assigns; Participations
    	
133
    
	
 
    	
 
    	
 
    
	
Section 12.10
    	
Treatment   of Certain Information; Confidentiality
    	
137
    
	
 
    	
 
    	
 
    
	
Section 12.11
    	
Performance   of Duties
    	
138
    
	
 
    	
 
    	
 
    
	
Section 12.12
    	
All   Powers Coupled with Interest
    	
138
    

 

v

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 12.13
    	
Survival
    	
139
    
	
 
    	
 
    	
 
    
	
Section 12.14
    	
Titles   and Captions
    	
139
    
	
 
    	
 
    	
 
    
	
Section 12.15
    	
Severability   of Provisions
    	
139
    
	
 
    	
 
    	
 
    
	
Section 12.16
    	
Counterparts;   Integration; Effectiveness; Electronic Execution
    	
139
    
	
 
    	
 
    	
 
    
	
Section 12.17
    	
Term   of Agreement
    	
140
    
	
 
    	
 
    	
 
    
	
Section 12.18
    	
USA   PATRIOT Act
    	
140
    
	
 
    	
 
    	
 
    
	
Section 12.19
    	
Independent   Effect of Covenants
    	
140
    
	
 
    	
 
    	
 
    
	
Section 12.20
    	
No   Advisory or Fiduciary Responsibility
    	
140
    
	
 
    	
 
    	
 
    
	
Section 12.21
    	
Inconsistencies   with Other Documents
    	
141
    

 

vi

 

	
EXHIBITS
    	
 
    	
 
    
	
Exhibit A-1
    	
-
    	
Form of   Revolving Credit Note
    
	
Exhibit A-2
    	
-
    	
Form of   Swingline Note
    
	
Exhibit A-3
    	
-
    	
Form of   Term Loan Note
    
	
Exhibit B
    	
-
    	
Form of   Notice of Borrowing
    
	
Exhibit C
    	
-
    	
Form of   Notice of Account Designation
    
	
Exhibit D
    	
-
    	
Form of   Notice of Prepayment
    
	
Exhibit E
    	
-
    	
Form of   Notice of Conversion/Continuation
    
	
Exhibit F
    	
-
    	
Form of   Officer’s Compliance Certificate
    
	
Exhibit G
    	
-
    	
Form of   Assignment and Assumption
    
	
Exhibit H-1
    	
-
    	
Form of   U.S. Tax Compliance Certificate (Non-Partnership Foreign Lenders)
    
	
Exhibit H-2
    	
-
    	
Form of   U.S. Tax Compliance Certificate (Non-Partnership Foreign Participants)
    
	
Exhibit H-3
    	
-
    	
Form of   U.S. Tax Compliance Certificate (Foreign Participant Partnerships)
    
	
Exhibit H-4
    	
-
    	
Form of   U.S. Tax Compliance Certificate (Foreign Lender Partnerships)
    
	
 
    	
 
    	
 
    
	
SCHEDULES
    	
 
    	
 
    
	
Schedule   1.1(b)
    	
-
    	
Commitments   and Commitment Percentages
    
	
Schedule   1.1(c)
    	
-
    	
Fiscal   Quarters
    
	
Schedule   1.1(d)
    	
-
    	
Fiscal   Years
    
	
Schedule   1.1(e)
    	
-
    	
Fiscal   Quarters and Fiscal Years after Fiscal Period Adjustment
    
	
Schedule   7.1
    	
-
    	
Jurisdictions   of Organization and Qualification
    
	
Schedule   7.2
    	
-
    	
Subsidiaries   and Capitalization
    
	
Schedule   7.6
    	
-
    	
Tax   Matters
    
	
Schedule   7.9
    	
-
    	
ERISA   Plans
    
	
Schedule   7.13
    	
-
    	
Labor   and Collective Bargaining Agreements
    
	
Schedule   7.18
    	
-
    	
Real   Property
    
	
Schedule   7.19
    	
-
    	
Litigation
    
	
Schedule   8.18
    	
-
    	
Post-Closing   Matters
    
	
Schedule   9.1
    	
-
    	
Existing   Indebtedness
    
	
Schedule   9.2
    	
-
    	
Existing   Liens
    
	
Schedule   9.3
    	
-
    	
Existing   Loans, Advances and Investments
    
	
Schedule   9.7
    	
-
    	
Transactions   with Affiliates
    

 

vii

 

CREDIT AGREEMENT, dated as of February 23, 2015, by and among BOOT BARN HOLDINGS, INC., a Delaware corporation, as Holdings, BOOT BARN, INC., a Delaware corporation, as Borrower, the lenders who are party to this Agreement and the lenders who may become a party to this Agreement pursuant to the terms hereof, as Lenders, and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Administrative Agent for the Lenders.  WELLS FARGO SECURITIES, LLC and PNC CAPITAL MARKETS LLC have each been given the title of joint lead arranger and joint bookrunner in connection with this Agreement.  PNC BANK, NATIONAL ASSOCIATION has been given the title of syndication agent in connection with this Agreement.

 

STATEMENT OF PURPOSE

 

The Borrower has requested, and subject to the terms and conditions set forth in this Agreement, the Administrative Agent and the Lenders have agreed to extend, certain credit facilities to the Borrower.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, such parties hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

SECTION 1.1                                             Definitions.  The following terms when used in this Agreement shall have the meanings assigned to them below:

 

“Acquisition” means any transaction, or any series of related transactions, consummated on or after the date of this Agreement, by which any Credit Party or any of its Subsidiaries (a) acquires any business or all or substantially all of the assets of any firm, corporation or limited liability company, or division thereof, 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 securities of a corporation which have ordinary voting power for the election of directors (other than securities having such power only by reason of the happening of a contingency) or a majority (by percentage or voting power) of the outstanding ownership interests of a partnership or limited liability company.

 

“Administrative Agent” means Wells Fargo, in its capacity as Administrative Agent hereunder, and any successor thereto appointed pursuant to Section 11.6.

 

“Administrative Agent’s Office” means the office of the Administrative Agent specified in or determined in accordance with the provisions of Section 12.1(c).

 

“Administrative Questionnaire” means an administrative questionnaire in a form supplied by the Administrative Agent.

 

 

“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 Person specified.

 

“Agreement” means this Credit Agreement.

 

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to Holdings or its Subsidiaries from time to time concerning or relating to bribery or corruption, including, without limitation, the United States Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.

 

“Applicable Law” means all applicable provisions of constitutions, laws, statutes, ordinances, rules, treaties, regulations, permits, licenses, approvals, interpretations and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.

 

“Applicable Margin” means the corresponding percentages per annum as set forth below based on the Consolidated Total Lease Adjusted Net Leverage Ratio:

 

	
Pricing
   Level
    	
 
    	
Consolidated Total Lease
   Adjusted Net Leverage Ratio
    	
 
    	
Commitment
   Fee
    	
 
    	
LIBOR
   Loans
    	
 
    	
Base Rate
   Loans
    	
 
    
	
I
    	
 
    	
Greater   than or equal to 4.75 to 1.00
    	
 
    	
0.40
    	
%
    	
2.75
    	
%
    	
1.75
    	
%
    
	
II
    	
 
    	
Greater   than or equal to 4.25 to 1.00, but less than 4.75 to 1.00
    	
 
    	
0.35
    	
%
    	
2.50
    	
%
    	
1.50
    	
%
    
	
III
    	
 
    	
Greater   than or equal to 3.75 to 1.00, but less than 4.25 to 1.00
    	
 
    	
0.30
    	
%
    	
2.25
    	
%
    	
1.25
    	
%
    
	
IV
    	
 
    	
Less   than 3.75 to 1.00
    	
 
    	
0.25
    	
%
    	
2.00
    	
%
    	
1.00
    	
%
    

 

The Applicable Margin shall be determined and adjusted quarterly on the date one Business Day after the day on which the Borrower provides an Officer’s Compliance Certificate pursuant to Section 8.2(a) for the most recently ended Fiscal Quarter (each such date, a “Calculation Date”); provided that (a) the Applicable Margin shall be based on Pricing Level III for the period commencing on the Closing Date until the first Calculation Date occurring after the Closing Date and, thereafter the Pricing Level shall be determined by reference to the Consolidated Total Lease Adjusted Net Leverage Ratio as of the last day of the most recently ended Fiscal Quarter preceding the applicable Calculation Date, and (b) if the Borrower fails to provide an Officer’s Compliance Certificate when due as required by Section 8.2(a) for the most recently ended Fiscal Quarter preceding the applicable Calculation Date, at the Administrative Agent’s or the Required Lenders’ election, the Applicable Margin from the date on which such Officer’s Compliance Certificate was required to have been delivered shall be based on Pricing Level I until such time as such Officer’s Compliance Certificate is delivered, at which time the Pricing Level shall be determined by reference to the Consolidated Total Lease Adjusted Net Leverage Ratio as of the last day of the most recently ended Fiscal Quarter preceding such Calculation Date.  The applicable Pricing Level shall be effective from one Calculation Date until the next Calculation Date.  Any adjustment in the Pricing Level shall be applicable to all Extensions of Credit then existing or subsequently made or issued.

 

Notwithstanding the foregoing, in the event that any financial statement or Officer’s Compliance Certificate delivered pursuant to Section 8.1 or 8.2(a) is shown to be inaccurate (regardless of

 

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whether (i) this Agreement is in effect, (ii) any Commitments are in effect, or (iii) any Extension of Credit is outstanding when such inaccuracy is discovered or such financial statement or Officer’s Compliance Certificate was delivered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin for any period (an “Applicable Period”) than the Applicable Margin applied for such Applicable Period, then (A) the Borrower shall promptly deliver to the Administrative Agent a corrected Officer’s Compliance Certificate for such Applicable Period, (B) the Applicable Margin for such Applicable Period shall be determined as if the Consolidated Total Lease Adjusted Net Leverage Ratio in the corrected Officer’s Compliance Certificate were applicable for such Applicable Period, and (C) the Borrower shall promptly and retroactively be obligated to pay to the Administrative Agent the accrued additional interest and fees owing as a result of such increased Applicable Margin for such Applicable Period, which payment shall be promptly applied by the Administrative Agent in accordance with Section 5.4.  Nothing in this paragraph shall limit the rights of the Administrative Agent and Lenders with respect to Sections 5.1(b) and 10.2 nor any of their other rights under this Agreement or any other Loan Document.  The Borrower’s obligations under this paragraph shall survive the termination of the Commitments and the repayment of all other Obligations hereunder.

 

Notwithstanding the foregoing, the Applicable Margin in respect of any Incremental Term Loans shall be the applicable percentages per annum set forth in the relevant Lender Joinder Agreement.

 

“Approved Fund” means any Fund 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.

 

“Arrangers” means Wells Fargo Securities, LLC and PNC Capital Markets LLC, in their respective capacity as joint lead arrangers and joint bookrunners.

 

“Asset Disposition” means the sale, transfer, license, lease or other disposition of any Property (including any disposition of Equity Interests of the Borrower or its Subsidiaries) by any Credit Party or any Subsidiary thereof.  The term “Asset Disposition” shall not include (a) the sale of inventory in the ordinary course of business, (b) the transfer of assets pursuant to any other transaction permitted pursuant to Section 9.4, (c) the write-off, discount, sale or other disposition of defaulted or past-due receivables and similar obligations in the ordinary course of business and not undertaken as part of an accounts receivable financing transaction, (d) the disposition of any Hedge Agreement, (e) dispositions of Investments in cash and Cash Equivalents, (f) the transfer by any Credit Party of its assets to any other Credit Party, (g) the transfer by any Non-Guarantor Subsidiary of its assets to any Credit Party (provided that in connection with any such transfer, such Credit Party shall not pay more than an amount equal to the fair market value of such assets as determined in good faith at the time of such transfer), (h) the transfer by any Non-Guarantor Subsidiary of its assets to any other Non-Guarantor Subsidiary, (i) Investments permitted pursuant to Section 9.3, (j) the lapse of registered patents, trademarks and other intellectual property of a Credit Party or Subsidiary thereof, with respect to the intellectual property that has been determined by any Credit Party or any Subsidiary thereof as not useful to its business or no longer commercially desirable; (k) dispositions of assets acquired by the Credit Parties and their Subsidiaries pursuant to a Permitted Acquisition

 

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consummated within 12 months of the date of the proposed disposition in an aggregate amount not to exceed $750,000 for each such Permitted Acquisition; (l) sales or other dispositions of a de minimis number of shares of the Equity Interests of a Foreign Subsidiary of Borrower in order to qualify members of the governing body of such Foreign Subsidiary if required by Applicable Law, (m) the endorsement of negotiable instruments held for collection in the ordinary course of business, (n) security deposits in respect of leases, utilities and other similar deposits in the ordinary course of business, (o) dispositions of equipment or real property, for fair market value, to the extent that such property is exchanged for credit against the purchase price of replacement property and (p) Restricted Payments permitted by Section 9.6.

 

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 12.9), and accepted by the Administrative Agent, in substantially the form attached as Exhibit G or any other form approved by the Administrative Agent.

 

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

 

“Base Rate” means, at any time, the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus 0.50% and (c) LIBOR for an Interest Period of one month plus 1%; each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the Prime Rate, the Federal Funds Rate or LIBOR (provided that clause (c) shall not be applicable during any period in which LIBOR is unavailable or unascertainable).

 

“Base Rate Loan” means any Loan bearing interest at a rate based upon the Base Rate as provided in Section 5.1(a).

 

“Borrower” means Boot Barn, Inc., a Delaware corporation.

 

“Borrower Materials” has the meaning assigned thereto in Section 8.2.

 

“Business Day” means (a) for all purposes other than as set forth in clause (b) below, any day other than a Saturday, Sunday or legal holiday on which banks in San Francisco, California and New York, New York, are open for the conduct of their commercial banking business and (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, any LIBOR Rate Loan, or any Base Rate Loan as to which the interest rate is determined by reference to LIBOR, any day that is a Business Day described in clause (a) and that is also a London Banking Day.

 

“Calculation Date” has the meaning assigned thereto in the definition of Applicable Margin.

 

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“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 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.

 

“Cash Collateralize” means, to  pledge and deposit with, or deliver to the Administrative Agent, or directly to the applicable Issuing Lender (with notice thereof to the Administrative Agent), for the benefit of one or more of the Issuing Lenders, the Swingline Lender or the Lenders, as collateral for L/C Obligations or obligations of the Lenders to fund participations in respect of L/C Obligations or Swingline Loans, cash or deposit account balances or, if the Administrative Agent and the applicable Issuing Lender and the Swingline Lender shall agree, in their sole discretion, other credit support, in each case pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent, such Issuing Lender and the Swingline Lender, as applicable.  “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

 

“Cash Equivalents” means, collectively, (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency thereof maturing within one hundred twenty (120) days from the date of acquisition thereof, (b) commercial paper maturing no more than one hundred twenty (120) days from the date of creation thereof and currently having the highest rating obtainable from either S&P or Moody’s, (c) certificates of deposit maturing no more than one hundred twenty (120) days from the date of creation thereof issued by commercial banks incorporated under the laws of the United States, each having combined capital, surplus and undivided profits of not less than $500,000,000 and having a rating of “A” or better by a nationally recognized rating agency, or (d) time deposits maturing no more than thirty (30) days from the date of creation thereof with commercial banks or savings banks or savings and loan associations each having membership either in the FDIC or the deposits of which are insured by the FDIC and in amounts not exceeding the maximum amounts of insurance thereunder.

 

“Cash Management Agreement” means any agreement to provide cash management services, including treasury, depository, overdraft, credit or debit card (including non-card electronic payables), electronic funds transfer and other cash management arrangements.

 

“Cash Management Bank” means any Person that, (a) at the time it enters into a Cash Management Agreement with a Credit Party, is a Lender, an Affiliate of a Lender, the Administrative Agent or an Affiliate of the Administrative Agent, or (b) at the time it (or its Affiliate) becomes a Lender (including on the Closing Date), is a party to a Cash Management Agreement with a Credit Party, in each case in its capacity as a party to such Cash Management Agreement.

 

“Change in Control” means an event or series of events by which:

 

(a)                                 at any time, Holdings shall fail to own one hundred percent (100%) of the Equity Interests of the Borrower; or

 

5

 

(b)                                 (i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit plan of such person or its Subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) (other than the Permitted Investors) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a “person” or “group” shall be deemed to have “beneficial ownership” of all Equity Interests that such “person” or “group” has the right to acquire, whether such right is exercisable immediately or only after the passage of time (such right, an “option right”)), directly or indirectly, of more than thirty-five percent (35%) of the Equity Interests of Holdings entitled to vote in the election of members of the board of directors (or equivalent governing body) of Holdings (provided that so long as the Permitted Investors own at least forty-five percent (45%) of the Equity Interests of Holdings, this clause (b)(i) shall only apply if the aggregate percentage of ownership of the Equity Interests of such “person” or “group” is greater than the aggregate percentage ownership of the Equity Interests held by the Permitted Investors) or (ii) during any period of twelve (12) consecutive months, a majority of the members of the board of directors or other equivalent governing body of Holdings cease to be comprised of individuals (x) who were members of that board or equivalent governing body on the first day of such period, (y) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (x) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (z) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (x) and (y) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body.

 

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

 

“Class” means, when used in reference to any Loan, whether such Loan is a Revolving Credit Loan, Swingline Loan, Initial Term Loan, Incremental Term Loan (of the same tranche) or Refinancing Term Loan and, when used in reference to any Commitment, whether such Commitment is a Revolving Credit Commitment, a Term Loan Commitment or an Incremental Term Loan Commitment (of the same tranche).

 

“Closing Date” means the date of this Agreement.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder.

 

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“Collateral” means the collateral security for the Secured Obligations pledged or granted pursuant to the Security Documents.

 

“Collateral Agreement” means the collateral agreement of even date herewith executed by the Credit Parties in favor of the Administrative Agent, for the benefit of the Secured Parties.

 

“Commitment Fee” has the meaning assigned thereto in Section 5.3(a).

 

“Commitment Percentage” means, as to any Lender, such Lender’s Revolving Credit Commitment Percentage or Term Loan Commitment Percentage with respect to any Term Loan Facility, as applicable.

 

“Commitments” means, collectively, as to all Lenders, the Revolving Credit Commitments, the Term Loan Commitments and the Incremental Term Loan Commitments of such Lenders.

 

“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.

 

“Consolidated” means, when used with reference to financial statements or financial statement items of any Person, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP.

 

“Consolidated EBITDAR” means, for any period, the sum of the following determined on a Consolidated basis, without duplication, for Holdings and its Subsidiaries in accordance with GAAP:

 

(a) Consolidated Net Income for such period;

 

plus

 

(b) the sum of the following, without duplication, and, except as to clauses (vii) and (xv), to the extent deducted in determining Consolidated Net Income for such period:

 

(i) income, capital, franchise, foreign withholding taxes, and any state business, unitary, gross receipts or any similar taxes;

 

(ii) Consolidated Interest Expense;

 

(iii) amortization, depreciation and other non-cash charges ((x) including any (A) non-cash charges relating to employee equity incentive programs, (B) non-cash charges attributable to inventory revaluations as a result of any Permitted Acquisition, (C) non-cash write-offs relating to impairment or disposal of assets, (D) non-cash expenses relating to the Boot Barn Rewards Program and (E) non-cash charges associated with any share based compensation awards or equity grants, and (y) excluding any non-cash charges to the extent that such non-cash charges  represent an accrual or reserve for potential cash items in any future period);

 

7

 

(iv) extraordinary losses (excluding extraordinary losses from discontinued operations);

 

(v) Transaction Costs;

 

(vi) Consolidated Rent Expense;

 

(vii) proceeds from business interruption insurance from loss of income to the extent recognized during such period;

 

(viii) Pre-Opening Costs;

 

(ix) to the extent not included in Consolidated Interest Expense, payment-in-kind interest and amortized or deferred financing fee expenses;

 

(x)(A) restructuring expenses and charges, (B) to the extent not constituting a Pre-Opening Cost, severance and other costs incurred in connection with the termination, relocation and training of employees, (C) costs incurred in connection with relocation, recruitment and training of employees (including executive placement charges) to the extent not constituting a Pre-Opening Cost, and (D) transition costs contemplated by or relating to Permitted Acquisitions, including any expenses or charges relating to hiring, severance or stay bonuses paid to employees contemplated by or relating to any such Permitted Acquisition, including related employee benefits attributable to such payments; provided that the total amount added pursuant to clause (xv) below together this clause (x) may not exceed 15% of Consolidated EBITDAR in any period of four consecutive Fiscal Quarters (without giving effect to this clause (x));

 

(xi) fees and expenses of the board of directors paid by Holdings or any of its Subsidiaries in an amount not to exceed $500,000 in any period of four consecutive Fiscal Quarters;

 

(xii) non-recurring litigation or claim settlement charges or expenses in an amount not to exceed $7,500,000 in the aggregate during the term of this Agreement;

 

(xiii) any earn-out or other similar contingent deferred purchase price payment obligations incurred in connection with a Permitted Acquisition;

 

(xiv) losses from discontinued operations; and

 

(xv) the amount of cost savings, operating expense reductions, other operating improvements and synergies projected by Holdings to be realized in connection with any Specified Transaction during the 15-month period following the date of such Specified Transaction (calculated on a Pro Forma Basis as though such cost savings, operating expense reductions, other operating improvements and synergies had been realized on the first day of such period and as if such cost savings, operating expense reductions, other operating improvements and synergies were realized during the entirety of such period), net of the amount of actual benefits realized during such period from such actions; provided that (1) such amounts are reasonably identifiable and projected in the good faith

 

8

 

judgment of Holdings, (2) such cost savings, operating expense reductions, other operating improvements and synergies are reasonably attributable to such transaction, (3) no amounts shall be added pursuant to this clause (xv) to the extent duplicative of any amounts that are otherwise added back in computing Consolidated EBITDAR, whether through a pro forma adjustment or otherwise, (4) Holdings shall have delivered to the Administrative Agent a certificate of a Responsible Officer of Holdings, certifying that such cost savings, operating expense reductions, other operating improvements and synergies meet the requirements set forth in clause (xv), together with reasonably detailed evidence in support thereof and (5) the aggregate amount of cost savings, operating expense reductions, other operating improvements and synergies; provided that the total amount added pursuant to clause (x) above together with this clause (xv) may not exceed 15% of Consolidated EBITDAR in any period of four consecutive Fiscal Quarters (without giving effect to this clause (xv)); less

 

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

 

(i) any extraordinary gains;

 

(ii) gains from discontinued operations;

 

(iii) non-cash gains or non-cash items increasing Consolidated Net Income; and

 

(iv) gains or income from the early extinguishment of Indebtedness.

 

Notwithstanding the foregoing, for purposes of this Agreement, (I) Consolidated EBITDAR shall be adjusted on a Pro Forma Basis and (II) quarterly Consolidated EBITDAR shall be deemed to be (A) for the Fiscal Quarter ended June 28, 2014, $13,033,577, (B) for the Fiscal Quarter ended September 27, 2014, $13,392,191 and (C) for the Fiscal Quarter ended December 27, 2014, $28,540,808.

 

“Consolidated Fixed Charge Coverage Ratio” means, as of any date of determination, for the period of four (4) consecutive Fiscal Quarters ending on or immediately prior to such date, the ratio of (a) (i) Consolidated EBITDAR to (b) Consolidated Fixed Charges.

 

“Consolidated Fixed Charges” means, for any period, the sum of the following determined on a Consolidated basis for such period, without duplication, for Holdings and its Subsidiaries in accordance with GAAP: (a) Consolidated Interest Expense paid in cash, (b) scheduled principal payments (excluding mandatory prepayments of principal) with respect to Indebtedness, provided, however, that for purposes of this clause (b), any optional or mandatory prepayments made during such period that are applied in forward order pursuant to Section 4.4 to payments on the Loans scheduled to be made during such period shall be disregarded, and such scheduled payments on the Loans during such period (prior to the making of such forward order payments) shall be included in this clause (b) notwithstanding the prior application of such prepayments to such scheduled payments; (c) federal, state, local and foreign income taxes paid in cash by Holdings and its Subsidiaries, and (d) Consolidated Rent Expense; provided, however, that for each of the four Fiscal Quarter periods ending with the first full Fiscal Quarter after the Closing Date, the second full Fiscal Quarter after the Closing Date and

 

9

 

the third full Fiscal Quarter after the Closing Date, Consolidated Fixed Charges for each such four Fiscal Quarter period shall be deemed equal to the sum of clauses (a) and (b) above for the full quarters after the Closing Date ending thereon multiplied by 4, by 2 and by 4/3rds, respectively.

 

“Consolidated Interest Expense” means, for any period, the sum of the following determined on a Consolidated basis, without duplication, for Holdings and its Subsidiaries in accordance with GAAP, interest expense (including, without limitation, interest expense attributable to Capital Lease Obligations and all net payment obligations pursuant to Hedge Agreements) for such period net of any interest income for such period.

 

“Consolidated Net Income” means, for any period, the net income (or loss) of Holdings and its Subsidiaries for such period, determined on a Consolidated basis, without duplication, in accordance with GAAP; provided, that in calculating Consolidated Net Income of Holdings and its Subsidiaries for any period, there shall be excluded (to the extent otherwise included therein), without duplication, (a) the net income (or loss) of any Person (other than a Subsidiary which shall be subject to clause (c) below), in which Holdings or any of its Subsidiaries has a joint interest with a third party, except to the extent such net income is actually paid in cash to Holdings or any of its Subsidiaries by dividend or other distribution during such period, (b) the net income (or loss) of any Person accrued prior to the date it becomes a Subsidiary of Holdings or any of its Subsidiaries or is merged into or consolidated with Holdings or any of its Subsidiaries or that Person’s assets are acquired by Holdings or any of its Subsidiaries except to the extent included pursuant to the foregoing clause (a), (c) the net income (if positive), of any Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary to Holdings or any of its Subsidiaries of such net income (i) is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Subsidiary or (ii) would be subject to any taxes payable on such dividends or distributions, but in each case only to the extent of such prohibition or taxes and (d) any gain or loss from Asset Dispositions during such period.

 

“Consolidated Rent Expense” means, for any period, the aggregate rent (excluding any operating lease expense which shall include, without limitation, CAM, tax pass-throughs and other similar pass-through items) of Holdings and its Subsidiaries for such period, determined on a Consolidated basis in accordance with GAAP.

 

“Consolidated Total Indebtedness” means, as of any date of determination with respect to Holdings and its Subsidiaries on a Consolidated basis without duplication, the sum, without duplication, of (i) all Attributable Indebtedness of such Person with respect to such Person’s Capital Lease Obligations and Synthetic Lease Obligations, (ii) Indebtedness evidencing the deferred purchase price of newly acquired property (including, without limitation earn-outs or similar contingent obligations in connection with an acquisition) or incurred to finance the acquisition, purchase, construction, improvement or remodel of a fixed or capital asset of the Borrower or its Subsidiaries, (iii) Indebtedness of such Person for borrowed money, (iv) Indebtedness of such Person constituting Guarantees in respect of the foregoing and (v) all obligations of any such Person relative to the letters of credit that have been drawn and not reimbursed.

 

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“Consolidated Total Lease Adjusted Net Leverage Ratio” means, as of any date of determination, the ratio of (a) (i) Consolidated Total Indebtedness outstanding on such date plus (ii) the product of Consolidated Rent Expense for the period of four consecutive Fiscal Quarters ended on or immediately prior to such date multiplied by a factor of 8 minus (iii) (x) until the first Control Agreement is executed in accordance with Section 8.18, the lesser of (1) the aggregate amount of cash and Cash Equivalents of Holdings and its Subsidiaries and (2) $10,000,000, and (y) thereafter, the aggregate amount of cash and Cash Equivalents of Holdings and its Subsidiaries subject to a Control Agreement on such date to (b) Consolidated EBITDAR for the period of the four consecutive Fiscal Quarters ended on or immediately prior to 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.

 

“Control Agreement” means a control agreement among Holdings or any of its Subsidiaries, a depository bank, a securities intermediary or a commodity intermediary, as the case may be, and the Administrative Agent, in form and substance reasonably acceptable to the Administrative Agent.

 

“Credit Facility” means, collectively, the Revolving Credit Facility, the Term Loan Facility, the Swingline Facility and the L/C Facility.

 

“Credit Parties” means, collectively, the Borrower and the Guarantors.

 

“Debt Issuance” means the issuance of any Indebtedness for borrowed money by any Credit Party or any of its Subsidiaries.

 

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

 

“Default” means any of the events specified in Section 10.1 which with the passage of time, the giving of notice or any other condition, would constitute an Event of Default.

 

“Defaulting Lender” means, subject to Section 5.15(b), any Lender that (a) has failed to (i) fund all or any portion of the Revolving Credit Loans, any Term Loan, participations in L/C Obligations or participations in Swingline Loans required to be funded by it hereunder within two Business Days of the date such Loans or participations were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any Issuing Lender, the Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent, any Issuing Lender or the Swingline Lender in writing that it does not

 

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intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the FDIC or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.  Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 5.15(b)) upon delivery of written notice of such determination to the Borrower, each Issuing Lender, the Swingline Lender and each Lender.

 

“Disqualified Equity Interests” means any Equity Interests that, by their terms (or by the terms of any security or other Equity Interest into which they are convertible or for which they are exchangeable) or upon the happening of any event or condition, (a)  mature or are mandatorily redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise (except as a result of a change of control or asset sale so long as any rights of the holders thereof upon the occurrence of a change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other Obligations that are accrued and payable and the termination of the Commitments), (b) are redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests) (except as a result of a change of control or asset sale so long as any rights of the holders thereof upon the occurrence of a change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other Obligations that are accrued and payable and the termination of the Commitments), in whole or in part, (c) provide for the scheduled payment of dividends in cash or (d) are or become convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Equity Interests, in each case under clauses (a)-(d) above, prior to the date that is 91 days after the Latest Maturity Date; provided that if such Equity Interests are issued pursuant to a plan for the benefit of Holdings or its Subsidiaries or by any such plan to such employees, such Equity Interests shall not constitute Disqualified Equity Interests solely because they may be required to be repurchased by Holdings or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations.

 

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“Dollars” or “$” means, unless otherwise qualified, dollars in lawful currency of the United States.

 

“Domestic Subsidiary” means any Subsidiary organized under the laws of any political subdivision of the United States.

 

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 12.9(b)(iii), (v) and (vi) (subject to such consents, if any, as may be required under Section 12.9(b)(iii)).

 

“Employee Benefit Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA that is maintained by any Credit Party for employees of any Credit Party.

 

“Environmental Claims” means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations (other than internal reports prepared by any Person in the ordinary course of business and not in response to any third party action or request of any kind) or proceedings relating in any way to any actual or alleged violation of or liability under any Environmental Law or relating to any permit issued, or any approval given, under any such Environmental Law, including any and all claims by Governmental Authorities for enforcement, cleanup, removal, response, remedial or other actions or damages, contribution, indemnification, cost recovery, compensation or injunctive relief resulting from Hazardous Materials or arising from alleged injury or threat of injury to human health or the environment from a release of or exposure to Hazardous Materials.

 

“Environmental Laws” means any and all federal, foreign, state, provincial and local laws, statutes, ordinances, codes, rules, standards and regulations, permits, licenses, approvals and orders of courts or Governmental Authorities, relating to the protection of health, safety or the environment, including requirements pertaining to the manufacture, processing, distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing, permitting, investigation or remediation of Hazardous Materials.

 

“Equity Interests” means (a) in the case of a corporation, capital stock, (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership interests (whether general or limited), (d) in the case of a limited liability company, membership interests, (e) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person and (f) any and all warrants, rights or options to purchase any of the foregoing.

 

“Equity Issuance” means (a) any issuance by Holdings of shares of its Equity Interests to any Person that is not a Credit Party (including, without limitation, any initial public offering, secondary offering or related equity issuance and any equity issuance in connection with the exercise of options or warrants or the conversion of any debt securities to equity) and (b) any capital contribution from any Person that is not a Credit Party into any Credit Party or any Subsidiary thereof.  The term “Equity Issuance” shall not include (A) any Asset Disposition or (B) any Debt Issuance.

 

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“ERISA” means the Employee Retirement Income Security Act of 1974, and the rules and regulations thereunder.

 

“ERISA Affiliate” means any Person who together with any Credit Party or any of its Subsidiaries is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.

 

“Eurodollar Reserve Percentage” means, for any day, the percentage which is in effect for such day as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including any basic, supplemental or emergency reserves) in respect of eurocurrency liabilities or any similar category of liabilities for a member bank of the Federal Reserve System in New York City.

 

“Event of Default” means any of the events specified in Section 10.1; provided that any requirement for passage of time, giving of notice, or any other condition, has been satisfied.

 

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

 

“Excluded Subsidiary” means (a) any Domestic Subsidiary that is not a Wholly-Owned Subsidiary, (b) any Immaterial Subsidiary, (c) any Domestic Subsidiary of a Foreign Subsidiary classified as a controlled foreign corporation under Section 957 of the Code, (d) any Domestic Subsidiary all or substantially all of the assets of which are Equity Interests in one or more Foreign Subsidiaries which are classified as controlled foreign corporations within the meaning of Section 957 of the Code, (e) any Subsidiary to the extent a guaranty or a pledge of its Equity Interest is prohibited or restricted by applicable requirements of law (including any requirement to obtain Governmental Approvals), rule or regulation and (f) any other Subsidiary with respect to which, in the reasonable judgment of the Administrative Agent and the Borrower, the burden or cost or other consequences of providing a guaranty shall be excessive in view of the benefits to be obtained by the Lenders therefrom.

 

“Excluded Swap Obligation” means, with respect to any Credit Party, any Swap Obligation if, and to the extent that, and for so long as,  all or a portion of the liability of such Credit Party for or the guarantee of such Credit Party of, or the grant by such Credit Party of a security interest to secure, such Swap Obligation (or any liability or 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 Credit Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the liability for or the guarantee of such Credit Party or the grant of such security interest becomes 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 for the reasons identified in the immediately preceding sentence of this definition.

 

“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

 

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imposed on or measured by gross income (other than withholding Taxes) or 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, United States federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 5.12(b)) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 5.11, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 5.11(g) and (d) any United States federal withholding Taxes imposed under FATCA.

 

“Extensions of Credit” means, as to any Lender at any time, (a) an amount equal to the sum of (i) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding, (ii) such Lender’s Revolving Credit Commitment Percentage of the L/C Obligations then outstanding, (iii) such Lender’s Revolving Credit Commitment Percentage of the Swingline Loans then outstanding and (iv) the aggregate principal amount of the Term Loans made by such Lender then outstanding, or (b) the making of any Loan or participation in any Letter of Credit by such Lender, as the context requires.

 

“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, any agreement entered into pursuant to Section 1471(b)(1) of the Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code.

 

“FDIC” means the Federal Deposit Insurance Corporation.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day (or, if such day is not a Business Day, for the immediately preceding Business Day), as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that if such rate is not so published for any day which is a Business Day, the average of the quotation for such day on such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by the Administrative Agent.

 

“Fee Letters” means (a) the separate fee letter agreement dated February 17, 2015 among the Borrower, Wells Fargo and Wells Fargo Securities, LLC and (b) any letter between the Borrower and any Issuing Lender (other than Wells Fargo) relating to certain fees payable to such Issuing Lender in its capacity as such.

 

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“First Tier Foreign Subsidiary” means any Foreign Subsidiary the Equity Interests of which are owned directly by any Credit Party.

 

“Fiscal Period Adjustment” means the change in the Fiscal Year end and Fiscal Quarter end of Holdings and its Subsidiaries from the periods described on Schedule 1.1(c) and Schedule 1.1(d) to the periods described on Schedule 1.1(e).

 

“Fiscal Quarter” means each fiscal quarter of Holdings and its Subsidiaries which, prior to the Fiscal Period Adjustment, end on each of the dates set forth on Schedule 1.1(c), and after the Fiscal Period Adjustment, end of each of the dates set forth on Schedule 1.1(e), which shall be delivered to the Administrative Agent within five (5) Business Days after the effectiveness of the Fiscal Period Adjustment.

 

“Fiscal Year” means each fiscal year of Holdings and its Subsidiaries which, prior to the Fiscal Period Adjustment, end on each of the dates set forth on Schedule 1.1(d), and after the Fiscal Period Adjustment, end on each of the dates set forth on Schedule 1.1(e), which shall be delivered to the Administrative Agent within five (5) Business Days after the effectiveness of the Fiscal Period Adjustment.

 

“Foreign Lender” means a Lender that is not a U.S. Person.

 

“Foreign Pledge Agreement” means a pledge agreement, charge agreement or similar agreement in form and substance reasonably acceptable to the Administrative Agent executed by a Credit Party with respect to a pledge (or equivalent thereof) of Equity Interests of a Foreign Subsidiary required by the terms of this Agreement

 

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

 

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to any Issuing Lender, such Defaulting Lender’s Revolving Credit Commitment Percentage of the outstanding L/C Obligations with respect to Letters of Credit issued by such Issuing Lender, other than such L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof and (b) with respect to the Swingline Lender, such Defaulting Lender’s Revolving Credit Commitment Percentage of outstanding Swingline Loans other than Swingline Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.

 

“Fund” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit in the ordinary course of its activities.

 

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States (including, without limitation, the FASB Accounting

 

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Standards Codification), that are applicable to the circumstances as of the date of determination, consistently applied and subject to Section 1.3.

 

“Governmental Approvals” means all authorizations, consents, approvals, permits, licenses and exemptions of, and all registrations and filings with or issued by, any Governmental Authorities.

 

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

 

“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 payable by another 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, (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, (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation or (e) for the purpose of assuming in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (whether in whole or in part).  The amount of any Guarantee shall be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made (including pursuant to any limitations on liability set forth in such Guarantee) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith.

 

“Guarantors” means, collectively, Holdings and each Subsidiary Guarantor.

 

“Guaranty Agreement” means the guaranty agreement of even date herewith executed by the Borrower and the Guarantors in favor of the Administrative Agent, for the benefit of the Secured Parties, which shall be in form and substance reasonably acceptable to the Administrative Agent.

 

“Hazardous Materials” means any substances or materials (a) which are defined as hazardous wastes, hazardous substances, pollutants, contaminants, or toxic substances under any Environmental Law, (b) which are toxic, explosive, corrosive, flammable, radioactive, carcinogenic, mutagenic or otherwise harmful to health, safety or the environment and are regulated by any Governmental Authority, (c) the presence of which require investigation or remediation under any Environmental Law, (d) the discharge or emission or release of which requires a permit or license under any Environmental Law or other Governmental Approval, or

 

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(e) which contain, without limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas.

 

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

 

“Hedge Bank” means any Person that, (a) at the time it enters into a Hedge Agreement with a Credit Party permitted under Article IX, is a Lender, an Affiliate of a Lender, the Administrative Agent or an Affiliate of the Administrative Agent or (b) at the time it (or its Affiliate) becomes a Lender (including on the Closing Date), is a party to a Hedge Agreement with a Credit Party, in each case in its capacity as a party to such Hedge Agreement.

 

“Hedge Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include a Lender or any Affiliate of a Lender).

 

“Holdings” means Boot Barn Holdings, Inc., a Delaware corporation.

 

“Immaterial Subsidiaries” means, as of any date of determination, those Domestic Subsidiaries designated by the Borrower in writing to the Administrative Agent that, when considered on an individual or aggregate basis, do not have (A) Consolidated EBITDAR attributable to such Immaterial Subsidiaries in excess of 5% of the Consolidated EBITDAR of Holdings and its Subsidiaries for the most recent four consecutive Fiscal Quarter period for which the Borrower has delivered Holdings’ financial statements or (B) assets (valued at the greater of book value or fair market value) in excess of 5% of the consolidated total assets of Holdings and its Subsidiaries as of the last day of the most recent Fiscal Quarter ended for which the Borrower has delivered Holdings’ financial statements.  The Borrower’s written notice described above shall include calculations with respect to clauses (A) and (B) in detail reasonably satisfactory to the Administrative Agent.  The Borrower may designate and re-designate a Domestic Subsidiary as an Immaterial Subsidiary at any time, subject to the

 

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limitations and requirements set forth in this definition.  Baskins Acquisition Holdings, LLC, a Delaware limited liability company, and RCC Western Stores, Inc., a South Dakota corporation, are designated as Immaterial Subsidiaries and as of the Closing Date are the only Immaterial Subsidiaries.

 

“Increased Amount Date” has the meaning assigned thereto in Section 5.13(a).

 

“Incremental Lender” has the meaning assigned thereto in Section 5.13(a).

 

“Incremental Term Loan” has the meaning assigned thereto in Section 5.13(a).

 

“Incremental Term Loan Commitment” has the meaning assigned thereto in Section 5.13(a).

 

“Indebtedness” means, with respect to any Person at any date and without duplication, the sum of the following:

 

(a)           all liabilities, obligations and indebtedness for borrowed money including obligations evidenced by bonds, debentures, notes or other similar instruments of any such Person;

 

(b)           all obligations to pay the deferred purchase price of property or services of any such Person, except (i) trade accounts payable arising in the ordinary course of business not more than ninety (90) days past due, or that are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided for on the books of such Person and (ii) earn-outs or similar contingent obligations that are not due and payable as of such date;

 

(c)           the Attributable Indebtedness of such Person;

 

(d)           all Indebtedness of any other Person secured by a Lien on any asset owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements but excluding (i) customary reservations or retentions of title under agreements with suppliers entered into in the ordinary course of business and (ii) trade accounts payable arising in the ordinary course of business, whether or not such indebtedness shall have been assumed by such Person or is limited in recourse); provided that, for purposes any covenant herein, the amount of any such Indebtedness shall be the lower of (A) the fair market value of such asset and (B) the amount of Indebtedness secured;

 

(e)           all obligations, contingent or otherwise, of any such Person relative to the face amount of letters of credit, whether or not drawn, including any Reimbursement Obligation, and banker’s acceptances issued for the account of any such Person;

 

(f)            all obligations of any such Person in respect of Disqualified Equity Interests;

 

(g)           all net obligations of such Person under any Hedge Agreements; and

 

(h)           all Guarantees of any such Person with respect to any of the foregoing.

 

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For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person.  The amount of any net obligation under any Hedge Agreement on any date shall be deemed to be the Hedge Termination Value thereof as of such date.

 

“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 Credit Party under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes, other than, in either case, any such Taxes as are imposed solely by reason of the gross negligence or willful neglect of the Administrative Agent or Lender, as applicable.

 

“Initial Issuing Lender” means Wells Fargo.

 

“Initial Term Loan” means the term loan made, or to be made, to the Borrower by the Term Loan Lenders pursuant to Section 4.1.

 

“Insurance and Condemnation Event” means the receipt by any Credit Party or any of its Subsidiaries of any cash insurance proceeds or condemnation award payable by reason of theft, loss, physical destruction or damage, taking or similar event with respect to any of their respective Property.

 

“Interest Period” means, as to each LIBOR Rate Loan, the period commencing on the date such LIBOR Rate Loan is disbursed or converted to or continued as a LIBOR Rate Loan and ending on the date one (1), two (2), three (3), or six (6) months (or, if approved by all of the relevant Lenders (such approval not to be unreasonably withheld), nine (9) or twelve (12) months or a period shorter than one (1) month) thereafter, in each case as selected by the Borrower in its Notice of Borrowing or Notice of Conversion/Continuation and subject to availability; provided that:

 

(a)           the Interest Period shall commence on the date of advance of or conversion to any LIBOR Rate Loan and, in the case of immediately successive Interest Periods, each successive Interest Period shall commence on the date on which the immediately preceding Interest Period expires;

 

(b)           if any Interest Period would otherwise expire on a day that is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided that if any Interest Period with respect to a LIBOR Rate Loan would otherwise expire on a day that is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the immediately preceding Business Day;

 

(c)           any Interest Period with respect to a LIBOR Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the relevant calendar month at the end of such Interest Period;

 

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(d)                                 no Interest Period for any Revolving Credit Loan shall extend beyond the Revolving Credit Maturity Date

 

(e)                                  no Interest Period for any Term Loan shall extend beyond the Term Loan Maturity Date applicable to such Term Loan and Interest Periods shall be selected by the Borrower so as to permit the Borrower to make the quarterly principal installment payments pursuant to Section 4.3 for such Term Loan without payment of any amounts pursuant to Section 5.9; and

 

(f)                                   there shall be no more than twelve (12) Interest Periods in effect at any time.

 

“Investment” has the meaning set forth in Section 9.3.

 

“IRS” means the United States Internal Revenue Service.

 

“ISP98” means the International Standby Practices (1998 Revision, effective January 1, 1999), International Chamber of Commerce Publication No. 590.

 

“Issuing Lender” means (a) the Initial Issuing Lender and (b) any other Revolving Credit Lender to the extent it has agreed in its sole discretion to act as an “Issuing Lender” hereunder and has been approved in writing by the Borrower and the Administrative Agent (such approval by the Administrative Agent not to be unreasonably delayed or withheld) as an “Issuing Lender” hereunder, in each case in its capacity as issuer of any Letter of Credit.

 

“Latest Maturity Date” means the latest maturity date of any Class of Loan or Commitment hereunder.

 

“L/C Commitment” means, as to any Issuing Lender, the obligation of such Issuing Lender to issue Letters of Credit for the account of the Borrower or one or more of its Subsidiaries from time to time in an aggregate amount equal to (a) for the Initial Issuing Lender, the amount set forth opposite the name of the Initial Issuing Lender on Schedule 1.1(b) and (b) for any other Issuing Lender becoming an Issuing Lender after the Closing Date, such amount as separately agreed to in a written agreement between the Borrower and such Issuing Lender (which such agreement shall be promptly delivered to the Administrative Agent upon execution), in each case of clauses (a) and (b) above, any such amount may be changed after the Closing Date in a written agreement between the Borrower and such Issuing Lender (which such agreement shall be promptly delivered to the Administrative Agent upon execution); provided that the L/C Commitment with respect to any Person that ceases to be an Issuing Lender for any reason pursuant to the terms hereof shall be $0 (subject to the Letters of Credit of such Person remaining outstanding in accordance with the provisions hereof).

 

“L/C Facility” means the letter of credit facility established pursuant to Article III.

 

“L/C Obligations” means at any time, an amount equal to the sum of (a) the aggregate undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit which have not then been reimbursed pursuant to Section 3.5.

 

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“L/C Participants” means, with respect to any Letter of Credit, the collective reference to all the Revolving Credit Lenders other than the applicable Issuing Lender.

 

“L/C Sublimit” means the lesser of (a) $5,000,000 and (b) the Revolving Credit Commitment.  The L/C Sublimit is a part of, and not in addition to, the Revolving Credit Commitment.

 

“Lender” means each Person executing this Agreement as a Lender on the Closing Date and any other Person that shall have become a party to this Agreement as a Lender pursuant to an Assignment and Assumption or pursuant to Section 5.13, other than any Person that ceases to be a party hereto as a Lender pursuant to an Assignment and Assumption.  Unless the context otherwise requires, the term “Lenders” includes the Swingline Lender.

 

“Lender Joinder Agreement” means a joinder agreement in form and substance reasonably satisfactory to the Administrative Agent delivered in connection with Section 5.13.

 

“Lending Office” means, with respect to any Lender, the office of such Lender maintaining such Lender’s Extensions of Credit.

 

“Letter of Credit Application” means an application, in the form specified by the applicable Issuing Lender from time to time, requesting such Issuing Lender to issue a Letter of Credit.

 

“Letters of Credit” means the collective reference to letters of credit issued pursuant to Section 3.1.

 

“LIBOR” means,

 

(a)                                 for any interest rate calculation with respect to a LIBOR Rate Loan, the rate of interest per annum determined on the basis of the rate for deposits in Dollars for a period equal to the applicable Interest Period which appears on Reuters Screen LIBOR01 or LIBOR02 Page (or any applicable successor page) at approximately 11:00 a.m. (London time) two (2) London Banking Days prior to the first day of the applicable Interest Period.  If, for any reason, such rate does not appear on Reuters Screen LIBOR01 or LIBOR02 Page (or any applicable successor page), then “LIBOR” shall be determined by the Administrative Agent to be the arithmetic average of the rate per annum at which deposits in Dollars would be offered by first class banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London time) two (2) London Banking Days prior to the first day of the applicable Interest Period for a period equal to such Interest Period, and

 

(b)                                 for any interest rate calculation with respect to a Base Rate Loan, the rate of interest per annum determined on the basis of the rate for deposits in Dollars for an Interest Period equal to one month (commencing on the date of determination of such interest rate) which appears on the Reuters Screen LIBOR01 or LIBOR02 Page (or any applicable successor page) at approximately 11:00 a.m. (London time) on such date of determination, or, if such date is not a Business Day, then the immediately preceding Business Day.  If, for any reason, such rate does not appear on Reuters Screen LIBOR01 or LIBOR02 Page (or any applicable successor page) then “LIBOR” for such Base Rate Loan shall be determined by the Administrative Agent to be

 

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the arithmetic average of the rate per annum at which deposits in Dollars would be offered by first class banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London time) on such date of determination for a period equal to one month commencing on such date of determination.

 

Each calculation by the Administrative Agent of LIBOR shall be conclusive and binding for all purposes, absent manifest error.

 

“LIBOR Rate” means a rate per annum determined by the Administrative Agent pursuant to the following formula:

 

	
 
    	
LIBOR   Rate =
    	
LIBOR
    	
 
    
	
 
    	
 
    	
1.00-Eurodollar Reserve Percentage
    	
 
    

 

Notwithstanding the foregoing, if the LIBOR Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

 

“LIBOR Rate Loan” means any Loan bearing interest at a rate based upon the LIBOR Rate as provided in Section 5.1(a).

 

“Lien” means, with respect to any asset, any mortgage, leasehold mortgage, lien, pledge, charge, security interest, hypothecation or encumbrance of any kind in respect of such asset.  For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease Obligation or other title retention agreement relating to such asset.

 

“Loan Documents” means, collectively, this Agreement, each Note, the Letter of Credit Applications, the Security Documents, the Guaranty Agreement, the Fee Letters, any Lender Joinder Agreement, any Refinancing Amendment and each other document, instrument, certificate and agreement executed and delivered by the Credit Parties or any of their respective Subsidiaries in favor of or provided to the Administrative Agent or any Secured Party in connection with this Agreement or otherwise referred to herein or contemplated hereby (excluding any Secured Hedge Agreement and any Secured Cash Management Agreement).

 

“Loans” means the collective reference to the Revolving Credit Loans, the Term Loans and the Swingline Loans (including the Initial Term Loan and any Incremental Term Loans), and “Loan” means any of such Loans.

 

“London Banking Day” means any day on which dealings in Dollar deposits are conducted by and between banks in the London interbank Eurodollar market.

 

“Material Adverse Effect” means (a) a material adverse effect on the operations, business, assets, properties or financial condition of Holdings and its Subsidiaries, taken as a whole, (b) a material impairment of the ability of the Credit Parties (taken as a whole) to perform their obligations under any material Loan Document, (c) a material adverse effect on the rights and remedies of the Administrative Agent or any Lender under any material Loan Document or

 

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(d) an impairment of the legality, validity or enforceability against any Credit Party of any material Loan Document to which it is a party.

 

“Material Contract” means any contract or agreement, written or oral, of any Credit Party or any of its Subsidiaries, the breach, non-performance, cancellation or failure to renew of which could reasonably be expected to have a Material Adverse Effect.

 

“Minimum Collateral Amount” means, at any time, (a) with respect to Cash Collateral consisting of cash or deposit account balances, an amount equal to 102% of the sum of (i) the Fronting Exposure of the Issuing Lender with respect to Letters of Credit issued and outstanding at such time and (ii) the Fronting Exposure of the Swingline Lender with respect to all Swingline Loans outstanding at such time and (b) otherwise, an amount determined by the Administrative Agent and each of the applicable Issuing Lenders that is entitled to Cash Collateral hereunder at such time in their sole discretion.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Mortgages” means the collective reference to each mortgage, deed of trust or other real property security document, encumbering any real property now or hereafter owned by any Credit Party, in each case, in form and substance reasonably satisfactory to the Administrative Agent and executed by such Credit Party in favor of the Administrative Agent, for the benefit of the Secured Parties, as any such document may be amended, restated, supplemented or otherwise modified from time to time.

 

“Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA which is subject to Title IV of ERISA and to which any Credit Party or any ERISA Affiliate is making, or is accruing an obligation to make, or has accrued an obligation to make contributions within the preceding seven (7) years.

 

“Net Cash Proceeds” means, as applicable, (a) with respect to any Asset Disposition or Insurance and Condemnation Event, the gross proceeds received by any Credit Party or any of its Subsidiaries therefrom (including any cash, Cash Equivalents, deferred payment pursuant to, or by monetization of, a note receivable or otherwise, as and when received) less the sum of (i) all reasonable and customary  out of pocket fees and expenses incurred in connection with such transaction or event, including, without limitation, all attorneys’ fees, accountants’ fees, and investment banking fees, (ii) amounts required to be applied to the repayment of Indebtedness secured by a Lien expressly permitted hereunder on any asset that is the subject of such Asset Disposition or Insurance and Condemnation Event (other than any Lien pursuant to a Security Document), (iii) taxes paid and the Borrower’s reasonable and good faith estimate of income, franchise, sales, and other applicable taxes required to be paid by Holdings, the Borrower or any Subsidiary in connection with such Asset Disposition or Insurance and Condemnation Event, the computation of which shall, in each such case, take into account the reduction in tax liability resulting from any available operating losses and net operating loss carryovers, tax credits, and tax credit carry forwards, and similar tax attributes, (iv) amounts provided as a cash reserve, in accordance with GAAP, or amounts placed in a funded escrow, against any liabilities under any indemnification obligations or purchase price adjustments associated with any Asset Disposition or Insurance and Condemnation Event, including, without limitation, pension and other post-

 

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employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction (provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds), and (v) the Borrower’s good faith estimate of payment required to be made with respect to unassumed liabilities directly relating to the assets sold (provided that, to the extent such cash proceeds are not so used within 12 months of such Asset Disposition, such cash proceeds shall constitute Net Cash Proceeds); and (b) with respect to Debt Issuance, the gross cash proceeds received by any Credit Party or any of its Subsidiaries therefrom less all reasonable and customary out-of-pocket legal, underwriting and other customary  fees, discounts, commissions and expenses incurred in connection therewith.

 

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver, amendment, modification or termination that (a) requires the approval of all Lenders or all affected Lenders in accordance with the terms of Section 12.2 and (b) has been approved by the Required Lenders.

 

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

 

“Non-Guarantor Subsidiary” means any Subsidiary of Holdings (other than the Borrower) that is not a Subsidiary Guarantor.

 

“Notes” means the collective reference to the Revolving Credit Notes, the Swingline Note and the Term Loan Notes.

 

“Notice of Account Designation” has the meaning assigned thereto in Section 2.3(b).

 

“Notice of Borrowing” has the meaning assigned thereto in Section 2.3(a).

 

“Notice of Conversion/Continuation” has the meaning assigned thereto in Section 5.2.

 

“Notice of Prepayment” has the meaning assigned thereto in Section 2.4(c).

 

“Obligations” means, in each case, whether now in existence or hereafter arising: (a) the principal of and interest on (including interest accruing after the filing of any bankruptcy or similar petition) the Loans, (b) the L/C Obligations and (c) all other fees and commissions (including attorneys’ fees), charges, indebtedness, loans, liabilities, financial accommodations, obligations, covenants and duties owing by the Credit Parties and each of their respective Subsidiaries to the Lenders, the Issuing Lender or the Administrative Agent, in each case under any Loan Document, with respect to any Loan or Letter of Credit of every kind, nature and description, direct or indirect, absolute or contingent, due or to become due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any note and including interest and fees that accrue after the commencement by or against any Credit Party or any Subsidiary thereof of any proceeding under any Debtor Relief Laws, naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

 

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

 

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“Officer’s Compliance Certificate” means a certificate of the chief financial officer, vice president or the treasurer of Holdings substantially in the form attached as Exhibit F.

 

“Operating Lease” means, as to any Person as determined in accordance with GAAP, any lease of Property (whether real, personal or mixed) by such Person as lessee which is not a capital lease.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes” means all present or future stamp, court, 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 5.12).

 

“Participant” has the meaning assigned thereto in Section 12.9(d).

 

“Participant Register” has the meaning assigned thereto in Section 12.9(d).

 

“PATRIOT Act” means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)).

 

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

 

“Pension Plan” means any employee pension benefit plan, as defined in Section 3(2) of ERISA, other than a Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is maintained, funded or administered for the employees of any Credit Party or any ERISA Affiliate or (b) has at any time within the preceding seven (7) years been maintained, funded or administered for the employees of any Credit Party or any current or former ERISA Affiliates and with respect to which any Credit Party or any ERISA Affiliate has any outstanding liability.

 

“Permitted Acquisition” means any Acquisition that meets all of the following requirements:

 

(a)                                 with respect to such Acquisition, the board of directors (or equivalent governing body) of the Person or business to be acquired shall not have indicated its opposition to the consummation of such Acquisition (which opposition has not been publicly withdrawn);

 

(b)                                 the Person or business to be acquired shall be in a line of business permitted pursuant to Section 9.11;

 

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(c)                                  if such Acquisition is a merger or consolidation, the Borrower or a Subsidiary Guarantor shall be the surviving Person and no Change in Control shall have been effected thereby;

 

(d)                                 the Borrower shall have delivered to the Administrative Agent all documents required to be delivered pursuant to, and in accordance with, Section 8.13, within the timeframes provided therein;

 

(e)                                  if the Permitted Acquisition Consideration for any such Acquisition (or series of related Acquisitions) is $10,000,000 or more in the aggregate, no later than three (3) Business Days prior to the proposed closing date of such Acquisition, the Borrower shall have delivered to the Administrative Agent (i) written notice of such Acquisition and the proposed closing date thereof, and (ii) an Officer’s Compliance Certificate for the most recent Fiscal Quarter end preceding such Acquisition for which financial statements are available (x) demonstrating, in form and substance reasonably satisfactory to the Administrative Agent, that the Borrower is in compliance on a Pro Forma Basis (as of the proposed closing date of the Acquisition and after giving effect thereto) with each covenant contained in Section 9.13 and (y) certifying that all of the requirements set forth above have been satisfied or will be satisfied on or prior to the consummation of such purchase or other Acquisition;

 

(f)                                   no Default or Event of Default shall have occurred and be continuing both before and after giving effect to such Acquisition and any Indebtedness incurred in connection therewith; and

 

(g)                                  the Borrower shall have obtained the prior written consent of the Required Lenders prior to the consummation of such Acquisition (or series of related Acquisitions) if (x) the Permitted Acquisition Consideration for such Acquisition (or series of related Acquisitions), together with all other Acquisitions consummated during the term of this Agreement, exceeds $75,000,000 in the aggregate or (y) the Permitted Acquisition Consideration for an Acquisition of any Person or Property that does not become a Credit Party or Property of a Credit Party exceeds $15,000,000;

 

Notwithstanding the foregoing, if the Permitted Acquisition is being financed with the proceeds of any Incremental Term Loan, the Incremental Lenders providing such Incremental Term Loan may agree that the incurrence of such Incremental Term Loan shall be subject only to customary “Limited Conditionality Provisions”.

 

“Permitted Acquisition Consideration” means, with respect to any Acquisition, an amount equal to the aggregate consideration, whether cash, property or securities (excluding (a) the value of any Equity Interests of Holdings issued in connection therewith, (b) any unsecured contingent liabilities of a Credit Party or its Subsidiaries arising under an agreement to make any deferred payment as part of the purchase price for any Permitted Acquisition, including earn outs, performance bonuses or consulting payments in any related services, employment or similar agreements in an amount that is subject to or contingent upon earning, revenues, income cash flow or profits (or the like) of the target of such Permitted Acquisition, (c) any cash of the seller or its Affiliates used to fund any portion of such consideration and (d) any cash or Cash Equivalents acquired in connection with such Acquisition), to be paid on a singular basis in

 

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connection with any Permitted Acquisition as set forth in the applicable Permitted Acquisition Documents executed by Borrower or any of its Subsidiaries  in order to consummate the applicable Permitted Acquisition.

 

“Permitted Acquisition Documents” means with respect to any Acquisition proposed by Holdings, the Borrower or any Subsidiary Guarantor, final copies or substantially final drafts if not executed at the required time of delivery of the purchase agreement, sale agreement, merger agreement or other agreement evidencing such Acquisition, including all legal opinions and each other document executed, delivered, contemplated by or prepared in connection therewith and any amendment, modification or supplement to any of the foregoing.

 

“Permitted Consignment Sale” means a sale of inventory by Borrower or any of its Subsidiaries to a third party on a consignment basis; provided that: (a) the aggregate value of all such inventory sold by Borrower or any of its Subsidiaries on consignment at any time shall not exceed $250,000 and (b) Borrower or such Subsidiary shall have filed a valid UCC-1 financing statement covering the consigned inventory in the relevant filing office under the UCC, applicable to the consignee and, if applicable, notified any creditor of the consignee with a security interest in the inventory of the consignee of Borrower’s or such Subsidiary’s rights as consignee with respect to such inventory.

 

“Permitted Investors” means, collectively, Freeman Spogli Management Co., L.P., or any successor thereto, and any fund or other Person (other than portfolio companies) Controlled directly or indirectly by Freeman Spogli Management Co., L.P., or any successor thereto, or any of its Affiliates.

 

“Permitted Liens” means the Liens permitted pursuant to Section 9.2.

 

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

 

“Platform” means Debt Domain, Intralinks, SyndTrak or a substantially similar electronic transmission system.

 

“Pledged Foreign Subsidiary” means a Foreign Subsidiary of a Credit Party for which the Administrative Agent has received a Foreign Pledge Agreement from such Credit Party, with respect to 65% of the total outstanding voting Equity Interests (and 100% of the non-voting Equity Interests) (or, in each case, such greater percentage as would not result in adverse federal income tax consequences for Holdings or any of its Subsidiaries) of such Foreign Subsidiary and such Foreign Pledge Agreement is in full force and effect and such Credit Party shall have satisfied all actions and requirements related to such Foreign Pledge Agreement (including delivery of stock certificates, where applicable).

 

“Pre-Opening Costs” means expenses incurred with respect to the acquisition, opening and organizing of new Stores of the Credit Parties to the extent not prohibited by this Agreement, such  costs  including,  but  not  limited  to,  the  cost  of  feasibility  studies, freight,  staff-training  and recruiting, and travel costs for employees engaged in such start-up activities; provided, however, that (a) such Pre-Opening Costs are incurred within ninety (90) days before

 

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the opening of the applicable new Store, and (b) the aggregate amount of such Pre-Opening Costs does not exceed an average of $150,000 with respect to each single location.

 

“Prime Rate” means, at any time, the rate of interest per annum publicly announced from time to time by the Administrative Agent as its prime rate.  Each change in the Prime Rate shall be effective as of the opening of business on the day such change in such prime rate occurs.  The parties hereto acknowledge that the rate announced publicly by the Administrative Agent as its prime rate is an index or base rate and shall not necessarily be its lowest or best rate charged to its customers or other banks.

 

“Pro Forma Basis” means with respect to any determination of the Consolidated Total Lease Adjusted Net Leverage Ratio, the Consolidated Fixed Charge Coverage Ratio or Consolidated EBITDAR (including, in each case, component definitions thereof) that all Specified Transactions and the following transactions in connection therewith shall be deemed to have occurred as of the first day of the applicable period with respect to any test or covenant for which such calculation is being made: (a) income statement items (whether positive or negative) attributable to the property or Person subject to a Specified Disposition shall be excluded, (b) any retirement or repayment of Indebtedness (other than normal fluctuations in revolving Indebtedness incurred for working capital purposes) and (c) any Indebtedness incurred or assumed by Holdings or any of its Subsidiaries in connection therewith, provided that, (x) if such Indebtedness has a floating or formula rate, such Indebtedness shall have an implied rate of interest for the applicable period for purposes of this definition determined by utilizing the rate that is or would be in effect with respect to such Indebtedness at the relevant date of determination (taking into account any interest hedging arrangements applicable to such Indebtedness), (y) interest on or in respect of  any Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a Responsible Officer of Holdings to be the rate of interest implicit in such obligation in accordance with GAAP and (z) interest on any Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a Eurocurrency interbank offered rate or other rate shall be determined to have been based upon the rate actually chosen, or if none, then based upon such optional rate chosen as Holdings or such Subsidiary may designate.   Any calculation of the Consolidated Total Lease Adjusted Net Leverage Ratio on a Pro Forma Basis shall be made using Consolidated Total Indebtedness as of such date of calculation, and Consolidated EBITDAR for the four consecutive Fiscal Quarter period most recently ended for which the Borrower has delivered financial statements pursuant to Section 8.1(a) or 8.1(b).

 

“Property” means any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, including Equity Interests.

 

“Public Lenders” has the meaning assigned thereto in Section 8.2.

 

“Qualified Equity Interests” means any Equity Interests that are not Disqualified Equity Interests.

 

“Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any Issuing Lender, as applicable.

 

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“Refinancing Amendment” means an amendment to this Agreement (which may, at the option of the Administrative Agent and the Borrower, be in the form of an amendment and restatement of this Agreement) in form and substance reasonably satisfactory to the Administrative Agent and the Borrower executed by each of (a) the Borrower, (b) the Administrative Agent and (c) each existing or new Lender that agrees to provide any portion of the Refinancing Term Loan being incurred pursuant thereto, in accordance with Section 5.16.

 

“Refinancing Effective Date” has the meaning specified in Section 5.16.

 

“Refinancing Indebtedness” means the Refinancing Term Loan or Refinancing Notes.

 

“Refinancing Notes” means any notes or loans, in each case which will be pari passu or subordinated in right of payment to the Obligations and be secured by the Collateral on a pari passu or junior Lien basis or which will be unsecured, issued pursuant to one or more indentures, note purchase agreements or other agreements (other than this Agreement or a Refinancing Amendment) to refinance, renew, replace, defease or refund all Term Loans then outstanding; provided that (a) the Refinancing Notes shall be issued in lieu of the Refinancing Term Loan, and there shall only be no more than one issuance of Refinancing Notes, (b) such notes or loans shall not mature prior to the Latest Maturity Date (or, in the case of any subordinated notes or loans, senior unsecured notes or loans or junior lien secured notes or loans, prior to the date that is 91 days after the Latest Maturity Date) or have a shorter weighted average life to maturity than the Initial Term Loan or Incremental Term Loans (if any), (c) no Subsidiary shall be a guarantor with respect to such notes or loans unless such Subsidiary is a Guarantor and the borrower of such notes or loans shall be the Borrower, (d) if subordinated to the Obligations, such notes or loans shall be subject to customary subordination terms agreed to by the holders thereof (or a duly authorized agent or trustee on their behalf) and reasonably satisfactory to the Administrative Agent, (e) if secured, such notes or loans (x) shall not be secured by any assets that do not constitute Collateral, (y) shall not be secured pursuant to security documentation that, taken as a whole, is more restrictive to the Credit Parties than the Loan Documents and (z) shall be subject to customary intercreditor and/or subordination agreements, as applicable, agreed to by the holders thereof (or a duly authorized agent or trustee on their behalf) and reasonable satisfactory to the Administrative Agent, (f) the Borrower shall prepay the Term Loans in full with the proceeds therefrom and the amount of Refinancing Notes issued shall not exceed the principal amount of the Term Loans (plus unpaid accrued interest and premium (if any) thereon outstanding and any underwriting discounts, commissions and reasonable fees and expenses incurred in connection therewith) and (g) all other terms and conditions applicable to such notes or loans (excluding pricing and optional prepayment or redemption terms) shall, in all material respects, be substantially identical or no more favorable (when taken as a whole) to the Persons providing or purchasing such notes or loans than those applicable to the Initial Term Loan and Incremental Term Loans (except for covenants or other provisions applicable only to periods after the Latest Maturity Date (or, in the case of any subordinated notes or loans, senior unsecured notes or loans or junior lien secured notes or loans, after the date 91 days after the Latest Maturity Date), as certified by the chief financial officer of Holdings in good faith prior to the incurrence of such notes or loans.

 

“Refinancing Term Loan” has the meaning specified in Section 5.16(a).

 

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“Register” has the meaning assigned thereto in Section 12.9(c).

 

“Reimbursement Obligation” means the obligation of the Borrower to reimburse any Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit issued by such Issuing Lender.

 

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

 

“Required Lenders” means, at any time, Lenders having Total Credit Exposures representing more than fifty percent (50%) of the Total Credit Exposures of all Lenders.  The Total Credit Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.  Notwithstanding the foregoing, Required Lenders shall comprise no less than two such Lenders that are not Affiliates of one another, unless (x) all Lenders that are not Defaulting Lenders are Affiliates of one another or (y) there is only one Lender that is not a Defaulting Lender, at such time.

 

“Required Revolving Credit Lenders” means, at any date, any combination of Revolving Credit Lenders holding more than fifty percent (50%) of the sum of the aggregate amount of the Revolving Credit Commitment or, if the Revolving Credit Commitment has been terminated, any combination of Revolving Credit Lenders holding more than fifty percent (50%) of the aggregate Extensions of Credit under the Revolving Credit Facility; provided that the Revolving Credit Commitment of, and the portion of the Extensions of Credit under the Revolving Credit Facility, as applicable, held or deemed held by, any Defaulting Lender shall be disregarded in determining the Required Revolving Credit Lenders. Notwithstanding the foregoing, Required Revolving Credit Lenders shall comprise no less than two such Revolving Credit Lenders that are not Affiliates of one another, unless (x) all Revolving Credit Lenders that are not Defaulting Lenders are Affiliates of one another or (y) there is only one Revolving Credit Lender that is not a Defaulting Lender, at such time.

 

“Responsible Officer” means, as to any Person, the chief executive officer, president, vice president, executive vice president, chief financial officer, principal accounting officer, controller, secretary, assistant secretary, treasurer or assistant treasurer of such Person or any other officer of such Person designated in writing by the Borrower and reasonably acceptable to the Administrative Agent.  Any document delivered hereunder or under any other Loan Document that is signed by a Responsible Officer of a Person shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Person and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Person.

 

“Restricted Payment” has the meaning assigned thereto in Section 9.6.

 

“Revolving Credit Commitment” means (a) as to any Revolving Credit Lender, the obligation of such Revolving Credit Lender to make Revolving Credit Loans to, and to purchase participations in L/C Obligations and Swingline Loans for the account of, the Borrower hereunder in an aggregate principal amount at any time outstanding not to exceed the amount set

 

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forth opposite such Revolving Credit Lender’s name on the Register, as such amount may be modified at any time or from time to time pursuant to the terms hereof and (b) as to all Revolving Credit Lenders, the aggregate commitment of all Revolving Credit Lenders to make Revolving Credit Loans, as such amount may be modified at any time or from time to time pursuant to the terms hereof.  The aggregate Revolving Credit Commitment of all the Revolving Credit Lenders on the Closing Date shall be $75,000,000.  The initial Revolving Credit Commitment of each Revolving Credit Lender is set forth opposite the name of such Lender on Schedule 1.1(b).

 

“Revolving Credit Commitment Percentage” means, with respect to any Revolving Credit Lender at any time, the percentage of the total Revolving Credit Commitments of all the Revolving Credit Lenders represented by such Revolving Credit Lender’s Revolving Credit Commitment.  If the Revolving Credit Commitments have terminated or expired, the Revolving Credit Commitment Percentages shall be determined based upon the Revolving Credit Commitments most recently in effect, giving effect to any assignments.  The initial Revolving Credit Commitment Percentage of each Revolving Credit Lender is set forth opposite the name of such Lender on Schedule 1.1(b).

 

“Revolving Credit Exposure” means, as to any Revolving Credit Lender at any time, the aggregate principal amount at such time of its outstanding Revolving Credit Loans and such Revolving Credit Lender’s participation in L/C Obligations and Swingline Loans at such time.

 

“Revolving Credit Facility” means the revolving credit facility established pursuant to Article II.

 

“Revolving Credit Lenders” means, collectively, all of the Lenders with a Revolving Credit Commitment.

 

“Revolving Credit Loan” means any revolving loan made to the Borrower pursuant to Section 2.1, and all such revolving loans collectively as the context requires.

 

“Revolving Credit Maturity Date” means the earliest to occur of (a) February 23, 2020, (b) the date of termination of the entire Revolving Credit Commitment by the Borrower pursuant to Section 2.5, and (c) the date of termination of the Revolving Credit Commitment pursuant to Section 10.2(a).

 

“Revolving Credit Note” means a promissory note made by the Borrower in favor of a Revolving Credit Lender evidencing the Revolving Credit Loans made by such Revolving Credit Lender, substantially in the form attached as Exhibit A-1, and any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.

 

“Revolving Credit Outstandings” means the sum of (a) with respect to Revolving Credit Loans and Swingline Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Revolving Credit Loans and Swingline Loans, as the case may be, occurring on such date; plus (b) with respect to any L/C Obligations on any date, the aggregate outstanding amount thereof on such date after giving effect to any Extensions of Credit occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements of

 

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outstanding unpaid drawings under any Letters of Credit or any reductions in the maximum amount available for drawing under Letters of Credit taking effect on such date.

 

“Revolving Extensions of Credit” means (a) any Revolving Credit Loan then outstanding, (b) any Letter of Credit then outstanding or (c) any Swingline Loan then outstanding.

 

“S&P” means Standard & Poor’s Financial Services LLC, a part of McGraw-Hill Financial and any successor thereto.

 

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by the U.S. government (including those administered by OFAC), the European Union, Her Majesty’s Treasury, or other relevant sanctions authority.

 

“Sanctioned Country” means at any time, a country or territory which is itself the subject or target of any Sanctions (including, without limitation, Cuba, Iran, North Korea, Sudan and Syria).

 

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in clauses (a) and (b).

 

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

 

“Secured Cash Management Agreement” means any Cash Management Agreement between or among any Credit Party and any Cash Management Bank.

 

“Secured Hedge Agreement” means any Hedge Agreement between or among any Credit Party and any Hedge Bank.

 

“Secured Obligations” means, collectively, (a) the Obligations and (b) all existing or future payment and other obligations owing by any Credit Party under (i) any Secured Hedge Agreement (other than an Excluded Swap Obligation) and (ii) any Secured Cash Management Agreement.

 

“Secured Parties” means, collectively, the Administrative Agent, the Lenders, the Issuing Lenders, the Hedge Banks, the Cash Management Banks, each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to Section 11.5, any other holder from time to time of any of any Secured Obligations and, in each case, their respective successors and permitted assigns.

 

“Security Documents” means the collective reference to the Collateral Agreement, the Mortgages (if any), each Control Agreement, each Foreign Pledge Agreement and each other

 

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agreement or writing pursuant to which any Credit Party pledges or grants a security interest in any Property or assets securing the Secured Obligations.

 

“Solvent” and “Solvency” mean, with respect to any Person on any date of determination, that on such date (a) the fair value of the property of such Person and its Subsidiaries, taken as a whole, is greater than the total amount of liabilities, including contingent liabilities, of such Person and its Subsidiaries, taken as a whole, (b) the present fair salable value of the assets of such Person and its Subsidiaries, taken as a whole, is not less than the amount that will be required to pay the probable liability of such Person and its Subsidiaries, taken as a whole, on their consolidated debts as they become absolute and matured, (c) such Person and its Subsidiaries, taken as a whole, do not intend to, and do not believe that they will, incur debts or liabilities beyond such their consolidated ability to pay such debts and liabilities as they mature, (d) such Person, and its Subsidiaries, taken as a whole, are not engaged in business or a transaction, and are not about to engage in business or a transaction, for which such their consolidated property would constitute unreasonably small capital, and (e) such Person and its Subsidiaries, taken as a whole, are able to pay their debts and liabilities, contingent obligations and other commitments as they mature in the ordinary course of business.  The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

 

“Specified Event of Default” means an Event of Default under Sections 10.1(a), 10.01(b),  10.1(d) (as a result of default in the performance or observance of Sections 8.1(a) and (b), 8.4 or Article IX), (h) or (i).

 

“Specified Disposition” means any disposition of all or substantially all of the assets or Equity Interests of any Subsidiary of the Borrower or any division, business unit, product line or line of business.

 

“Specified Transactions” means (a) any Specified Disposition, (b) any Permitted Acquisition, (c) the Transactions and (d) any other event that by the terms of the Loan Documents requires pro forma compliance with a test or covenant hereunder or requires such test or covenant to be calculated on a Pro Forma Basis.

 

“Stores” shall mean the retail stores operated by Borrower or any of its Subsidiaries.

 

“Subordinated Indebtedness” means the collective reference to any Indebtedness incurred by Holdings or any of its Subsidiaries that is subordinated in right and time of payment to the Obligations on terms and conditions reasonably satisfactory to the Administrative Agent.

 

“Subsidiary” means as to any Person, any corporation, partnership, limited liability company or other entity of which more than fifty percent (50%) of the outstanding Equity Interests having ordinary voting power to elect a majority of the board of directors (or equivalent governing body) or other managers of such corporation, partnership, limited liability company or other entity is at the time owned by (directly or indirectly) or the management is otherwise controlled by (directly or indirectly) such Person (irrespective of whether, at the time, Equity Interests of any other class or classes of such corporation, partnership, limited liability company

 

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or other entity shall have or might have voting power by reason of the happening of any contingency).  Unless otherwise qualified, references to “Subsidiary” or “Subsidiaries” herein shall refer to those of Holdings.

 

“Subsidiary Guarantors” means, collectively, all direct and indirect Domestic Subsidiaries of Holdings (other than the Borrower and Excluded Subsidiaries) in existence on the Closing Date or which become a party to the Guaranty Agreement pursuant to Section 8.13.

 

“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.

 

“Swingline Commitment” means the lesser of (a) $10,000,000 and (b) the Revolving Credit Commitment. The Swingline Commitment is a part of, and not in addition to, the Revolving Credit Commitment.

 

“Swingline Facility” means the swingline facility established pursuant to Section 2.2.

 

“Swingline Lender” means Wells Fargo in its capacity as swingline lender hereunder or any successor thereto.

 

“Swingline Loan” means any swingline loan made by the Swingline Lender to the Borrower pursuant to Section 2.2, and all such swingline loans collectively as the context requires.

 

“Swingline Note” means a promissory note made by the Borrower in favor of the Swingline Lender evidencing the Swingline Loans made by the Swingline Lender, substantially in the form attached as Exhibit A-2, and any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.

 

“Synthetic Lease” means any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing product where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an Operating Lease in accordance with GAAP.

 

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

 

“Term Loan Commitment” means (a) as to any Term Loan Lender, the obligation of such Term Loan Lender to make a portion of the Initial Term Loan or Incremental Term Loans, as applicable, to the account of the Borrower hereunder on the Closing Date (in the case of the Initial Term Loan) or the applicable borrowing date (in the case of any Incremental Term Loan) in an aggregate principal amount not to exceed the amount set forth opposite such Lender’s name on Schedule 1.1(b), as such amount may be increased, reduced or otherwise modified at any time or from time to time pursuant to the terms hereof and (b) as to all Term Loan Lenders, the aggregate commitment of all Term Loan Lenders to make such Term Loans.  The aggregate

 

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Term Loan Commitment with respect to the Initial Term Loan of all Term Loan Lenders on the Closing Date shall be $75,000,000.  The Term Loan Commitment of each Term Loan Lender as of the Closing Date is set forth opposite the name of such Term Loan Lender on Schedule 1.1(b).

 

“Term Loan Commitment Percentage” means, with respect to any Term Loan Lender and any Term Loan Facility at any time, the percentage of the total outstanding principal balance of the Term Loans of such Term Loan Facility represented by the outstanding principal balance of such Term Loan Lender’s Term Loans of such Term Loan Facility.  The Term Loan Commitment Percentage of each Term Loan Lender as of the Closing Date is set forth opposite the name of such Lender on Schedule 1.1(b).

 

“Term Loan Facility” means the term loan facility established pursuant to Article IV (including any new term loan facility established pursuant to Section 5.13).

 

“Term Loan Installment Date” means the last Business Day of each Fiscal Quarter commencing on the last Business Day of the Fiscal Quarter ending closest to June 30, 2015.

 

“Term Loan Lender” means any Lender with a Term Loan Commitment and/or outstanding Term Loans.

 

“Term Loan Maturity Date” means (a) for the Initial Term Loan, February 23, 2020 and (b) for any Incremental Term Loans, the final maturity date specified in the applicable Lender Joinder Agreement.

 

“Term Loan Note” means a promissory note made by the Borrower in favor of a Term Loan Lender evidencing the portion of the Term Loans made by such Term Loan Lender, substantially in the form attached as Exhibit A-3, and any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.

 

“Term Loans” means the Initial Term Loan and, if applicable, the Incremental Term Loans and “Term Loan” means any of such Term Loans.

 

“Termination Event” means the occurrence of any of the following which, individually or in the aggregate, has resulted or could reasonably be expected to result in liability of the Borrower in an aggregate amount in excess of the Threshold Amount: (a) a “Reportable Event” described in Section 4043 of ERISA for which the thirty (30) day notice requirement has not been waived by the PBGC, (b) the withdrawal of any Credit Party or any ERISA Affiliate from a Pension Plan during a plan year in which it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA, (c) the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a termination, under Section 4041 of ERISA, if the plan assets are not sufficient to pay all plan liabilities, (d) the institution of proceedings to terminate, or the appointment of a trustee with respect to, any Pension Plan by the PBGC, (e) a determination by the PBGC that there has occurred an event or there exists a condition which would constitute grounds under Section 4042(a) of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan, (f) the imposition of a Lien pursuant to Section 430(k) of the Code or Section 303 of ERISA on the property of any Credit Party, (g) the determination that any

 

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Pension Plan, or the receipt by any Credit Party or any ERISA Affiliate of notice that a Multiemployer Plan, is considered an at-risk plan or plan in endangered or critical status with the meaning of Sections 430, 431 or 432 of the Code or Sections 303, 304 or 305 of ERISA (h) the partial or complete withdrawal of any Credit Party or any ERISA Affiliate from a Multiemployer Plan if withdrawal liability is asserted against such Credit Party or ERISA Affiliate by such plan pursuant to Part 1 of Subtitle E of Title IV of ERISA, (i) the receipt by any Credit Party or ERISA Affiliate of notice of any event or condition which results in the reorganization or insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, (j) the receipt by any Credit Party or any ERISA Affiliate of notice of any event or condition which results in the termination of a Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA, or (k) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Credit Party or any ERISA Affiliate.

 

“Threshold Amount” means $12,500,000.

 

“Total Credit Exposure” means, as to any Lender at any time, the unused Commitments, Revolving Credit Exposure and outstanding Term Loans of such Lender at such time.

 

“Transaction Costs” means all transaction fees, charges (including premiums, discounts and Hedge Agreement settlement and termination costs) and other amounts (a) related to the Transactions and any Permitted Acquisitions (including any financing fees, merger and acquisition fees, legal fees and expenses, due diligence fees or any other fees and expenses in connection therewith), or (b) attributable to any debt financings or refinancings, Equity Issuance, mergers, recapitalizations, Acquisitions, Investments, option buyouts, dispositions or other similar transactions, in the case of (i) Transactions Costs related to the Transactions, to the extent paid within six (6) months of the Closing Date, and (ii) in all other cases, to the extent paid during the applicable period whether or not the applicable transaction is completed.

 

“Transactions” means, collectively, (a) the repayment in full on the Closing Date of certain existing Indebtedness of Holdings and its Subsidiaries, (b) the initial Extensions of Credit, and (c) the payment of the Transaction Costs incurred in connection with the foregoing.

 

“UCC” means the Uniform Commercial Code as in effect in the State of New York.

 

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

 

“United States” means the United States of America.

 

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

 

“U.S. Tax Compliance Certificate” has the meaning assigned thereto in Section 5.11(g).

 

“Wells Fargo” means Wells Fargo Bank, National Association, a national banking association.

 

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“Wholly-Owned” means, with respect to a Subsidiary, that all of the Equity Interests of such Subsidiary are, directly or indirectly, owned or controlled by Holdings and/or one or more of its Wholly-Owned Subsidiaries (except for directors’ qualifying shares or other shares required by Applicable Law to be owned by a Person other than Holdings and/or one or more of its Wholly-Owned Subsidiaries).

 

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

 

SECTION 1.2                                             Other Definitions and Provisions.  With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document: (a) the definitions of terms herein shall apply equally to the singular and plural forms of the terms defined, (b) whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms, (c) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (d) the word “will” shall be construed to have the same meaning and effect as the word “shall”, (e) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (f) 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, (g) 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, (h) 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, (i) the term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form and (j) in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including”.

 

SECTION 1.3                                             Accounting Terms.

 

(a)                                 All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with GAAP, applied on a consistent basis, as in effect from time to time and in a manner consistent with that used in preparing the audited financial statements required by Section 8.1(a), except as otherwise specifically prescribed herein.  Notwithstanding the foregoing, for purposes of determining compliance with any covenant (including the computation of any financial ratio) contained herein, the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall be disregarded and any Indebtedness of Holdings and its Subsidiaries subject thereto shall be deemed to be carried at 100% of the outstanding principal amount thereof unless otherwise specified herein.

 

(b)                                 If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so

 

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amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

 

SECTION 1.4                                             UCC Terms.  Terms defined in the UCC in effect on the Closing Date and not otherwise defined herein shall, unless the context otherwise indicates, have the meanings provided by those definitions.  Subject to the foregoing, the term “UCC” refers, as of any date of determination, to the UCC then in effect.

 

SECTION 1.5                                             Rounding.  Any financial ratios required to be maintained or measured pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio or percentage is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

 

SECTION 1.6                                             References to Agreement and Laws.  Unless otherwise expressly provided herein, (a) any definition or reference to formation documents, governing documents, agreements (including the Loan Documents) and other contractual documents or instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan Document; and (b) any definition or reference to any Applicable Law, including the Code, the Commodity Exchange Act, ERISA, the Exchange Act, the PATRIOT Act, the Securities Act of 1933, the UCC, the Investment Company Act of 1940, the Interstate Commerce Act, the Trading with the Enemy Act of the United States or any of the foreign assets control regulations of the United States Treasury Department, shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Applicable Law.

 

SECTION 1.7                                             Times of Day.  Unless otherwise specified, all references herein to times of day shall be references to Pacific time (daylight or standard, as applicable).

 

SECTION 1.8                                             Letter of Credit Amounts.  Unless otherwise specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum face amount of such Letter of Credit after giving effect to all increases thereof contemplated by such Letter of Credit or the Letter of Credit Application therefor (at the time specified therefor in such applicable Letter of Credit or Letter of Credit Application and as such amount may be reduced by (a) any permanent reduction of such Letter of Credit or (b) any amount which is drawn, reimbursed and no longer available under such Letter of Credit).

 

SECTION 1.9                                             Guarantees.  Unless otherwise specified, the amount of any Guarantee shall be the lesser of the principal amount of the obligations guaranteed and still outstanding and the maximum amount for which the guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Guarantee.

 

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SECTION 1.10                                      Covenant Compliance Generally.  For purposes of determining compliance under Sections 9.1, 9.2, 9.3, 9.5 and 9.6, any amount in a currency other than Dollars will be converted to Dollars in a manner consistent with that used in calculating Consolidated Net Income in the most recent annual financial statements of Holdings and its Subsidiaries delivered pursuant to Section 8.1(a).  Notwithstanding the foregoing, for purposes of determining compliance with Sections 9.1, 9.2 and 9.3, with respect to any amount of Indebtedness or Investment in a currency other than Dollars, no breach of any basket contained in such Sections shall be deemed to have occurred solely as a result of changes in rates of exchange occurring after the time such Indebtedness or Investment is incurred; provided that for the avoidance of doubt, the foregoing provisions of this Section 1.10 shall otherwise apply to such Sections, including with respect to determining whether any Indebtedness or Investment may be incurred at any time under such Sections.

 

ARTICLE II

 

REVOLVING CREDIT FACILITY

 

SECTION 2.1                                             Revolving Credit Loans.  Subject to the terms and conditions of this Agreement and the other Loan Documents, and in reliance upon the representations and warranties set forth in this Agreement and the other Loan Documents, each Revolving Credit Lender severally agrees to make Revolving Credit Loans to the Borrower from time to time from the Closing Date to, but not including, the Revolving Credit Maturity Date as requested by the Borrower in accordance with the terms of Section 2.3; provided, that (a) the Revolving Credit Outstandings shall not exceed the Revolving Credit Commitment and (b) the Revolving Credit Exposure of any Revolving Credit Lender shall not at any time exceed such Revolving Credit Lender’s Revolving Credit Commitment.  Each Revolving Credit Loan by a Revolving Credit Lender shall be in a principal amount equal to such Revolving Credit Lender’s Revolving Credit Commitment Percentage of the aggregate principal amount of Revolving Credit Loans requested on such occasion.  Subject to the terms and conditions hereof, the Borrower may borrow, repay and reborrow Revolving Credit Loans hereunder until the Revolving Credit Maturity Date.

 

SECTION 2.2                                             Swingline Loans.

 

(a)                                 Availability.  Subject to the terms and conditions of this Agreement and the other Loan Documents, including Section 6.2(d), and in reliance upon the representations and warranties set forth in this Agreement and the other Loan Documents, the Swingline Lender agrees to make Swingline Loans to the Borrower from time to time from the Closing Date to, but not including, the Revolving Credit Maturity Date; provided, that (a) after giving effect to any amount requested, the Revolving Credit Outstandings shall not exceed the Revolving Credit Commitment and (b) the aggregate principal amount of all outstanding Swingline Loans (after giving effect to any amount requested) shall not exceed the Swingline Commitment.

 

(b)                                 Refunding.

 

(i)                                     The Swingline Lender, at any time and from time to time in its sole and absolute discretion may, on behalf of the Borrower (which hereby irrevocably directs the Swingline Lender to act on its behalf), by written notice given no later than 11:00 a.m. on

 

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any Business Day request each Revolving Credit Lender to make, and each Revolving Credit Lender hereby agrees to make, a Revolving Credit Loan as a Base Rate Loan in an amount equal to such Revolving Credit Lender’s Revolving Credit Commitment Percentage of the aggregate amount of the Swingline Loans outstanding on the date of such notice, to repay the Swingline Lender.  Each Revolving Credit Lender shall make the amount of such Revolving Credit Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m. on the day specified in such notice.  The proceeds of such Revolving Credit Loans shall be immediately made available by the Administrative Agent to the Swingline Lender for application by the Swingline Lender to the repayment of the Swingline Loans.  No Revolving Credit Lender’s obligation to fund its respective Revolving Credit Commitment Percentage of a Swingline Loan shall be affected by any other Revolving Credit Lender’s failure to fund its Revolving Credit Commitment Percentage of a Swingline Loan, nor shall any Revolving Credit Lender’s Revolving Credit Commitment Percentage be increased as a result of any such failure of any other Revolving Credit Lender to fund its Revolving Credit Commitment Percentage of a Swingline Loan.

 

(ii)                                  The Borrower shall pay to the Swingline Lender on demand in immediately available funds the amount of such Swingline Loans to the extent amounts received from the Revolving Credit Lenders are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded.  In addition, the Borrower irrevocably authorizes the Administrative Agent to charge any account maintained by the Borrower with the Swingline Lender (up to the amount available therein) in order to immediately pay the Swingline Lender the amount of such Swingline Loans to the extent amounts received from the Revolving Credit Lenders are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded.  If any portion of any such amount paid to the Swingline Lender shall be recovered by or on behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise, the loss of the amount so recovered shall be ratably shared among all the Revolving Credit Lenders in accordance with their respective Revolving Credit Commitment Percentages.

 

(iii)                               If for any reason any Swingline Loan cannot be refinanced with a Revolving Credit Loan pursuant to Section 2.2(b)(i), each Revolving Credit Lender shall, on the date such Revolving Credit Loan was to have been made pursuant to the notice referred to in Section 2.2(b)(i), purchase for cash an undivided participating interest in the then outstanding Swingline Loans by paying to the Swingline Lender an amount (the “Swingline Participation Amount”) equal to such Revolving Lender’s Revolving Credit Commitment Percentage of the aggregate principal amount of Swingline Loans then outstanding.  Each Revolving Credit Lender will immediately transfer to the Swingline Lender, in immediately available funds, the amount of its Swingline Participation Amount.  Whenever, at any time after the Swingline Lender has received from any Revolving Credit Lender such Revolving Credit Lender’s Swingline Participation Amount, the Swingline Lender receives any payment on account of the Swingline Loans, the Swingline Lender will distribute to such Revolving Credit Lender its Swingline Participation Amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s participating interest was outstanding and

 

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funded and, in the case of principal and interest payments, to reflect such Revolving Credit Lender’s pro rata portion of such payment if such payment is not sufficient to pay the principal of and interest on all Swingline Loans then due); provided that in the event that such payment received by the Swingline Lender is required to be returned, such Revolving Credit Lender will return to the Swingline Lender any portion thereof previously distributed to it by the Swingline Lender.

 

(iv)                              Each Revolving Credit Lender’s obligation to make the Revolving Credit Loans referred to in Section  2.2(b)(i) and to purchase participating interests pursuant to Section 2.2(b)(iii) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right that such Revolving Credit Lender or the Borrower may have against the Swingline Lender, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default or an Event of Default or the failure to satisfy any of the other conditions specified in Article VI, (C) any adverse change in the condition (financial or otherwise) of the Borrower, (D) any breach of this Agreement or any other Loan Document by the Borrower, any other Credit Party or any other Revolving Credit Lender or (E) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.

 

(v)                                 If any Revolving Credit Lender fails to make available to the Administrative Agent for the account of the Swingline Lender any amount required to be paid by such Revolving Credit Lender pursuant to the foregoing provisions of this Section 2.2(b) by the time specified in Section 2.2(b)(i), the Swingline Lender shall be entitled to recover from such Revolving Credit Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Swingline Lender at a rate per annum equal to the applicable Federal  Funds Rate, plus any administrative, processing or similar fees customarily charged by the Swingline Lender in connection with the foregoing.  If such Revolving Credit Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Revolving Credit Lender’s Revolving Credit Loan or Swingline Participation Amount, as the case may be.  A certificate of the Swingline Lender submitted to any Revolving Credit Lender (through the Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

 

(c)                                  Defaulting Lenders.  Notwithstanding anything to the contrary contained in this Agreement, this Section 2.2 shall be subject to the terms and conditions of Section 5.14 and Section 5.15.

 

SECTION 2.3                                             Procedure for Advances of Revolving Credit Loans and Swingline Loans.

 

(a)                                 Requests for Borrowing.  The Borrower shall give the Administrative Agent irrevocable prior written notice substantially in the form of Exhibit B (a “Notice of Borrowing”) not later than 11:00 a.m. (i) on the same Business Day as each Base Rate Loan and each Swingline Loan and (ii) at least three (3) Business Days before each LIBOR Rate Loan

 

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(provided that the Borrower may request, no later than two (2) Business Days prior to the Closing Date, that the Lenders make Revolving Credit Loans that are LIBOR Rate Loans on the Closing Date if the Borrower has delivered to the Administrative Agent a letter in form and substance reasonably satisfactory to the Administrative Agent indemnifying the Lenders in the manner set forth in Section 5.9 of this Agreement), of its intention to borrow, specifying (A) the date of such borrowing, which shall be a Business Day, (B) the amount of such borrowing, which shall be, (x) other than with respect to Swingline Loans, in an aggregate principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof and (y) with respect to Swingline Loans in an aggregate principal amount of $500,000 or a whole multiple of $100,000 in excess thereof, (C) whether such Loan is to be a Revolving Credit Loan or Swingline Loan, (D) in the case of a Revolving Credit Loan whether the Loans are to be LIBOR Rate Loans or Base Rate Loans, and (E) in the case of a LIBOR Rate Loan, the duration of the Interest Period applicable thereto; provided that if the Borrower wishes to request LIBOR Rate Loans having an Interest Period of nine or twelve months (or any period less than one month) in duration, such notice must be received by the Administrative Agent not later than 11:00 a.m. three (3) Business Days prior to the requested date of such borrowing, whereupon the Administrative Agent shall give prompt notice to the Revolving Credit Lenders of such request and determine whether the requested Interest Period is acceptable to all of them.  If the Borrower fails to specify a type of Loan in a Notice of Borrowing, then the applicable Loans shall be made as Base Rate Loans.  If the Borrower requests a Borrowing of LIBOR Rate Loans in any such Notice of Borrowing, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.  A Notice of Borrowing received after 11:00 a.m. shall be deemed received on the next Business Day.  The Administrative Agent shall promptly notify the Revolving Credit Lenders of each Notice of Borrowing.

 

(b)                                 Disbursement of Revolving Credit and Swingline Loans.  Not later than 1:00 p.m. on the proposed borrowing date, (i) each Revolving Credit Lender will make available to the Administrative Agent, for the account of the Borrower, at the office of the Administrative Agent in funds immediately available to the Administrative Agent, such Revolving Credit Lender’s Revolving Credit Commitment Percentage of the Revolving Credit Loans to be made on such borrowing date and (ii) the Swingline Lender will make available to the Administrative Agent, for the account of the Borrower, at the office of the Administrative Agent in funds immediately available to the Administrative Agent, the Swingline Loans to be made on such borrowing date.  The Borrower hereby irrevocably authorizes the Administrative Agent to disburse the proceeds of each borrowing requested pursuant to this Section in immediately available funds by crediting or wiring such proceeds to the deposit account of the Borrower identified in the most recent notice substantially in the form attached as Exhibit C (a “Notice of Account Designation”) delivered by the Borrower to the Administrative Agent or as may be otherwise agreed upon by the Borrower and the Administrative Agent from time to time.  Subject to Section 5.7 hereof, the Administrative Agent shall not be obligated to disburse the portion of the proceeds of any Revolving Credit Loan requested pursuant to this Section to the extent that any Revolving Credit Lender has not made available to the Administrative Agent its Revolving Credit Commitment Percentage of such Loan.  Revolving Credit Loans to be made for the purpose of refunding Swingline Loans shall be made by the Revolving Credit Lenders as provided in Section 2.2(b).

 

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SECTION 2.4                                             Repayment and Prepayment of Revolving Credit and Swingline Loans.

 

(a)                                 Repayment on Termination Date.  The Borrower hereby agrees to repay the outstanding principal amount of (i) all Revolving Credit Loans in full on the Revolving Credit Maturity Date, and (ii) all Swingline Loans in accordance with Section 2.2(b) (but, in any event, no later than the Revolving Credit Maturity Date), together, in each case, with all accrued but unpaid interest thereon.

 

(b)                                 Mandatory Prepayments.  If at any time the Revolving Credit Outstandings exceed the Revolving Credit Commitment, the Borrower agrees to repay immediately upon notice from the Administrative Agent, by payment to the Administrative Agent for the account of the Revolving Credit Lenders, Extensions of Credit in an amount equal to such excess with each such repayment applied first, to the principal amount of outstanding Swingline Loans, second to the principal amount of outstanding Revolving Credit Loans and third, with respect to any Letters of Credit then outstanding, a payment of Cash Collateral into a Cash Collateral account opened by the Administrative Agent, for the benefit of the Revolving Credit Lenders, in an amount equal to such excess (such Cash Collateral to be applied in accordance with Section 10.2(b)).

 

(c)                                  Optional Prepayments.  The Borrower may at any time and from time to time prepay Revolving Credit Loans and Swingline Loans, in whole or in part, with irrevocable prior written notice to the Administrative Agent substantially in the form attached as Exhibit D (a “Notice of Prepayment”) given not later than 11:00 a.m. (i) on the same Business Day as the prepayment of each Base Rate Loan and each Swingline Loan and (ii) at least three (3) Business Days before the prepayment of each LIBOR Rate Loan, specifying the date and amount of prepayment and whether the prepayment is of LIBOR Rate Loans, Base Rate Loans, Swingline Loans or a combination thereof, and, if of a combination thereof, the amount allocable to each.  Upon receipt of such notice, the Administrative Agent shall promptly notify each Revolving Credit Lender.  If any such notice is given, the amount specified in such notice shall be due and payable on the date set forth in such notice.  Partial prepayments shall be in an aggregate amount of $1,000,000 or a whole multiple of $500,000 in excess thereof (other than Swingline Loans), and $500,000 or a whole multiple of $100,000 in excess thereof with respect to Swingline Loans.  A Notice of Prepayment received after 11:00 a.m. shall be deemed received on the next Business Day.  Each such repayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof.  Notwithstanding the foregoing, any Notice of a Prepayment delivered in connection with any refinancing of all of the Credit Facility with the proceeds of such refinancing or of any incurrence of Indebtedness, may be, if expressly so stated to be, contingent upon the consummation of such refinancing or incurrence and may be revoked by the Borrower in the event such refinancing is not consummated (provided that the failure of such contingency shall not relieve the Borrower from its obligations in respect thereof under Section 5.9).

 

(d)                                 Prepayment of Excess Proceeds.  In the event proceeds remain after the prepayments of the Term Loan Facility pursuant to Section 4.4(b), the amount of such excess proceeds shall be used on the date of the required prepayment under Section 4.4(b) to prepay the outstanding principal amount of the Revolving Credit Loans, without a corresponding reduction of the Revolving Credit Commitment, with remaining proceeds, if any, refunded to the Borrower.

 

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(e)                                  Limitation on Prepayment of LIBOR Rate Loans.  The Borrower may not prepay any LIBOR Rate Loan on any day other than on the last day of the Interest Period applicable thereto unless such prepayment is accompanied by any amount required to be paid pursuant to Section 5.9 hereof.

 

(f)                                   Hedge Agreements.  No repayment or prepayment of the Loans pursuant to this Section shall affect any of the Borrower’s obligations under any Hedge Agreement entered into with respect to the Loans.

 

SECTION 2.5                                             Permanent Reduction of the Revolving Credit Commitment.

 

(a)                                 Voluntary Reduction.  The Borrower shall have the right at any time and from time to time, upon at least five (5) Business Days prior irrevocable written notice to the Administrative Agent, to permanently terminate or reduce, without premium or penalty, (i) the entire Revolving Credit Commitment at any time or (ii) portions of the Revolving Credit Commitment, from time to time, in an aggregate principal amount not less than $3,000,000 or any whole multiple of $1,000,000 in excess thereof.  Any reduction of the Revolving Credit Commitment shall be applied to the Revolving Credit Commitment of each Revolving Credit Lender according to its Revolving Credit Commitment Percentage.  All Commitment Fees accrued until the effective date of any termination of the Revolving Credit Commitment shall be paid on the effective date of such termination.  Notwithstanding the foregoing, any notice to reduce the Revolving Credit Commitment delivered in connection with any refinancing of all of the Credit Facility with the proceeds of such refinancing or of any incurrence of Indebtedness, may be, if expressly so stated to be, contingent upon the consummation of such refinancing or incurrence and may be revoked by the Borrower in the event such refinancing is not consummated (provided that the failure of such contingency shall not relieve the Borrower from its obligations in respect thereof under Section 5.9).

 

(b)                                 Corresponding Payment.  Each permanent reduction permitted pursuant to this Section shall be accompanied by a payment of principal sufficient to reduce the aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C Obligations, as applicable, to less than the Revolving Credit Commitment as so reduced, and if the aggregate amount of all outstanding Letters of Credit exceeds the Revolving Credit Commitment as so reduced, the Borrower shall be required to deposit Cash Collateral in a Cash Collateral account opened by the Administrative Agent in an amount equal to such excess.  Such Cash Collateral shall be applied in accordance with Section 10.2(b).  Any reduction of the Revolving Credit Commitment to zero shall be accompanied by payment of all outstanding Revolving Credit Loans and Swingline Loans (and furnishing of Cash Collateral satisfactory to the Administrative Agent for all L/C Obligations) and shall result in the termination of the Revolving Credit Commitment and the Swingline Commitment and the Revolving Credit Facility.  If the reduction of the Revolving Credit Commitment requires the repayment of any LIBOR Rate Loan, such repayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof.

 

SECTION 2.6                                             Termination of Revolving Facility; Swingline Credit Facility.  The Revolving Credit Facility and the Revolving Credit Commitments shall terminate on the Revolving Credit Maturity Date.  The Swingline Facility and Swingline Commitment shall terminate on the Revolving Credit Maturity Date.

 

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ARTICLE III

 

LETTER OF CREDIT FACILITY

 

SECTION 3.1                                             L/C Facility.

 

(a)                                 Availability.  Subject to the terms and conditions hereof, each Issuing Lender, in reliance on the agreements of the Revolving Credit Lenders set forth in Section 3.4(a), agrees to issue standby or commercial Letters of Credit in an aggregate amount not to exceed its L/C Commitment for the account of the Borrower or, subject to Section 3.9, any Subsidiary thereof, Letters of Credit may be issued on any Business Day from the Closing Date to, but not including the fifth (5th) Business Day prior to the Revolving Credit Maturity Date in such form as may be approved from time to time by the applicable Issuing Lender; provided that no Issuing Lender shall issue any Letter of Credit if, after giving effect to such issuance, (a) the L/C Obligations would exceed the L/C Sublimit or (b) the Revolving Credit Outstandings would exceed the Revolving Credit Commitment.  Each Letter of Credit shall (i) be denominated in Dollars in a minimum amount of $10,000, in the case of a commercial Letter of Credit, or $25,000, in the case of a standby Letter of Credit (or such lesser amount as agreed to by the applicable Issuing Lender and the Administrative Agent), (ii) expire on a date no more than twelve (12) months after the date of issuance or last renewal of such Letter of Credit (or such later date as the applicable Issuing Lender may reasonably agree) (subject to automatic renewal for additional one (1) year periods pursuant to the terms of the Letter of Credit Application or other documentation acceptable to the applicable Issuing Lender), which date shall be no later than the fifth (5th) Business Day prior to the Revolving Credit Maturity Date and (iii) be subject to the Uniform Customs, in the case of a commercial Letter of Credit, or ISP98, in the case of a standby Letter of Credit, in each case as set forth in the Letter of Credit Application or as determined by the applicable Issuing Lender and, to the extent not inconsistent therewith, the laws of the State of New York.  No Issuing Lender shall at any time be obligated to issue any Letter of Credit hereunder if (A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such Issuing Lender from issuing such Letter of Credit, or (B) any Applicable Law applicable to such Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Lender shall prohibit, or request that such Issuing Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Lender with respect to letters of credit generally or such Letter of Credit in particular any restriction or reserve or capital requirement (for which such Issuing Lender is not otherwise compensated) not in effect on the Closing Date, or any unreimbursed loss, cost or expense that was not applicable or in effect as of the Closing Date and that such Issuing Lender in good faith deems material to it, or (C) the conditions set forth in Section 6.2 are not satisfied.  References herein to “issue” and derivations thereof with respect to Letters of Credit shall also include extensions or modifications of any outstanding Letters of Credit, unless the context otherwise requires.

 

(b)                                 Defaulting Lenders.  Notwithstanding anything to the contrary contained in this Agreement, Article III shall be subject to the terms and conditions of Section 5.14 and Section 5.15.

 

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SECTION 3.2                                             Procedure for Issuance of Letters of Credit.  The Borrower may from time to time request that any Issuing Lender issue a Letter of Credit by delivering to such Issuing Lender at its applicable office (with a copy to the Administrative Agent at the Administrative Agent’s Office) a Letter of Credit Application therefor, completed to the satisfaction of such Issuing Lender, and such other certificates, documents and other papers and information as such Issuing Lender or the Administrative Agent may request.  Upon receipt of any Letter of Credit Application, the applicable Issuing Lender shall process such Letter of Credit Application and the certificates, documents and other papers and information delivered to it in connection therewith in accordance with its customary procedures and shall, subject to Section 3.1 and Article VI, promptly issue the Letter of Credit requested thereby (but in no event shall such Issuing Lender be required to issue any Letter of Credit earlier than three (3) Business Days after its receipt of the Letter of Credit Application therefor and all such other certificates, documents and other papers and information relating thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or as otherwise may be agreed by such Issuing Lender and the Borrower.  The applicable Issuing Lender shall promptly furnish to the Borrower and the Administrative Agent a copy of such Letter of Credit and the Administrative Agent shall promptly notify each Revolving Credit Lender of the issuance and upon request by any Lender, furnish to such Revolving Credit Lender a copy of such Letter of Credit and the amount of such Revolving Credit Lender’s participation therein.

 

SECTION 3.3                                             Commissions and Other Charges.

 

(a)                                 Letter of Credit Commissions.  Subject to Section 5.15(a)(iii)(B), the Borrower shall pay to the Administrative Agent, for the account of the applicable Issuing Lender and the L/C Participants, a letter of credit commission with respect to each Letter of Credit in the amount equal to the daily amount available to be drawn under such standby Letters of Credit times the Applicable Margin with respect to Revolving Credit Loans that are LIBOR Rate Loans (determined, in each case, on a per annum basis).  Such commission shall be payable quarterly in arrears on the last Business Day of each Fiscal Quarter, on the Revolving Credit Maturity Date and thereafter on demand of the Administrative Agent.  The Administrative Agent shall, promptly following its receipt thereof, distribute to the applicable Issuing Lender and the L/C Participants all commissions received pursuant to this Section 3.3(a) in accordance with their respective Revolving Credit Commitment Percentages.

 

(b)                                 Issuance Fee.  In addition to the foregoing commission, the Borrower shall pay directly to the applicable Issuing Lender, for its own account, an issuance fee with respect to each Letter of Credit issued by such Issuing Lender as set forth in the Fee Letter executed by such Issuing Lender.  Such issuance fee shall be payable quarterly in arrears on the last Business Day of each Fiscal Quarter commencing with the first such date to occur after the issuance of such Letter of Credit, on the Revolving Credit Maturity Date and thereafter on demand of the applicable Issuing Lender.

 

(c)                                  Other Fees, Costs, Charges and Expenses.  In addition to the foregoing fees and commissions, the Borrower shall pay or reimburse each Issuing Lender for such normal and customary fees, costs, charges and expenses as are incurred or charged by such Issuing Lender in issuing, effecting payment under, amending or otherwise administering any Letter of Credit issued by it.

 

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SECTION 3.4                                             L/C Participations.

 

(a)                                 Each Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induce each Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from each Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant’s own account and risk an undivided interest equal to such L/C Participant’s Revolving Credit Commitment Percentage in each Issuing Lender’s obligations and rights under and in respect of each Letter of Credit issued by it hereunder and the amount of each draft paid by such Issuing Lender thereunder.  Each L/C Participant unconditionally and irrevocably agrees with each Issuing Lender that, if a draft is paid under any Letter of Credit issued by such Issuing Lender for which such Issuing Lender is not reimbursed in full by the Borrower through a Revolving Credit Loan or otherwise in accordance with the terms of this Agreement, such L/C Participant shall pay to such Issuing Lender upon demand at such Issuing Lender’s address for notices specified herein an amount equal to such L/C Participant’s Revolving Credit Commitment Percentage of the amount of such draft, or any part thereof, which is not so reimbursed.

 

(b)                                 Upon becoming aware of any amount required to be paid by any L/C Participant to any Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by such Issuing Lender under any Letter of Credit, issued by it, such Issuing Lender shall notify the Administrative Agent of such unreimbursed amount and the Administrative Agent shall notify each L/C Participant (with a copy to the applicable Issuing Lender) of the amount and due date of such required payment and such L/C Participant shall pay to the Administrative Agent (which, in turn shall pay such Issuing Lender) the amount specified on the applicable due date.  If any such amount is paid to such Issuing Lender after the date such payment is due, such L/C Participant shall pay to such Issuing Lender on demand, in addition to such amount, the product of (i) such amount, times (ii) the daily average Federal Funds Rate as determined by the Administrative Agent during the period from and including the date such payment is due to the date on which such payment is immediately available to such Issuing Lender, times (iii) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360.  A certificate of such Issuing Lender with respect to any amounts owing under this Section shall be conclusive in the absence of manifest error.  With respect to payment to such Issuing Lender of the unreimbursed amounts described in this Section, if the L/C Participants receive notice that any such payment is due (A) prior to 1:00 p.m. on any Business Day, such payment shall be due that Business Day, and (B) after 1:00 p.m. on any Business Day, such payment shall be due on the following Business Day.

 

(c)                                  Whenever, at any time after any Issuing Lender has made payment under any Letter of Credit issued by it and has received from any L/C Participant its Revolving Credit Commitment Percentage of such payment in accordance with this Section, such Issuing Lender receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise), or any payment of interest on account thereof, such Issuing Lender will distribute to such L/C Participant its pro rata share thereof; provided, that in the event that any such payment received by such Issuing Lender shall be required to be returned by such Issuing Lender, such L/C Participant shall return to such Issuing Lender the portion thereof previously distributed by such Issuing Lender to it.

 

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SECTION 3.5                                             Reimbursement Obligation of the Borrower.  In the event of any drawing under any Letter of Credit, the Borrower agrees to reimburse (either with the proceeds of a Revolving Credit Loan as provided for in this Section or with funds from other sources), in same day funds, the applicable Issuing Lender on each date on which such Issuing Lender notifies the Borrower of the date and amount of a draft paid by it under any Letter of Credit for the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by such Issuing Lender in connection with such payment.  Unless the Borrower shall immediately notify such Issuing Lender that the Borrower intends to reimburse such Issuing Lender for such drawing from other sources or funds, the Borrower shall be deemed to have timely given a Notice of Borrowing to the Administrative Agent requesting that the Revolving Credit Lenders make a Revolving Credit Loan bearing interest at the Base Rate on the applicable repayment date in the amount of (i) such draft so paid and (ii) any amounts referred to in Section 3.3(c) incurred by such Issuing Lender in connection with such payment, and the Revolving Credit Lenders shall make a Revolving Credit Loan bearing interest at the Base Rate in such amount, the proceeds of which shall be applied to reimburse such Issuing Lender for the amount of the related drawing and such fees and expenses.  Each Revolving Credit Lender acknowledges and agrees that its obligation to fund a Revolving Credit Loan in accordance with this Section to reimburse such Issuing Lender for any draft paid under a Letter of Credit issued by it is absolute and unconditional and shall not be affected by any circumstance whatsoever, including non-satisfaction of the conditions set forth in Section 2.3(a) or Article VI.  If the Borrower has elected to pay the amount of such drawing with funds from other sources and shall fail to reimburse such Issuing Lender as provided above, the unreimbursed amount of such drawing shall bear interest at the rate which would be payable on any outstanding Base Rate Loans which were then overdue from the date such amounts become payable (whether at stated maturity, by acceleration or otherwise) until payment in full.

 

SECTION 3.6                                             Obligations Absolute.  The Borrower’s obligations under this Article III (including the Reimbursement Obligation) shall be absolute and unconditional under any and all circumstances and irrespective of any set off, counterclaim or defense to payment which the Borrower may have or have had against the applicable Issuing Lender or any beneficiary of a Letter of Credit or any other Person.  The Borrower also agrees that the applicable Issuing Lender and the L/C Participants shall not be responsible for, and the Borrower’s Reimbursement Obligation under Section 3.5 shall not be affected by, among other things, the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee.  No Issuing Lender shall be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit issued by it, except for errors or omissions caused by such Issuing Lender’s gross negligence or willful misconduct, as determined by a court of competent jurisdiction by final nonappealable judgment.  The Borrower agrees that any action taken or omitted by any Issuing Lender under or in connection with any Letter of Credit issued by it or the related drafts or documents, if done in the absence of gross negligence or willful misconduct shall be binding on the Borrower and shall not result in any liability of such Issuing Lender or any L/C Participant to the Borrower.  The responsibility of any Issuing Lender to the Borrower in connection with any draft presented for payment under

 

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any Letter of Credit issued to it shall, in addition to any payment obligation expressly provided for in such Letter of Credit, be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment substantially conforms to the requirements under such Letter of Credit.

 

SECTION 3.7                                             Effect of Letter of Credit Application.  To the extent that any provision of any Letter of Credit Application related to any Letter of Credit is inconsistent with the provisions of this Article III, the provisions of this Article III shall apply.

 

SECTION 3.8                                             Reporting of Letter of Credit Information and L/C Commitment.  At any time that there is an Issuing Lender that is not also the financial institution acting as Administrative Agent, then (a) on the last Business Day of each calendar month, (b) on each date that a Letter of Credit is amended, terminated or otherwise expires, (c) on each date that a Letter of Credit is issued or the expiry date of a Letter of Credit is extended, and (d) upon the request of the Administrative Agent, each Issuing Lender (or, in the case of clauses (b), (c) or (d) of this Section, the applicable Issuing Lender) shall deliver to the Administrative Agent a report setting forth in form and detail reasonably satisfactory to the Administrative Agent information (including with respect to any reimbursement, Cash Collateral, or termination in respect of Letters of Credit issued by such Issuing Lender) with respect to each Letter of Credit issued by such Issuing Lender that is outstanding hereunder.  In addition, each Issuing Lender shall provide notice to the Administrative Agent of its L/C Commitment, or any change thereto, promptly upon it becoming an Issuing Lender or making any change to its L/C Commitment.  No failure on the part of any Issuing Lender to provide such information pursuant to this Section 3.8 shall limit the obligations of the Borrower or any Revolving Credit Lender hereunder with respect to its reimbursement and participation obligations hereunder.

 

SECTION 3.9                                             Letters of Credit Issued for Subsidiaries.  Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Subsidiary, the Borrower shall be obligated to reimburse, or to cause the applicable Subsidiary to reimburse, the applicable Issuing Lender hereunder for any and all drawings under such Letter of Credit.  The Borrower hereby acknowledges that the issuance of Letters of Credit for the account of any of its Subsidiaries inures to the benefit of the Borrower and that the Borrower’s business derives substantial benefits from the businesses of such Subsidiaries.

 

ARTICLE IV

 

TERM LOAN FACILITY

 

SECTION 4.1                                             Initial Term Loan.  Subject to the terms and conditions of this Agreement and the other Loan Documents, and in reliance upon the representations and warranties set forth in this Agreement and the other Loan Documents, each Term Loan Lender severally agrees to make the Initial Term Loan to the Borrower on the Closing Date in a principal amount equal to such Lender’s Term Loan Commitment as of the Closing Date. Notwithstanding the foregoing, if the total Term Loan Commitment as of the Closing Date is not drawn on the Closing Date, the undrawn amount shall automatically be cancelled.

 

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SECTION 4.2                                             Procedure for Advance of Term Loan.

 

(a)                                 Initial Term Loan.  The Borrower shall give the Administrative Agent an irrevocable Notice of Borrowing prior to 11:00 a.m. on the Closing Date requesting that the Term Loan Lenders make the Initial Term Loan as a Base Rate Loan on such date (provided that the Borrower may request, no later than two (2) Business Days prior to the Closing Date, that the Lenders make the Initial Term Loan as a LIBOR Rate Loan if the Borrower has delivered to the Administrative Agent a letter in form and substance reasonably satisfactory to the Administrative Agent indemnifying the Lenders in the manner set forth in Section 5.9 of this Agreement).  Upon receipt of such Notice of Borrowing from the Borrower, the Administrative Agent shall promptly notify each Term Loan Lender thereof.  Not later than 1:00 p.m. on the Closing Date, each Term Loan Lender will make available to the Administrative Agent for the account of the Borrower, at the Administrative Agent’s Office in immediately available funds, the amount of such Initial Term Loan to be made by such Term Loan Lender on the Closing Date.  The Borrower hereby irrevocably authorizes the Administrative Agent to disburse the proceeds of the Initial Term Loan in immediately available funds by wire transfer to such Person or Persons as may be designated by the Borrower in writing.

 

(b)                                 Incremental Term Loans.  Any Incremental Term Loans shall be borrowed pursuant to, and in accordance with Section 5.13.

 

SECTION 4.3                                             Repayment of Term Loans.

 

(a)                                 Initial Term Loan.  The Borrower shall repay the aggregate outstanding principal amount of the Initial Term Loan in consecutive quarterly installments on each Term Loan Installment Date as set forth below, except as the amounts of individual installments may be adjusted pursuant to Section 4.4 hereof:

 

	
Term Loan Installment Date
    	
 
    	
Quarterly Principal Installment
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Term Loan Installment Dates 1-4
    	
 
    	
$
    	
468,750
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Term Loan Installment Dates 5-8
    	
 
    	
$
    	
937,500
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Term Loan Installment Dates 9-12
    	
 
    	
$
    	
1,406,250
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Each Term Loan Installment Date thereafter until   the Term Loan Maturity Date. 
    	
 
    	
$
    	
1,875,000
    	
 
    

 

If not sooner paid, the Initial Term Loan shall be paid in full, together with accrued interest thereon, on the Term Loan Maturity Date.

 

(b)                                 Incremental Term Loans.  The Borrower shall repay the aggregate outstanding principal amount of each Incremental Term Loan (if any) as determined pursuant to, and in accordance with, Section 5.13.

 

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SECTION 4.4                                             Prepayments of Term Loans.

 

(a)                                 Optional Prepayments.  The Borrower shall have the right at any time and from time to time, without premium or penalty, to prepay the Term Loans, in whole or in part, upon delivery to the Administrative Agent of a Notice of Prepayment not later than 11:00 a.m. (i) on the same Business Day as each Base Rate Loan and (ii) at least three (3) Business Days before each LIBOR Rate Loan, specifying the date and amount of repayment, whether the repayment is of LIBOR Rate Loans or Base Rate Loans or a combination thereof, and if a combination thereof, the amount allocable to each and whether the repayment is of the Initial Term Loan, an Incremental Term Loan or a combination thereof, and if a combination thereof, the amount allocable to each.  Each optional partial prepayment of the Term Loans hereunder shall be in an aggregate principal amount of at least $1,000,000 or any whole multiple of $500,000 in excess thereof and shall be applied to the outstanding principal installments of the Initial Term Loan and, if applicable, any Incremental Term Loans as directed by the Borrower; provided that in the absence of such direction, optional prepayment shall be applied on a pro rata basis to the outstanding principal installments.  Each repayment shall be accompanied by any amount required to be paid pursuant to Section 5.9 hereof.  A Notice of Prepayment received after 11:00 a.m. shall be deemed received on the next Business Day.  The Administrative Agent shall promptly notify the applicable Term Loan Lenders of each Notice of Prepayment.  Notwithstanding the foregoing, any Notice of Prepayment delivered in connection with any refinancing of all of the Credit Facility with the proceeds of such refinancing or of any other incurrence of Indebtedness may be, if expressly so stated to be, contingent upon the consummation of such refinancing or incurrence and may be revoked by the Borrower in the event such refinancing is not consummated; provided that the delay or failure of such contingency shall not relieve the Borrower from its obligations in respect thereof under Section 5.9.

 

(b)                                 Mandatory Prepayments.

 

(i)                                     Debt Issuances.  The Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in clause (iv) below in an amount equal to one hundred percent (100%) of the aggregate Net Cash Proceeds from any Debt Issuance (x) not otherwise permitted pursuant to Section 9.1 or (y) that constitutes Refinancing Indebtedness.  Such prepayment shall be made within three (3) Business Days after the date of receipt of the Net Cash Proceeds of any such Debt Issuance.

 

(ii)                                  Asset Dispositions and Insurance and Condemnation Events.  The Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in clause (iv) below in amounts equal to one hundred percent (100%) of the aggregate Net Cash Proceeds from (A) any Asset Disposition (other than any Asset Disposition permitted pursuant to, and in accordance with, clauses (a)-(f) of Section 9.5) or (B) any Insurance and Condemnation Event, to the extent that the aggregate amount of such Net Cash Proceeds, in the case of each of clauses (A) and (B), respectively, exceed $2,000,000 during any Fiscal Year.  Such prepayments shall be made within three (3) Business Days after the date of receipt of the Net Cash Proceeds; provided that, so long as no Default or Event of Default has occurred and is continuing, no prepayment shall be required under this Section 4.4(b)(ii) with respect to such portion of such Net Cash Proceeds that the Borrower shall have, or prior to such date given written notice to the Administrative Agent of its intent to reinvest in accordance with Section 4.4(b)(iii).

 

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(iii)                               Reinvestment Option.  With respect to any Net Cash Proceeds realized or received with respect to any Asset Disposition or any Insurance and Condemnation Event by any Credit Party of any Subsidiary thereof (in each case, to the extent not excluded pursuant to Section 4.4(b)(ii)), at the option of the Borrower, the Credit Parties may reinvest all or any portion of such Net Cash Proceeds in assets used or useful for the business of the Credit Parties and their Subsidiaries within (x) twelve (12) months following receipt of such Net Cash Proceeds or (y) if such Credit Party enters into a bona fide commitment to reinvest such Net Cash Proceeds within twelve (12) months following receipt thereof, within the later of (A) twelve (12) months following receipt thereof and (B) six (6) months of the date of such commitment; provided that if any Net Cash Proceeds are no longer intended to be or cannot be so reinvested at any time after delivery of a notice of reinvestment election, an amount equal to any such Net Cash Proceeds shall be applied within three (3) Business Days after the applicable Credit Party reasonably determines that such Net Cash Proceeds are no longer intended to be or cannot be so reinvested to the prepayment of the Term Loans as set forth in this Section 4.4(b); provided further that any Net Cash Proceeds relating to Collateral shall be reinvested in assets constituting Collateral.  Pending the final application of any such Net Cash Proceeds, the applicable Credit Party may invest an amount equal to such Net Cash Proceeds in any manner that is not prohibited by this Agreement.

 

(iv)                              Notice; Manner of Payment.  Upon the occurrence of any event triggering the prepayment requirement under clauses (i) through and including (iii) above, the Borrower shall promptly deliver a Notice of Prepayment to the Administrative Agent and upon receipt of such notice, the Administrative Agent shall promptly so notify the Lenders.  Each prepayment of the Loans under this Section shall be applied as follows:  first, ratably between the Initial Term Loan and any Incremental Term Loans to reduce the next eight scheduled amortization payments of each such Class and then to the remaining scheduled amortization payments on a pro rata basis and (ii) second, to the extent of any excess, to repay the Revolving Credit Loans pursuant to Section 2.4(d), without a corresponding reduction in the Revolving Credit Commitment.

 

(v)                                 Prepayment of LIBOR Rate Loans.  Each prepayment shall be accompanied by any amount required to be paid pursuant to Section 5.9; provided that, so long as no Default or Event of Default shall have occurred and be continuing, if any prepayment of LIBOR Rate Loans is required to be made under this Section 4.4(b) prior to the last day of the Interest Period therefor, in lieu of making any payment pursuant to this Section 4.4(b) in respect of any such LIBOR Rate Loan prior to the last day of the Interest Period therefor, the applicable Borrower may, in its sole discretion, deposit an amount sufficient to make any such prepayment otherwise required to be made thereunder together with accrued interest to the last day of such Interest Period into an account held at, and subject to the sole control of, the Administrative Agent until the last day of such Interest Period, at which time the Administrative Agent shall be authorized (without any further action by or notice to or from the Borrower or any other Credit Party) to apply such amount to the prepayment of such Term Loans in accordance with this Section 4.4(b).  Upon the occurrence and during the continuance of any Default or Event of Default, the Administrative Agent shall also be authorized (without any further action by or notice to or from the Borrower or any other Credit Party) to apply such

 

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amount to the prepayment of the outstanding Term Loans in accordance with the relevant provisions of this Section 4.4(b).

 

(vi)                              No Reborrowings.  Amounts prepaid under the Term Loan pursuant to this Section may not be reborrowed.

 

ARTICLE V

 

GENERAL LOAN PROVISIONS

 

SECTION 5.1                                             Interest.

 

(a)                                 Interest Rate Options.  Subject to the provisions of this Section, at the election of the Borrower, (i) Revolving Credit Loans and the Term Loans shall bear interest at (A) the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the Applicable Margin and (ii) any Swingline Loan shall bear interest at the Base Rate plus the Applicable Margin.  The Borrower shall select the rate of interest and Interest Period, if any, applicable to any Loan at the time a Notice of Borrowing is given or at the time a Notice of Conversion/Continuation is given pursuant to Section 5.2.

 

(b)                                 Default Rate.

 

(i)                                     Subject to Section 10.3, (A) immediately upon the occurrence and during the continuance of an Event of Default under Section 10.1(a), (b), (h) or (i), or (B) at the election of the Required Lenders, upon the occurrence and during the continuance of any Specified Event of Default not listed in clause (A) above, (1) all outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two percent (2%) in excess of the rate (including the Applicable Margin) then applicable to LIBOR Rate Loans until the end of the applicable Interest Period and thereafter at a rate equal to two percent (2%) in excess of the rate (including the Applicable Margin) then applicable to Base Rate Loans, (2) all outstanding Base Rate Loans arising hereunder or under any other Loan Document shall bear interest at a rate per annum equal to two percent (2%) in excess of the rate (including the Applicable Margin) then applicable to Base Rate Loans and (3) all past due Obligations shall bear interest at a rate per annum equal to two percent (2%), in each case commencing (x) in respect of principal, from the date of such Event of Default, (y) in respect of all other amounts, from the later of (A) the date of such Event of Default and (B) the date such payment was otherwise due.

 

(ii)                                  Subject to Section 10.3, upon the occurrence and during the continuance of any Event of Default (A) the Borrower shall no longer have the option to request LIBOR Rate Loans, Swingline Loans or Letters of Credit and (B) all accrued and unpaid interest shall be due and payable on demand of the Administrative Agent.

 

(iii)                               Interest shall continue to accrue on the Obligations after the filing by or against the Borrower of any petition seeking any relief in bankruptcy or under any Debtor Relief Law.

 

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(c)                                  Interest Payment and Computation.  Interest on each Base Rate Loan shall be due and payable in arrears on the last Business Day of each Fiscal Quarter commencing on the last Business Day of the Fiscal Quarter ending closest to June 30, 2015; and interest on each LIBOR Rate Loan shall be due and payable on the last day of each Interest Period applicable thereto, and if such Interest Period extends over three (3) months, at the end of each three (3) month interval during such Interest Period.  All computations of interest for Base Rate Loans when the Base Rate is determined by the Prime Rate shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed.  All other computations of fees and interest provided hereunder shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365/366-day year).

 

(d)                                 Maximum Rate.  In no contingency or event whatsoever shall the aggregate of all amounts deemed interest under this Agreement charged or collected pursuant to the terms of this Agreement exceed the highest rate permissible under any Applicable Law which a court of competent jurisdiction shall, in a final determination, deem applicable hereto.  In the event that such a court determines that the Lenders have charged or received interest hereunder in excess of the highest applicable rate, the rate in effect hereunder shall automatically be reduced to the maximum rate permitted by Applicable Law and the Lenders shall at the Administrative Agent’s option (i) promptly refund to the Borrower any interest received by the Lenders in excess of the maximum lawful rate or (ii) apply such excess to the principal balance of the Obligations.  It is the intent hereof that the Borrower not pay or contract to pay, and that neither the Administrative Agent nor any Lender receive or contract to receive, directly or indirectly in any manner whatsoever, interest in excess of that which may be paid by the Borrower under Applicable Law.

 

SECTION 5.2                                             Notice and Manner of Conversion or Continuation of Loans.  Provided that no Default or Event of Default has occurred and is then continuing, the Borrower shall have the option to (a) convert at any time following the third Business Day after the Closing Date all or any portion of any outstanding Base Rate Loans (other than Swingline Loans) in a principal amount equal to $1,000,000 or any whole multiple of $500,000 in excess thereof into one or more LIBOR Rate Loans and (b) upon the expiration of any Interest Period, (i) convert all or any part of its outstanding LIBOR Rate Loans in a principal amount equal to $1,000,000 or a whole multiple of $500,000 in excess thereof into Base Rate Loans (other than Swingline Loans) or (ii) continue such LIBOR Rate Loans as LIBOR Rate Loans.  Whenever the Borrower desires to convert or continue Loans as provided above, the Borrower shall give the Administrative Agent irrevocable prior written notice in the form attached as Exhibit E (a “Notice of Conversion/Continuation”) not later than 11:00 a.m. three (3) Business Days before the day on which a proposed conversion or continuation of such Loan is to be effective specifying (A) the Loans to be converted or continued, and, in the case of any LIBOR Rate Loan to be converted or continued, the last day of the Interest Period therefor, (B) the effective date of such conversion or continuation (which shall be a Business Day), (C) the principal amount of such Loans to be converted or continued, and (D) the Interest Period to be applicable to such converted or continued LIBOR Rate Loan; provided that if the Borrower wishes to request LIBOR Rate Loans having an Interest Period of nine or twelve months (or any period less than one month) in duration, such notice must be received by the Administrative Agent not later than 11:00 a.m. three (3) Business Days prior to the requested date of such conversion or continuation, whereupon the Administrative Agent shall give prompt notice to the applicable Lenders of such

 

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request and determine whether the requested Interest Period is acceptable to all of them.  If the Borrower fails to give a timely Notice of Conversion/Continuation prior to the end of the Interest Period for any LIBOR Rate Loan, then the applicable LIBOR Rate Loan shall be converted to a Base Rate Loan.  Any such automatic conversion to a Base Rate Loan shall be effective as of the last day of the Interest Period then in effect with respect to the applicable LIBOR Rate Loan.  If the Borrower requests a conversion to, or continuation of, LIBOR Rate Loans, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.  Notwithstanding anything to the contrary herein, a Swingline Loan may not be converted to a LIBOR Rate Loan.  The Administrative Agent shall promptly notify the affected Lenders of such Notice of Conversion/Continuation.

 

SECTION 5.3                                             Fees.

 

(a)                                 Commitment Fee.  Commencing on the Closing Date, subject to Section 5.15(a)(iii)(A), the Borrower shall pay to the Administrative Agent, for the account of the Revolving Credit Lenders, a non-refundable commitment fee (the “Commitment Fee”) at a rate per annum equal to the amount specified in the definition of “Applicable Margin” on the average daily unused portion of the Revolving Credit Commitment of the Revolving Credit Lenders (other than the Defaulting Lenders, if any); provided, that the amount of outstanding Swingline Loans shall not be considered usage of the Revolving Credit Commitment for the purpose of calculating the Commitment Fee.  The Commitment Fee shall be payable in arrears on the last Business Day of each Fiscal Quarter during the term of this Agreement commencing on the last Business Day of the Fiscal Quarter ending closest to June 30, 2015 and ending on the date upon which all Obligations (other than contingent indemnification and cost reimbursement obligations not then due) arising under the Revolving Credit Facility shall have been indefeasibly and irrevocably paid and satisfied in full, all Letters of Credit have been terminated or expired (or been Cash Collateralized) and the Revolving Credit Commitment has been terminated.  The Commitment Fee shall be distributed by the Administrative Agent to the Revolving Credit Lenders (other than any Defaulting Lender) pro rata in accordance with such Revolving Credit Lenders’ respective Revolving Credit Commitment Percentages.

 

(b)                                 Other Fees.  The Borrower shall pay to the Arrangers and the Administrative Agent for their own respective accounts fees in the amounts and at the times specified in the separate agreements between them.  The Borrower shall pay to the Lenders such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified.

 

SECTION 5.4                                             Manner of Payment.  Each payment by the Borrower on account of the principal of or interest on the Loans or of any fee, commission or other amounts (including the Reimbursement Obligation) payable to the Lenders under this Agreement shall be made not later than 1:00 p.m. on the date specified for payment under this Agreement to the Administrative Agent at the Administrative Agent’s Office for the account of the Lenders entitled to such payment in Dollars, in immediately available funds and shall be made without any set off, counterclaim or deduction whatsoever.  Any payment received after such time shall be deemed a payment on such date for the purposes of Section 10.1, but for all other purposes shall be deemed to have been made on the next succeeding Business Day.  Upon receipt by the Administrative Agent of each such payment, the Administrative Agent shall distribute to each such Lender at its address for notices set forth herein its Commitment Percentage in respect of the relevant Credit

 

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Facility (or other applicable share as provided herein) of such payment and shall wire advice of the amount of such credit to each Lender.  Each payment to the Administrative Agent on account of the principal of or interest on the Swingline Loans or of any fee, commission or other amounts payable to the Swingline Lender shall be made in like manner, but for the account of the Swingline Lender.  Each payment to the Administrative Agent of any Issuing Lender’s fees or L/C Participants’ commissions shall be made in like manner, but for the account of such Issuing Lender or the L/C Participants, as the case may be.  Each payment to the Administrative Agent of the Administrative Agent’s fees or expenses shall be made for the account of the Administrative Agent and any amount payable to any Lender under Sections 5.9, 5.10, 5.11 or 12.3 shall be paid to the Administrative Agent for the account of the applicable Lender.  Subject to the definition of Interest Period, if any payment under this Agreement shall be specified to be made upon a day which is not a Business Day, it shall be made on the next succeeding day which is a Business Day and such extension of time shall in such case be included in computing any interest if payable along with such payment.  Notwithstanding the foregoing, if there exists a Defaulting Lender each payment by the Borrower to such Defaulting Lender hereunder shall be applied in accordance with Section 5.15(a)(ii).

 

SECTION 5.5                                             Evidence of Indebtedness.

 

(a)                                 Extensions of Credit.  The Extensions of Credit made by each Lender and each Issuing Lender shall be evidenced by one or more accounts or records maintained by such Lender or such Issuing Lender and by the Administrative Agent in the ordinary course of business.  The accounts or records maintained by the Administrative Agent shall be conclusive absent manifest error of the amount of the Extensions of Credit made by the Lenders or such Issuing Lender to the Borrower and its Subsidiaries and the interest and payments thereon.  Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations.  In the event of any conflict between the accounts and records maintained by any Lender or any Issuing Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.  Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Revolving Credit Note, Term Loan Note and/or Swingline Note, as applicable, which shall evidence such Lender’s Revolving Credit Loans, Term Loans and/or Swingline Loans, as applicable, in addition to such accounts or records.  Each Lender may attach schedules to its Notes and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto.

 

(b)                                 Participations.  In addition to the accounts and records referred to in subSection (a), each Revolving Credit Lender and the Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Revolving Credit Lender of participations in Letters of Credit and Swingline Loans.  In the event of any conflict between the accounts and records maintained by the Administrative Agent and the accounts and records of any Revolving Credit Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.

 

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SECTION 5.6                                             Sharing of Payments by Lenders.  If 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 other obligations hereunder resulting in such Lender’s receiving payment of a proportion of the aggregate amount of its Loans and accrued interest thereon or other such obligations (other than pursuant to Sections 5.9, 5.10, 5.11 or 12.3) greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing them; 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 (A) any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender), (B) the application of Cash Collateral provided for in Section 5.14 or (C) 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 Swingline Loans and Letters of Credit to any assignee or participant, other than to Holdings or any of its Subsidiaries or Affiliates (as to which the provisions of this paragraph shall apply).

 

Each Credit Party 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 each Credit Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of each Credit Party in the amount of such participation.

 

SECTION 5.7                                             Administrative Agent’s Clawback.

 

(a)                                 Funding by Lenders; Presumption by Administrative Agent.  Unless the Administrative Agent shall have received notice from a Lender (i) in the case of Base Rate Loans, not later than 12:00 noon on the date of any proposed borrowing and (ii) otherwise, 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 Sections 2.3(b) and 4.2 and may, in reliance upon such assumption, make available to the 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 Borrower severally 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 Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the greater of the daily average Federal Funds Rate and a rate determined by the Administrative Agent in

 

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accordance with banking industry rules on interbank compensation and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans.  If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period.  If such Lender pays its share of the applicable borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in such borrowing.  Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

 

(b)                                 Payments by the Borrower; Presumptions by Administrative Agent.  Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders, the Issuing Lender or the Swingline Lender hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders, the Issuing Lender or the Swingline Lender, as the case may be, the amount due.  In such event, if the Borrower has not in fact made such payment, then each of the Lenders, the Issuing Lender or the Swingline Lender, as the case maybe, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender, Issuing Lender or the Swingline Lender, 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 Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

 

(c)                                  Nature of Obligations of Lenders Regarding Extensions of Credit.  The obligations of the Lenders under this Agreement to make the Loans and issue or participate in Letters of Credit are several and are not joint or joint and several.  The failure of any Lender to make available its Commitment Percentage of any Loan requested by the Borrower shall not relieve it or any other Lender of its obligation, if any, hereunder to make its Commitment Percentage of such Loan available on the borrowing date, but no Lender shall be responsible for the failure of any other Lender to make its Commitment Percentage of such Loan available on the borrowing date.

 

SECTION 5.8                                             Changed Circumstances.

 

(a)                                 Circumstances Affecting LIBOR Rate Availability.  In connection with any request for a LIBOR Rate Loan or a conversion to or continuation thereof, if for any reason (i) the Administrative Agent shall determine (which determination shall be conclusive and binding absent manifest error) that Dollar deposits are not being offered to banks in the London interbank Eurodollar market for the applicable amount and Interest Period of such Loan, (ii) the Administrative Agent shall determine (which determination shall be conclusive and binding absent manifest error) that reasonable and adequate means do not exist for the ascertaining the LIBOR Rate for such Interest Period with respect to a proposed LIBOR Rate Loan or (iii) the Required Lenders shall determine (which determination shall be conclusive and binding absent manifest error) that the LIBOR Rate does not adequately and fairly reflect the cost to such Lenders of making or maintaining such Loans during such Interest Period, then the

 

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Administrative Agent shall promptly give notice thereof to the Borrower.  Thereafter, until such circumstances no longer exist, the obligation of the Lenders to make LIBOR Rate Loans and the right of the Borrower to convert any Loan to or continue any Loan as a LIBOR Rate Loan shall be suspended, and the Borrower shall, at its option, either (A) repay in full (or cause to be repaid in full) the then outstanding principal amount of each such LIBOR Rate Loan together with accrued interest thereon (subject to Section 5.1(d)), on the last day of the then current Interest Period applicable to such LIBOR Rate Loan; or (B) convert the then outstanding principal amount of each such LIBOR Rate Loan to a Base Rate Loan as of the last day of such Interest Period.

 

(b)                                 Laws Affecting LIBOR Rate Availability.  If, after the date hereof, the introduction of, or any change in, any Applicable Law or any change in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any of the Lenders (or any of their respective Lending Offices) with any request or directive (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, shall make it unlawful or impossible for any of the Lenders (or any of their respective Lending Offices) to honor its obligations hereunder to make or maintain any LIBOR Rate Loan, such Lender shall promptly give notice thereof to the Administrative Agent and the Administrative Agent shall promptly give notice to the Borrower and the other Lenders.  Thereafter, until such circumstances no longer exist, (i) the obligations of the Lenders to make LIBOR Rate Loans, and the right of the Borrower to convert any Loan to a LIBOR Rate Loan or continue any Loan as a LIBOR Rate Loan shall be suspended and thereafter the Borrower may select only Base Rate Loans and (ii) if any of the Lenders may not lawfully continue to maintain a LIBOR Rate Loan to the end of the then current Interest Period applicable thereto, the applicable Loan shall immediately be converted to a Base Rate Loan for the remainder of such Interest Period.

 

SECTION 5.9                                             Indemnity.  The Borrower hereby indemnifies each of the Lenders against any loss or expense (including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain a LIBOR Rate Loan or from fees payable to terminate the deposits from which such funds were obtained) which may arise or be attributable to each Lender’s obtaining, liquidating or employing deposits or other funds acquired to effect, fund or maintain any Loan (a) as a consequence of any failure by the Borrower to make any payment when due of any amount due hereunder in connection with a LIBOR Rate Loan, (b) due to any failure of the Borrower to borrow, continue or convert on a date specified therefor in a Notice of Borrowing or Notice of Conversion/Continuation or (c) due to any payment, prepayment or conversion of any LIBOR Rate Loan on a date other than the last day of the Interest Period or the day on which the Borrower’s notice has specified for payment.  The amount of such loss or expense shall be determined, in the applicable Lender’s discretion, based upon the assumption that such Lender funded its Commitment Percentage of the LIBOR Rate Loans in the London interbank market and using any reasonable attribution or averaging methods which such Lender deems appropriate and practical.  A certificate of such Lender setting forth the basis for determining such amount or amounts necessary to compensate such Lender shall be forwarded to the Borrower through the Administrative Agent and shall be conclusively presumed to be correct save for manifest error.

 

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SECTION 5.10                                      Increased Costs.

 

(a)                                 Increased Costs Generally.  If any Change in Law shall:

 

(i)                                     impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or advances, loans or other credit extended or participated in by, any Lender (except any reserve requirement reflected in the LIBOR Rate) or any Issuing Lender;

 

(ii)                                  subject any Recipient to any Taxes (other than (A) Indemnified Taxes or (B) Excluded Taxes on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

 

(iii)                               impose on any Lender or any Issuing Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or LIBOR Rate Loans made by such Lender or any Letter of Credit or participation therein;

 

and the result of any of the foregoing shall be to increase the cost to such Lender, the Issuing Lender or such other Recipient of making, converting to, continuing or maintaining any Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender, such Issuing Lender or such other Recipient of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender, such Issuing Lender or such other Recipient hereunder (whether of principal, interest or any other amount) then, upon written request of such Lender, such Issuing Lender or other Recipient, the Borrower shall promptly pay to any such Lender, within 15 days of written demand (including documentation reasonably supporting such request) such Issuing Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, such Issuing Lender or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.

 

(b)                                 Capital Requirements.  If any Lender or any Issuing Lender determines that any Change in Law affecting such Lender or such Issuing Lender or any lending office of such Lender or such Lender’s or such Issuing Lender’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender’s or such Issuing Lender’s capital or on the capital of such Lender’s or such Issuing Lender’s holding company, if any, as a consequence of this Agreement, the Revolving Credit Commitment of such Lender 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 such Issuing Lender, to a level below that which such Lender or such Issuing Lender or such Lender’s or such Issuing Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such Issuing Lender’s policies and the policies of such Lender’s or such Issuing Lender’s holding company with respect to capital adequacy), then from time to time upon written request of such Lender or such Issuing Lender the Borrower shall promptly pay to such Lender or such Issuing Lender, as the case may be, within 15 days of submission by such Lender or Issuing Lender, as the case may be to the Borrower of a written request therefor (including documentation reasonably supporting such request) such additional amount or

 

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amounts as will compensate such Lender or such Issuing Lender or such Lender’s or such Issuing Lender’s holding company for any such reduction suffered.

 

(c)                                  Certificates for Reimbursement.  A certificate of a Lender, or an Issuing Lender or such other Recipient setting forth the amount or amounts necessary to compensate such Lender or such Issuing Lender, such other Recipient or any of their respective holding companies, as the case may be, as specified in paragraph (a) or (b) of this Section and delivered to the Borrower, shall be conclusive absent manifest error.  The Borrower shall pay such Lender or such Issuing Lender or such other Recipient, as the case may be, the amount shown as due on any such certificate within fifteen (15) days after receipt thereof.

 

(d)                                 Delay in Requests.  Failure or delay on the part of any Lender or any Issuing Lender or such other Recipient to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or such Issuing Lender’s or such other Recipient’s right to demand such compensation; provided that the Borrower shall not be required to compensate any Lender or an Issuing Lender or any other Recipient pursuant to this Section for any increased costs incurred or reductions suffered more than six (6) months prior to the date that such Lender or such Issuing Lender or such other Recipient, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions, and of such Lender’s or such Issuing Lender’s or such other Recipient’s intention to claim compensation therefor (except that if the Change in Law giving rise to such increased costs or reductions is retroactive, then the six-month period referred to above shall be extended to include the period of retroactive effect thereof).

 

SECTION 5.11                                      Taxes.

 

(a)                                 Defined Terms.  For purposes of this Section 5.11, for the avoidance of doubt, the term “Lender” includes any Issuing Lender and the term “Applicable Law” includes FATCA.

 

(b)                                 Payments Free of Taxes.  Any and all payments by or on account of any obligation of any Credit 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 Credit 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), the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

 

(c)                                  Payment of Other Taxes by the Credit Parties.  The Credit 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 the payment of, any Other Taxes.

 

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(d)                                 Indemnification by the Credit Parties.  Without duplication of any amounts paid under Section 5.11(b) hereof, the Credit Parties shall jointly and severally indemnify each Recipient, within ten (10) days after written 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 out-of-pocket 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 the Borrower by a Recipient (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Recipient, shall be conclusive absent manifest error.

 

(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 Credit Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Credit Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 12.9(d) 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 set off 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 the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).

 

(f)                                   Evidence of Payments.  As soon as practicable after any payment of Taxes by any Credit Party to a Governmental Authority pursuant to this Section 5.11, such Credit 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 such other evidence of such payment within the possession of such Credit Party and reasonably satisfactory to the Administrative Agent.

 

(g)                                  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 and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower 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 or the Administrative Agent, shall deliver such other documentation prescribed by Applicable Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is

 

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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 5.11(g)(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:

 

(A)                               any Lender that is a U.S. Person shall deliver to the Borrower 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 or the Administrative Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from United States federal backup withholding tax;

 

(B)                               any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower 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 or the Administrative Agent), whichever of the following is applicable:

 

(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, executed copies of IRS Form W-8BEN or W-8BEN-E establishing an exemption from, or reduction of, United States 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 W-8BEN-E establishing an exemption from, or reduction of, United States federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

 

(2)                                 executed originals 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 H-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 the 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) executed copies of IRS Form W-8BEN or W-8BEN-E; or

 

(4)                                 to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-

 

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8BEN or W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit H-2 or Exhibit H-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 H-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 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 or the Administrative Agent), executed originals of any other form prescribed by Applicable Law as a basis for claiming exemption from or a reduction in United States federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by Applicable Law to permit the Borrower 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 United States 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 applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by Applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower 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 and the Administrative Agent in writing of its legal inability to do so.

 

(h)                                 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 5.11 (including by the payment of additional amounts pursuant to this Section 5.11), 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

 

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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 (h) (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 (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (h) 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 with respect to such Tax had never been paid.  This paragraph 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.

 

(i)                                     Survival.  Each party’s obligations under this Section 5.11 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 Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document; provided that the Borrower shall not be required to compensate any Lender or Administrative Agent pursuant to this Section 5.11 for any amounts (x) incurred solely by reason of the gross negligence or willful neglect of the Administrative Agent or the Lenders, as applicable or (y) after the date that is one year after all other Obligations (other than continent indemnification obligations not then due) have been repaid in full.

 

SECTION 5.12                                      Mitigation Obligations; Replacement of Lenders.

 

(a)                                 Designation of a Different Lending Office.  If any Lender requests compensation under Section 5.10, or requires the Borrower to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 5.11, then such Lender shall, at the request of the Borrower, 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 5.10 or Section 5.11, 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 Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

(b)                                 Replacement of Lenders.  If any Lender requests compensation under Section 5.10, or if the Borrower is 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 5.11, and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 5.12(a), or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without

 

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recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 12.9), all of its interests, rights (other than its existing rights to payments pursuant to Section 5.10 or Section 5.11) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

 

(i)                                     the Borrower shall have paid to the Administrative Agent the assignment fee (if any) specified in Section 12.9;

 

(ii)                                  such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in Letters of Credit, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 5.9) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts;

 

(iii)                               in the case of any such assignment resulting from a claim for compensation under Section 5.10 or payments required to be made pursuant to Section 5.11, such assignment will result in a reduction in such compensation or payments thereafter;

 

(iv)                              such assignment does not conflict with Applicable Law; and

 

(v)                                 in the case of any assignment resulting from  a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent.

 

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

 

SECTION 5.13                                      Incremental Term Loans.

 

(a)                                 At any time the Borrower may by written notice to the Administrative Agent elect to request the establishment of one or more incremental term loan commitments (any such incremental term loan commitment, an “Incremental Term Loan Commitment”) to make an additional term loan (any such additional term loan, an “Incremental Term Loan”); provided that (1) the total aggregate principal amount for all such Incremental Term Loan Commitments shall not (as of any date of incurrence thereof) exceed $50,000,000, (2) the total aggregate amount for each Incremental Term Loan Commitment (and the Incremental Term Loan made thereunder) shall not be less than a minimum principal amount of $5,000,000 (or, if less, the remaining amount permitted pursuant to the foregoing clause (1)) and (iii) there shall not be more than six Incremental Term Loans during the term of this Agreement.  Each such notice shall specify the date (each, an “Increased Amount Date”) on which the Borrower proposes that any Incremental Term Loan Commitment shall be effective, which shall be a date not less than ten (10) Business Days after the date on which such notice is delivered to Administrative Agent.  The Borrower may invite any Lender, any Affiliate of any Lender and/or any Approved Fund, and/or any other Person reasonably satisfactory to the Administrative Agent, to provide an Incremental Term

 

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Loan Commitment (any such Person, an “Incremental Lender”).  Any proposed Incremental Lender offered or approached to provide all or a portion of any Incremental Term Loan Commitment may elect or decline, in its sole discretion, to provide such Incremental Term Loan Commitment.  Any Incremental Term Loan Commitment shall become effective as of such Increased Amount Date; provided that:

 

(A)                               no Default or Event of Default shall exist on such Increased Amount Date before or after giving effect to (1) any Incremental Term Loan Commitment and (2) the making of any Incremental Term Loans  pursuant thereto;

 

(B)                               the Administrative Agent and the Lenders shall have received from the Borrower an Officer’s Compliance Certificate demonstrating, in form and substance reasonably satisfactory to the Administrative Agent, that the Borrower is in compliance with the financial covenants set forth in Section 9.13 based on the financial statements most recently delivered pursuant to Section 8.1(a) or 8.1(b), as applicable, both before and after giving effect (on a Pro Forma Basis) to (x) any Incremental Term Loan Commitment and (y) the making of any Incremental Term Loans pursuant thereto (with any Incremental Term Loan Commitment being deemed to be fully funded) and after giving effect to any prepayment or repayment of Indebtedness in connection therewith;

 

(C)                               the proceeds of any Incremental Term Loans shall be used for capital expenditures, general corporate purposes and ongoing capital requirements of the Borrower and its Subsidiaries (including Permitted Acquisitions);

 

(D)                               each Incremental Term Loan Commitment (and the Incremental Term Loans made thereunder) shall constitute Obligations of the Borrower and shall be secured and guaranteed with the other Extensions of Credit on a pari passu basis;

 

(E)                                for each Incremental Term Loan (the terms of which shall be set forth in the relevant Lender Joinder Agreement):

 

(1)                                 such Incremental Term Loan will not have a shorter weighted average life to maturity than the remaining weighted average life to maturity of the Initial Term Loan or a maturity date earlier than the Term Loan Maturity Date;

 

(2)                                 the Applicable Margin and pricing grid, if applicable, for such Incremental Term Loan shall be determined by the applicable Incremental Lenders and the Borrower on the applicable Increased Amount Date; and

 

(3)                                 except as provided above, the other terms and documentation in respect of such Incremental Term Loan, to the extent not consistent with the terms and conditions applicable to the Initial Term

 

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Loan, shall be reasonably satisfactory to the Administrative Agent and the Borrower;

 

(F)                                 any Incremental Lender making any Incremental Term Loan shall be entitled to the same voting rights as the existing Term Loan Lenders under the Term Loan Facility and each Incremental Term Loan shall receive proceeds of prepayments on the same basis as the Initial Term Loan (such prepayments to be shared pro rata on the basis of the original aggregate funded amount thereof among the Initial Term Loan and the Incremental Term Loans); and

 

(G)                               such Incremental Term Loan Commitments shall be effected pursuant to one or more Lender Joinder Agreements executed and delivered by the Borrower, the Administrative Agent and the applicable Incremental Lenders (which Lender Joinder Agreement may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary, in the reasonable opinion of the Administrative Agent, to effect the provisions of this Section 5.13); and

 

(H)                              the Borrower shall deliver or cause to be delivered any customary legal opinions or other documents (including a resolution duly adopted by the board of directors (or equivalent governing body) of each Credit Party authorizing such Incremental Term Loan and/or Incremental Term Loan Commitment) reasonably requested by the Administrative Agent in connection with any such transaction.

 

Notwithstanding the foregoing or anything in this Agreement to the contrary, if the proceeds of any Incremental Term Loan are intended to and will be used to finance a Permitted Acquisition, the Incremental Lenders providing such Incremental Term Loan may agree that the incurrence of such Incremental Term Loan shall be subject only to customary “Limited Conditionality Provisions.”

 

(b)                                 The Incremental Term Loans shall be deemed to be Term Loans; provided that such Incremental Term Loans shall be designated as a separate tranche of Term Loans for all purposes of this Agreement.

 

(c)                                  On any Increased Amount Date on which any Incremental Term Loan Commitment becomes effective, subject to the foregoing terms and conditions, each Incremental Lender with an Incremental Term Loan Commitment shall make, or be obligated to make, an Incremental Term Loan to the Borrower in an amount equal to its Incremental Term Loan Commitment and shall become a Term Loan Lender hereunder with respect to such Incremental Term Loan Commitment and the Incremental Term Loan made pursuant thereto.

 

SECTION 5.14                                      Cash Collateral.  At any time that there shall exist a Defaulting Lender, within three Business Days following the written request of the Administrative Agent, any Issuing Lender (with a copy to the Administrative Agent) or the Swingline Lender (with a copy to the Administrative Agent), the Borrower shall Cash Collateralize the Fronting Exposure of such Issuing Lender and/or the Swingline Lender, as applicable, with respect to such Defaulting

 

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Lender (determined after giving effect to Section 5.15(a)(iv) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the Minimum Collateral Amount.

 

(a)                                 Grant of Security Interest.  The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of each Issuing Lender and the Swingline Lender, and agrees to maintain, a first priority security interest in all such Cash Collateral as security for the Defaulting Lender’s obligation to fund participations in respect of L/C Obligations and Swingline Loans, to be applied pursuant to subsection (b) below.  If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent, each Issuing Lender and the Swingline Lender as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).

 

(b)                                 Application.  Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section 5.14 or Section 5.15 in respect of Letters of Credit and Swingline Loans shall be applied to the satisfaction of the Defaulting Lender’s obligation to fund participations in respect of L/C Obligations and Swingline Loans (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein.

 

(c)                                  Termination of Requirement.  Cash Collateral (or the appropriate portion thereof) provided to reduce the Fronting Exposure of any Issuing Lender and/or the Swingline Lender, as applicable, shall no longer be required to be held as Cash Collateral pursuant to this Section 5.14 following (i) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender), or (ii) the determination by the Administrative Agent, the Issuing Lenders and the Swingline Lender that there exists excess Cash Collateral; provided that, subject to Section 5.15, the Person providing Cash Collateral, the Issuing Lenders and the Swingline Lender may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations; and provided further that to the extent that such Cash Collateral was provided by the Borrower, such Cash Collateral shall remain subject to the security interest granted pursuant to the Loan Documents.

 

SECTION 5.15                                      Defaulting Lenders.

 

(a)                                 Defaulting Lender Adjustments.  Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by Applicable Law:

 

(i)                                     Waivers and Amendments.  Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders and Section 12.2.

 

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(ii)                                  Defaulting Lender Waterfall. 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 Article X or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 12.4 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 the Issuing Lenders or the Swingline Lender hereunder; third, to Cash Collateralize the Fronting Exposure of the Issuing Lenders and the Swingline Lender with respect to such Defaulting Lender in accordance with Section 5.14; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan or funded participation 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, to be held in a deposit account and released pro rata in order to (A) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans and funded participations under this Agreement and (B) Cash Collateralize the Issuing Lenders’ future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit and Swingline Loans issued under this Agreement, in accordance with Section 5.14; sixth, to the payment of any amounts owing to the Lenders, the Issuing Lenders or the Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, any Issuing Lender or the Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (1) such payment is a payment of the principal amount of any Loans or funded participations in Letters of Credit or Swingline Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (2) such Loans were made or the related Letters of Credit or Swingline Loans were issued at a time when the conditions set forth in Section 6.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and funded participations in Letters of Credit or Swingline Loans owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or funded participations in Letters of Credit or Swingline Loans owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations and Swingline Loans are held by the Lenders pro rata in accordance with the Revolving Credit Commitments under the applicable Revolving Credit Facility without giving effect to Section 5.15(a)(iv). 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 5.15(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

 

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(iii)                               Certain Fees.

 

(A)                               No Defaulting Lender shall be entitled to receive any Commitment Fee for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

 

(B)                               Each Defaulting Lender shall be entitled to receive letter of credit commissions pursuant to Section 3.3 for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Revolving Credit Commitment Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 5.14.

 

(C)                               With respect to any Commitment Fee or letter of credit commission not required to be paid to any Defaulting Lender pursuant to clause (A) or (B) above, the Borrower shall (1) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in L/C Obligations or Swingline Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (2) pay to each applicable Issuing Lender and Swingline Lender, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Lender’s or Swingline Lender’s Fronting Exposure to such Defaulting Lender, and (3) not be required to pay the remaining amount of any such fee.

 

(iv)                              Reallocation of Participations to Reduce Fronting Exposure.  All or any part of such Defaulting Lender’s participation in L/C Obligations and Swingline Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Revolving Credit Commitment Percentages (calculated without regard to such Defaulting Lender’s Revolving Credit Commitment) but only to the extent that (x) the conditions set forth in Section 6.2 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Revolving Credit Commitment.  No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

 

(v)                                 Cash Collateral, Repayment of Swingline Loans.  If the reallocation described in clause (iv) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, (x) first, repay Swingline Loans in an amount equal to the Swingline Lenders’ Fronting Exposure and (y) second, Cash Collateralize the Issuing Lenders’ Fronting Exposure in accordance with the procedures set forth in Section 5.14.

 

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(b)                                 Defaulting Lender Cure.  If the Borrower, the Administrative Agent, the Issuing Lenders and the Swingline Lender agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), such Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swingline Loans to be held pro rata by the Lenders in accordance with the Commitments under the applicable Credit Facility (without giving effect to Section 5.15(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

SECTION 5.16                                      Refinancing Amendment.

 

(a)                                 At any time after the Closing Date, with the consent of the Administrative Agent (not to be unreasonably withheld or delayed), the Borrower may, by written notice to the Administrative Agent, request the establishment of an additional Class of term loan under this Agreement (the “Refinancing Term Loan”) to refinance, renew, replace, defease or refund all of the Term Loans then outstanding (including unpaid accrued interest and premium (if any) thereon); provided that:

 

(i)                                     the Refinancing Term Loan shall be issued in lieu of any Refinancing Notes, and there shall only be no more than one Refinancing Term Loan;

 

(ii)                                  the Refinancing Term Loan does not mature prior to the Latest Maturity Date or have a shorter weighted average life to maturity than the Initial Term Loan or Incremental Term Loans (if any);

 

(iii)                               no Subsidiary is a guarantor with respect to the Refinancing Term Loan unless such Subsidiary is a Guarantor and the borrower of the Refinancing Term Loan shall be the Borrower;

 

(iv)                              the Refinancing Term Loan shall be secured solely by the Collateral, on a pari passu basis with the Loans, pursuant to the Security Documents;

 

(v)                                 the proceeds of the Refinancing Term Loan shall be applied, concurrently or substantially concurrently with the incurrence thereof, solely to the repayment in full of the Term Loans (including unpaid accrued interest and premium (if any) thereon);

 

(vi)                              the Refinancing Term Loan shall be in an aggregate principal amount not greater than the aggregate principal amount of Term Loans (plus unpaid accrued interest and premium (if any) thereon and any underwriting discounts, commissions and reasonable fees and expenses incurred in connection therewith);

 

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(vii)                           all other terms and conditions applicable to the Refinancing Term Loan (excluding pricing and optional prepayment or redemption terms) shall be substantially identical in all material respects to or less favorable (when taken as a whole) to the Persons providing the Refinancing Term Loan than those applicable to the Initial Term Loan and Incremental Term Loans (except for covenants or other provisions applicable only to periods after the Latest Maturity Date), as certified by the chief financial officer of Holdings in good faith prior to the incurrence of the Refinancing Term Loan; and

 

(viii)                        no existing Lender shall be required to provide the Refinancing Term Loan.

 

(b)                                 Each such notice shall specify (x) the date on which the Borrower proposes that the Refinancing Term Loans be made, which shall be a date reasonably acceptable to the Administrative Agent and (y) the identity of the Persons (each of which shall be a Person that would be an Eligible Assignee whom the Borrower proposes would provide the Refinancing Term Loan and the portion of the Refinancing Term Loan to be provided by each such Person.

 

(c)                                  This Section 5.16 shall supersede any provisions in Section 12.2 to the contrary (but shall be in addition to and not in lieu of the last paragraph of Section 12.2). The Refinancing Term Loan shall be documented by a Refinancing Amendment executed by the Persons providing the Refinancing Term Loans (and the other Persons specified in the definition of Refinancing Amendment but no other existing Lender), and the Refinancing Amendment may provide for such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower, to effect the provisions of this Section 5.16. The effectiveness of any Refinancing Amendment shall be subject to the satisfaction on the date thereof of conditions consistent with the conditions in Section 6.1 and, to the extent reasonably requested by the Administrative Agent, receipt by the Administrative Agent of (i) customary legal opinions, board resolutions and officers’ certificates reasonably satisfactory to the Administrative Agent and (ii) reaffirmation agreements and/or such amendments to the Loan Documents as may be reasonably requested by the Administrative Agent in order to ensure that such Refinancing Term Loan is provided with the benefit of the applicable Loan Documents.   Notwithstanding the foregoing or anything in this Agreement to the contrary, if any Refinancing Term Loan is made substantially concurrent or in connection with a Permitted Acquisition, the lenders providing such Refinancing Term Loan may agree that the incurrence of such Refinancing Term Loan shall be subject only to customary “Limited Conditionality Provisions”.

 

ARTICLE VI

 

CONDITIONS OF CLOSING AND BORROWING

 

SECTION 6.1                                             Conditions to Closing and Initial Extensions of Credit.  The obligation of the Lenders to close this Agreement and to make the initial Loans or issue or participate in the initial Letters of Credit, if any, is subject to the satisfaction of each of the following conditions:

 

(a)                                 Executed Loan Documents.  This Agreement, a Revolving Credit Note in favor of each Revolving Credit Lender requesting a Revolving Credit Note, a Term Loan Note in favor of

 

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each Term Loan Lender requesting a Term Loan Note, a Swingline Note in favor of the Swingline Lender, the Security Documents and the Guaranty Agreement, together with any other applicable Loan Documents, shall have been duly authorized, executed and delivered to the Administrative Agent by the parties thereto, shall be in full force and effect.

 

(b)                                 Legal Opinion.  The Administrative Agent shall have received a written opinion of Morgan, Lewis & Bockius LLP, special counsel for the Credit Parties, with respect to the Credit Parties, the Loan Documents and such other matters as the Administrative Agent shall reasonably request, which such opinions shall be addressed to the Administrative Agent, the Lenders and the Issuing Lenders and shall expressly permit reliance by permitted successors and assigns on customary matters).

 

(c)                                  Closing Certificates; Etc.  The Administrative Agent shall have received each of the following in form and substance reasonably satisfactory to the Administrative Agent:

 

(i)                                     Officer’s Certificate.  A certificate from a Responsible Officer of the Borrower to the effect that (A) all representations and warranties of the Credit Parties contained in this Agreement and the other Loan Documents are true, correct and complete in all material respects (except to the extent any such representation and warranty is qualified by materiality or reference to Material Adverse Effect, in which case, such representation and warranty shall be true, correct and complete in all respects); (B) after giving effect to the Transactions, no Default or Event of Default has occurred and is continuing; and (C) since March 29, 2014, no event has occurred or condition arisen, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

 

(ii)                                  Certificate of Secretary of each Credit Party.  A certificate of a Responsible Officer of each Credit Party certifying as to the incumbency and genuineness of the signature of each officer of such Credit Party executing Loan Documents to which it is a party and certifying that attached thereto is a true, correct and complete copy of (A) the articles or certificate of incorporation or formation (or equivalent), as applicable, of such Credit Party and all amendments thereto, certified as of a recent date by the appropriate Governmental Authority in its jurisdiction of incorporation, organization or formation (or equivalent), as applicable, (B) the bylaws or other governing document of such Credit Party as in effect on the Closing Date, (C) resolutions duly adopted by the board of directors (or other governing body) of such Credit Party authorizing and approving the transactions contemplated hereunder and the execution, delivery and performance of this Agreement and the other Loan Documents to which it is a party, and (D) each certificate required to be delivered pursuant to Section 6.1(c)(iii).

 

(iii)                               Certificates of Good Standing.  Certificates as of a recent date of the good standing of each Credit Party under the laws of its jurisdiction of incorporation, organization or formation (or equivalent), as applicable.

 

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(d)                                 Personal Property Collateral.

 

(i)                                     Filings and Recordings.  The Administrative Agent shall have received UCC financing statements in form appropriate for filing for each appropriate jurisdiction as is necessary, in the Administrative Agent’s reasonable discretion, to perfect the Administrative Agent’s security interest in the Collateral that can be perfected by filing a UCC financing statement.

 

(ii)                                  Pledged Collateral.  The Administrative Agent shall have received (A) original stock certificates or other certificates evidencing the certificated Equity Interests pledged pursuant to the Security Documents, together with an undated stock power for each such certificate duly executed in blank by the registered owner thereof and (B) each original promissory note pledged pursuant to the Security Documents together with an undated allonge for each such promissory note duly executed in blank by the holder thereof.

 

(iii)                               Lien Search.  The Administrative Agent shall have received the results of a Lien search (including a search as to judgments, pending litigation, bankruptcy, tax and intellectual property matters), in form and substance reasonably satisfactory thereto, made against the Credit Parties under the UCC (or applicable judicial docket) as in effect in each jurisdiction in which filings or recordations under the UCC should be made to evidence or perfect security interests in all assets of such Credit Party, indicating among other things that the assets of each such Credit Party are free and clear of any Lien (except for Permitted Liens and other Liens to be released on or prior to the Closing Date).

 

(iv)                              Property and Liability Insurance.  The Administrative Agent shall have received, in each case in form and substance reasonably satisfactory to the Administrative Agent, evidence of property, business interruption and liability insurance covering each Credit Party (with appropriate endorsements delivered within sixty days after the Closing Date (or such later date as may be consented to by the Administrative Agent)) naming the Administrative Agent as lender’s loss payee (and mortgagee, as applicable) on all policies for property insurance and as additional insured on all policies for liability insurance), and if requested by the Administrative Agent, copies of such insurance policies.

 

(e)                                  Consents; Defaults.

 

(i)                                     Governmental and Third Party Approvals.  The Credit Parties shall have received all governmental, shareholder and third party consents and approvals necessary (or any other consents as determined in the reasonable discretion of the Administrative Agent) in connection with the transactions contemplated by this Agreement and the other Loan Documents to the extent failure to receive such consents or approvals could reasonably be expected to have a Material Adverse Effect and all applicable waiting periods shall have expired without any action being taken by any Person that could reasonably be expected to restrain, prevent or impose any material adverse conditions on any of the Credit Parties or such other transactions or that could seek or threaten any of the foregoing, and no law or regulation shall be applicable which in the reasonable judgment of the Administrative Agent could reasonably be expected to have such effect.

 

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(ii)                                  No Injunction, Etc.  No action, proceeding or investigation shall have been instituted, or to the knowledge of the Borrower, threatened or proposed before any Governmental Authority that could reasonably be expected to have a Material Adverse Effect.

 

(f)                                   Financial Matters.

 

(i)                                     Financial Statements.  The Administrative Agent shall have received (A) the audited Consolidated balance sheet of Holdings and its Subsidiaries and the related audited statements of income and retained earnings and cash flows for the Fiscal Years ended March 31, 2012, March 30, 2013, and March 29, 2014 and (B) unaudited Consolidated balance sheet of Holdings and its Subsidiaries as of December 27, 2014 and related unaudited interim statements of income and retained earnings.

 

(ii)                                  Financial Projections.  The Administrative Agent shall have received projections prepared by management of Holdings, of balance sheets, income statements and cash flow statements on a quarterly basis for the first full Fiscal Year following the Closing Date and on an annual basis for each Fiscal Year thereafter during the term of the Credit Facility, which shall not be inconsistent with any financial information or projections previously delivered to the Administrative Agent.

 

(iii)                               Financial Condition/Solvency Certificate.  The Borrower shall have delivered to the Administrative Agent a certificate, in form and substance reasonably satisfactory to the Administrative Agent, and certified as accurate by the chief financial officer of Holdings, that (A) after giving effect to the Transactions, the Credit Parties, on a Consolidated basis, are Solvent, (B) attached thereto are calculations evidencing compliance on a Pro Forma Basis after giving effect to the Transactions with the covenants contained in Section 9.13 and (C) the financial projections previously delivered to the Administrative Agent represent the good faith estimates of the financial condition and operations of Holdings and its Subsidiaries based on assumptions believed in good faith to be reasonable at the time made.

 

(iv)                              Payment at Closing.  The Borrower shall have paid or made arrangements to pay contemporaneously with closing (A) to the Administrative Agent, the Arrangers and the Lenders the fees set forth or referenced in Section 5.3 and any other accrued and unpaid fees or commissions due hereunder, (B) all fees, charges and disbursements of one primary counsel to the Administrative Agent (directly to such counsel if requested by the Administrative Agent) to the extent invoiced at least two Business Days prior to the Closing Date and (C) to any other Person such amount as may be due thereto in connection with the transactions contemplated hereby, including all taxes, fees and other charges in connection with the execution, delivery, recording, filing and registration of any of the Loan Documents.

 

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(g)                                  Miscellaneous.

 

(i)                                     Notice of Account Designation.  The Administrative Agent shall have received a Notice of Account Designation specifying the account or accounts to which the proceeds of any Loans made on or after the Closing Date are to be disbursed.

 

(ii)                                  Existing Indebtedness.  Substantially concurrently with the initial borrowing on the Closing Date, all existing Indebtedness of Holdings and its Subsidiaries (excluding Indebtedness permitted pursuant to Section 9.1) shall be repaid in full, all commitments (if any) in respect thereof shall have been terminated and all guarantees therefor and security therefor shall be released, and the Administrative Agent shall have received payoff letters in form and substance reasonably satisfactory to it evidencing such repayment, termination and release.

 

(iii)                               PATRIOT Act, etc.  Holdings, the Borrower and each of the Subsidiary Guarantors shall have provided to the Administrative Agent and the Lenders the documentation and other information requested by the Administrative Agent in order to comply with requirements of the PATRIOT Act, applicable “know your customer” and anti-money laundering rules and regulations, in each case to the extent such documentation was requested at least ten (10) Business Days prior to the Closing Date.

 

(iv)                              Other Documents.  All opinions, certificates and other instruments and all proceedings in connection with the transactions contemplated by this Agreement shall be reasonably satisfactory in form and substance to the Administrative Agent.

 

Without limiting the generality of the provisions of the last paragraph of Section 11.3, for purposes of determining compliance with the conditions specified in this Section 6.1, the Administrative Agent and each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

 

SECTION 6.2                                             Conditions to All Extensions of Credit.  The obligations of the Lenders to make or participate in any Extensions of Credit (including the initial Extension of Credit) and/or any Issuing Lender to issue or extend any Letter of Credit are subject to the satisfaction of the following conditions precedent on the relevant borrowing, continuation, conversion, issuance or extension date:

 

(a)                                 Continuation of Representations and Warranties.  The representations and warranties contained in this Agreement and the other Loan Documents shall be true and correct in all material respects, except for any representation and warranty that is qualified by materiality or reference to Material Adverse Effect, which such representation and warranty shall be true and correct in all respects, on and as of such borrowing, issuance or extension date with the same effect as if made on and as of such date (except for any such representation and warranty that by its terms is made only as of an earlier date, which representation and warranty shall remain true and correct in all material respects as of such earlier date, except for any representation and warranty that is qualified by materiality or reference to Material Adverse Effect, which such representation and warranty shall be true and correct in all respects as of such earlier date)

 

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(subject to, in the case of Incremental Term Loans the proceeds of which are intended to and will be used to finance a Permitted Acquisition, customary “Limited Conditionality Provisions” to the extent agreed to by the Incremental Lenders providing such Incremental Term Loans).

 

(b)                                 No Existing Default.  No Default or Event of Default shall have occurred and be continuing (i) on the borrowing date with respect to such Loan or after giving effect to the Loans to be made on such date or (ii) on the issuance or extension date with respect to such Letter of Credit or after giving effect to the issuance or extension of such Letter of Credit on such date (subject to, in the case of Incremental Term Loans the proceeds of which are intended to and will be used to finance a Permitted Acquisition, customary “Limited Conditionality Provisions” to the extent agreed to by the Incremental Lenders providing such Incremental Term Loans).

 

(c)                                  Notices.  The Administrative Agent shall have received a Notice of Borrowing or Letter of Credit Application, as applicable, from the Borrower in accordance with Section 2.3(a), Section 3.2 or Section 4.2, as applicable.  The submission by the Borrower or each Notice of Borrowing and each Letter of Credit Application shall be deemed to be a representation and warranty by the Borrower that each of the statements set forth in Sections 6.2(a) and 6.2(b) is true and correct as of the date of such notice.

 

(d)                                 New Swingline Loans/Letters of Credit.  So long as any Lender is a Defaulting Lender, (i) the Swingline Lender shall not be required to fund any Swingline Loans unless it is satisfied that it will have no Fronting Exposure after giving effect to such Swingline Loan and (ii) the Issuing Lender shall not be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that it will have no Fronting Exposure after giving effect thereto.

 

ARTICLE VII

 

REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES

 

To induce the Administrative Agent and Lenders to enter into this Agreement and to induce the Lenders to make Extensions of Credit, the Credit Parties hereby represent and warrant to the Administrative Agent and the Lenders on the Closing Date and after giving effect to the Transactions and other transactions contemplated hereunder, which representations and warranties shall be deemed made on the Closing Date and as otherwise set forth in Section 6.2, that:

 

SECTION 7.1                                             Organization; Power; Qualification.  Each Credit Party and each Subsidiary thereof (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation, (b) has the power and authority to own its Properties and to carry on its business as now being and hereafter proposed to be conducted and (c) is duly qualified and authorized to do business in each jurisdiction in which the character of its Properties or the nature of its business requires such qualification and authorization except in the case of preceding clauses (b) and (c) to the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.  The jurisdictions in which each Credit Party and each Subsidiary thereof are organized and qualified to do business as of the Closing Date are described on Schedule 7.1.

 

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SECTION 7.2                                             Ownership.  Each Subsidiary of each Credit Party as of the Closing Date is listed on Schedule 7.2.  As of the Closing Date, the capitalization of the Borrower and its Subsidiaries consists of the number of Equity Interests, authorized, issued and outstanding (if applicable), of such classes and series, with or without par value, described on Schedule 7.2.  All outstanding Equity Interests of each Credit Party have been duly authorized and validly issued and are fully paid and nonassessable and not subject to any preemptive or similar rights, except as described in Schedule 7.2.  The shareholders, members or other equity holders, as applicable, of each Subsidiary and the number of shares or percentage of Equity Interests, as applicable, owned by each as of the Closing Date are described on Schedule 7.2.  As of the Closing Date, there are no outstanding stock purchase warrants, subscriptions, options, securities, instruments or other rights of any type or nature whatsoever, which are convertible into, exchangeable for or otherwise provide for or require the issuance of Equity Interests of any Credit Party  (other than Holdings) or any Subsidiary thereof, except as described on Schedule 7.2.

 

SECTION 7.3                                             Authorization; Enforceability.  Each Credit Party has the right, power and authority and has taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement and each of the other Loan Documents to which it is a party in accordance with their respective terms.  This Agreement and each of the other Loan Documents have been duly executed and delivered by the duly authorized officers of each Credit Party, and each such document upon execution will constitute the legal, valid and binding obligation of each Credit Party, enforceable against such Credit Party in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar state or federal Debtor Relief Laws from time to time in effect which affect the enforcement of creditors’ rights in general and the availability of equitable remedies.

 

SECTION 7.4                                             Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc.  The execution, delivery and performance by each Credit Party of the Loan Documents to which each such Person is a party, in accordance with their respective terms, the Extensions of Credit hereunder and the transactions contemplated hereby or thereby do not and will not, by the passage of time, the giving of notice or otherwise, (a) require any Governmental Approval or violate any Applicable Law relating to any Credit Party or any Subsidiary thereof where the failure to obtain such Governmental Approval or such violation could reasonably be expected to have a Material Adverse Effect, (b) conflict with, result in a breach of or constitute a default under the articles of incorporation, bylaws or other organizational documents of any Credit Party or any Subsidiary thereof, (c) conflict with, result in a breach of or constitute a default under any Material Contract  to which such Person is a party or by which any of its properties may be bound or any Governmental Approval relating to such Person, which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (d) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by such Person other than Permitted Liens, or (e) require any consent or authorization of, filing with, or other act in respect of, an arbitrator or Governmental Authority and no consent of any other Person is required in connection with the execution, delivery, performance, validity or enforceability of this Agreement other than (i) consents, authorizations, filings or other acts or consents for which the failure to obtain or make could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) consents or filings under the UCC, (iii) filings with the United States

 

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Copyright Office and/or the United States Patent and Trademark Office and (iv) Mortgage filings with the applicable county recording office or register of deeds, if applicable.

 

SECTION 7.5                                             Compliance with Law; Governmental Approvals.  Each Credit Party and each Subsidiary thereof (a) has all Governmental Approvals required by any Applicable Law for it to conduct its business, each of which is in full force and effect, is final and not subject to review on appeal and is not the subject of any pending or, to its knowledge, threatened attack by direct or collateral proceeding, (b) is in compliance with each Governmental Approval applicable to it and in compliance with all other Applicable Laws relating to it or any of its respective properties except in each case (a) or (b)  where the failure to have, comply or file could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 7.6                                             Tax Returns and Payments.  Each Credit Party and each Subsidiary thereof has duly filed or caused to be filed all material federal, state, local and other tax returns required by Applicable Law to be filed, and has paid, or made adequate provision for the payment of, all material federal, state, local and other taxes, assessments and governmental charges or levies upon it and its property, income, profits and assets which are due and payable (other than any amount the validity of which is currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided for on the books of the relevant Credit Party).  Such returns accurately reflect in all material respects all material liability for taxes of any Credit Party or any Subsidiary thereof for the periods covered thereby.  As of the Closing Date, except as set forth on Schedule 7.6, there is no ongoing audit or examination or, to its knowledge, other investigation by any Governmental Authority of the tax liability of any Credit Party or any Subsidiary thereof.  No Governmental Authority has asserted any Lien or other claim against any Credit Party or any Subsidiary thereof with respect to unpaid taxes which has not been discharged or resolved (other than (a) any amount the validity of which is currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided for on the books of the relevant Credit Party and (b) Permitted Liens).  The charges, accruals and reserves on the books of each Credit Party and each Subsidiary thereof in respect of federal, state, local and other taxes for all Fiscal Years and portions thereof since the organization of any Credit Party or any Subsidiary thereof are in the judgment of Holdings and the Borrower adequate, and the Borrower does not anticipate any additional taxes or assessments for any of such years.

 

SECTION 7.7                                             Intellectual Property Matters.  Each Credit Party and each Subsidiary thereof owns or possesses rights to use all material, licenses, copyrights, patents, trademarks, service marks, trade names, and other rights with respect to the foregoing which are reasonably necessary to conduct its business.  To the knowledge of the Credit Parties, no event has occurred which permits, or after notice or lapse of time or both would permit, the revocation or termination of any such rights, and no Credit Party nor any Subsidiary thereof have knowledge or reason to believe that it is liable to any Person for infringement under Applicable Law with respect to any such rights as a result of its business operations.

 

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SECTION 7.8                                             Environmental Matters.

 

(a)                                 To the knowledge of the Borrower, the properties owned, leased or operated by each Credit Party and each Subsidiary thereof do not contain any Hazardous Materials in amounts or concentrations which constitute a violation of applicable Environmental Laws that could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect;

 

(b)                                 Each Credit Party and each Subsidiary thereof and such properties and all operations conducted in connection therewith are in material compliance, and have been in material compliance for the past three (3) years, with all applicable Environmental Laws;

 

(c)                                  No Credit Party nor any Subsidiary thereof has received any notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters, Hazardous Materials, or compliance with Environmental Laws that, if adversely determined, could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, nor does any Credit Party or any Subsidiary thereof have knowledge or reason to believe that any such notice will be received or is being threatened;

 

(d)                                 To the knowledge of the Borrower, Hazardous Materials have not been transported or disposed of to or from the properties owned, leased or operated by any Credit Party or any Subsidiary thereof in violation of, or in a manner or to a location which could give rise to material liability under, Environmental Laws, nor to their knowledge have any Hazardous Materials been generated, treated, stored or disposed of at, on or under any of such properties in violation of, or in a manner that could give rise to material liability under, any applicable Environmental Laws;

 

(e)                                  No judicial proceedings or governmental or administrative action is pending, or, to the knowledge of the Borrower, threatened, under any Environmental Law to which any Credit Party or any Subsidiary thereof is or will be named as a potentially responsible party, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any applicable Environmental Law with respect to any Credit Party, any Subsidiary thereof, with respect to any real property owned, leased or operated by any Credit Party or any Subsidiary thereof or operations conducted in connection therewith that could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect; and

 

(f)                                   To the knowledge of the Borrower, there has been no release or threat of release, of Hazardous Materials at or from properties owned, leased or operated by any Credit Party or any Subsidiary, now or in the past, in violation of or in amounts or in a manner that could give rise to liability under applicable Environmental Laws that could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

 

SECTION 7.9                                             Employee Benefit Matters.

 

(a)                                 As of the Closing Date, no Credit Party nor any ERISA Affiliate maintains or contributes to, or has any outstanding obligation under, any Pension Plans or Multiemployer Plans other than those identified on Schedule 7.9;

 

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(b)                                 Each Credit Party is in compliance with all applicable provisions of ERISA, the Code and the regulations and published interpretations thereunder with respect to all Employee Benefit Plans except for any required amendments to a plan intended to qualify under Section 401(a) of the Code for which the remedial amendment period as defined in Section 401(b) of the Code has not yet expired, and except where a failure to so comply could not reasonably be expected to have a Material Adverse Effect.  Each Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been determined by the IRS to be so qualified (or, in the case of a preapproved plan, the IRS has issued a favorable advisory or opinion letter with respect to the underlying plan document) and as a result of such determination by the IRS each trust related to such Employee Benefit Plan is exempt from taxation pursuant to Section 501(a) of the Code, except for such plans that have not yet received determination, opinion or advisory letters but for which the remedial amendment period for submitting an application for such letter has not yet expired.  No liability has been incurred by any Credit Party which remains unsatisfied for any taxes or penalties assessed with respect to any Employee Benefit Plan, Pension Plan or Multiemployer Plan except for a liability that could not reasonably be expected to have a Material Adverse Effect;

 

(c)                                  As of the Closing Date, no Pension Plan has been terminated, nor has any Pension Plan become subject to funding based benefit restrictions under Section 436 of the Code, nor has any funding waiver from the IRS been received or requested with respect to any Pension Plan, nor has any Credit Party or any ERISA Affiliate failed to make any contributions or to pay to any Pension Plan any amounts due and owing as required by Sections 412 or 430 of the Code, Section 302 of ERISA or the terms of any Pension Plan on or prior to the due dates of such contributions under Sections 412 or 430 of the Code or Section 302 of ERISA, nor has there been any event requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension Plan;

 

(d)                                 Except where the failure of any of the following representations to be correct could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, no Credit Party has: (i) engaged in a nonexempt prohibited transaction described in Section 406 of the ERISA or Section 4975 of the Code, (ii) incurred any liability to the PBGC which remains outstanding other than the payment of premiums and there are no premium payments which are due and unpaid, (iii) failed to make a required contribution or payment to a Multiemployer Plan, or (iv) failed to make a required installment or other required payment under Sections 412 or 430 of the Code;

 

(e)                                  No Termination Event has occurred or is reasonably expected to occur; and

 

(f)                                   Except where the failure of any of the following representations to be correct could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, no proceeding, claim (other than a benefits claim in the ordinary course of business), lawsuit and/or investigation is existing or, to its knowledge, threatened concerning or involving (i) any Pension Plan or (ii) to the knowledge of the Borrower, any Multiemployer Plan.

 

SECTION 7.10                                      Margin Stock.  No Credit Party or any Subsidiary thereof is engaged principally or as one of its activities in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” (as each such term is defined or used, directly or

 

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indirectly, in Regulation U of the Board of Governors of the Federal Reserve System).  No part of the proceeds of any of the Loans or Letters of Credit will be used for purchasing or carrying margin stock or for any purpose which violates, or which would be inconsistent with, the provisions of Regulation U of such Board of Governors.  Following the application of the proceeds of each Extension of Credit, not more than twenty-five percent (25%) of the value of the assets (either of the Borrower only or of Holdings and its Subsidiaries on a Consolidated basis) subject to the provisions of Section 9.2 or Section 9.5 or subject to any restriction contained in any agreement or instrument between the Borrower and any Lender or any Affiliate of any Lender relating to Indebtedness in excess of the Threshold Amount will be “margin stock”.

 

SECTION 7.11                                      Government Regulation.  No Credit Party or any Subsidiary thereof is an “investment company” or a company “controlled” by an “investment company” (as each such term is defined or used in the Investment Company Act of 1940).

 

SECTION 7.12                                      Material Contracts.  As of the Closing Date, no Credit Party nor any Subsidiary thereof (nor, to its knowledge, any other party thereto) is in breach of or in default under any Material Contract in any respect that could reasonably be expected to have a Material Adverse Effect.

 

SECTION 7.13                                      Employee Relations.  As of the Closing Date, no Credit Party or any Subsidiary thereof is party to any collective bargaining agreement, nor has any labor union been recognized as the representative of its employees except as set forth on Schedule 7.13.  The Borrower knows of no pending, threatened or contemplated strikes, work stoppage or other collective labor disputes involving its employees or those of its Subsidiaries that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

 

SECTION 7.14                                      No Burdensome Restrictions.  No Credit Party is a party to any contract or agreement the performance of which could be reasonably likely to have a Material Adverse Effect.  No Credit Party is party to any agreement or instrument or otherwise subject to any restriction or encumbrance that restricts or limits its ability to make dividend payments or other distributions in respect of its Equity Interests to the Borrower or any Subsidiary or to transfer any of its assets or properties to the Borrower or any other Subsidiary in each case other than existing under or permitted by the Loan Documents or Applicable Law.

 

SECTION 7.15                                      Financial Statements.  The audited and unaudited financial statements delivered pursuant to Section 6.1(f)(i)  fairly and accurately present on a Consolidated basis in all material respects the assets, liabilities and financial position of Holdings and its Subsidiaries as at such dates, and the results of the operations and changes of financial position for the periods then ended (subject to customary year-end adjustments for unaudited financial statements and the absence of footnotes from unaudited financial statements).  All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP (subject to customary year-end adjustments for unaudited financial statements and the absence of footnotes from unaudited financial statements).  The projections delivered pursuant to Section 6.1(f)(iii)  were prepared in good faith on the basis of the assumptions stated therein, which assumptions were, when made, believed to be reasonable in light of then existing conditions except that such financial projections and statements shall be subject to customary

 

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year end closing and audit adjustments (it being understood and acknowledged that projections are as to future events and are not a guarantee of financial performance and are not to be viewed as facts, no assurances can be given that any particular projections will be realized, and that the actual results during the period or periods covered by such projections may vary materially from such projections).

 

SECTION 7.16                                      No Material Adverse Change.  Since March 29, 2014, there has been no material adverse change in the operations, business, assets, properties or financial condition of Holdings and its Subsidiaries and no event has occurred or condition arisen, either individually or in the aggregate, that could reasonably be expected to have a Material Adverse Effect.

 

SECTION 7.17                                      Solvency.  The Credit Parties, on a Consolidated basis, are Solvent.

 

SECTION 7.18                                      Title to Properties.  As of the Closing Date, the real property listed on Schedule 7.18 constitutes all of the real property (other than locations that may be temporarily occupied by any of the Credit Parties or their Subsidiaries) that is owned, leased, subleased or used by any Credit Party or any of its Subsidiaries.  Each Credit Party and each Subsidiary thereof has such title to or leasehold interest in or rights to use the material real property owned or leased by it as is necessary or desirable to the conduct of its business and valid and legal title to all of its personal property and assets, except (i) those which have been disposed of by the Credit Parties and their Subsidiaries subsequent to such date which dispositions have been in the ordinary course of business or as otherwise not prohibited hereunder, (ii) as could not reasonably be expected to have a Material Adverse Effect, or (iii) subject to Permitted Liens.

 

SECTION 7.19                                      Litigation.  Except for matters existing on the Closing Date and set forth on Schedule 7.19, there are no actions, suits or proceedings pending nor, to the knowledge of the applicable Credit Party, threatened against or in any other way relating adversely to or affecting any Credit Party or any Subsidiary thereof or any of their respective properties in any court or before any arbitrator of any kind or before or by any Governmental Authority that could reasonably be expected to have a Material Adverse Effect.

 

SECTION 7.20                                      Anti-Corruption Laws and Sanctions.  None of (a) Holdings, the Borrower, any Subsidiary or any of their respective directors, officers, employees or affiliates, or (b) to the knowledge of Holdings, the Borrower, any agent or representative of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby is a Sanctioned Person or currently the subject or target of any Sanctions.

 

SECTION 7.21                                      Absence of Defaults.  No event has occurred or is continuing (a) which constitutes a Default or an Event of Default, or (b) which constitutes a default or event of default by any Credit Party or any Subsidiary thereof under any judgment, decree or order to which any Credit Party or any Subsidiary thereof is a party or by which any Credit Party or any Subsidiary thereof or any of their respective properties may be bound or which would require any Credit Party or any Subsidiary thereof to make any payment thereunder prior to the scheduled maturity date therefor that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

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SECTION 7.22                                      Senior Indebtedness Status.  The Obligations of each Credit Party under this Agreement and each of the other Loan Documents ranks and shall continue to rank at least senior in priority of payment to all Subordinated Indebtedness and is designated as “Senior Indebtedness” under all instruments and documents evidencing such Subordinated Indebtedness.

 

SECTION 7.23                                      Disclosure.  Holdings and/or its Subsidiaries have disclosed to the Administrative Agent and the Lenders all agreements, instruments and corporate or other restrictions to which any Credit Party and any Subsidiary thereof are 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.  No financial statement, material report, material certificate or other material information (other than general industry information) furnished by or on behalf of any Credit Party or any Subsidiary thereof to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished), taken together as a whole, contains, as of the Closing Date, or if later, as of the date first delivered, any untrue statement of a material 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 materially misleading in light of the circumstances under which such statements are made; provided that, with respect to projected financial information, pro forma financial information, estimated financial information, and other projected, forward-looking or estimated information, such information was prepared in good faith based upon assumptions believed to be reasonable at the time made (it being understood and acknowledged that projections are as to future events and are not a guarantee of financial performance and are not to be viewed as facts, no assurances can be given that any particular projections will be realized, and that the actual results during the period or periods covered by such projections may vary materially from such projections).

 

SECTION 7.24                                      Flood Hazard Insurance.  With respect to each owned parcel of real property subject to a Mortgage, if any, the Administrative Agent has received (a) such flood hazard certifications, notices and confirmations thereof, (b) all flood hazard insurance policies required hereunder have been obtained and remain in full force and effect, and the premiums thereon have been paid in full, and (c) except as the Borrower has previously given written notice thereof to the Administrative Agent, there has been no redesignation of such owned real property into or out of a special flood hazard area.

 

ARTICLE VIII

 

AFFIRMATIVE COVENANTS

 

Until all of the Obligations (other than contingent indemnification and cost reimbursement obligations not then due) have been paid and satisfied in full in cash, all Letters of Credit have been terminated or expired (or been Cash Collateralized) and the Commitments terminated, each Credit Party will, and will cause each of its Subsidiaries to:

 

SECTION 8.1                                             Financial Statements and Budgets.  Deliver to the Administrative Agent, in form and detail satisfactory to the Administrative Agent (which shall promptly make such information available to the Lenders in accordance with its customary practice):

 

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(a)                                 Annual Financial Statements.  As soon as practicable and in any event within ninety (90) days (or, if later, the date of any required public filing thereof) after the end of each Fiscal Year, an audited Consolidated balance sheet of Holdings and its Subsidiaries as of the close of such Fiscal Year and audited Consolidated statements of income, retained earnings and cash flows including the notes thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the preceding Fiscal Year and prepared in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the year.  Such annual financial statements shall be audited by an independent certified public accounting firm of recognized national standing, and accompanied by a report and opinion thereon by such certified public accountants prepared in accordance with generally accepted auditing standards that is not subject to any “going concern”, explanatory language or exception or any qualification as to the scope of such audit or with respect to accounting principles followed by Holdings or any of its Subsidiaries not in accordance with GAAP.

 

(b)                                 Quarterly Financial Statements.  As soon as practicable and in any event within forty-five (45) days (or, if later, the date of any required public filing thereof) after the end of the first three Fiscal Quarters of each Fiscal Year, an unaudited Consolidated balance sheet of Holdings and its Subsidiaries as of the close of such Fiscal Quarter and unaudited Consolidated statements of income, retained earnings and cash flows and a report containing management’s discussion and analysis of such financial statements for the Fiscal Quarter then ended and that portion of the Fiscal Year then ended, including the notes thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the corresponding period in the preceding Fiscal Year and prepared by Holdings in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the period, and certified by the chief financial officer of Holdings to present fairly in all material respects the financial condition of Holdings and its Subsidiaries on a Consolidated basis as of their respective dates and the results of operations of Holdings and its Subsidiaries for the respective periods then ended, subject to normal year-end adjustments and the absence of footnotes.

 

(c)                                  Annual Business Plan and Budget.  As soon as practicable and in any event within sixty (60) days after the end of each Fiscal Year, a business plan and operating and capital budget of Holdings and its Subsidiaries for the ensuing four (4) Fiscal Quarters, such plan to be prepared in accordance with GAAP and to include, on a quarterly basis, the following:  a quarterly operating and capital budget, a projected income statement, statement of cash flows and balance sheet.

 

SECTION 8.2                                             Certificates; Other Reports.  Deliver to the Administrative Agent (which shall promptly make such information available to the Lenders in accordance with its customary practice):

 

(a)                                 at each time financial statements are delivered or deemed delivered pursuant to Sections 8.1(a) or (b), a duly completed and executed Officer’s Compliance Certificate (which includes a schedule in a form reasonably acceptable to the Administrative Agent setting forth, for the Fiscal Quarter or Fiscal Year covered by such Financial Statements or as of the last day of such Fiscal Quarter or Fiscal Year (as the case may be), the calculation of the financial ratios and

 

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tests provided in Section 9.13) and a report containing management’s discussion and analysis of such financial statements;

 

(b)                                 promptly upon any request by the Administrative Agent, copies of all reports, if any, submitted to any Credit Party, any Subsidiary thereof or any of their respective boards of directors by their respective independent public accountants in connection with their auditing function, including, without limitation, any management report and any management responses thereto to the extent consented to by such independent public accountants;

 

(c)                                  promptly after the furnishing thereof, copies of any statement or report furnished to any holder of Indebtedness of any Credit Party or any Subsidiary thereof in excess of the Threshold Amount pursuant to the terms of any indenture, loan or credit or similar agreement;

 

(d)                                 promptly after the assertion or occurrence thereof, notice of any action or proceeding against or of any noncompliance by any Credit Party or any Subsidiary thereof with any Environmental Law that could reasonably be expected to have a Material Adverse Effect;

 

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

 

(f)                                   promptly, and in any event within five (5) Business Days after receipt thereof by any Credit Party or any Subsidiary thereof, copies of each notice or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or possible investigation or other inquiry by such agency regarding financial or other operational results of any Credit Party or any Subsidiary thereof;

 

(g)                                  within ten (10) Business Days after the request therefor, such other information and documentation required by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations (including the PATRIOT Act), as from time to time reasonably requested by the Administrative Agent or any Lender; and

 

(h)                                 such other information regarding the operations, business affairs and financial condition of any Credit Party or any Subsidiary thereof as the Administrative Agent or any Lender may reasonably request.

 

Documents required to be delivered pursuant to Section 8.1(a) or (b) or Section 8.2(e) (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 Holdings posts such documents, or provides a link thereto on the Borrower’s or Holding’s website on the Internet at the website address listed in Section 12.1; or (ii) on which such documents are posted on Holdings’ behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent),  Notwithstanding anything contained herein, in every instance the Borrower shall be required to provide paper copies of the

 

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Officer’s Compliance Certificates required by Section 8.2 to the Administrative Agent.  Except for such Officer’s Compliance Certificates, the Administrative Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Borrower with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

 

The Borrower and Holdings hereby acknowledge that (a) the Administrative Agent and/or the Arrangers will make available to the Lenders and the Issuing Lenders materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials the Platform and (b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Borrower or its securities) (each, a “Public Lender”).  The Borrower hereby agrees that it will use commercially reasonable efforts to identify that portion of the Borrower Materials that may be distributed to the Public Lenders and that (w) all such Borrower Materials, except those filed with the SEC, shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, means that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, the Arrangers, the Issuing Lenders and the Lenders to treat such Borrower Materials as not containing any material non-public information (although it may be sensitive and proprietary) with respect to Holdings or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in Section 12.10); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Investor;” and (z) the Administrative Agent and the Arrangers shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Investor.”  Notwithstanding the foregoing, the Borrower shall be under no obligation to mark any Borrower Materials “PUBLIC”.

 

SECTION 8.3                                             Notice of Litigation and Other Matters.  Promptly (but in no event later than ten (10) days after any Responsible Officer of any Credit Party obtains knowledge thereof) notify the Administrative Agent in writing of (which shall promptly make such information available to the Lenders in accordance with its customary practice):

 

(a)                                 the occurrence of any Default or Event of Default;

 

(b)                                 the commencement of all proceedings and investigations by or before any Governmental Authority and all actions and proceedings in any court or before any arbitrator against or involving any Credit Party or any Subsidiary thereof or any of their respective properties, assets or businesses in each case that if adversely determined could reasonably be expected to result in a Material Adverse Effect;

 

(c)                                  any notice of any violation received by any Credit Party or any Subsidiary thereof from any Governmental Authority including any notice of violation of Environmental Laws which in any such case could reasonably be expected to have a Material Adverse Effect;

 

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(d)                                 any labor controversy that has resulted in, or threatens to result in, a strike or other work action against any Credit Party or any Subsidiary thereof, which in any such case could reasonably be expected to result in a Material Adverse Effect;

 

(e)                                  any attachment, judgment, lien, levy or order exceeding the Threshold Amount has been assessed against any Credit Party or any Subsidiary thereof; and

 

(f)                                   (i) all notices received by any Credit Party or any ERISA Affiliate of the PBGC’s intent to terminate any Pension Plan or to have a trustee appointed to administer any Pension Plan, (ii) all notices received by any Credit Party or any ERISA Affiliate from a Multiemployer Plan sponsor concerning the imposition or amount of withdrawal liability pursuant to Section 4202 of ERISA and (iii) the Borrower obtaining knowledge or reason to know that any Credit Party or any ERISA Affiliate has filed or intends to file a notice of intent to terminate any Pension Plan under a distress termination within the meaning of Section 4041(c) of ERISA.

 

Each notice pursuant to Section 8.3 shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and, to the extent applicable, stating what action the Borrower has taken and proposes to take with respect thereto.  Each notice pursuant to Section 8.3(a) shall reasonably describe any and all provisions of this Agreement and any other Loan Document that, to the knowledge of a Responsible Officer of any Credit Party, have been breached.

 

SECTION 8.4                                             Preservation of Corporate Existence and Related Matters.  Except as permitted by Section 9.4, preserve and maintain its separate corporate existence and all rights, franchises, licenses and privileges necessary to the conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 8.5                                             Maintenance of Property and Licenses.

 

(a)                                 In addition to the requirements of any of the Security Documents, protect and preserve all Properties necessary in and material to its business, including copyrights, patents, trade names, service marks and trademarks; maintain in good working order and condition, ordinary wear and tear excepted, all buildings, equipment and other tangible real and personal property, in each case except as such action or inaction could not reasonably be expected to result in a Material Adverse Effect.

 

(b)                                 Maintain, in full force and effect in all material respects, each license, permit, certification, qualification, approval or franchise issued by any Governmental Authority (each a “License”) required for each of them to conduct their respective businesses as presently conducted, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 8.6                                             Insurance.  Maintain insurance with financially sound and reputable insurance companies consistent with past practice and as may be required by Applicable Law and as are required by any Security Documents (including hazard and business interruption insurance).  The Borrower shall use commercially reasonable efforts to cause, unless otherwise agreed by the Administrative Agent, each provider of such insurance to agree to (a) provide that no cancellation or material modification thereof shall be effective until at least 30 days after

 

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receipt by the Administrative Agent of written notice thereof (or until at least 10 days in the case of cancellation due to the nonpayment of premiums), (b) name the Administrative Agent as an additional insured party thereunder and (c) in the case of each casualty insurance policy, name the Administrative Agent as lender’s loss payee.  On the Closing Date and from time to time thereafter deliver to the Administrative Agent upon its request information in reasonable detail as to the insurance then in effect, stating the names of the insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof and the properties and risks covered thereby.  Without limiting the foregoing, the Borrower shall and shall cause each appropriate Credit Party to (i) maintain, if available, fully paid flood hazard insurance on all owned real property that is located in a special flood hazard area and that is subject to a Mortgage, if any, on such terms and in such amounts as required by The National Flood Insurance Reform Act of 1994, (ii) furnish to the Administrative Agent evidence of renewal (and payment of renewal premiums therefor) of all such policies prior to or concurrently with the expiration or lapse thereof, and (iii) furnish to the Administrative Agent prompt written notice of any redesignation of any such improved real property into or out of a special flood hazard area.

 

SECTION 8.7                                             Accounting Methods and Financial Records.  Maintain a system of accounting, and keep proper books, records and accounts (which shall be true and complete in all material respects) as may be required or as may be necessary to permit the preparation of financial statements in accordance with GAAP and in compliance with the regulations of any Governmental Authority having jurisdiction over it or any of its Properties.

 

SECTION 8.8                                             Payment of Taxes and Other Obligations.  Except where the failure to do so could not reasonably be expected to have a Material Adverse Effect, to pay and perform (a) all taxes, assessments and other governmental charges that may be levied or assessed upon it or any of its Property and (b) all other Indebtedness, obligations and liabilities in accordance with customary trade practices; provided, that the Borrower or such Subsidiary may contest any item described in clause (a) or (b) of this Section in good faith so long as adequate reserves are maintained with respect thereto in accordance with GAAP.

 

SECTION 8.9                                             Compliance with Laws and Approvals.  Observe and remain in compliance with all Applicable Laws and maintain in full force and effect all Governmental Approvals, in each case applicable to the conduct of its business except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 8.10                                      Environmental Laws.  In addition to and without limiting the generality of Section 8.9, (a) comply with all applicable Environmental Laws and obtain and comply with and maintain any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws and (b) conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions to the extent required of any Credit Party or any Subsidiary under Environmental Laws, and promptly comply with all lawful orders and directives imposed on any Credit Party or any Subsidiary by any Governmental Authority regarding Environmental Laws.

 

SECTION 8.11                                      Compliance with ERISA.  In addition to and without limiting the generality of Section 8.9, (a) except where the failure to so comply could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) comply with

 

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applicable provisions of ERISA, the Code and the regulations and published interpretations thereunder with respect to all Employee Benefit Plans, (ii) not take any action or fail to take action the result of which could reasonably be expected to result in a liability to the PBGC or to a Multiemployer Plan, (iii) not participate in any prohibited transaction that could result in any civil penalty under ERISA or tax under the Code upon the Borrower and (iv) operate each Employee Benefit Plan in such a manner that will not incur any tax liability under Section 4980B of the Code and (b) furnish to the Administrative Agent upon the Administrative Agent’s request such additional information about any Employee Benefit Plan as may be reasonably requested by the Administrative Agent.

 

SECTION 8.12                                      Visits and Inspections.  Permit representatives of the Administrative Agent (and each Lender accompanying the Administrative Agent), from time to time upon prior reasonable notice and at such times during normal business hours, all at the expense of the Borrower, to visit and inspect its properties; inspect, audit and make extracts from its books, records and files, including management letters prepared by independent accountants, to the extent consented to by such independent accountants; and discuss with its principal officers, and its independent accountants, its business, assets, liabilities, financial condition, results of operations and business prospects (provided that the Borrower may, if it chooses, be present at or participate in any such discussions); provided that excluding any such visits and inspections during the continuation of an Event of Default, the Administrative Agent shall not exercise such rights more often than once during any Fiscal Year; provided further that (i) upon the occurrence and during the continuance of an Event of Default, the Administrative Agent or any Lender may do any of the foregoing at the expense of the Borrower as often as may be reasonably necessary, at any time during normal business hours and without advance notice and (ii) so long as no Event of Default has occurred and is continuing, the Borrower shall only be responsible to pay the costs of one such visit, inspection and examination of the Administrative Agent in any Fiscal Year.

 

SECTION 8.13                                      Additional Subsidiaries.

 

(a)                                 Additional Domestic Subsidiaries.  Promptly after the creation or acquisition of any Domestic Subsidiary (other than an Excluded Subsidiary) or after any Excluded Subsidiary ceases to be an Excluded Subsidiary (and, in any event, within thirty (30) days after such creation, acquisition or a Responsible Officer of any Credit Party obtaining knowledge of any such cessation, as such time period may be extended by the Administrative Agent in its sole discretion) cause such Person to (i) become a Subsidiary Guarantor by delivering to the Administrative Agent a duly executed supplement to the Guaranty Agreement or such other document as the Administrative Agent shall deem appropriate for such purpose, (ii) grant a security interest in all Collateral (subject to the exceptions specified in the Collateral Agreement) owned by such Subsidiary by delivering to the Administrative Agent a duly executed supplement to each applicable Security Document or such other document as the Administrative Agent shall deem appropriate for such purpose and comply with the terms of each applicable Security Document, (iii) upon reasonable request of the Administrative Agent, deliver to the Administrative Agent such opinions, documents and certificates referred to in Section 6.1 as may be reasonably requested by the Administrative Agent, (iv) deliver to the Administrative Agent such original certificated Equity Interests or other certificates and stock or other transfer powers evidencing the Equity Interests of such Person, and (v) deliver to the Administrative Agent such

 

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updated Schedules to the Loan Documents as requested by the Administrative Agent with respect to such Person.

 

(b)                                 Additional Foreign Subsidiaries.  Notify the Administrative Agent promptly after any Person becomes a First Tier Foreign Subsidiary, and at the request of the Administrative Agent, promptly thereafter (and, in any event, within forty five (45) days after such request, as such time period may be extended by the Administrative Agent in its sole discretion), cause (i) the applicable Credit Party to deliver to the Administrative Agent a Foreign Pledge Agreement pledging sixty-five percent (65%) of the total outstanding voting Equity Interests (and one hundred percent (100%) of the non-voting Equity Interests) (or, in each case, such percentage as would not result in adverse federal income tax consequences for Holdings) of any such new First Tier Foreign Subsidiary and a consent thereto executed by such new First Tier Foreign Subsidiary (including if applicable, original certificated Equity Interests (or the equivalent thereof pursuant to the Applicable Laws and practices of any relevant foreign jurisdiction) evidencing the Equity Interests of such new First Tier Foreign Subsidiary, together with an appropriate undated stock or other transfer power for each certificate duly executed in blank by the registered owner thereof), (ii) upon reasonable request of the Administrative Agent, such Person to deliver to the Administrative Agent such opinions, documents and certificates referred to in Section 6.1 as may be reasonably requested by the Administrative Agent, and (iii) such Person to deliver to the Administrative Agent such updated Schedules to the Loan Documents as requested by the Administrative Agent with regard to such Person.

 

(c)                                  Real Property Collateral; Collateral Access Agreements.

 

(i)                                     (A) Promptly after the acquisition of any owned real property that has a fair market value in excess of $1,000,000 by any Credit Party that is not subject to the existing Security Documents (and, in any event, within ten (10) days after such acquisition, as such time period may be extended by the Administrative Agent in its sole discretion), notify the Administrative Agent and (B) promptly thereafter (and in any event, within sixty (60) days of such acquisition (as such time period may be extended by the Administrative Agent, in its sole discretion), deliver such mortgages, deeds of trust and title insurance policies in connection with granting and perfecting a first priority Lien, other than Permitted Liens, on such real property in favor of the Administrative Agent, for the benefit of the Secured Parties, all in form and substance reasonably acceptable to the Administrative Agent.  The provisions of this Section 8.13(c) shall not apply to any owned real property that (x) becomes subject to a Sale and Leaseback transaction permitted by Section 9.12, or (y) is subject to a commitment to become subject to a Sale and Leaseback, in each case, within ninety (90) days of the acquisition thereof.

 

(ii)                                  No leasehold mortgages, landlord waivers, estoppels or collateral access letters shall be required to be entered into except, in the case of landlord waivers and collateral access letters, to the extent available following the use of commercially reasonable efforts by the applicable Credit Party with respect to (x) the headquarters of each Credit Party and distribution centers, and (y) locations leased from MSW Promenade, L.P., TX-SW #1, LP, Ambassador Way Associates, LP and Bluecap, Ltd.

 

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(d)                                 Merger Subsidiaries.  Notwithstanding the foregoing, to the extent any new Subsidiary is created solely for the purpose of consummating a merger transaction pursuant to a Permitted Acquisition, and such new Subsidiary at no time holds any assets or liabilities other than any merger consideration contributed to it contemporaneously with the closing of such merger transaction, such new Subsidiary shall not be required to take the actions set forth in Section 8.13(a) or (b), as applicable, until the consummation of such Permitted Acquisition (at which time, the surviving entity of the respective merger transaction shall be required to so comply with Section 8.13(a) or (b), as applicable, within thirty (30) days after the consummation of such Permitted Acquisition, as such time period may be extended by the Administrative Agent in its sole discretion).

 

(e)                                  Exclusions.  The provisions of this Section 8.13 shall not apply to assets as to which the Administrative Agent and the Borrower shall reasonably determine that the costs and burdens of obtaining a security interest therein or perfection thereof outweigh the value of the security afforded thereby.

 

SECTION 8.14                                      Use of Proceeds.

 

(a)                                 The Borrower shall use the proceeds of the Extensions of Credit (i) to refinance certain existing indebtedness of the Borrower and its Subsidiaries, (ii) for the payment of fees and expenses incurred in connection with the Transactions occurring on the Closing Date, and (iii) to finance ongoing working capital requirements, Permitted Acquisitions, capital expenditures and other general corporate purposes of the Borrower and its Subsidiaries.

 

(b)                                 The Borrower shall use the proceeds of any Incremental Term Loan as permitted pursuant to Section 5.13, as applicable.

 

(c)                                  The Borrower shall use the proceeds of any Refinancing Indebtedness to prepay all Term Loans then outstanding (including all accrued interest, fees and premiums (if any)).

 

(d)                                 The Borrower will not request any Extension of Credit, and the Borrower shall not use, and shall ensure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Extension 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, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

 

SECTION 8.15                                      Compliance with Anti-Corruption Laws and Sanctions.  The Borrower will maintain in effect and enforce policies and procedures designed to ensure compliance by Holdings, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.

 

SECTION 8.16                                      Reserved.

 

SECTION 8.17                                      Further Assurances.  Subject to the exceptions and limitations set forth herein or in any other Loan Document, execute any and all further documents, financing

 

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statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements and other documents), required under any Applicable Law or which the Administrative Agent or the Required Lenders may reasonable request,  to effectuate the transactions contemplated by the Loan Documents or to grant, preserve, protect or perfect the Liens created or intended to be created by the Security Documents or the validity or priority of any such Lien, all at the expense of the Credit Parties.

 

SECTION 8.18                                      Post-Closing Matters.  Execute and deliver the documents and complete the tasks set forth on Schedule 8.18, in each case within the time limits specified on such schedule.

 

ARTICLE IX

 

NEGATIVE COVENANTS

 

Until all of the Obligations (other than contingent, indemnification and cost reimbursement obligations not then due) have been paid and satisfied in full in cash, all Letters of Credit have been terminated or expired (or been Cash Collateralized) and the Commitments terminated, the Credit Parties will not, and will not permit any of their respective Subsidiaries to:

 

SECTION 9.1                                             Indebtedness.  Create, incur, assume or suffer to exist any Indebtedness except:

 

(a)                                 the Obligations;

 

(b)                                 Indebtedness owing under Hedge Agreements entered into in order to manage existing or anticipated interest rate, exchange rate or commodity price risks and not for speculative purposes;

 

(c)                                  Indebtedness (not otherwise permitted by this Section 9.1) existing on the Closing Date and listed on Schedule 9.1, and any refinancings, refundings, renewals or extensions thereof; provided that (i) the principal amount of such Indebtedness is not increased at the time of such refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to any existing commitments unutilized thereunder, (ii) the final maturity date and weighted average life of such refinancing, refunding, renewal or extension shall not be prior to or shorter than that applicable to the Indebtedness prior to such refinancing, refunding, renewal or extension and (iii) any refinancing, refunding, renewal or extension of any Subordinated Indebtedness shall be (A) on subordination terms (taken as a whole) at least as favorable to the Lenders, (B) no more restrictive (taken as a whole) on Holdings and its Subsidiaries than the Subordinated Indebtedness being refinanced, refunded, renewed or extended and (C) in an amount not less than the amount outstanding at the time of such refinancing, refunding, renewal or extension;

 

(d)                                 (i) Capital Lease Obligations (other than described in (ii) below) and Indebtedness evidencing the deferred purchase price of newly acquired property or incurred to finance the acquisition, purchase, construction, improvement or remodel of a fixed or capital asset of the Borrower or its Subsidiaries to the extent that the aggregate amount of such Indebtedness does

 

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not exceed the Threshold Amount at any time outstanding, and (ii) Indebtedness in respect of Capitalized Lease Obligations that are in the nature of Sale and Leaseback Transactions, to the extent permitted by Section 9.12;

 

(e)                                  Indebtedness of a Person existing at the time such Person became a Subsidiary or assets were acquired from such Person in connection with an Investment permitted pursuant to Section 9.3, to the extent that (i) such Indebtedness was not incurred in connection with, or in contemplation of, such Person becoming a Subsidiary or the acquisition of such assets, (ii) neither Holdings nor any Subsidiary thereof (other than such Person or any other Person that such Person merges with or that acquires the assets of such Person) shall have any liability or other obligation with respect to such Indebtedness and (iii) the aggregate outstanding principal amount of such Indebtedness does not exceed $10,000,000 at any time outstanding;

 

(f)                                   Guarantees with respect to Indebtedness permitted pursuant to subsections (a) through (e) of this Section;

 

(g)                                  intercompany Indebtedness:

 

(i)                                     owed by any Credit Party (other than Holdings) to another Credit Party;

 

(ii)                                  owed by any Credit Party (other than Holdings) to any Non-Guarantor Subsidiary (provided that such Indebtedness shall be unsecured and subordinated to the Obligations in a manner reasonably satisfactory to the Administrative Agent);

 

(iii)                               owed by any Non-Guarantor Subsidiary to any other Non-Guarantor Subsidiary; and

 

(iv)                              owed by any Non-Guarantor Subsidiary to any Credit Party to the extent permitted pursuant to Section 9.3(a)(vi);

 

(h)                                 Indebtedness arising from the endorsement of instrument for deposit or honoring by a bank or other financial institution of a check, draft or other similar instrument drawn against insufficient funds in the ordinary course of business;

 

(i)                                     Subordinated Indebtedness of Holdings and its Subsidiaries; provided, that in the case of each incurrence of such Subordinated Indebtedness, (i) no Event of Default shall have occurred and be continuing or would be caused by the incurrence of such Subordinated Indebtedness and (ii) the Administrative Agent shall have received an appropriately completed Officer’s Compliance Certificate that evidences that on a Pro Forma Basis after giving effect to the incurrence of any such Subordinated Indebtedness the Borrower would be in compliance with the financial covenants set forth in Section 9.13 for the most recently completed four Fiscal Quarter period with respect to which the Administrative Agent has received financial statements from the Borrower pursuant to Section 8.1; provided, further that the maturity of such Subordinated Indebtedness shall be no earlier than a date that is six months after the Latest Maturity Date and such Subordinated Indebtedness shall have no principal payments prior to a date that is six months after the Latest Maturity Date;

 

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(j)                                    Indebtedness arising from Borrower or any Subsidiary becoming an account party in respect of letters of credit issued in the ordinary course of business, or under performance bonds, surety bonds, release, appeal and similar bonds, statutory obligations or with respect to workers’ compensation claims, in each case incurred in the ordinary course of business, and reimbursement obligations in respect of any of the foregoing;

 

(k)                                 Indebtedness of Foreign Subsidiaries in an aggregate principal amount not to exceed $5,000,000 at any time outstanding;

 

(l)                                     Refinancing Indebtedness;

 

(m)                             Indebtedness consisting of promissory notes issued to current or former officers, directors and employees (or their respective family members, estates or trusts or other entities for the benefit of any of the foregoing) of Holdings or its Subsidiaries to purchase or redeem Equity Interests or options of Holdings permitted pursuant to Section 9.6(d)(iii); provided that the aggregate principal amount of all such Indebtedness shall not exceed $1,000,000 at any time outstanding;

 

(n)                                 Indebtedness owing to any insurance company in connection with the financing of any insurance premiums permitted by such insurance company in the ordinary course of business;

 

(o)                                 Indebtedness consisting of incentive, non-compete, consulting, deferred compensation or other similar arrangements to employees of any Credit Party incurred in the ordinary course of business;

 

(p)                                 Indebtedness in respect of taxes, assessments, governmental charges or levies and claims for labor, materials and supplies, and liabilities under employee benefit plan, including pension plans, not overdue by more than 90 days or which are being contested in good faith and by appropriate proceedings diligently conducted if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP; and

 

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

 

(r)                                    Indebtedness constituting (i) the obligation to make customary purchase price adjustments for working capital and indemnities or (ii) any earn-out or other similar deferred purchase price payment obligation, in connection with Permitted Acquisitions;

 

(s)                                   without duplication of any other Indebtedness, accretion or amortization of original issue discount and payment-in-kind interest with respect to Indebtedness permitted hereunder;

 

(t)                                    Indebtedness in respect of netting services and overdraft protections in connection with deposit accounts, in each case in the ordinary course of business;

 

(u)                                 Indebtedness in respect of an Investment permitted under Section 9.2(a)(ii);

 

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(v)                                 Indebtedness of any Credit Party or any Subsidiary thereof not otherwise permitted pursuant to this Section in an aggregate principal amount not to exceed $5,000,000 at any time outstanding; and

 

(w)                               unsecured Indebtedness of any Credit Party or any Subsidiary thereof not otherwise permitted pursuant to this Section; provided, that in the case of each incurrence of such Indebtedness, (i) no Event of Default shall have occurred and be continuing or would be caused by the incurrence of such Indebtedness and (ii)  the Consolidated Total Lease Adjusted Net Leverage Ratio on a Pro Forma Basis after giving effect to the incurrence of any such Indebtedness is at least 0.25 below the then applicable maximum ratio set forth in Section 9.13(a) (and the Administrative Agent shall have received an appropriately completed Officer’s Compliance Certificate that evidencing the same).

 

SECTION 9.2                                             Liens.  Create, incur, assume or suffer to exist, any Lien on or with respect to any of its Property, whether now owned or hereafter acquired, except:

 

(a)                                 Liens created pursuant to the Loan Documents (including Liens securing the obligations under the Hedge Agreements, and Liens in favor of the Swingline Lender and/or the Issuing Lenders, as applicable, on Cash Collateral granted pursuant to the Loan Documents);

 

(b)                                 Liens not otherwise permitted by this Section 9.2 and in existence on the Closing Date and described on Schedule 9.2, and the replacement, renewal or extension thereof (including Liens incurred, assumed or suffered to exist in connection with any refinancing, refunding, renewal or extension of Indebtedness pursuant to Section 9.1(c) (solely to the extent that such Liens were in existence on the Closing Date and described on Schedule 9.2)); provided that the scope of any such Lien shall not be increased, or otherwise expanded, to cover any additional property or type of asset, as applicable, beyond that in existence on the Closing Date, except for products and proceeds of the foregoing;

 

(c)                                  Liens for taxes, assessments and other governmental charges or levies (i) not yet delinquent or (ii) which are being contested in good faith and by appropriate proceedings if adequate reserves are maintained to the extent required by GAAP;

 

(d)                                 Liens (i) for the claims of materialmen, mechanics, carriers, warehousemen, processors or landlords, which are not overdue for a period of more than ninety (90) days, or if more than ninety (90) days overdue and such Liens are being contested in good faith and by appropriate proceedings if (A) adequate reserves are maintained to the extent required by GAAP or (B) no action has been taken to enforce such Liens or any such action has been stayed, (ii) granted to each of MSW Promenade, L.P., TX-SW #1, LP, Ambassador Way Associates, LP and Bluecap, Ltd. pursuant to the leases entered with such Persons by a Credit Party, as such leases exist on the Closing Date with such adjustments and modifications thereto as are permitted under this Agreement;

 

(e)                                  deposits or pledges made in the ordinary course of business in connection with, or to secure payment of, obligations under workers’ compensation, unemployment insurance and other types of social security or similar legislation, or to secure the performance of bids, trade contracts and leases (other than Indebtedness), statutory obligations, surety bonds (other than

 

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bonds related to judgments or litigation), performance bonds and other obligations of a like nature incurred in the ordinary course of business;

 

(f)                                   encumbrances in the nature of zoning restrictions, covenants, conditions, easements and rights or restrictions of record on the use of real property, minor defects or other irregularities of title, and other similar encumbrances incurred in the ordinary course of business, which do not, in any case, detract from the value of such property or interfere in any material respect with the ordinary conduct of the business of any Credit Party;

 

(g)                                  Liens arising from (i) the filing of precautionary UCC financing statements in respect of leases of goods or in respect of trade show or special event consignment arrangements, in each case, to the extent that such Liens attach only to such leased property or consigned goods, and (ii) non-consensual filings of any financing statement under the UCC or any comparable law;

 

(h)                                 Liens securing Indebtedness permitted under Section 9.1(d); provided that (i) such Liens do not at any time encumber any property other than the Property financed by such Indebtedness or the proceeds thereof and (ii) the principal amount of Indebtedness secured by any such Lien shall at no time exceed one hundred percent (100%) of the original price for the purchase, repair improvement or lease amount (as applicable) of such Property at the time of purchase, repair, improvement or lease (as applicable);

 

(i)                                     (i) Liens securing judgments, writs, orders or decrees for the payment of money not constituting an Event of Default under Section 10.1(l) or securing appeal or other surety bonds relating to such judgments, and (ii) Liens arising out of judgments, writs, orders or awards not resulting in an Event of Default;

 

(j)                                    (i) Liens on tangible property or tangible assets (and proceeds thereof) (i) of any Subsidiary which are in existence at the time that such Subsidiary is acquired pursuant to a Permitted Acquisition and (ii) of the Borrower or any of its Subsidiaries existing at the time such tangible property or tangible assets are purchased or otherwise acquired by the Borrower or such Subsidiary thereof pursuant to a transaction permitted pursuant to this Agreement; provided that, with respect to each of the foregoing clauses (i) and (ii), (A) such Liens are not incurred in connection with, or in anticipation of, such Permitted Acquisition, purchase or other acquisition, (B) such Liens are applicable only to specific Property, (C) such Liens are not “blanket” or all asset Liens, (D) such Liens do not attach to any other Property of Holdings or any of its Subsidiaries and (E) the Indebtedness secured by such Liens is permitted under Section 9.1(e) of this Agreement);

 

(k)                                 Liens on Collateral securing obligations in respect of Refinancing Indebtedness; provided that, if such Liens secure Refinancing Notes, such Liens shall be pari passu with or junior to the Lien securing the Obligations and shall be subject to customary intercreditor and/or subordination agreements, as applicable, agreed to by the holders thereof (or a duly authorized agent on their behalf) and reasonably satisfactory to the Administrative Agent and the Borrower;

 

(l)                                     (i) Liens of a collecting bank arising in the ordinary course of business under Section 4-210 of the Uniform Commercial Code in effect in the relevant jurisdiction and

 

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(ii) Liens of any depositary bank in connection with statutory, common law and contractual rights of set-off and recoupment with respect to any deposit account of the Borrower or any Subsidiary thereof;

 

(m)                             (i) contractual or statutory Liens of landlords to the extent relating to the property and assets relating to any lease agreements with such landlord, and (ii) contractual Liens of suppliers (including sellers of goods) or customers granted in the ordinary course of business to the extent limited to the property or assets relating to such contract;

 

(n)                                 any interest or title of a licensor, sublicensor, lessor or sublessor with respect to any assets under any license or lease agreement entered into in the ordinary course of business  and covering only the assets so licensed;

 

(o)                                 non-exclusive licenses of patents, trademarks, copyrights, and other intellectual property rights in the ordinary course of business;

 

(p)                                 Liens held by creditors of consignees of inventory of the Borrower and its Subsidiaries in connection with Permitted Consignment Sales by Borrower;

 

(q)                                 Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of custom duties in connection with the importation of goods in the ordinary course of business so long as such Liens attach only to the imported good;

 

(r)                                    Good faith pledges or deposits (not otherwise covered in clause (e) above) made in the ordinary course of business to secure new construction of business locations of the Borrower and its Subsidiaries;

 

(s)                                   Liens on any cash earnest money deposits made by Borrower or any of its Subsidiaries in connection with any letter of intent or purchase agreement with respect to a Permitted Acquisition or disposition (which for the avoidance of doubt may include any proposed merger, asset or stock purchase agreement);

 

(t)                                    Liens granted by Borrower or any of its Subsidiaries in favor of a Credit Party in respect of Indebtedness owed by Borrower or any of its Subsidiaries to such Credit Party; provided that such Indebtedness is (i) evidenced by an intercompany note and (ii) pledged by such Credit Party as Collateral and delivered to the Administrative Agent pursuant to the Collateral Documents;

 

(u)                                 Liens on property rented to, or leased by, the Credit Parties or their Subsidiaries pursuant to a Sale and Leaseback Transaction; provided that (i) such Sale and Leaseback Transaction is permitted by Section 9.12, (ii) such Liens do not encumber any other property of the Credit Parties or any of their Subsidiaries, and (iii) such Liens secure only the Attributable Indebtedness incurred in connection with such Sale and Leaseback Transaction;

 

(v)                                 Liens on the assets of any Foreign Subsidiary securing Indebtedness described in Section 9.1(k);

 

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(w)                               Liens arising by operation of law under Article 2 of the UCC in favor of a reclaiming seller of goods or buyer of goods;

 

(x)                                 Liens on securities which are the subject of repurchase agreements incurred in the ordinary course of business in connection with an investment in a Cash Equivalent;

 

(y)                                 Liens on unearned insurance premiums financed by Indebtedness contemplated by Section 9.1(n);

 

(z)                                  Liens in the nature of the right of setoff in favor of counterparties to contractual agreements with the Credit Parties in the ordinary course of business; and

 

(aa)                          Liens not otherwise permitted hereunder on assets other than the Collateral securing Indebtedness or other obligations in an aggregate principal amount not to exceed $5,000,000 at any time outstanding.

 

SECTION 9.3                                             Investments.  Purchase, own, invest in or otherwise acquire (in one transaction or a series of transactions), directly or indirectly, any Equity Interests, interests in any partnership or joint venture (including, without limitation, the creation or capitalization of any Subsidiary), evidence of Indebtedness or other obligation or security, substantially all or a portion of the business or assets of any other Person or any other investment or interest whatsoever in any other Person, or make or permit to exist, directly or indirectly, any loans, advances or extensions of credit to, or any investment in cash or by delivery of Property in, any Person (all the foregoing, “Investments”) except:

 

(a)                                 (i)                                     Investments existing on the Closing Date in Subsidiaries existing on the Closing Date;

 

(ii)                                  Investments existing on the Closing Date (other than Investments in Subsidiaries existing on the Closing Date) and described on Schedule 9.3;

 

(iii)                               Investments made after the Closing Date by any Credit Party in any other Credit Party (other than Holdings);

 

(iv)                              Investments made after the Closing Date by any Non-Guarantor Subsidiary in any other Non-Guarantor Subsidiary;

 

(v)                                 Investments made after the Closing Date by any Non-Guarantor Subsidiary in any Credit Party; provided that, to the extent such Investment constitutes Indebtedness of such Credit Party, such Indebtedness shall be subordinated to the Obligations in a manner reasonably satisfactory to the Administrative Agent;

 

(vi)                              Investments made after the Closing Date by any Credit Party in any Non-Guarantor Subsidiary in an aggregate amount at any time outstanding not to exceed $1,000,000 (provided that any Investments in the form of loans or advances made by any Credit Party to any Non-Guarantor Subsidiary pursuant to this clause (vi) shall be evidenced by a demand note in form and substance reasonably satisfactory to the

 

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Administrative Agent and shall be pledged and delivered to the Administrative Agent pursuant to the Security Documents); and

 

(vii)                           Investments made after the Closing Date by the Borrower in RCC Western Stores, Inc. and Baskins Acquisition Holdings, LLC in an amount sufficient to permit each such Subsidiary to pay (x) certain rent expenses with respect to leases as in effect on the Closing Date (and any amendments, modifications, extensions, or replacements thereof) and (y) operating and overhead expenses (including, without limitation, utilities and salary) in the ordinary course of business and fees and expenses of attorneys, accountants and appraisers;

 

(b)                                 Investments in cash and Cash Equivalents;

 

(c)                                  Investments by the Borrower or any of its Subsidiaries consisting of capital expenditures;

 

(d)                                 deposits made in the ordinary course of business to secure the performance of leases or other obligations as permitted by Section 9.2;

 

(e)                                  Hedge Agreements permitted pursuant to Section 9.1(b);

 

(f)                                   purchases of assets in the ordinary course of business;

 

(g)                                  Investments by the Borrower or any Subsidiary thereof in the form of Permitted Acquisitions;

 

(h)                                 Investments in the form of loans and advances to officers, directors and employees in the ordinary course of business in an aggregate amount not to exceed at any time outstanding $500,000 (determined without regard to any write-downs or write-offs of such loans or advances);

 

(i)                                     Investments permitted pursuant to Section 9.6;

 

(j)                                    Guarantees permitted pursuant to Section 9.1;

 

(k)                                 Investments in joint ventures; in an aggregate amount not to exceed $5,000,000 at any time outstanding;

 

(l)                                     Holdings or any of its Subsidiaries may (i) acquire and hold accounts receivables owning to any of them if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary terms, (ii) endorse negotiable instruments held for collection in the ordinary course of business, or (iii) make lease, utility and other similar deposits in the ordinary course of business;

 

(m)                             Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors;

 

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(n)                                 Investments made by Borrower or any Subsidiary thereof as a result of consideration received in connection with an Asset Sale made in compliance with Sections 9.5;

 

(o)                                 Investments of any Person that becomes a Subsidiary on or after the Closing Date existing on the date such Person becomes a Subsidiary; provided that (i) such Investments exist at the time such person is acquired, (ii) such Investments are not made in anticipation or contemplation of such Person becoming a Subsidiary, and (iii) such Investments are not directly or indirectly recourse to any of Holdings or any of its Subsidiaries or any of their respective assets, other than to the person that becomes a Subsidiary;

 

(p)                                 Payroll, travel and similar employee advances of Holdings and its Subsidiaries to cover matters that are expected at the time of such advances ultimately to be treated as expenses of Holdings and its Subsidiaries for accounting purposes and that are made in the ordinary course of business;

 

(q)                                 Endorsements of negotiable instruments and documents in the ordinary course of business;

 

(r)                                    Creation of (but not any Investment of cash or other property in) any Subsidiary of Borrower; provided that Credit Parties shall comply with Section 8.13 in connection therewith; and

 

(s)                                   Investments not otherwise permitted pursuant to this Section in an aggregate amount not to exceed $7,500,000 at any time outstanding.

 

For purposes of determining the amount of any Investment outstanding for purposes of this Section 9.3, such amount shall be deemed to be the amount of such Investment when made, purchased or acquired (without adjustment for subsequent increases or decreases in the value of such Investment) less any amount received in respect of such Investment upon the sale, collection or return of capital or Repayment of Indebtedness on account of such Indebtedness (not to exceed the original amount invested).

 

SECTION 9.4                                             Fundamental Changes.  Merge, consolidate or enter into any similar combination with, or enter into any Asset Disposition of all or substantially all of its assets (whether in a single transaction or a series of transactions) with, any other Person or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution) except:

 

(a)                                 (i) any Wholly-Owned Subsidiary of the Borrower may be merged, amalgamated or consolidated with or into the Borrower (provided that the Borrower shall be the continuing or surviving entity) or (ii) any Wholly-Owned Subsidiary of the Borrower may be merged, amalgamated or consolidated with or into any Subsidiary Guarantor (provided that the Subsidiary Guarantor shall be the continuing or surviving entity or simultaneously with such transaction, the continuing or surviving entity shall become a Subsidiary Guarantor and the Borrower shall comply with Section 8.13 in connection therewith);

 

(b)                                 (i) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may be merged, amalgamated or consolidated with or into, or be liquidated into, any other Non-Guarantor Subsidiary and (ii) any Non-Guarantor Subsidiary that is a Domestic Subsidiary may be merged,

 

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amalgamated or consolidated with or into, or be liquidated into, any other Non-Guarantor Subsidiary that is a Domestic Subsidiary;

 

(c)                                  any Subsidiary of Holdings (other than the Borrower) may dispose of all or substantially all of its assets (upon voluntary liquidation, dissolution, winding up or otherwise) to the Borrower or any other Credit Party; provided that, with respect to any such disposition by any Non-Guarantor Subsidiary, the consideration for such disposition shall not exceed the fair value of such assets;

 

(d)                                 (i) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may dispose of all or substantially all of its assets (upon voluntary liquidation, dissolution, winding up or otherwise) to any other Non-Guarantor Subsidiary and (ii) any Non-Guarantor Subsidiary that is a Domestic Subsidiary may be merged, amalgamated or consolidated with or into, or be liquidated into, any other Non-Guarantor Subsidiary that is a Domestic Subsidiary;

 

(e)                                  any Wholly-Owned Subsidiary of the Borrower may merge with or into the Person such Wholly-Owned Subsidiary was formed to acquire in connection with any acquisition permitted hereunder (including any Permitted Acquisition permitted pursuant to Section 9.3(g)); provided that (i) in the case of any merger involving a Wholly-Owned Subsidiary that is a Domestic Subsidiary, (x) a Subsidiary Guarantor shall be the continuing or surviving entity or (y) simultaneously with such transaction, the continuing or surviving entity shall become a Subsidiary Guarantor and the Borrower shall comply with Section 8.13 in connection therewith and (ii) in the case of any merger involving a Wholly-Owned Subsidiary that is a Pledged Foreign Subsidiary, (x) the Pledged Foreign Subsidiary shall be the continuing or surviving entity or (y) simultaneously with such transaction, the continuing or surviving entity shall become a Pledged Foreign Subsidiary and the Borrower shall comply with Section 8.13 in connection therewith;

 

(f)                                   any Person may merge into the Borrower or any of the Borrower’s Wholly-Owned Subsidiaries in connection with a Permitted Acquisition permitted pursuant to Section 9.3(g); provided that in the case of a merger involving Holdings, the Borrower, a Subsidiary Guarantor or a Pledged Foreign Subsidiary, the continuing or surviving Person shall be Holdings, the Borrower, such Subsidiary Guarantor or such Pledged Foreign Subsidiary;

 

(g)                                  convert into any other organizational form (subject to complying with any notification requirements under the Collateral Agreement); and

 

(h)                                 make Asset Dispositions permitted pursuant to Section 9.5.

 

SECTION 9.5                                             Asset Dispositions.  Make any Asset Disposition except:

 

(a)                                 the sale of obsolete, worn-out or surplus assets no longer used or usable in the business of the Borrower or any of its Subsidiaries;

 

(b)                                 non-exclusive licenses and sublicenses of intellectual property rights in the ordinary course of business not interfering, individually or in the aggregate, in any material respect with the conduct of the business of the Borrower and its Subsidiaries;

 

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(c)                                  leases, subleases, licenses or sublicenses of real or personal property granted by the Borrower or any of its Subsidiaries to others in the ordinary course of business to the extent not prohibited by the Loan Documents;

 

(d)                                 Asset Dispositions in connection with Insurance and Condemnation Events;

 

(e)                                  Asset Dispositions in connection with transactions expressly permitted by Section 9.4;

 

(f)                                   Dispositions of assets in connection with Sale and Leaseback Transactions (i) in respect of properties owned by any Credit Party as of the Closing Date in an aggregate amount not to exceed $10,000,000 in any fiscal year and $20,000,000 during the term of this Agreement, and (ii) in respect of other properties in an unlimited amount; provided that after giving effect to such Disposition of assets in connection with any Sale and Leaseback Transaction, the Credit Parties shall be in Pro Forma Compliance with the financial covenants set forth in Section 9.13; and

 

(g)                                  Asset Dispositions not otherwise permitted pursuant to this Section; provided that (i) at the time of such Asset Disposition, no Default or Event of Default shall exist or would result from such Asset Disposition, (ii) such Asset Disposition is made for fair market value and the consideration received shall be no less than 75% in cash or Cash Equivalents, and (iii) the aggregate fair market value of all property disposed of in reliance on this clause (g) shall not exceed $10,000,000 in any Fiscal Year.

 

SECTION 9.6                                             Restricted Payments.  Declare or pay any dividend on, or make any payment or other distribution on account of, or purchase, redeem, retire or otherwise acquire (directly or indirectly), or set apart assets for a sinking or other analogous fund for the purchase, redemption, retirement or other acquisition of, any class of Equity Interests of any Credit Party or any Subsidiary thereof, or make any distribution of cash, property or assets to the holders of shares of any Equity Interests of any Credit Party or any Subsidiary thereof (all of the foregoing, the “Restricted Payments”); provided that:

 

(a)                                 to the extent not resulting in a Change in Control, Holdings, the Borrower or any of its Subsidiaries may pay dividends or distributions in shares or other Equity Interests, as applicable, of its own Qualified Equity Interests;

 

(b)                                 any Subsidiary of the Borrower may pay cash dividends or distributions to the Borrower or any Subsidiary Guarantor;

 

(c)                                  (i) any Non-Guarantor Subsidiary that is a Domestic Subsidiary may make Restricted Payments to any other Non-Guarantor Subsidiary that is a Domestic Subsidiary (and, if applicable, to other holders of its outstanding Equity Interests on a ratable basis) and (ii) any Non-Guarantor Subsidiary that is a Foreign Subsidiary may make Restricted Payments to any other Non-Guarantor Subsidiary (and, if applicable, to other holders of its outstanding Equity Interests on a ratable basis); and

 

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(d)                                 the Borrower may declare and make (and each Subsidiary of the Borrower may declare and make to enable the Borrower to do the same) Restricted Payments to Holdings, so that Holdings may, and Holdings shall be permitted to:

 

(i)                                     pay any Taxes which are due and payable by (A) Holdings on a stand-alone basis, or (B) the consolidated, combined, affiliated, unitary or other group of which Holdings is the common parent;

 

(ii)                                  pay corporate operating (including, without limitation, directors fees and expenses) and overhead expenses (including, without limitation, rent, utilities and salary) in the ordinary course of business and fees and expenses of attorneys, accountants, appraisers and the like;

 

(iii)                               redeem, retire or otherwise acquire shares of its Equity Interests or options or other equity or phantom equity in respect of its Equity Interests from present or former officers, employees, directors or consultants (or their family members or trusts or other entities for the benefit of any of the foregoing) or make severance payments to such Persons in connection with the death, disability or termination of employment or consultancy of any such officer, employee, director or consultant (A) to the extent that such purchase is made with the Net Cash Proceeds of any offering of equity securities of or capital contributions to Holdings, (B) to the extent that such purchase is made solely in the form of forgiveness of Indebtedness that was incurred in connection with the purchase of such Equity Interests of such Person, or (C) otherwise in an aggregate amount not to exceed $5,000,000 over the term of this Agreement;

 

(iv)                              so long as no Default or Event of Default has occurred and is continuing, make, directly or indirectly, non-cash repurchases of Equity Interests deemed to occur in connection with the exercise of stock options by directors, officers and management, including, without limitation, deemed redemptions arising as a result of the payment of withholdings taxes; provided that such Equity Interests represent a portion of the consideration delivered in connection with the payment of the exercise price of such options; and

 

(v)                                 make other Restricted Payments in an aggregate amount not to exceed $5,000,000 during the term of this Agreement so long as all the following conditions are met as of the date of such Restricted Payment: (A) such Restricted Payment does not and will not result in a violation of Regulation U of the Board of Governors of the Federal Reserve System, (B) the actions of Holdings in connection with any such Restricted Payment and any and all transactions entered into or consummated by Holdings in connection with such Restricted Payment (including, as applicable, the repurchase of Equity Interests of Holdings) will be and have been consummated in accordance with Applicable Law (including the General Corporation Law of the State of Delaware and federal securities laws) and (C) no Default or Event of Default has occurred and is continuing or would result therefrom; provided that any Restricted Payment made by Holdings when the Consolidated Total Lease Adjusted Net Leverage Ratio (after giving effect to any Extension of Credit in connection with such Restricted Payment) is less than

 

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4.25:1.00 on a Pro Forma Basis shall not apply towards the dollar limitation in this clause (v);

 

(e)                                  Holdings or any of its Subsidiaries may redeem, repurchase or otherwise acquire Equity Interests of any Subsidiary that is not a Wholly-Owned Subsidiary from any holder of Equity Interests in such Subsidiary, so long as, after giving effect thereto, no Default or Event of Default has occurred and is continuing and provided that the aggregate amount of such redemptions, repurchases or other acquisitions shall not exceed $500,000 in any 12 consecutive month period; and

 

(f)                                   so long as no Default or Event of Default has occurred and is continuing, Holdings may make Restricted Payments not exceeding $2,500,000 in any fiscal year pursuant to and in accordance with stock option plans or other equity based benefit plans approved by Holdings’ board of directors (or equivalent governing body).

 

SECTION 9.7                                             Transactions with Affiliates.  Directly or indirectly enter into any transaction, including any purchase, sale, lease or exchange of Property, the rendering of any service or the payment of any management, advisory or similar fees, with (a) any officer, director, holder of any Equity Interests in, or other Affiliate of, Holdings, the Borrower or any of its Subsidiaries, or (b) any Affiliate of any such officer, director or holder, other than:

 

(i)                                     transactions expressly permitted by Sections 9.1, 9.3, 9.4, 9.5, 9.6 and 9.13;

 

(ii)                                  transactions existing on the Closing Date and described on Schedule 9.7;

 

(iii)                               transactions among Credit Parties;

 

(iv)                              other transactions in the ordinary course of business on terms as favorable as would be obtained by it on a comparable arm’s-length transaction with an independent, unrelated third party as determined in good faith by the board of directors (or equivalent governing body) of Holdings;

 

(v)                                 employment and severance arrangements (including equity incentive plans and employee benefit plans and arrangements) with their respective officers and employees in the ordinary course of business;

 

(vi)                              payment of customary fees and reasonable out of pocket costs to, and indemnities for the benefit of, directors, officers and employees of Holdings, the Borrower and its Subsidiaries in the ordinary course of business to the extent attributable to the ownership or operation of the Borrower and its Subsidiaries; and

 

(vii)                           stock option, stock incentive, equity, bonus and other compensation plans of the Credit Parties and their Subsidiaries and the issuance of shares thereunder.

 

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SECTION 9.8                                             Accounting Changes; Organizational Documents.

 

(a)                                 Change its Fiscal Year end (other than the Fiscal Period Adjustment), or make (without the consent of the Administrative Agent) any material change in its accounting treatment and reporting practices except as required by GAAP.

 

(b)                                 Amend, modify or change its articles of incorporation (or corporate charter or other similar organizational documents) or amend, modify or change its bylaws (or other similar documents) in any manner materially adverse to the interests of the Lenders; provided that any such amendment, modification or change evidencing the Fiscal Period Adjustment shall be permitted.

 

SECTION 9.9                                             Payments and Modifications of Subordinated Indebtedness; Prepayments of Indebtedness.

 

(a)                                 Amend, modify, waive or supplement (or permit the modification, amendment, waiver or supplement of) any of the terms or provisions of any Subordinated Indebtedness in any respect which would materially and adversely affect the rights or interests of the Administrative Agent and Lenders hereunder.

 

(b)                                 Cancel, forgive, make any payment or prepayment on, or redeem or acquire for value (including (x) by way of depositing with any trustee with respect thereto money or securities before due for the purpose of paying when due and (y) at the maturity thereof) any Subordinated Indebtedness, except:

 

(i)                                     refinancings, refundings, renewals, extensions or exchange of any Subordinated Indebtedness permitted by Section 9.1(c), (g)(ii), (i) or (m), and by any subordination provisions applicable thereto;

 

(ii)                                  payments and prepayments of any Subordinated Indebtedness made solely with the proceeds of Qualified Equity Interests;

 

(iii)                               the payment of interest, expenses and indemnities in respect of Subordinated Indebtedness incurred under Section 9.1(c), (g)(ii), (i) or (m) (other than any such payments prohibited by any subordination provisions applicable thereto); and

 

(iv)                              the payment of any Subordinated Indebtedness in accordance with the subordination terms thereof;

 

(c)                                  Prepay, redeem, purchase, defease or otherwise satisfy or obligate itself to do so prior to the scheduled maturity thereof in any manner (including by the exercise of any right of setoff), or make any payment in violation of any subordination, standstill or collateral sharing terms of or governing any Indebtedness incurred pursuant to Section 9.1(e) or (l).

 

SECTION 9.10                                      No Further Negative Pledges; Restrictive Agreements.

 

(a)                                 Enter into, assume or be subject to any agreement prohibiting or otherwise restricting the creation or assumption of any Lien upon the Collateral, whether now owned or

 

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hereafter acquired, or requiring the grant of any security for such obligation if security is given for some other obligation, except (i) pursuant to this Agreement and the other Loan Documents, (ii) pursuant to any document or instrument governing Indebtedness incurred pursuant to Section 9.1(d) (provided that any such restriction contained therein relates only to the asset or assets financed thereby), (iii) customary restrictions contained in the organizational documents of any Non-Guarantor Subsidiary, (iv) restrictions in any Refinancing Notes and (v) customary restrictions in connection with any Permitted Lien or any document or instrument governing any Permitted Lien (provided that any such restriction contained therein relates only to the asset or assets subject to such Permitted Lien).

 

(b)                                 Create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Credit Party or any Subsidiary thereof to (i) pay dividends or make any other distributions to any Credit Party or any Subsidiary on its Equity Interests or with respect to any other interest or participation in, or measured by, its profits, (ii) pay any Indebtedness or other obligation owed to any Credit Party or (iii) make loans or advances to any Credit Party, except in each case for such encumbrances or restrictions existing under or by reason of (a) this Agreement and the other Loan Documents and (b) Applicable Law.

 

(c)                                  Create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Credit Party or any Subsidiary thereof to (i) sell, lease or transfer any of its properties or assets to any Credit Party or (ii) act as a Credit Party pursuant to the Loan Documents or any renewals, refinancings, exchanges, refundings or extension thereof, except in each case for such encumbrances or restrictions existing under or by reason of (A) this Agreement and the other Loan Documents, (B) Applicable Law, (C) any document or instrument governing Indebtedness incurred pursuant to Section 9.1(d) (provided that any such restriction contained therein relates only to the asset or assets acquired in connection therewith), (D) any Permitted Lien or any document or instrument governing any Permitted Lien (provided that any such restriction contained therein relates only to the asset or assets subject to such Permitted Lien), (E) obligations that are binding on a Subsidiary at the time such Subsidiary first becomes a Subsidiary of the Borrower, so long as such obligations are not entered into in contemplation of such Person becoming a Subsidiary, (F) customary restrictions contained in an agreement related to the sale of Property (to the extent such sale is permitted pursuant to Section 9.5) that limit the transfer of such Property pending the consummation of such sale, (G) customary restrictions in leases, subleases, licenses and sublicenses or asset sale agreements otherwise permitted by this Agreement so long as such restrictions relate only to the assets subject thereto and (H) customary provisions restricting assignment of any agreement entered into in the ordinary course of business.

 

SECTION 9.11                                      Nature of Business.  Engage in any material line of business that is not the same or substantially the same as the business conducted by the Borrower and its Subsidiaries as of the Closing Date, and business activities reasonably related or ancillary thereto or that are reasonable extensions thereof.

 

SECTION 9.12                                      Sale and Leasebacks.  Directly or indirectly become or remain liable as lessee or as guarantor or other surety with respect to any lease, whether an operating lease or a capital lease, of any Property (whether real, personal or mixed), whether now owned or hereafter acquired, (a) which any Credit Party or any Subsidiary thereof has sold or transferred or is to sell

 

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or transfer to a Person which is not another Credit Party or Subsidiary of a Credit Party or (b) which any Credit Party or any Subsidiary of a Credit Party intends to use for substantially the same purpose as any other Property that has been sold or is to be sold or transferred by such Credit Party or such Subsidiary to another Person which is not another Credit Party or Subsidiary of a Credit Party in connection with such lease (the “Sale and Leaseback Transaction”), unless (i) such Sale and Leaseback Transaction is made for cash consideration in an amount not less than the fair market value of the property subject to such Sale and Leaseback Transaction, (b) the Sale and Leaseback Transaction is permitted by Section 9.5 and is consummated within sixty (60) days after the date on which such property is sold or transferred, (c) any Liens arising in connection with its use of the property are permitted by Section 9.2(u), and (d) the Sale and Leaseback Transaction is permitted under Section 9.1(d), assuming the Attributable Indebtedness with respect to the Sale and Leaseback Transaction constituted Indebtedness under Section 9.1(d).

 

SECTION 9.13                                      Financial Covenants.

 

(a)                                 Consolidated Total Lease Adjusted Net Leverage Ratio.  As of the last day of any Fiscal Quarter ending during the periods specified below, permit the Consolidated Total Lease Adjusted Net Leverage Ratio to be greater than the corresponding ratio set forth below:

 

	
Period
    	
 
    	
Maximum Ratio
    
	
The last day of the Fiscal Quarter ending closest   to June 30, 2015 through the last day of the Fiscal Quarter ending   closest to March 31, 2016
    	
 
    	
5.25 to 1.00
    
	
Thereafter
    	
 
    	
5.00 to 1.00
    

 

(b)                                 Consolidated Fixed Charge Coverage Ratio.  As of the last day of any Fiscal Quarter, commencing with the Fiscal Quarter ending closest to June 30, 2015, permit the Consolidated Fixed Charge Coverage Ratio to be less than 1.10:1.00.

 

SECTION 9.14                                      Limitations on Holdings.  Permit Holdings to:

 

(a)                                 hold any assets other than (i) the Equity Interests of the Borrower, (ii) assets, properties or rights that are not capable of being sold, assigned, transferred or conveyed to the Borrower without the consent of any other Person, or if such assignment or attempted assignment would constitute a breach thereof, or a violation of any Applicable Law, (iii) agreements relating to the issuance, sale, purchase, repurchase or registration of securities of Holdings, (iv) minute books and other corporate books and records of Holdings, (v) cash, on a temporary basis, which is permitted to be paid to the stockholders of Holdings pursuant to Section 9.6, and (v) other miscellaneous non-material assets;

 

(b)                                 have any liabilities other than (i) the liabilities under the Loan Documents, (ii) tax liabilities arising in the ordinary course of business, (iii) Indebtedness permitted under

 

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Section 9.1, (iv) corporate, administrative and operating expenses in the ordinary course of business and (v) liabilities under any contracts or agreements described in (a)(ii) and (iii) above; or

 

(c)                                  engage in any activities or business other than (i) issuing shares of its own Qualified Equity Interests, (ii) holding the assets and incurring the liabilities described in this Section 9.14 and activities incidental and related thereto, (iii) making payments, dividends, distributions, issuances or other activities permitted pursuant to Sections 9.6 or 9.7, (iv) maintenance of its corporate existence in compliance with applicable law, (iv) legal, tax and accounting matters in connection with any of the foregoing or following activities, (v) performance of obligations under and compliance with its certificate of incorporation and by-laws, or any applicable law, ordinance, regulation, rule, order, judgment, decree or permit, including as a result of or in connection with the activities of its Subsidiaries.

 

SECTION 9.15                                      Disposal of Subsidiary Interests.  Permit any Domestic Subsidiary to be a non-Wholly-Owned Subsidiary except as a result of or in connection with a dissolution, merger, amalgamation, consolidation or disposition permitted by Section 9.4 or 9.5.

 

ARTICLE X

 

DEFAULT AND REMEDIES

 

SECTION 10.1                                      Events of Default.  Each of the following shall constitute an Event of Default:

 

(a)                                 Default in Payment of Principal of Loans and Reimbursement Obligations.  The Borrower shall default in any payment of principal of any Loan or Reimbursement Obligation when and as due (whether at maturity, by reason of acceleration or otherwise).

 

(b)                                 Other Payment Default.  The Borrower shall default (i) in the payment when and as due (whether at maturity, by reason of acceleration or otherwise) of interest on any Loan and such default shall continue for a period of three (3) Business Days, or (ii) in the payment when and as due (whether at maturity, by reason of acceleration or otherwise) of Reimbursement Obligation or the payment of any other Obligation and such default shall continue for a period of five (5) Business Days.

 

(c)                                  Misrepresentation.  Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of any Credit Party or any Subsidiary thereof in this Agreement, in any other Loan Document, or in any document delivered in connection herewith or therewith that is subject to materiality or Material Adverse Effect qualifications, shall be incorrect or misleading in any respect when made or deemed made or any representation, warranty, certification or statement of fact made or deemed made by or on behalf of any Credit Party or any Subsidiary thereof in this Agreement, any other Loan Document, or in any document delivered in connection herewith or therewith that is not subject to materiality or Material Adverse Effect qualifications, shall be incorrect or misleading in any material respect when made or deemed made.

 

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(d)                                 Default in Performance of Certain Covenants.  Any Credit Party or any Subsidiary thereof shall default in the performance or observance of any covenant or agreement contained in Sections 8.1, 8.2(a), 8.3(a), 8.4, 8.14, 8.15, 8.18 or Article IX.

 

(e)                                  Default in Performance of Other Covenants and Conditions.  Any Credit Party or any Subsidiary thereof shall default in the performance or observance of any term, covenant, condition or agreement contained in this Agreement (other than as specifically provided for in this Section) or any other Loan Document and such default shall continue for a period of thirty (30) days after the earlier of (i) the Administrative Agent’s delivery of written notice thereof to the Borrower and (ii) a Responsible Officer of any Credit Party having obtained knowledge thereof.

 

(f)                                   Indebtedness Cross-Default.  Any Credit Party or any Subsidiary thereof shall (i) default in the payment of any Indebtedness (other than the Loans or any Reimbursement Obligation) the aggregate principal amount (including undrawn committed or available amounts), or with respect to any Hedge Agreement, the Hedge Termination Value, of which is in excess of the Threshold Amount beyond the period of grace if any, provided in the instrument or agreement under which such Indebtedness was created, or (ii) default in the observance or performance of any other agreement or condition relating to any Indebtedness (other than the Loans or any Reimbursement Obligation) the aggregate principal amount (including undrawn committed or available amounts), or with respect to any Hedge Agreement, the Hedge Termination Value, of which is in excess of the Threshold Amount or contained in any instrument or agreement evidencing, securing or relating thereto or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause any such Indebtedness to become redeemable, due, liquidated or otherwise payable (whether at scheduled maturity, by required prepayment, upon acceleration or otherwise) and/or to be secured by cash collateral.

 

(g)                                  Change in Control.  Any Change in Control shall occur.

 

(h)                                 Voluntary Bankruptcy Proceeding.  Any Credit Party or any Subsidiary thereof shall (i) commence a voluntary case under any Debtor Relief Laws, (ii) file a petition seeking to take advantage of any Debtor Relief Laws, (iii) consent to or fail to contest in a timely and appropriate manner any petition filed against it in an involuntary case under any Debtor Relief Laws, (iv) apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign, (v) admit in writing its inability to pay its debts as they become due, (vi) make a general assignment for the benefit of creditors, or (vii) take any corporate action for the purpose of authorizing any of the foregoing.

 

(i)                                     Involuntary Bankruptcy Proceeding.  A case or other proceeding shall be commenced against any Credit Party or any Subsidiary thereof in any court of competent jurisdiction seeking (i) relief under any Debtor Relief Laws, or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like for any Credit Party or any Subsidiary thereof or for all or any substantial part of their respective assets, domestic or foreign, and such case or proceeding shall continue without dismissal or stay for a period of sixty (60) consecutive days, or

 

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an order granting the relief requested in such case or proceeding (including an order for relief under such federal bankruptcy laws) shall be entered.

 

(j)                                    Failure of Agreements.  Any provision of this Agreement or any provision of any other Loan Document shall for any reason (other than as expressly permitted hereunder or satisfaction in full of the Obligations (other than contingent indemnification and cost reimbursement obligations not then due) cease to be in full force and effect in all material respects, or any Credit Party or any Subsidiary thereof shall so state in writing, or any Loan Document shall for any reason cease to create a valid and perfected first priority Lien (subject to Permitted Liens) on, or security interest in, the Collateral with the aggregate book value greater than $100,000, purported to be covered thereby, in each case other than in accordance with the express terms hereof or thereof.

 

(k)                                 ERISA Events.  The occurrence of any of the following events: (i) any Credit Party or any ERISA Affiliate fails to make full payment within 30 days following the due date of all amounts which, under the provisions of any Pension Plan or Sections 412 or 430 of the Code, any Credit Party or any ERISA Affiliate is required to pay as contributions to a Pension Plan, and such unpaid amounts are in excess of the Threshold Amount, (ii) a Termination Event resulting in liability to any Credit Party in excess of the Threshold Amount or (iii) any Credit Party or any ERISA Affiliate as employers under one or more Multiemployer Plans makes a complete or partial withdrawal from any such Multiemployer Plan and the plan sponsor of such Multiemployer Plans notifies such withdrawing employer that such employer has incurred a withdrawal liability requiring payments in an amount exceeding the Threshold Amount.

 

(l)                                     Judgment.  (i) A judgment or order for the payment of money which causes the aggregate amount of all such judgments or orders (net of any amounts paid or fully covered by independent third party insurance as to which the relevant insurance company does not dispute coverage) to exceed the Threshold Amount shall be entered against any Credit Party or any Subsidiary thereof by any court and such judgment or order shall continue without having been discharged, vacated or stayed for a period of sixty (60) consecutive days after the entry thereof, (ii) any judgment, writ, assessment, warrant of attachment, tax lien or execution or similar process shall be issued or levied against a part of the property of any Credit Party with an aggregate value in excess of the Threshold Amount and the same shall not be released, stayed, vacated or otherwise dismissed within sixty (60) consecutive days after issue or levy; or (iii) any other judgments, orders, decrees, arbitration awards, writs, assessments, warrants of attachment, tax liens, executions or similar processes which, alone or in the aggregate, could reasonably be expected to have a Material Adverse Effect are rendered, issued or levied.

 

SECTION 10.2                                      Remedies.  Upon the occurrence and during the continuance of an Event of Default, with the consent of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower:

 

(a)                                 Acceleration; Termination of Credit Facility.  Terminate the Revolving Credit Commitment and declare the principal of and interest on the Loans and the Reimbursement Obligations at the time outstanding, and all other amounts owed to the Lenders and to the Administrative Agent under this Agreement or any of the other Loan Documents (including,

 

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without limitation, all L/C Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented or shall be entitled to present the documents required thereunder) and all other Obligations, to be forthwith due and payable, whereupon the same shall immediately become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived by each Credit Party, anything in this Agreement or the other Loan Documents to the contrary notwithstanding, and terminate the Credit Facility and any right of the Borrower to request borrowings or Letters of Credit thereunder; provided, that upon the occurrence of an Event of Default specified in Section 10.1(h) or (i), the Credit Facility shall be automatically terminated and all Obligations shall automatically become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly waived by each Credit Party, anything in this Agreement or in any other Loan Document to the contrary notwithstanding.

 

(b)                                 Letters of Credit.  With respect to all Letters of Credit with respect to which presentment for honor shall not have occurred at the time of an acceleration pursuant to the preceding paragraph, the Borrower shall at such time deposit in a Cash Collateral account opened by the Administrative Agent an amount equal to 102% of the aggregate then undrawn and unexpired amount of such Letters of Credit.  Amounts held in such Cash Collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit, and the unused portion thereof after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay the other Secured Obligations on a pro rata basis.  After all such Letters of Credit shall have expired or been fully drawn upon, the Reimbursement Obligation shall have been satisfied and all other Secured Obligations shall have been paid in full, the balance, if any, in such Cash Collateral account shall be returned to the Borrower.

 

(c)                                  General Remedies.  Exercise on behalf of the Secured Parties all of its other rights and remedies under this Agreement, the other Loan Documents and Applicable Law, in order to satisfy all of the Secured Obligations.

 

SECTION 10.3                                      Rights and Remedies Cumulative; Non-Waiver; etc.

 

(a)                                 The enumeration of the rights and remedies of the Administrative Agent and the Lenders set forth in this Agreement is not intended to be exhaustive and the exercise by the Administrative Agent and the Lenders of any right or remedy shall not preclude the exercise of any other rights or remedies, all of which shall be cumulative, and shall be in addition to any other right or remedy given hereunder or under the other Loan Documents or that may now or hereafter exist at law or in equity or by suit or otherwise.  No delay or failure to take action on the part of the Administrative Agent or any Lender in exercising any right, power or privilege shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege preclude any other or further exercise thereof or the exercise of any other right, power or privilege or shall be construed to be a waiver of any Event of Default.  No course of dealing between the  Borrower, the Administrative Agent and the Lenders or their respective agents or employees shall be effective to change, modify or discharge any provision of this Agreement or any of the other Loan Documents or to constitute a waiver of any Event of Default.

 

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(b)                                 Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Credit Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with Section 10.2 for the benefit of all the Lenders and the Issuing Lenders; provided that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) any Issuing Lender or the Swingline Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as an Issuing Lender or Swingline Lender, as the case may be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 12.4 (subject to the terms of Section 5.6), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Credit Party under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 10.2 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of the preceding proviso and subject to Section 5.6, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

 

SECTION 10.4                                      Crediting of Payments and Proceeds.  In the event that the Obligations have been accelerated pursuant to Section 10.2 or the Administrative Agent or any Lender has exercised any remedy set forth in this Agreement or any other Loan Document, all payments received on account of the Secured Obligations (including any payments received by the Administrative Agent with respect to the Guaranty or any intercreditor or subordination agreement) and all net proceeds from the enforcement of the Secured Obligations shall be applied by the Administrative Agent as follows:

 

First, to payment of that portion of the Secured Obligations constituting fees, indemnities, expenses and other amounts, including attorney fees, payable to the Administrative Agent in its capacity as such, the Issuing Lenders in their capacity as such and the Swingline Lender in its capacity as such, ratably among the Administrative Agent, the Issuing Lenders and Swingline Lender in proportion to the respective amounts described in this clause First payable to them;

 

Second, to payment of that portion of the Secured Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders under the Loan Documents, including attorney fees, ratably among the Lenders in proportion to the respective amounts described in this clause Second payable to them;

 

Third, to payment of that portion of the Secured Obligations constituting accrued and unpaid interest on the Loans and Reimbursement Obligations, ratably among the Lenders in proportion to the respective amounts described in this clause Third payable to them;

 

Fourth, to payment of that portion of the Secured Obligations constituting unpaid principal of the Loans, Reimbursement Obligations and payment obligations then owing under Secured Hedge Agreements and Secured Cash Management Agreements and to Cash

 

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Collateralize any L/C Obligations then outstanding, ratably among the Lenders, the Issuing Lenders, the Hedge Banks and the Cash Management Banks in proportion to the respective amounts described in this clause Fourth payable to them; and

 

Last, the balance, if any, after all of the Secured Obligations have been indefeasibly paid in full, to the Borrower or as otherwise required by Applicable Law.

 

Notwithstanding the foregoing, Secured Obligations arising under Secured Cash Management Agreements and Secured Hedge Agreements shall be excluded from the application described above if the Administrative Agent has not received written notice thereof, together with such supporting documentation as the Administrative Agent may request, from the applicable Cash Management Bank or Hedge Bank, as the case may be.  Each Cash Management Bank or Hedge Bank not a party to this Agreement that has given the notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of Article XI for itself and its Affiliates as if a “Lender” party hereto.

 

SECTION 10.5                                      Administrative Agent May File Proofs of Claim.  In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Credit Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation 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 the Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

 

(a)                                 to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations 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 Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the Issuing Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders, the Issuing Lenders and the Administrative Agent under Sections 3.3, 5.3 and 12.3) allowed in such judicial proceeding; and

 

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

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and each Issuing Lender 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 and the Issuing Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 3.3, 5.3 and 12.3.

 

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SECTION 10.6                                      Credit Bidding.

 

(a)                                 The Administrative Agent, on behalf of itself and the Lenders, shall have the right to credit bid and purchase for the benefit of the Administrative Agent and the Lenders all or any portion of Collateral at any sale thereof conducted by the Administrative Agent under the provisions of the UCC, including pursuant to Sections 9-610 or 9-620 of the UCC, at any sale thereof conducted under the provisions of the United States Bankruptcy Code, including Section 363 thereof, or a sale under a plan of reorganization, or at any other sale or foreclosure conducted by the Administrative Agent (whether by judicial action or otherwise) in accordance with Applicable Law.

 

(b)                                 Each Lender hereby agrees that, except as otherwise provided in any Loan Documents or with the written consent of the Administrative Agent and the Required Lenders, it will not take any enforcement action, accelerate obligations under any Loan Documents, or exercise any right that it might otherwise have under Applicable Law to credit bid at foreclosure sales, Uniform Commercial Code sales or other similar dispositions of Collateral.

 

SECTION 10.7                                      Intercreditor and Subordination Agreements.  Each of the Lenders from time to time party to this Agreement hereby confirms and reaffirms the irrevocable authority of the Administrative Agent to execute, deliver and act on their behalf in respect of each intercreditor agreement and subordination agreement and each supplement, modification, amendment, restatement or extension thereto, in connection with the incurrence by any Credit Party of any Subordinated Indebtedness, any Refinancing Notes and, in the case of any secured Refinancing Notes, to subject the Liens on the Collateral securing the Obligations to the provisions of such intercreditor agreement or subordination agreement.  Each Lender agrees to be bound by the terms and provisions of any such intercreditor or subordination agreement.  Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent and each Lender hereby agree that no Lender shall have any right individually to enforce any intercreditor agreement, subordination agreement or guaranty, it being understood and agreed that all powers, rights and remedies under any intercreditor agreement, any subordination agreement and any guaranty may be exercised solely by the Administrative Agent for the benefit of the Lenders in accordance with the terms thereof.

 

SECTION 10.8                                      Lender Action.  Each Lender agrees that it shall not take or institute any actions or proceedings, judicial or otherwise, for any right or remedy against any Credit Party or any other obligor under any of the Loan Documents (including the exercise of any right of setoff, rights on account of any banker’s lien or similar claim or other rights of self-help), or institute any actions or proceedings, or otherwise commence any remedial procedures or cause any of the foregoing (through Affiliates or otherwise), with respect to any Collateral or any other property of any such Credit Party, without the prior written consent of the Administrative Agent. The provisions of this Section 10.8 are for the sole benefit of the Lenders and shall not afford any right to, or constitute a defense available to, any Credit Party.

 

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ARTICLE XI

 

THE ADMINISTRATIVE AGENT

 

SECTION 11.1                                      Appointment and Authority.

 

(a)                                 Each of the Lenders and each Issuing Lender hereby irrevocably appoints Wells Fargo to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the Issuing Lenders, and neither Holdings nor any Subsidiary thereof shall have rights as a third-party beneficiary of any of such provisions.  It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any Applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

 

(b)                                 The Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the Lenders (including in its capacity as a potential Hedge Bank or Cash Management Bank) and the Issuing Lenders hereby irrevocably appoints and authorizes the Administrative Agent to act as the agent of such Lender and such Issuing Lender for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Credit Parties to secure any of the Secured Obligations, together with such powers and discretion as are reasonably incidental thereto (including to enter into additional Loan Documents or supplements to existing Loan Documents on behalf of the Secured Parties).  In this connection, the Administrative Agent, as “collateral agent” and any co-agents, sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant to this Article XI for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Security Documents, or for exercising any rights and remedies thereunder at the direction of the Administrative Agent), shall be entitled to the benefits of all provisions of Articles XI and XII (including Section 12.3, as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto.

 

SECTION 11.2                                      Rights as a Lender.  The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity.  Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

 

SECTION 11.3                                      Exculpatory Provisions.

 

(a)                                 The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder and thereunder shall be administrative in nature.  Without limiting the generality of the foregoing, the Administrative Agent:

 

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(i)                                     shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or Event of Default has occurred and is continuing;

 

(ii)                                  shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or Applicable Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and

 

(iii)                               shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to Holdings, the Borrower or any of their respective Subsidiaries or Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

 

(b)                                 The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 12.2 and Section 10.2) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final nonappealable judgment.  The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Default unless and until notice describing such Default or Event of Default is given to the Administrative Agent by Holdings, the Borrower, a Lender or an Issuing Lender.

 

(c)                                  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 this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith (including any report provided to it by an Issuing Lender pursuant to Section 3.8), (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default or Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, (v) the satisfaction of any condition set forth in Article VI or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent or (vi) the utilization of any Issuing Lender’s L/C Commitment (it being understood and agreed that each Issuing Lender shall monitor compliance with its own L/C Commitment without any further action by the Administrative Agent).

 

SECTION 11.4                                      Reliance by the Administrative Agent.  The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice,

 

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request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of a Loan, or the issuance, extension, renewal or increase of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender or such Issuing Lender unless the Administrative Agent shall have received notice to the contrary from such Lender or such Issuing Lender prior to the making of such Loan or the issuance of such Letter of Credit.  The Administrative Agent may consult with legal counsel (who may be counsel for Holdings and the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

SECTION 11.5                                      Delegation of Duties.  The Administrative Agent may perform any and all 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 and all of its duties and exercise its rights and powers by or 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 in connection with the syndication of the Credit Facility as well as activities as Administrative Agent.  The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agents.

 

SECTION 11.6                                      Resignation of Administrative Agent.

 

(a)                                 The Administrative Agent may at any time give notice of its resignation to the Lenders, the Issuing Lenders and the Borrower.  Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Borrower to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States.  If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by the Required Lenders) (the “Resignation Effective Date”), then the retiring Administrative Agent may (but shall not be obligated to), on behalf of the Lenders and the Issuing Lenders, appoint a successor Administrative Agent meeting the qualifications set forth above.  Whether or not a successor has been appointed, such resignation shall become effective in accordance with such notice on the Resignation Effective Date.

 

(b)                                 If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, the Required Lenders may, to the extent permitted by Applicable Law, by notice in writing to the Borrower and such Person, remove such Person as

 

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Administrative Agent and, in consultation with the Borrower, appoint a successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.

 

(c)                                  With effect from the Resignation Effective Date or the Removal Effective Date (as applicable), (1) the retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders or the Issuing Lenders under any of the Loan Documents, the retiring or removed Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (2) except for any indemnity payments owed to the retiring or removed Administrative Agent, all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and each Issuing Lender directly, until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided for above.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring or removed Administrative Agent (other than any rights to indemnity payments owed to the retiring or removed Administrative Agent), and the retiring or removed Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents.  The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor.  After the retiring or removed Administrative Agent’s resignation or removal hereunder and under the other Loan Documents, the provisions of this Article and Section 12.3 shall continue in effect for the benefit of such retiring or removed 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 or removed Administrative Agent was acting as Administrative Agent.

 

(d)                                 Any resignation by, or removal of, Wells Fargo as Administrative Agent pursuant to this Section shall also constitute its resignation as an Issuing Lender and Swingline Lender.  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Issuing Lender, if in its sole discretion it elects to, and Swingline Lender, (b) the retiring Issuing Lender and Swingline Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor Issuing Lender, if in its sole discretion it elects to, shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangement satisfactory to the retiring Issuing Lender to effectively assume the obligations of the retiring Issuing Lender with respect to such Letters of Credit.

 

SECTION 11.7                                      Non-Reliance on Administrative Agent and Other Lenders.  Each Lender and each Issuing Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Lender and each Issuing Lender also acknowledges

 

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that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

 

SECTION 11.8                                      No Other Duties, Etc.  Anything herein to the contrary notwithstanding, none of the syndication agents, documentation agents, co-agents, arrangers or bookrunners listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or an Issuing Lender hereunder.

 

SECTION 11.9                                      Collateral and Guaranty Matters.

 

(a)                                 Each of the Lenders (including in its or any of its Affiliate’s capacities as a potential Hedge Bank or Cash Management Bank) irrevocably authorize the Administrative Agent, at its option and in its discretion:

 

(i)                                     to release any Lien on any Collateral granted to or held by the Administrative Agent, for the benefit of the Secured Parties, under any Loan Document (A) upon the termination of the Revolving Credit Commitment and payment in full of all Secured Obligations (other than (1) contingent indemnification obligations and (2) obligations and liabilities under Secured Cash Management Agreements or Secured Hedge Agreements as to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to the Administrative Agent and the applicable Issuing Lender shall have been made), (B) that is sold or otherwise disposed of or to be sold or otherwise disposed of as part of or in connection with any sale or other disposition permitted under the Loan Documents, or (C) if approved, authorized or ratified in writing in accordance with Section 12.2;

 

(ii)                                  to subordinate any Lien on any Collateral granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien permitted pursuant to Section 9.2(h); and

 

(iii)                               to release any Subsidiary Guarantor from its obligations under any Loan Documents if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents.

 

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate its interest in particular types or items of property, or to release any Subsidiary Guarantor from its obligations under the Guaranty Agreement pursuant to this Section 11.9.  In each case as specified in this Section 11.9, the Administrative Agent will, at the Borrower’s expense, execute and deliver to the applicable Credit Party such documents as such Credit Party may reasonably request to evidence the release of such item of Collateral from the assignment and security interest granted under the Security

 

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Documents or to subordinate its interest in such item, or to release such Guarantor from its obligations under the Guaranty Agreement, in each case in accordance with the terms of the Loan Documents and this Section 11.9.  In the case of any such sale, transfer or disposal of any property constituting Collateral in a transaction constituting an Asset Disposition permitted pursuant to Section 9.5, the Liens created by any of the Security Documents on such property shall be automatically released without need for further action by any person.

 

(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 Credit Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.

 

SECTION 11.10                               Secured Hedge Agreements and Secured Cash Management Agreements.  No Cash Management Bank or Hedge Bank that obtains the benefits of Section 10.4 or any Collateral by virtue of the provisions hereof or of any Security Document shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents.  Notwithstanding any other provision of this Article XI to the contrary, the Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Secured Cash Management Agreements and Secured Hedge Agreements unless the Administrative Agent has received written notice of such Secured Cash Management Agreements and Secured Hedge Agreements, together with such supporting documentation as the Administrative Agent may request, from the applicable Cash Management Bank or Hedge Bank, as the case may be.

 

ARTICLE XII

 

MISCELLANEOUS

 

SECTION 12.1                                      Notices.

 

(a)                                 Notices Generally.  Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in 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:

 

	
If   to the Borrower:
    
	
 
    
	
Boot Barn, Inc.

15776 Laguna Canyon Road

Irvine, CA 92618

Attention:  Greg Hackman
    

 

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Telephone No.:  949.453.4421
    Facsimile No.:  949.453.4401
    E-mail:  ghackman@bootbarn.com
    
	
 
    
	
With   copies to, which copies shall not constitute notice:
    
	
 
    
	
Morgan, Lewis & Bockius LLP

355 South Grand Avenue, Suite 4400

Los Angele, CA 90071

Attention: Steve Miller

 

Telephone No.:  213.680.6562
    Facsimile No.:  213.680.6499
    E-mail:    steve.miller@morganlewis.com
    
	
 
    
	
If   to Wells Fargo as
   Administrative 
   Agent:
    
	
 
    
	
Wells   Fargo Bank, National Association
   MAC D1109-019
   1525 West W.T. Harris Blvd.
   Charlotte, NC  28262
   Attention:  Syndication Agency Services
   Facsimile No.:  (704) 715-0017

E-mail:   agencyservices.requests@wellsfargo.com
    
	
 
    
	
With   copies to:
    
	
 
    
	
Wells Fargo Bank, National Association
   1800 Century Park East, Suite 1120

Los Angeles, CA 90067
   Attention: Belle Villasenor

Telephone No.: (310) 789-5030

Facsimile No.: (310) 789-8951

E-mail: belle.villasenor@wellsfargo.com
    
	
 
    
	
If   to any Lender:
    
	
 
    
	
To   the address set forth on the Register
    

 

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the

 

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recipient).  Notices delivered through electronic communications to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b).

 

(b)                                 Electronic Communications.  Notices and other communications to the Lenders and the Issuing Lenders hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender or any Issuing Lender pursuant to Article II if such Lender or such Issuing Lender, as applicable, has notified the Administrative Agent that is incapable of receiving notices under such Article by electronic communication.  The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.  Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as 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, email or other communication is not sent during the normal business hours of the recipient, such notice, email or other communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient.

 

(c)                                  Administrative Agent’s Office.  The Administrative Agent hereby designates its office located at the address set forth above, or any subsequent office which shall have been specified for such purpose by written notice to the Borrower and Lenders, as the Administrative Agent’s Office referred to herein, to which payments due are to be made and at which Loans will be disbursed and Letters of Credit requested.

 

(d)                                 Change of Address, Etc.  Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto.

 

(e)                                  Platform.

 

(i)                                     Each Credit Party agrees that the Administrative Agent may, but shall not be obligated to, make the Borrower Materials available to the Issuing Lenders and the other Lenders by posting the Borrower Materials on the Platform.

 

(ii)                                  The Platform is provided “as is” and “as available.”  The Agent Parties (as defined below) do not warrant the accuracy or completeness of the Borrower Materials or the adequacy of the Platform, and expressly disclaim liability for errors or omissions in the Borrower Materials.  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 any Agent Party in connection with the Borrower Materials or the Platform.  In no event shall the Administrative Agent or any of its Related Parties (collectively, the

 

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“Agent Parties”) have any liability to any Credit Party, any Lender or any other Person or entity for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of any Credit Party’s or the Administrative Agent’s transmission of communications through the Internet (including the Platform), except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided that in no event shall any Agent Party have any liability to any Credit Party, any Lender, the Issuing Lender or any other Person for indirect, special, incidental, consequential or punitive damages, losses or expenses (as opposed to actual damages, losses or expenses).

 

(f)                                   Private Side Designation.  Each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and Applicable Law, including United States federal and state securities laws, to make reference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to the Borrower or its securities for purposes of United States federal or state securities laws.

 

SECTION 12.2                                      Amendments, Waivers and Consents.  Except as set forth below or as specifically provided in any Loan Document, any term, covenant, agreement or condition of this Agreement or any of the other Loan Documents may be amended or waived by the Lenders, and any consent given by the Lenders, if, but only if, such amendment, waiver or consent is in writing signed by the Required Lenders (or by the Administrative Agent with the consent of the Required Lenders) and delivered to the Administrative Agent and the Borrower; provided, that no amendment, waiver or consent shall:

 

(a)                                 without the prior written consent of the Required Revolving Credit Lenders, amend, modify or waive (i) Section 6.2 or any other provision of this Agreement if the effect of such amendment, modification or waiver is to require the Revolving Credit Lenders (pursuant to, in the case of any such amendment to a provision hereof other than Section 6.2, any substantially concurrent request by the Borrower for a borrowing of Revolving Credit Loans) to make Revolving Credit Loans when such Revolving Credit Lenders would not otherwise be required to do so, (ii) the amount of the Swingline Commitment or (iii) the amount of the L/C Sublimit;

 

(b)                                 increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 10.2) or the amount of Loans of any Lender, in any case, without the written consent of such Lender (it being understood and agreed that a waiver of any condition precedent in Section 6.2 or of any Default or a mandatory reduction in Commitments is not considered an extension or increase in Commitments of any Lender);

 

(c)                                  waive, extend or postpone any date fixed by this Agreement or any other Loan Document for any payment (it being understood that a waiver of a mandatory prepayment under Section 4.4(b) shall only require the consent of the Required Lenders) of principal, interest, fees

 

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or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender entitled to such payment;

 

(d)                                 reduce the principal of, or the rate of interest specified herein on, any Loan or Reimbursement Obligation, or (subject to clause (iv) of the proviso set forth in the paragraph below) any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender entitled to such amount; provided that only the consent of the Required Lenders shall be necessary (i) to waive any obligation of the Borrower to pay interest at the rate set forth in Section 5.1(b)(i) during the continuance of a Specified Event of Default, (ii) to waive any Default or Event of Default or (iii) to amend any financial covenant hereunder (or any defined term used therein) even if the effect of such amendment would be to reduce the rate of interest on any Loan or L/C Obligation or to reduce any fee payable hereunder;

 

(e)                                  (i) change Section 5.6 or Section 10.4 in a manner that would alter the pro rata sharing of payments or order of application required thereby or (ii) change Section 5.4 or any other applicable provision of the Credit Agreement in a manner that would alter the agreement of the Administrative Agent to distribute to each Lender payments from the Borrower for the account of such Lender received by the Administrative Agent, in each case without the written consent of each Lender directly and adversely affected thereby;

 

(f)                                   change Section 4.4(b)(iv) in a manner that would alter the order of application of amounts prepaid pursuant thereto without the written consent of each Lender directly and adversely affected thereby;

 

(g)                                  except as otherwise permitted by this Section 12.2 change any provision of this Section or reduce the percentages specified in the definitions of “Required Lenders,” or “Required Revolving Credit Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender directly affected thereby;

 

(h)                                 Reserved;

 

(i)                                     release (i) (A) Holdings, (B) all of the Subsidiary Guarantors or (C) Subsidiary Guarantors comprising substantially all of the credit support for the Secured Obligations, in any case, from the Guaranty Agreement (other than as authorized in Section 11.9) or (ii) the Borrower from the Credit Agreement, in each case without the written consent of each Lender;

 

(j)                                    release all or substantially all of the Collateral or release any Security Document (other than as authorized in Section 11.9 or as otherwise specifically permitted or contemplated in this Agreement or the applicable Security Document) without the written consent of each Lender;

 

provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by each affected Issuing Lender in addition to the Lenders required above, affect the rights or duties of such Issuing Lender under this Agreement or any Letter of Credit Application relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swingline Lender in addition to the Lenders required above, affect the

 

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rights or duties of the Swingline Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; (iv) each Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto, (v) each Letter of Credit Application may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto; provided that a copy of such amended Letter of Credit Application shall be promptly delivered to the Administrative Agent upon such amendment or waiver, (vi) any waiver, amendment or modification of this Agreement that by its terms affects the rights or duties under this Agreement of Lenders holding Loans or Commitments of a particular Class (but not the Lenders holding Loans or Commitments of any other Class) may be effected by an agreement or agreements in writing entered into by Holdings, the Borrower and the requisite percentage in interest of the 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, and (vii) the Administrative Agent and the Borrower shall be permitted to amend any provision of the Loan Documents (and such amendment shall become effective without any further action or consent of any other party to any Loan Document if the same is not objected to in writing by the Required Lenders to the Administrative Agent within five (5) Business Days following receipt of notice thereof) if the Administrative Agent and the Borrower shall have jointly identified an obvious error or any error or omission of a purely technical nature in any such provision.  Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Revolving Credit Commitment of such Lender may not be increased or extended without the consent of such Lender.

 

Notwithstanding anything in this Agreement to the contrary, each Lender hereby irrevocably authorizes the Administrative Agent on its behalf, and without further consent, to enter into amendments or modifications to this Agreement (including amendments to this Section 12.2) or any of the other Loan Documents or to enter into additional Loan Documents as the Administrative Agent reasonably deems appropriate in order to effectuate the terms of Section 5.13 (including, without limitation, as applicable, (1) to permit the Incremental Term Loans or Refinancing Term Loan to share ratably in the benefits of this Agreement and the other Loan Documents and (2) to include the Incremental Term Loan Commitments or outstanding Incremental Term Loans or Refinancing Term Loan, as applicable, in any determination of (i) Required Lenders or (ii) similar required lender terms applicable thereto) and Section 5.16; provided that no amendment or modification shall result in any increase in the amount of any Lender’s Commitment or any increase in any Lender’s Commitment Percentage, in each case, without the written consent of such affected Lender.

 

SECTION 12.3                                      Expenses; Indemnity.

 

(a)                                 Costs and Expenses.  The Borrower and each other Credit Party, jointly and severally, shall pay (i) all reasonable and documented out of pocket expenses incurred by the Administrative Agent, the Arrangers and their Affiliates (including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the syndication of the Credit Facility, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the

 

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provisions hereof or thereof (promptly following presentation of a summary statement), (ii) all reasonable and documented out of pocket expenses incurred by any Issuing Lender in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder (promptly following presentation of a summary statement) and (iii) all reasonable and documented out of pocket expenses incurred by the Administrative Agent, any Lender or any Issuing Lender (including the fees, charges and disbursements of any counsel for the Administrative Agent, any Lender or any Issuing Lender, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) 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 (in each case, following presentation of a summary statement).  Notwithstanding the foregoing, in no event will the Credit Parties be liable for the costs and expenses of more than one firm of legal counsel for the Administrative Agent, the Arrangers and the Lenders collectively (and one additional firm of local counsel in each applicable jurisdiction) unless representation by one such firm would present actual or potential conflicts of interest, in which case the Credit Parties will be liable for costs and expenses of one firm of legal counsel for  each affected party (and, if reasonably necessary, one additional firm of local counsel in each applicable jurisdiction for each such affected party).

 

(b)                                 Indemnification by the Borrower.  The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender and each Issuing 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, and shall pay or reimburse any such Indemnitee for, any and all losses, claims, penalties, damages, liabilities and related expenses (including the reasonable fees, charges and disbursements of any counsel for any Indemnitee) incurred by any Indemnitee or asserted against any Indemnitee by any Person (including the Borrower or any other Credit Party), other than such Indemnitee and its Related Parties, arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby (including the Transactions), (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by any Issuing Lender 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 any Credit Party or any Subsidiary thereof, or any Environmental Claim related in any way to any Credit Party or any Subsidiary or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by any Credit Party or any Subsidiary thereof, 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, liabilities or related expenses (A) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee, (B) result from a claim brought by any Credit Party or any Subsidiary thereof against an Indemnitee for a material breach of such Indemnitee’s obligations hereunder or under any other Loan Document if

 

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the Borrower or such Credit Party has obtained a final and nonappeable judgment in its favor on such claim as determined by a court of competent jurisdiction or (C) relate to any dispute solely among Indemnitees and their Related Parties (other than (1) any claims against any agent or arranger in its respective capacity or fulfilling its role as an agent or arranger or any similar role hereunder and (2) any claims arising out of any act or omission on the part of the Borrower or its Subsidiaries or Affiliates), if such Credit Party or such Subsidiary has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction.  This Section 12.3(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.  Notwithstanding the foregoing, in no event will the Credit Parties be liable for the costs and expenses of more than one firm of legal counsel for all Indemnitees (and one additional firm of local counsel in each applicable jurisdiction) unless representation by one such firm would present actual or potential conflicts of interest, in which case the Credit Parties will be liable for costs and expenses of one firm of legal counsel for  each affected party (and, if reasonably necessary, one additional firm of local counsel in each applicable jurisdiction for each such affected party).

 

(c)                                  Reimbursement by Lenders.  To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under clause (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), any Issuing Lender, the Swingline Lender or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), such Issuing Lender, the Swingline Lender or such Related Party, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the Total Credit Exposure at such time, or if the Total Credit Exposure has been reduced to zero, then based on such Lender’s share of the Total Credit Exposure immediately prior to such reduction) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender); provided that with respect to such unpaid amounts owed to any Issuing Lender or the Swingline Lender solely in its capacity as such, only the Revolving Credit Lenders shall be required to pay such unpaid amounts, such payment to be made severally among them based on such Revolving Credit Lenders’ Revolving Credit Commitment Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought or, if the Revolving Credit Commitment has been reduced to zero as of such time, determined immediately prior to such reduction); provided, further, that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), such Issuing Lender or the Swingline Lender in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent), such Issuing Lender or the Swingline Lender in connection with such capacity.  The obligations of the Lenders under this clause (c) are subject to the provisions of Section 5.7.

 

(d)                                 Waiver of Consequential Damages, Etc.  To the fullest extent permitted by Applicable Law, no Credit Party or Indemnitee shall assert, and each Credit Party and Indemnitee hereby waives, any claim against any Indemnitee or Credit Party, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.  No Credit

 

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Party or Indemnitee referred to in clause (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.  Notwithstanding the foregoing, nothing in this clause (d) shall limit the Credit Parties’ indemnification and reimbursement obligations to the extent set forth in this Agreement.

 

(e)                                  Payments.  All amounts due under this Section shall be payable promptly after demand therefor.

 

(f)                                   Survival.  Each party’s obligations under this Section shall survive the termination of the Loan Documents and payment of the obligations hereunder.

 

SECTION 12.4                                      Right of Setoff.  If an Event of Default shall have occurred and be continuing, each Lender, each Issuing Lender, the Swingline Lender and each of their respective Affiliates is hereby authorized at any time and from time to time, after obtaining the prior written consent of the Administrative Agent, to the fullest extent permitted by Applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, such Issuing Lender, the Swingline Lender or any such Affiliate to or for the credit or the account of the Borrower or any other Credit Party against any and all of the obligations of the Borrower or such Credit Party now or hereafter existing under this Agreement or any other Loan Document to such Lender, such Issuing Lender or the Swingline Lender or any of their respective Affiliates, irrespective of whether or not such Lender, such Issuing Lender, the Swingline Lender or any such Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Credit Party may be contingent or unmatured or are owed to a branch or office of such Lender, such Issuing Lender, the Swingline Lender or such Affiliate 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 10.4 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 Lenders, the Swingline Lender and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff.  The rights of each Lender, each Issuing Lender, the Swingline Lender and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, such Issuing Lender, the Swingline Lender or their respective Affiliates may have.  Each Lender, such Issuing Lender and the Swingline Lender agree to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.

 

SECTION 12.5                                      Governing Law; Jurisdiction, Etc.

 

(a)                                 Governing Law.  This Agreement and the other Loan Documents and any claim, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon,

 

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arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the law of the State of New York.

 

(b)                                 Submission to Jurisdiction.  The Borrower and each other Credit Party irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any kind or description, whether in law or equity, whether in contract or in tort or otherwise, against the Administrative Agent, any Lender, any Issuing Lender, the Swingline Lender, or any Related Party of the foregoing in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, in any forum other than the courts of the State of New York sitting in New York County, and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in respect of any such action, litigation or proceeding may be heard and determined in such New York State court or, to the fullest extent permitted by Applicable Law, in such federal court.  Each of the parties hereto agrees that a final judgment in any such action, litigation 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 in any other Loan Document shall affect any right that the Administrative Agent, any Lender, any Issuing Lender or the Swingline Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or any other Credit Party or its properties in the courts of any jurisdiction.

 

(c)                                  Waiver of Venue.  Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by Applicable Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(d)                                 Service of Process.  Each party hereto irrevocably consents to service of process in the manner provided for notices in Section 12.1.  Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by Applicable Law.

 

SECTION 12.6                                      Waiver of Jury Trial.

 

(a)                                 EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

 

SECTION 12.7                                      Reversal of Payments.  To the extent any Credit Party makes a payment or payments to the Administrative Agent for the benefit of the Lenders or the

 

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Administrative Agent receives any payment or proceeds of the Collateral which payments or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any Debtor Relief Law, other Applicable Law or equitable cause, then, to the extent of such payment or proceeds repaid, the Obligations or part thereof intended to be satisfied shall be revived and continued in full force and effect as if such payment or proceeds had not been received by the Administrative Agent.

 

SECTION 12.8                                      Reserved.

 

SECTION 12.9                                      Successors and Assigns; Participations.

 

(a)                                 Successors and Assigns Generally.  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, except that neither the Borrower nor any other Credit Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of paragraph (b) of this Section, (ii) by way of participation in accordance with the provisions of paragraph (d) of this Section or (iii) by way of pledge or assignment of a security interest subject to the restrictions of paragraph (e) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void).  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, Participants to the extent provided in paragraph (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)                                 Assignments by Lenders.  Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Revolving Credit Commitment and the Loans at the time owing to it); provided that, in each case with respect to any Credit Facility, any such assignment shall be subject to the following conditions:

 

(i)                                     Minimum Amounts.

 

(A)                               in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and/or the Loans at the time owing to it (in each case with respect to any Credit Facility) or contemporaneous assignments to related Approved Funds that equal at least the amount specified in paragraph (b)(i)(B) of this Section in the aggregate or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

 

(B)                               in any case not described in paragraph (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the

 

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principal outstanding balance of the 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 or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000, in the case of any assignment in respect of the Revolving Credit Facility, or $5,000,000, in the case of any assignment in respect of the Term Loan Facility, unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed); provided that the Borrower shall be deemed to have given its consent five (5) Business Days after the date written notice thereof has been delivered by the assigning Lender (through the Administrative Agent) unless such consent is expressly refused by the Borrower prior to such fifth (5th) Business Day;

 

(ii)                                  Proportionate Amounts.  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 with respect to the Loan or the Commitment assigned, except that this clause (ii) shall not prohibit any Lender from assigning all or a portion of its rights and obligations among separate Classes on a non-pro rata basis;

 

(iii)                               Required Consents.  No consent shall be required for any assignment except to the extent required by paragraph (b)(i)(B) of this Section and, in addition:

 

(A)                               the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (x) an Event of Default has occurred and is continuing at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided, that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within 5 Business Days after having received notice thereof;

 

(B)                               the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of (i) the Revolving Credit Facility or any unfunded Term Loan Commitments if such assignment is to a Person that is not a Lender with a Revolving Credit Commitment or a Term Loan Commitment, as applicable, an Affiliate of such Lender or an Approved Fund with respect to such Lender or (ii) the Term Loans to a Person who is not a Lender, an Affiliate of a Lender or an Approved Fund; and

 

(C)                               the consents of the Issuing Lenders and the Swingline Lender shall be required for any assignment in respect of the Revolving Credit Facility.

 

(iv)                              Assignment and Assumption.  The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500 for each assignment; provided that (A) only one such fee will be payable in connection with simultaneous assignments to

 

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two or more related Approved Funds by a Lender and (B) the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment.  The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

 

(v)                                 No Assignment to Certain Persons.  No such assignment shall be made to (A) Holdings or any of its Subsidiaries or Affiliates or (B) any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B).

 

(vi)                              No Assignment to Natural Persons.  No such assignment shall be made to a natural Person.

 

(vii)                           Certain Additional Payments.  In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested, but not funded by, the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (A) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, the Issuing Lenders, the Swingline Lender and each other Lender hereunder (and interest accrued thereon), and (B) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swingline Loans in accordance with its Revolving Credit Commitment Percentage.  Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under Applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

 

Subject to acceptance and recording thereof by the Administrative Agent pursuant to paragraph (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement 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 5.8, 5.9, 5.10, 5.11 and 12.3 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided that, except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this

 

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paragraph 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 (d) of this Section (other than a purported assignment to a natural Person or the Borrower or any of the Borrower’s Subsidiaries or Affiliates, which shall be null and void.)

 

(c)                                  Register.  The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices in Charlotte, North Carolina, a copy of each Assignment and Assumption and each Lender Joinder Agreement delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amounts of (and stated interest on) the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive, absent manifest error, and the Borrower, the Administrative Agent 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.  The Register shall be available for inspection by the Borrower and any Lender (but only to the extent of entries in the Register that are applicable to such Lender), at any reasonable time and from time to time upon reasonable prior notice.

 

(d)                                 Participations.  Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural Person, a Defaulting Lender or the Borrower or any of the Borrower’s Subsidiaries or Affiliates) (each, a “Participant”) in all or a portion of such Lender’s rights and/or 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, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent, the Issuing Lender, the Swingline Lender 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.  For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 12.3(c) with respect to any payments made by such Lender to its Participant(s).

 

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 Section 12.2(b), (c), (d) or (e) that directly and adversely affects such Participant.  The Borrower agrees that each Participant shall be entitled to the benefits of Sections 5.9, 5.10 and 5.11 (subject to the requirements and limitations therein, including the requirements under Section 5.11(g) (it being understood that the documentation required under Section 5.11(g) shall be delivered to the participating Lender)) 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 Section 5.12 as if it were an assignee under paragraph (B) of this Section; and (b) shall not be entitled to receive any greater payment under Sections 5.10 or 5.11, 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.  Each Lender that

 

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sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 5.12(b) with respect to any Participant.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 12.4 as though it were a Lender; provided that such Participant agrees to be subject to Section 5.6 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 Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each Participant’s interest in the Loans or other obligations under the Loan Documents (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.

 

(e)                                  Certain Pledges.  Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

 

SECTION 12.10                               Treatment of Certain Information; Confidentiality.  Each of the Administrative Agent, the Lenders and the Issuing Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and their Related Parties (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 required or requested by, or required to be disclosed to, any regulatory or similar authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by Applicable Laws or regulations or in any legal, judicial, administrative or other compulsory proceeding or process (in which case, the Administrative Agent, the applicable Lender or the applicable Issuing Lender shall, to the extent permitted by Applicable Law, inform the Borrower promptly in advance thereof), (d) to any other party hereto, (e) in connection with the exercise of any remedies under this Agreement, under any other Loan Document or under any Secured Hedge Agreement or Secured Cash Management Agreement, or any action or proceeding relating to this Agreement, any other Loan Document or any Secured Hedge Agreement or Secured Cash Management Agreement, 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 and obligations

 

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under this Agreement, (ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder, (iii) to an investor or prospective investor in an Approved Fund that also agrees that Information shall be used solely for the purpose of evaluating an investment in such Approved Fund, (iv) to a trustee, collateral manager, servicer, backup servicer, noteholder or secured party in an Approved Fund in connection with the administration, servicing and reporting on the assets serving as collateral for an Approved Fund, or (v) to a nationally recognized rating agency that requires access to information regarding Holdings and its Subsidiaries, the Loans and the Loan Documents in connection with ratings issued with respect to an Approved Fund , (g) on a confidential basis to (i) any rating agency in connection with rating Holdings or its Subsidiaries or the Credit Facility or (ii) to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Credit Facility, (h) with the consent of the Borrower, (i) to Gold Sheets and other similar bank trade publications, such information to consist of deal terms and other information customarily found in such publications, (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, any Lender, any Issuing Lender or any of their respective Affiliates from a third party that is not, to such Person’s knowledge, subject to confidentiality obligations to Holdings or the Borrower, (k) to governmental regulatory authorities in connection with any regulatory examination of the Administrative Agent or any Lender or in accordance with the Administrative Agent’s or any Lender’s regulatory compliance policy if the Administrative Agent or such Lender deems necessary for the mitigation of claims by those authorities against the Administrative Agent or such Lender or any of its subsidiaries or affiliates, (l) to the extent that such information is independently developed by the Administrative Agent, the applicable Lender or the applicable Issuing Lender, or (m) for purposes of establishing a “due diligence” defense.  For purposes of this Section, “Information” means all information received from any Credit Party or any Subsidiary thereof relating to any Credit Party or any Subsidiary thereof or any of their respective businesses, other than any such information that is available to the Administrative Agent, any Lender or any Issuing Lender on a nonconfidential basis prior to disclosure by any Credit Party or any Subsidiary thereof; provided that, in the case of information received from a Credit Party or any Subsidiary thereof 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.

 

SECTION 12.11                               Performance of Duties.  Each of the Credit Party’s obligations under this Agreement and each of the other Loan Documents shall be performed by such Credit Party at its sole cost and expense.

 

SECTION 12.12                               All Powers Coupled with Interest.  All powers of attorney and other authorizations granted to the Lenders, the Administrative Agent and any Persons designated by the Administrative Agent or any Lender pursuant to any provisions of this Agreement or any of the other Loan Documents shall be deemed coupled with an interest and shall be irrevocable so long as any of the Obligations remain unpaid or unsatisfied, any of the Commitments remain in effect or the Credit Facility has not been terminated.

 

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SECTION 12.13                               Survival.

 

(a)                                 All representations and warranties set forth in Article VII and all representations and warranties contained in any certificate, or any of the Loan Documents (including any such representation or warranty made in or in connection with any amendment thereto) shall constitute representations and warranties made under this Agreement.  All representations and warranties made under this Agreement shall be made or deemed to be made at and as of the Closing Date (except those that are expressly made as of a specific date), shall survive the Closing Date and shall not be waived by the execution and delivery of this Agreement, any investigation made by or on behalf of the Lenders or any borrowing hereunder.

 

(b)                                 Notwithstanding any termination of this Agreement, the indemnities to which the Administrative Agent and the Lenders are entitled under the provisions of this Article XII and any other provision of this Agreement and the other Loan Documents shall continue in full force and effect and shall protect the Administrative Agent and the Lenders against events arising after such termination as well as before.

 

SECTION 12.14                               Titles and Captions.  Titles and captions of Articles, Sections and subSections in, and the table of contents of, this Agreement are for convenience only, and neither limit nor amplify the provisions of this Agreement.

 

SECTION 12.15                               Severability of Provisions.  Any provision of this Agreement or any other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remainder of such provision or the remaining provisions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction.

 

SECTION 12.16                               Counterparts; Integration; Effectiveness; Electronic Execution.

 

(a)                                 Counterparts; Integration; Effectiveness.  This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, the Issuing Lender, the Swingline Lender and/or the Arrangers, 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 6.1, 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 that, when taken together, bear the signatures of each of the other parties hereto.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Agreement.

 

(b)                                 Electronic Execution of Assignments.  The words “execution”, “signed”, “signature”, and words of like import in any Assignment and Assumption shall be deemed to include electronic signatures 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 or the use of

 

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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.

 

SECTION 12.17                               Term of Agreement.  This Agreement shall remain in effect from the Closing Date through and including the date upon which all Obligations (other than contingent indemnification obligations not then due) arising hereunder or under any other Loan Document shall have been indefeasibly and irrevocably paid and satisfied in full, all Letters of Credit have been terminated or expired (or been Cash Collateralized) or otherwise satisfied in a manner acceptable to the Issuing Lender) and the Revolving Credit Commitment has been terminated.  No termination of this Agreement shall affect the rights and obligations of the parties hereto arising prior to such termination or in respect of any provision of this Agreement which survives such termination.

 

SECTION 12.18                               USA PATRIOT Act.  The Administrative Agent and each Lender hereby notifies the Borrower that pursuant to the requirements of the PATRIOT Act, each of them is required to obtain, verify and record information that identifies each Credit Party, which information includes the name and address of each Credit Party and other information that will allow such Lender to identify each Credit Party in accordance with the PATRIOT Act.

 

SECTION 12.19                               Independent Effect of Covenants.  The Borrower expressly acknowledges and agrees that each covenant contained in Articles VIII or IX hereof shall be given independent effect.  Accordingly, the Borrower shall not engage in any transaction or other act otherwise permitted under any covenant contained in Articles VIII or IX, before or after giving effect to such transaction or act, the Borrower shall or would be in breach of any other covenant contained in Articles VIII or IX.

 

SECTION 12.20                               No Advisory or Fiduciary Responsibility.

 

(a)                                 In connection with all aspects of each transaction contemplated hereby, each Credit Party acknowledges and agrees, and acknowledges its Affiliates’ understanding, that (i) the facilities provided for hereunder and any related arranging or other services in connection therewith (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document) are an arm’s-length commercial transaction between the Borrower and its Affiliates, on the one hand, and the Administrative Agent, the Arrangers and the Lenders, on the other hand, and the Borrower is capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents (including any amendment, waiver or other modification hereof or thereof), (ii) in connection with the process leading to such transaction, each of the Administrative Agent, the Arrangers and the Lenders is and has been acting solely as a principal and is not the financial advisor, agent or fiduciary, for the Borrower or any of its Affiliates, stockholders, creditors or employees or any other Person, (iii) none of the Administrative Agent, the Arrangers or the Lenders has assumed or will assume an advisory, agency or fiduciary responsibility in favor of the Borrower with respect to any of the transactions contemplated hereby or the process leading thereto, including with respect to any amendment, waiver or other modification hereof or of any other Loan Document (irrespective of whether any Arranger or

 

140

 

Lender has advised or is currently advising the Borrower or any of its Affiliates on other matters) and none of the Administrative Agent, the Arrangers or the Lenders has any obligation to the Borrower or any of its Affiliates with respect to the financing transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents, (iv) the Arrangers and the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from, and may conflict with, those of the Borrower and its Affiliates, and none of the Administrative Agent, the Arrangers or the Lenders has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship and (v) the Administrative Agent, the Arrangers and the Lenders have not provided and will not provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby (including any amendment, waiver or other modification hereof or of any other Loan Document) and the Credit Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate.

 

(b)                                 Each Credit Party acknowledges and agrees that each Lender, the Arrangers and any Affiliate thereof may lend money to, invest in, and generally engage in any kind of business with, any of the Borrower, the Parent, any Affiliate thereof or any other person or entity that may do business with or own securities of any of the foregoing, all as if such Lender, Arranger or Affiliate thereof were not a Lender or Arranger or an Affiliate thereof (or an agent or any other person with any similar role under any Credit Facilities) and without any duty to account therefor to any other Lender, the Arrangers, the Parent, the Borrower or any Affiliate of the foregoing.  Each Lender, the Arrangers and any Affiliate thereof may accept fees and other consideration from the Parent, the Borrower or any Affiliate thereof for services in connection with this Agreement, the Credit Facilities or otherwise without having to account for the same to any other Lender, the Arrangers, the Parent, the Borrower or any Affiliate of the foregoing.

 

SECTION 12.21                               Inconsistencies with Other Documents.  In the event there is a conflict or inconsistency between this Agreement and any other Loan Document, the terms of this Agreement shall control; provided that any provision of the Security Documents which imposes additional burdens on Holdings or any of its Subsidiaries or further restricts the rights of Holdings or any of its Subsidiaries or gives the Administrative Agent or Lenders additional rights shall not be deemed to be in conflict or inconsistent with this Agreement and shall be given full force and effect.

 

[Signature pages to follow]

 

141

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed under seal by their duly authorized officers, all as of the day and year first written above.

 

	
 
    	
BOOT   BARN HOLDINGS, INC., as Holdings
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Greg Hackman
    
	
 
    	
Name:
    	
Greg   Hackman
    
	
 
    	
Title:
    	
Chief   Financial Officer and Secretary
    
	
 
    	
 
    
	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Greg Hackman
    
	
 
    	
Name:
    	
Greg   Hackman
    
	
 
    	
Title:
    	
Chief   Financial Officer and Secretary
    

 

 

	
 
    	
AGENTS   AND LENDERS:
    
	
 
    	
 
    
	
 
    	
WELLS   FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent, Swingline   Lender, Issuing Lender and Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Belle Villaseñor
    
	
 
    	
Name:
    	
Belle   Villaseñor
    
	
 
    	
Title:
    	
Vice   President
    

 

 

	
 
    	
PNC   BANK, NATIONAL ASSOCIATION
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Fred Kiehne
    
	
 
    	
Name:
    	
Fred   Kiehne
    
	
 
    	
Title:
    	
Senior   Vice President
    

 

Signature Page to Credit Agreement – Boot Barn

 

 

	
 
    	
JPMORGAN   CHASE BANK, N.A.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jennifer Tang
    
	
 
    	
Name:
    	
Jennifer   Tang
    
	
 
    	
Title:
    	
Vice   President
    

 

Signature Page to Credit Agreement – Boot Barn

 

 

EXHIBIT A-1

 

FORM OF REVOLVING CREDIT NOTE

 

	
$
    	
, 20       
    

 

FOR VALUE RECEIVED, the undersigned, BOOT BARN, INC., a Delaware corporation (the “Borrower”), promises to pay to                                (the “Lender”), at the place and times provided in the Credit Agreement referred to below, the principal sum of                                DOLLARS ($                    ) or, if less, the unpaid principal amount of all Revolving Credit Loans made by the Lender from time to time pursuant to that certain Credit Agreement, dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, the Borrower, the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

The unpaid principal amount of this Revolving Credit Note from time to time outstanding is payable as provided in the Credit Agreement and shall bear interest as provided in Section 5.1 of the Credit Agreement.  All payments of principal and interest on this Revolving Credit Note shall be payable in Dollars in immediately available funds as provided in the Credit Agreement.

 

This Revolving Credit Note is entitled to the benefits of, and evidences Obligations incurred under, the Credit Agreement, to which reference is made for a description of the security for this Revolving Credit Note and for a statement of the terms and conditions on which the Borrower is permitted and required to make prepayments and repayments of principal of the Obligations evidenced by this Revolving Credit Note and on which such Obligations may be declared to be immediately due and payable.

 

THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

The Indebtedness evidenced by this Revolving Credit Note is senior in right of payment to all Subordinated Indebtedness referred to in the Credit Agreement.

 

The Borrower hereby waives all requirements as to diligence, presentment, demand of payment, protest and (except as required by the Credit Agreement) notice of any kind with respect to this Revolving Credit Note.

 

 

IN WITNESS WHEREOF, the undersigned has executed this Revolving Credit Note under seal as of the day and year first above written.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT A-2

 

FORM OF SWINGLINE NOTE

 

	
$
    	
, 20     
    

 

FOR VALUE RECEIVED, the undersigned, BOOT BARN, INC., a Delaware corporation (the “Borrower”), promises to pay to WELLS FARGO BANK, NATIONAL ASSOCIATION (the “Lender”), at the place and times provided in the Credit Agreement referred to below, the principal sum of                                DOLLARS ($                    ) or, if less, the unpaid principal amount of all Swingline Loans made by the Lender from time to time pursuant to that certain Credit Agreement, dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, the Borrower, the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

The unpaid principal amount of this Swingline Note from time to time outstanding is payable as provided in the Credit Agreement and shall bear interest as provided in Section 5.1 of the Credit Agreement.  Swingline Loans refunded as Revolving Credit Loans in accordance with Section 2.2(b) of the Credit Agreement shall be payable by the Borrower as Revolving Credit Loans pursuant to the Revolving Credit Notes, and shall not be payable under this Swingline Note as Swingline Loans.  All payments of principal and interest on this Swingline Note shall be payable in Dollars in immediately available funds as provided in the Credit Agreement.

 

This Swingline Note is entitled to the benefits of, and evidences Obligations incurred under, the Credit Agreement, to which reference is made for a description of the security for this Swingline Note and for a statement of the terms and conditions on which the Borrower is permitted and required to make prepayments and repayments of principal of the Obligations evidenced by this Swingline Note and on which such Obligations may be declared to be immediately due and payable.

 

THIS SWINGLINE NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

The Indebtedness evidenced by this Swingline Note is senior in right of payment to all Subordinated Indebtedness referred to in the Credit Agreement.

 

The Borrower hereby waives all requirements as to diligence, presentment, demand of payment, protest and (except as required by the Credit Agreement) notice of any kind with respect to this Swingline Note.

 

 

IN WITNESS WHEREOF, the undersigned has executed this Swingline Note under seal as of the day and year first above written.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT A-3

 

FORM OF TERM LOAN NOTE

 

	
$
    	
, 20     
    

 

FOR VALUE RECEIVED, the undersigned, BOOT BARN, INC., a Delaware corporation (the “Borrower”), promises to pay to                                (the “Lender”), at the place and times provided in the Credit Agreement referred to below, the principal sum of                                DOLLARS ($                    ) or, if less, the unpaid principal amount of all Term Loans made by the Lender pursuant to that certain Credit Agreement, dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, the Borrower, the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

The unpaid principal amount of this Term Loan Note from time to time outstanding is payable as provided in the Credit Agreement and shall bear interest as provided in Section 5.1 of the Credit Agreement.  All payments of principal and interest on this Term Loan Note shall be payable in Dollars in immediately available funds as provided in the Credit Agreement.

 

This Term Loan Note is entitled to the benefits of, and evidences Obligations incurred under, the Credit Agreement, to which reference is made for a description of the security for this Term Loan Note and for a statement of the terms and conditions on which the Borrower is permitted and required to make prepayments and repayments of principal of the Obligations evidenced by this Term Loan Note and on which such Obligations may be declared to be immediately due and payable.

 

THIS TERM LOAN NOTE SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

The Indebtedness evidenced by this Term Loan Note is senior in right of payment to all Subordinated Indebtedness referred to in the Credit Agreement.

 

The Borrower hereby waives all requirements as to diligence, presentment, demand of payment, protest and (except as required by the Credit Agreement) notice of any kind with respect to this Term Loan Note.

 

 

IN WITNESS WHEREOF, the undersigned has executed this Term Loan Note under seal as of the day and year first above written.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT B

 

FORM OF NOTICE OF BORROWING

 

Dated as of:

 

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention:  Syndication Agency Services

 

Ladies and Gentlemen:

 

This irrevocable Notice of Borrowing is delivered to you pursuant to Section 2.3(a) of the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

1.             The Borrower hereby requests that the Lenders make [a Revolving Credit Loan][a Swingline Loan][the Initial Term Loan][an Incremental Term Loan] to the Borrower in the aggregate principal amount of $                      .(1)

 

2.             The Borrower hereby requests that such Loan(s) be made on the following Business Day:                                            .(2)

 

3.             The Borrower hereby requests that such Loan(s) bear interest at the following interest rate, plus the Applicable Margin, as set forth below:

 

	
Component 
   of Loan(3)
    	
 
    	
Interest Rate
    	
 
    	
Interest Period
   (LIBOR
   Rate only)
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
[Base Rate or   LIBOR Rate](4)
    	
 
    	
 
    

 

(1)  Complete with an amount in accordance with Section 2.3, Section 4.2 or Section 5.13, as applicable, of the Credit Agreement.

(2)  Complete with a Business Day in accordance with Section 2.3 of the Credit Agreement for Revolving Credit Loans or Swingline Loans, Section 4.2(a) of the Credit Agreement for the Initial Term Loan or Section 5.13 of the Credit Agreement for an Incremental Term Loan.

(3)  Complete with the Dollar amount of that portion of the overall Loan requested that is to bear interest at the selected interest rate and/or Interest Period (e.g., for a $20,000,000 loan, $5,000,000 may be requested at Base Rate, $8,000,000 may be requested at LIBOR with an interest period of three months and $7,000,000 may be requested at LIBOR with an interest period of one month).

(4)   Complete with (i) the Base Rate or the LIBOR Rate for Revolving Credit Loans, the Initial Term Loan or any Incremental Term Loan or (ii) the Base Rate for Swingline Loans.

 

 

4.             The aggregate principal amount of all Loans and L/C Obligations outstanding as of the date hereof (including the Loan(s) requested herein) does not exceed the maximum amount permitted to be outstanding pursuant to the terms of the Credit Agreement.

 

5.             All of the conditions set forth in Section 6.2(b) of the Credit Agreement have been satisfied as of the date hereof.(5)

 

[Signature Page Follows]

 

(5)  Incremental Term Loans, the proceeds of which are intended to and will be used to finance a Permitted Acquisition, may be subject to customary “Limited Conditionality Provisions” to the extent agreed to by the Incremental Lenders providing such Incremental Term Loans.

 

 

IN WITNESS WHEREOF, the undersigned has executed this Notice of Borrowing as of the day and year first written above.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT C

 

FORM OF NOTICE OF ACCOUNT DESIGNATION

 

Dated as of:

 

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention:  Syndication Agency Services

 

Ladies and Gentlemen:

 

This Notice of Account Designation is delivered to you pursuant to Section 2.3(b) of the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender (the “Administrative Agent”).  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

1.                                      The Administrative Agent is hereby authorized to disburse all Loan proceeds into the following account(s):

 

Bank Name:

ABA Routing Number:

Account Number:

 

2.                                      This authorization shall remain in effect until revoked or until a subsequent Notice of Account Designation is provided to the Administrative Agent.

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, the undersigned has executed this Notice of Account Designation as of the day and year first written above.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT D

 

FORM OF NOTICE OF PREPAYMENT

 

Dated as of:

 

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention:  Syndication Agency Services

 

Ladies and Gentlemen:

 

This irrevocable Notice of Prepayment is delivered to you pursuant to Section [2.4(c)] [4.4(a)] [Section 4.4(b)(iv)] of the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender (the “Administrative Agent”).  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

1.                                      The Borrower hereby provides notice to the Administrative Agent that it shall repay the following [Base Rate Loans] and/or [LIBOR Rate Loans]:                                . (Complete with an amount in accordance with Section 2.4 or Section 4.4 of the Credit Agreement.)

 

2.                                      The Loan(s) to be prepaid consist of:  [check each applicable box]

 

o                                    a Swingline Loan

 

o                                    a Revolving Credit Loan

 

o                                    the Initial Term Loan

 

o                                    an Incremental Term Loan

 

3.                                      The Borrower shall repay the above-referenced Loans on the following Business Day:                                .  (Complete with a date no earlier than (i) the same Business Day as of the date of this Notice of Prepayment with respect to any Swingline Loan or Base Rate Loan and (ii) three (3) Business Days subsequent to date of this Notice of Prepayment with respect to any LIBOR Rate Loan.)

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, the undersigned has executed this Notice of Prepayment as of the day and year first written above.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT E

 

FORM OF NOTICE OF CONVERSION/CONTINUATION

 

Dated as of:

 

Wells Fargo Bank, National Association,

as Administrative Agent

MAC D 1109-019

1525 West W.T. Harris Blvd.

Charlotte, North Carolina 28262

Attention:  Syndication Agency Services

 

Ladies and Gentlemen:

 

This irrevocable Notice of Conversion/Continuation (this “Notice”) is delivered to you pursuant to Section 5.2 of the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender (the “Administrative Agent”).  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

1.                                      The Loan to which this Notice relates is [a Revolving Credit Loan] [the Initial Term Loan] [an Incremental Term Loan].

 

2.                                      This Notice is submitted for the purpose of:  (Check one and complete applicable information in accordance with the Credit Agreement.)

 

o                                    Converting all or a portion of a Base Rate Loan into a LIBOR Rate Loan

 

Outstanding principal balance:                                                                                                                          $

 

Principal amount to be converted:                                                                                                        $

 

Requested effective date of conversion:

 

Requested new Interest Period:

 

o                                    Converting all or a portion of a LIBOR Rate Loan into a Base Rate Loan

 

Outstanding principal balance:                                                                                                                          $

 

Principal amount to be converted:                                                                                                        $

 

Last day of the current Interest Period:

 

Requested effective date of conversion:

 

 

o                                    Continuing all or a portion of a LIBOR Rate Loan as a LIBOR Rate Loan

 

Outstanding principal balance:                                                                                                                          $

 

Principal amount to be continued:                                                                                                        $

 

Last day of the current Interest Period:

 

Requested effective date of continuation:

 

Requested new Interest Period:

 

3.                                      The aggregate principal amount of all Loans and L/C Obligations outstanding as of the date hereof does not exceed the maximum amount permitted to be outstanding pursuant to the terms of the Credit Agreement.

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, the undersigned has executed this Notice of Conversion/Continuation as of the day and year first written above.

 

	
 
    	
BOOT   BARN, INC., as Borrower
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

EXHIBIT F

 

FORM OF OFFICER’S COMPLIANCE CERTIFICATE

 

Dated as of:

 

The undersigned, on behalf of Boot Barn Holdings, Inc., a Delaware corporation, (“Holdings”), hereby certifies, solely in his capacity as an authorized officer of Holdings and not in any individual capacity, to the Administrative Agent and the Lenders, each as defined in the Credit Agreement referred to below, as follows:

 

1.                                      This certificate is delivered to you pursuant to Section 8.2 of the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the Lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender (the “Administrative Agent”).  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

2.                                      I have reviewed the financial statements of Holdings and its Subsidiaries dated as of                                and for the                                period[s] then ended and such statements fairly present in all material respects the financial condition of Holdings and its Subsidiaries on a Consolidated basis as of the dates indicated and the results of their operations and cash flows for the period[s] indicated, subject to customary year-end adjustments for unaudited financial statements and the absence of footnotes from unaudited financial statements.

 

3.                                      I have reviewed the terms of the Credit Agreement, and the related Loan Documents and to the best of my knowledge, no Default or an Event of Default exists as at the date of this certificate.

 

4.                                      As of the date of this certificate, the Applicable Margin and calculations determining such figures are set forth on the attached Schedule 1,(1) and Holdings and its Subsidiaries are in compliance with the financial covenants contained in Section 9.13 of the Credit Agreement as shown on such Schedule 1.

 

[Signature Page Follows]

 

(1)  To be in a form reasonably acceptable to the Administrative Agent.

 

 

WITNESS the following signature as of the day and year first written above.

 

	
 
    	
BOOT   BARN HOLDINGS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

 

Schedule 1
 to
  Officer’s Compliance Certificate

 

(See attached.)

 

 

EXHIBIT G

 

FORM OF ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [INSERT NAME OF ASSIGNOR] (the “Assignor”) and the parties identified on the Schedules hereto and [the] [each](1) Assignee identified on the Schedules hereto as “Assignee” or as “Assignees” (collectively, the “Assignees” and each, an “Assignee”).  [It is understood and agreed that the rights and obligations of [the Assignees][the Assignors](2) hereunder are several and not joint.](3)  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, restated, supplements or otherwise modified from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by [the] [each] Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to [the Assignee] [the respective Assignees], and [the] [each] Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including without limitation any letters of credit, guarantees, and swingline loans included in such facilities) and (ii) to the extent permitted to be assigned under Applicable Law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned to [the] [any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as, [the] [an] “Assigned Interest”).  Each such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

 

	
1.
    	
Assignor:
    	
[INSERT   NAME OF ASSIGNOR]
    
	
 
    	
 
    	
 
    
	
2.
    	
Assignee(s):
    	
See   Schedules attached hereto
    

 

(1)   For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee, choose the first bracketed language.  If the assignment is to multiple Assignees, choose the second bracketed language.

(2)   Select as appropriate.

(3)   Include bracketed language if there are multiple Assignees.

 

 

	
3.
    	
Borrower:
    	
Boot   Barn, Inc.
    
	
 
    	
 
    	
 
    
	
4.
    	
Administrative   Agent:
    	
Wells   Fargo Bank, National Association, as the administrative agent under the Credit   Agreement
    
	
 
    	
 
    	
 
    
	
5.
    	
Credit   Agreement:
    	
The   Credit Agreement dated as of February 23, 2015 by and among Boot Barn   Holdings, Inc., a Delaware corporation, as Holdings, Boot   Barn, Inc., a Delaware corporation (the “Borrower”), the Lenders party   thereto and Wells Fargo Bank, National Association, as Administrative Agent,   Swingline Lender and Issuing Lender (as amended, restated, supplemented or   otherwise modified from time to time)
    
	
 
    	
 
    	
 
    
	
6.
    	
Assigned   Interest:
    	
See   Schedules attached hereto
    
	
 
    	
 
    	
 
    
	
[7.
    	
Trade   Date:
    	
                                ](4)
    

 

[Remainder of Page Intentionally Left Blank]

 

(4)   To be completed if the Assignor and the Assignees intend that the minimum assignment amount is to be determined as of the Trade Date.

 

 

Effective Date:                                    , 2         [TO BE INSERTED BY THE ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR]

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

	
 
    	
ASSIGNOR
    
	
 
    	
[NAME OF   ASSIGNOR]
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ASSIGNEES
    
	
 
    	
 
    
	
 
    	
See   Schedules attached hereto
    

 

 

	
[Consented   to and](11) Accepted:
    
	
 
    
	
WELLS   FARGO BANK, NATIONAL ASSOCIATION,
    
	
as   Administrative Agent, Swingline Lender and Issuing Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
By
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
[Consented to:](12)
    	
 
    
	
 
    	
 
    
	
BOOT BARN, INC.
    	
 
    
	
as Borrower
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    

 

(11)  To be added only if the consent of the Administrative Agent and/or Swingline Lender and Issuing Lender is required by the terms of the Credit Agreement.

(12)  To be added only if the consent of the Borrower is required by the terms of the Credit Agreement.

 

 

SCHEDULE 1
 To Assignment and Assumption

 

By its execution of this Schedule, the Assignee identified on the signature block below agrees to the terms set forth in the attached Assignment and Assumption.

 

Assigned Interests:

 

	
Facility
   Assigned(1)
    	
 
    	
Aggregate
   Amount of
   Commitment/
   Loans for all
   Lenders(2)
    	
 
    	
Amount of
   Commitment/
   Loans Assigned(3)
    	
 
    	
Percentage
   Assigned of
   Commitment/
   Loans(4)
    	
 
    	
CUSIP Number
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
 
    	
%
    	
 
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
 
    	
%
    	
 
    	
 
    
	
 
    	
 
    	
$
    	
 
    	
 
    	
$
    	
 
    	
 
    	
 
    	
%
    	
 
    	
 
    

 

 

	
 
    	
[NAME   OF ASSIGNEE](5)
    
	
 
    	
[and is an   Affiliate/Approved Fund of [identify Lender](6)]
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Title:
    	
 
    

 

(1)   Fill in the appropriate terminology for the types of facilities under the Credit Agreement that are being assigned under this Agreement (e.g. “Revolving Credit Commitment,” “Term Loan Commitment,” etc.)

(2)   Amount to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date.

(3)   Amount to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date.

(4)   Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

(5)   Add additional signature blocks, as needed.

(6)   Select as appropriate.

 

 

ANNEX 1
 to Assignment and Assumption

 

STANDARD TERMS AND CONDITIONS FOR
 ASSIGNMENT AND ASSUMPTION

 

1.             Representations and Warranties.

 

1.1          Assignor.  The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the] [the relevant] Assigned Interest, (ii) [the] [such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and (iv) it is [not] a Defaulting Lender; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of Holdings, the Borrower, any of their respective Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by Holdings, the Borrower, any of their respective Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

 

1.2.         Assignee[s].  [The] [Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets the requirements of an Eligible Assignee under the Credit Agreement (subject to such consents, if any, as may be required under Section 12.9(b)(iii) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of [the] [the relevant] Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire [the] [such] Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 8.1 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase [the] [such] Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase [the] [such] Assigned Interest, and (vii) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by [the] [such] Assignee; and (b) agrees that (i) it will, independently and without reliance upon the Administrative Agent, [the] [any] Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in 

 

 

accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

 

2.             Payments.  From and after the Effective Date, the Administrative Agent shall make all payments in respect of [the] [each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the] [the relevant] Assignor for amounts which have accrued to but excluding the Effective Date and to [the] [the relevant] Assignee for amounts which have accrued from and after the Effective Date.

 

3.             General Provisions.  This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

 

 

EXHIBIT H-1

 

FORM OF
 U.S. TAX COMPLIANCE CERTIFICATE
  (FOR NON-U.S. LENDERS THAT ARE NOT PARTNERSHIPS FOR U.S. FEDERAL INCOME TAX PURPOSES)

 

Reference is hereby made to the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), by and among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the lenders who are or may become a party thereto, as Lenders, and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

Pursuant to the provisions of Section 5.11(g) of the Credit Agreement, the undersigned hereby certifies that (a) it is the sole record and beneficial owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (b) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (c) it is not a ten percent (10%) shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (d) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable.  By executing this certificate, the undersigned agrees that (a) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent and (b) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two (2) calendar years preceding such payments.

 

	
[NAME OF LENDER]
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date:                          , 20
    	
 
    

 

 

EXHIBIT H-2

 

FORM OF
 U.S. TAX COMPLIANCE CERTIFICATE
  (FOR NON-U.S. PARTICIPANTS THAT ARE NOT PARTNERSHIPS FOR U.S. FEDERAL INCOME TAX PURPOSES)

 

Reference is hereby made to the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the lenders who are or may become party a thereto, as Lenders, and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

Pursuant to the provisions of Section 5.11(g) of the Credit Agreement, the undersigned hereby certifies that (a) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (b) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (c) it is not a ten percent (10%) shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (d) it is not a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable.  By executing this certificate, the undersigned agrees that (a) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing and (b) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two (2) calendar years preceding such payments.

 

	
[NAME OF LENDER]
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date:                        , 20
    	
 
    

 

 

EXHIBIT H-3

 

FORM OF
 U.S. TAX COMPLIANCE CERTIFICATE
  (FOR NON-U.S. PARTICIPANTS THAT ARE PARTNERSHIPS FOR U.S. FEDERAL INCOME TAX PURPOSES)

 

Reference is hereby made to the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the lenders who are or may become party thereto, as Lenders, and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

Pursuant to the provisions of Section 5.11(g) of the Credit Agreement, the undersigned hereby certifies that (a) it is the sole record owner of the participation in respect of which it is providing this certificate, (b) its direct or indirect partners/members are the sole beneficial owners of such participation, (c) with respect such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (d) none of its direct or indirect partners/members is a ten percent (10%) shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (e) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption:  (a) an IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, or (b) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (i) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (ii) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two (2) calendar years preceding such payments.

 

	
[NAME OF LENDER]
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date:                          , 20
    	
 
    

 

 

EXHIBIT H-4

 

FORM OF
 U.S. TAX COMPLIANCE CERTIFICATE
  (FOR NON-U.S. LENDERS THAT ARE PARTNERSHIPS FOR U.S. FEDERAL INCOME TAX PURPOSES)

 

Reference is hereby made to the Credit Agreement dated as of February 23, 2015 (as amended, restated, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Boot Barn Holdings, Inc., a Delaware corporation, as Holdings, Boot Barn, Inc., a Delaware corporation (the “Borrower”), the lenders who are or may become party thereto, as Lenders, and Wells Fargo Bank, National Association, as Administrative Agent, Swingline Lender and Issuing Lender.  Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.

 

Pursuant to the provisions of Section 5.11(g) of the Credit Agreement, the undersigned hereby certifies that (a) it is the sole record owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (b) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)), (c) with respect to the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (d) none of its direct or indirect partners/members is a ten percent (10%) shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (e) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption:  (a) an IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable or (b) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (i) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent and (ii) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two (2) calendar years preceding such payments.

 

	
[NAME OF LENDER]
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date:                          , 20
    	
 
    

 

 

Schedule 1.1(b)

Commitments and Commitment Percentages

 

	
Institution
    	
 
    	
Revolving Credit
   Commitment
    	
 
    	
Term Loan
   Commitment
    	
 
    	
Total
   Commitment
    	
 
    	
% of Total
   Commitments
    	
 
    
	
Wells Fargo Bank, National Association
    	
 
    	
$
    	
25,000,000.00
    	
 
    	
$
    	
25,000,000.00
    	
 
    	
$
    	
50,000,000.00
    	
 
    	
33.33333333
    	
%
    
	
PNC Bank, National Association
    	
 
    	
$
    	
25,000,000.00
    	
 
    	
$
    	
25,000,000.00
    	
 
    	
$
    	
50,000,000.00
    	
 
    	
33.33333333
    	
%
    
	
JPMorgan Chase Bank, N.A.
    	
 
    	
$
    	
25,000,000.00
    	
 
    	
$
    	
25,000,000.00
    	
 
    	
$
    	
50,000,000.00
    	
 
    	
33.33333333
    	
%
    
	
TOTALS
    	
 
    	
$
    	
75,000,000.00
    	
 
    	
$
    	
75,000,000.00
    	
 
    	
$
    	
150,000,000.00
    	
 
    	
100.00
    	
%
    

 

 

Schedule 1.1(c), Schedule 1.1(d)

Existing Fiscal Period End Dates

 

	
 
    	
 
    	
FY-15
    	
 
    	
FY-16
    	
 
    	
FY-17
    	
 
    	
FY-18
    	
 
    	
FY-19
    	
 
    	
FY-20
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
1st   Quarter
    	
 
    	
6/28/2014
    	
 
    	
6/27/2015
    	
 
    	
7/2/2016
    	
 
    	
7/1/2017
    	
 
    	
6/30/2018
    	
 
    	
6/29/2019
    
	
2nd   Quarter
    	
 
    	
9/27/2014
    	
 
    	
9/26/2015
    	
 
    	
10/1/2016
    	
 
    	
9/30/2017
    	
 
    	
9/29/2018
    	
 
    	
9/28/2019
    
	
3rd   Quarter
    	
 
    	
12/27/2014
    	
 
    	
12/26/2015
    	
 
    	
12/31/2016
    	
 
    	
12/30/2017
    	
 
    	
12/29/2018
    	
 
    	
12/28/2019
    
	
4th   Quarter
    	
 
    	
3/28/2015
    	
 
    	
4/2/2016
    	
 
    	
4/1/2017
    	
 
    	
3/31/2018
    	
 
    	
3/30/2019
    	
 
    	
3/28/2020
    

 

 

Schedule 1.1(e)

Proposed Amendment to Fiscal Period End Dates

 

	
 
    	
 
    	
FY-15
    	
 
    	
FY-16
    	
 
    	
FY-17
    	
 
    	
FY-18
    	
 
    	
FY-19
    	
 
    	
FY-20
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
1st   Quarter
    	
 
    	
6/28/2014
    	
 
    	
6/27/2015
    	
 
    	
6/25/2016
    	
 
    	
7/1/2017
    	
 
    	
6/30/2018
    	
 
    	
6/29/2019
    
	
2nd   Quarter
    	
 
    	
9/27/2014
    	
 
    	
9/26/2015
    	
 
    	
9/24/2016
    	
 
    	
9/30/2017
    	
 
    	
9/29/2018
    	
 
    	
9/28/2019
    
	
3rd   Quarter
    	
 
    	
12/27/2014
    	
 
    	
12/26/2015
    	
 
    	
12/24/2016
    	
 
    	
12/30/2017
    	
 
    	
12/29/2018
    	
 
    	
12/28/2019
    
	
4th   Quarter
    	
 
    	
3/28/2015
    	
 
    	
3/26/2016
    	
 
    	
4/1/2017
    	
 
    	
3/31/2018
    	
 
    	
3/30/2019
    	
 
    	
3/28/2020
    

 

 

Schedule 7.1

Jurisdictions of Organization and Qualification

 

	
Entity Name
    	
 
    	
Jurisdiction of
   Organization
    	
 
    	
Jurisdiction(s) of
   Qualification
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Boot   Barn Holdings, Inc.
    	
 
    	
Delaware
    	
 
    	
None.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Boot   Barn, Inc.
    	
 
    	
Delaware
    	
 
    	
Arizona,   California, Colorado, Florida,   Georgia, Idaho, Illinois, Indiana, Iowa, Kansas,   Kentucky, Louisiana, Minnesota Missouri, Montana Nevada, New Mexico, North   Carolina, North Dakota, Oregon, South Carolina, South Dakota, Tennessee,   Texas, Utah, Wisconsin, Wyoming
    
	
Baskins   Acquisition Holdings, LLC
    	
 
    	
Delaware
    	
 
    	
None.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
RCC   Western Stores, Inc.
    	
 
    	
South   Dakota
    	
 
    	
None.
    

 

 

Schedule 7.2

Subsidiaries and Capitalization

 

	
Entity Name
    	
 
    	
Class of Stock
    	
 
    	
Number of
   Shares
   Authorized
    	
 
    	
Number of
   Shares
   Outstanding
    	
 
    	
Ownership
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Boot   Barn, Inc.
    	
 
    	
Common   Stock
    	
 
    	
1,000
    	
 
    	
1,000
    	
 
    	
100%   owned by Boot Barn Holdings, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Baskins   Acquisition Holdings, LLC
    	
 
    	
Membership   interests
    	
 
    	
N/A
    	
 
    	
N/A   - Boot Barn, Inc. is the sole member and owner of membership interests
    	
 
    	
100%   owned by Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
RCC   Western Stores, Inc.
    	
 
    	
Common   Stock
    	
 
    	
10,000
    	
 
    	
2,000
    	
 
    	
100%   owned by Boot Barn, Inc.
    

 

 

Schedule 7.6

Tax Matters

 

Audit relating to Texas use tax.  Estimated $50,000 pending liability on use tax associated with capital expenditures.

 

 

Schedule 7.9

ERISA Plans

 

None.

 

 

Schedule 7.12

Material Contracts

 

None.

 

 

Schedule 7.13

Labor and Collective Bargaining Agreements

 

None.

 

 

Schedule 7.18

Real Property

 

[See Attached]

 

[This list will match Schedule 3(d) from the Collateral Certificate]

 

 

Schedule 7.19

Litigation

 

None.

 

 

Schedule 8.18

Post-Closing Matters

 

	
Covenant
    	
 
    	
Post-Closing Time Period
    
	
1.              Execute and   deliver Control Agreements in form and substance reasonable acceptable to the   Administrative Agent with respect to each account of the Credit Parties   (other than Excluded Deposit Accounts and Excluded Securities Accounts).
    	
 
    	
60   days (as such period may be extended by the Administrative Agent in its   reasonable discretion).
    
	
 
    	
 
    	
 
    
	
2.              Use   commercially reasonable efforts to execute and deliver (and cause to be   executed and delivered) landlord waivers and collateral access agreements in   form and substance reasonably acceptable to the Administrative Agent with   respect to the following locations: 

 

a.              15776 Laguna   Canyon Road, Irvine, CA 92618

b.              8554 Katy   Freeway, Suite 301, Houston, Texas 77024 

c.               3320   Ambassador Caffery Pkwy, Lafayette, Louisiana 70506 

d.              1220 Airline   Road, Suite 100, in the City of Corpus Christi, County of Nueces, State   of Texas 

e.               240 North New   Road, Waco, TX 76710 

f.                15770 Laguna   Canyon Road, Irvine, CA 92618
    	
 
    	
60   days (as such period may be extended by the Administrative Agent in its   reasonable discretion).
    
	
 
    	
 
    	
 
    
	
3.              Obtain and   deliver endorsements reasonably acceptable to the Administrative Agent with   respect to the Credit Parties’ insurance policies, naming the Administrative   Agent as loss payee and the Administrative Agent and the Lenders as   additional insured.
    	
 
    	
60   days (as such period may be extended by the Administrative Agent in its   reasonable discretion).
    

 

 

Schedule 9.1

Existing Indebtedness

 

Capital Lease Obligations to Wells Fargo - office equipment - approximate balance as of the Closing Date is $12,000

 

Capital Lease Obligations to Raymond Equipment Leasing - warehouse equipment - approximate balance as of the Closing Date is $44,000

 

Capital Lease Obligations to Dell - computer equipment - approximate balance as of the Closing Date is $4,000

 

 

Schedule 9.2

Existing Liens

 

Personal Services Agreement between Boot Barn, Inc. and Plaid Paisley Management, Inc. dated August 13, 2014.

 

 

Schedule 9.3

Existing Loans, Advances and Investments

 

None.

 

 

Schedule 9.7

Transactions with Affiliates

 

Transactions with Patrick Meany, Kenneth Meany, and John Grivalja, each as disclosed in the prospectus of Holdings.Exhibit 10.30

 

 

COLLATERAL AGREEMENT

 

dated as of February 23, 2015

 

by and among

 

BOOT BARN HOLDINGS, INC.,

 

BOOT BARN, INC.

 

and certain of its Subsidiaries,

 

as Grantors,

 

in favor of

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

 

as Administrative Agent,

 

 

 

Table of Contents

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I           DEFINED   TERMS
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.1
    	
Terms   Defined in the UCC
    	
1
    
	
Section 1.2
    	
Definitions
    	
2
    
	
Section 1.3
    	
Other   Definitional Provisions
    	
5
    
	
 
    	
 
    	
 
    
	
ARTICLE II         SECURITY   INTEREST
    	
6
    
	
 
    	
 
    	
 
    
	
Section 2.1
    	
Grant   of Security Interest
    	
6
    
	
Section 2.2
    	
Provisions   Relating to Equity Interests
    	
8
    
	
Section 2.3
    	
Grantors   Remain Liable
    	
8
    
	
 
    	
 
    	
 
    
	
ARTICLE III       REPRESENTATIONS   AND WARRANTIES
    	
9
    
	
 
    	
 
    	
 
    
	
Section 3.1
    	
Organization;   Power; Qualification
    	
9
    
	
Section 3.2
    	
Authorization   of Agreement; Compliance with Laws; Non Contravention
    	
9
    
	
Section 3.3
    	
Governmental   Approvals
    	
9
    
	
Section 3.4
    	
Perfected   First Priority Liens
    	
10
    
	
Section 3.5
    	
Title,   No Other Liens
    	
10
    
	
Section 3.6
    	
State   of Organization; Locations of Inventory, Equipment and Fixtures; Other   Information
    	
10
    
	
Section 3.7
    	
Accounts
    	
11
    
	
Section 3.8
    	
Chattel   Paper; Instruments; Negotiable Documents Letter-of-Credit Rights
    	
11
    
	
Section 3.9
    	
Commercial   Tort Claims
    	
11
    
	
Section 3.10
    	
Deposit   Accounts and Securities Accounts
    	
11
    
	
Section 3.11
    	
Intellectual   Property
    	
11
    
	
Section 3.12
    	
Reserved
    	
12
    
	
Section 3.13
    	
Equity   Interests
    	
12
    
	
 
    	
 
    	
 
    
	
ARTICLE IV        COVENANTS
    	
12
    
	
 
    	
 
    	
 
    
	
Section 4.1
    	
Maintenance   of Perfected Security Interest; Further Information
    	
12
    
	
Section 4.2
    	
Maintenance   of Insurance
    	
12
    
	
Section 4.3
    	
Changes   in Locations; Changes in Name or Structure
    	
12
    
	
Section 4.4
    	
Required   Notifications
    	
13
    

 

i

 

	
Section 4.5
    	
Delivery   Covenants
    	
13
    
	
Section 4.6
    	
Control   Covenants
    	
14
    
	
Section 4.7
    	
Filing   Covenants
    	
14
    
	
Section 4.8
    	
Accounts
    	
15
    
	
Section 4.9
    	
Intellectual   Property
    	
15
    
	
Section 4.10
    	
Equity   Interests
    	
16
    
	
Section 4.11
    	
Reserved
    	
17
    
	
Section 4.12
    	
Further   Assurances
    	
17
    
	
Section 4.13
    	
Burdensome   Requirements
    	
17
    
	
 
    	
 
    	
 
    
	
ARTICLE V         REMEDIAL   PROVISIONS
    	
17
    
	
 
    	
 
    	
 
    
	
Section 5.1
    	
General   Remedies
    	
17
    
	
Section 5.2
    	
Specific   Remedies
    	
18
    
	
Section 5.3
    	
Registration   Rights
    	
21
    
	
Section 5.4
    	
Application   of Proceeds
    	
22
    
	
Section 5.5
    	
Waiver,   Deficiency
    	
22
    
	
 
    	
 
    	
 
    
	
ARTICLE VI        THE   ADMINISTRATIVE AGENT
    	
22
    
	
 
    	
 
    	
 
    
	
Section 6.1
    	
Appointment   of Administrative Agent as Attorney-In-Fact
    	
22
    
	
Section 6.2
    	
Duty   of Administrative Agent
    	
24
    
	
Section 6.3
    	
Authority   of Administrative Agent
    	
24
    
	
 
    	
 
    	
 
    
	
ARTICLE VII      MISCELLANEOUS
    	
25
    
	
 
    	
 
    	
 
    
	
Section 7.1
    	
Notices
    	
25
    
	
Section 7.2
    	
Amendments,   Waivers and Consents
    	
25
    
	
Section 7.3
    	
Expenses, Indemnification,   Waiver of Consequential Damages, etc.
    	
25
    
	
Section 7.4
    	
Right   of Set Off
    	
26
    
	
Section 7.5
    	
Governing   Law; Jurisdiction; Venue; Service of Process
    	
26
    
	
Section 7.6
    	
Waiver   of Jury Trial
    	
27
    
	
Section 7.7
    	
Reserved
    	
27
    
	
Section 7.8
    	
No   Waiver By Course of Conduct; Cumulative Remedies
    	
27
    
	
Section 7.9
    	
Successors   and Assigns
    	
28
    
	
Section 7.10
    	
Survival   of Indemnities
    	
28
    
	
Section 7.11
    	
Titles   and Captions
    	
28
    
	
Section 7.12
    	
Severability   of Provisions
    	
28
    

 

ii

 

	
Section 7.13
    	
Counterparts
    	
28
    
	
Section 7.14
    	
Integration
    	
28
    
	
Section 7.15
    	
Advice   of Counsel; No Strict Construction
    	
28
    
	
Section 7.16
    	
Acknowledgements
    	
28
    
	
Section 7.17
    	
Releases
    	
29
    
	
Section 7.18
    	
Additional   Grantors
    	
29
    
	
Section 7.19
    	
All   Powers Coupled With Interest
    	
30
    

 

SCHEDULES:

 

	
Schedule 3.6
    	
Exact Legal Name; Jurisdiction of   Organization; Taxpayer Identification Number; Registered Organization Number;   Mailing Address; Chief Executive Office; Locations of Inventory, Equipment   and Fixtures; Locations of Books and Records
    
	
Schedule 3.8
    	
Chattel Paper; Instruments; Negotiable   Documents; Letter-of-Credit Rights
    
	
Schedule 3.9
    	
Commercial Tort Claims
    
	
Schedule 3.10
    	
Deposit Accounts
    
	
Schedule 3.11
    	
Intellectual Property
    
	
Schedule 3.13
    	
Equity Interests Held Directly by Grantors
    

 

iii

 

COLLATERAL AGREEMENT (this “Agreement”), dated as of February 23, 2015, by and among BOOT BARN HOLDINGS, INC. (“Holdings”), BOOT BARN, INC., a Delaware corporation (the “Borrower”), any Additional Grantor (as defined below) who may become party to this Agreement (such Additional Grantors, collectively, with Holdings and the Borrower, the “Grantors”), in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent (in such capacity, the “Administrative Agent”) for the benefit of the Secured Parties (as defined in the Credit Agreement identified below).

 

STATEMENT OF PURPOSE

 

Pursuant to the Credit Agreement dated as of the date hereof by and among Holdings, the Borrower, the Lenders from time to time party thereto and the Administrative Agent (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), the Lenders have agreed to make Extensions of Credit to the Borrower upon the terms and subject to the conditions set forth therein.

 

Pursuant to the terms of the Guaranty Agreement, Holdings and certain Subsidiaries of the Borrower who are parties hereto have guaranteed the payment and performance of the Secured Obligations.

 

It is a condition precedent to the obligation of the Lenders to make their respective Extensions of Credit to the Borrower under the Credit Agreement that the Grantors shall have executed and delivered this Agreement to the Administrative Agent, for the benefit of the Secured Parties.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, and to induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective Extensions of Credit to the Borrower thereunder, each Grantor hereby agrees with the Administrative Agent, for the benefit of the Secured Parties, as follows:

 

ARTICLE I

 

DEFINED TERMS

 

SECTION 1.1  Terms Defined in the UCC.

 

(a)           The following terms when used in this Agreement shall have the meanings assigned to them in the UCC (as defined in the Credit Agreement) as in effect from time to time:   “Accession”, “Account”, “Account Debtor”, “Authenticate”, “Certificated Security”, “Chattel Paper”; “Commercial Tort Claim”, “Deposit Account”, “Documents”, “Electronic Chattel Paper”, “Equipment”, “Farm Products” “Fixture”, “General Intangible”, “Goods”, “Instrument”, “Inventory”, “Investment Company Security”, “Investment Property”, “Letter-of-Credit Rights”, “Proceeds”, “Record”, “Registered Organization”, “Securities Account”, “Securities Entitlement”, “Securities Intermediary”, “Security”, “Supporting Obligation”, “Tangible Chattel Paper”, and “Uncertificated Security”.

 

 

(b)           Terms defined in the UCC and not otherwise defined herein or in the Credit Agreement shall have the meaning assigned in the UCC as in effect from time to time.

 

SECTION 1.2  Definitions.  The following terms when used in this Agreement shall have the meanings assigned to them below:

 

“Additional Grantor” means each Subsidiary of Holdings which hereafter becomes a Grantor pursuant to Section 7.18 (as required pursuant to Section 8.13 of the Credit Agreement).

 

“Administrative Agent” has the meaning assigned thereto in the Preamble to this Agreement.

 

“Agreement” means this Collateral Agreement, as amended, restated, supplemented or otherwise modified from time to time.

 

“Assignment of Claims Act” means the Assignment of Claims Act of 1940 (41 U.S.C. Section 15 and 31 U.S.C. Section 3727), including all amendments thereto and regulations promulgated thereunder.

 

“Borrower” has the meaning assigned thereto in the Preamble to this Agreement.

 

“Collateral” has the meaning assigned thereto in Section 2.1.

 

“Collateral Account” has the meaning assigned thereto in Section 5.2.

 

“Control” means the manner in which “control” is achieved under the UCC with respect to any Collateral for which the UCC specifies a method of achieving “control”.

 

“Controlled Depository” has the meaning assigned thereto in Section 4.6.

 

“Controlled Intermediary” has the meaning assigned thereto in Section 4.6.

 

“Copyrights” means, collectively, all of the following owned by any Grantor: (a) all copyrights, works protectable by copyright, copyright registrations and copyright applications anywhere in the world, including, without limitation, those listed on Schedule 3.11 hereto, (b) all reissues, extensions, continuations (in whole or in part) and renewals of any of the foregoing, (c) all income, royalties, damages and payments now or hereafter due and/or payable under any of the foregoing or with respect to any of the foregoing, including, without limitation, damages or payments for past, present and future infringements of any of the foregoing, (d) the right to sue for past, present and future infringements of any of the foregoing, and (e) all rights corresponding to any of the foregoing throughout the world.

 

“Copyright Licenses” means any agreement now or hereafter in existence naming any Grantor as licensor or licensee, including, without limitation, those listed in Schedule 3.11, granting any right under any Copyright, including, without limitation, the grant of rights to manufacture, distribute, exploit and sell materials derived from any Copyright.

 

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“Effective Endorsement and Assignment” means, with respect to any specific type of Collateral, all such endorsements, assignments and other instruments of transfer reasonably requested by the Administrative Agent with respect to the Security Interest granted in such Collateral, and in each case, in form and substance reasonably satisfactory to the Administrative Agent.

 

“Excluded Assets” has the meaning assigned thereto in clause (ii) of the first proviso to Section 2.1.

 

“Excluded Deposit Account” means (a) any Deposit Account maintained by a Grantor solely for the purpose of funding payroll, taxes and other compensation and benefits to employees, (b) zero balance accounts maintained by a Grantor, (c) any Deposit Account used solely for escrow, customs or other fiduciary purposes, in each case, that solely contains property not beneficially owned by any Grantor, (d) any Deposit Account the balance of which is swept at the end of each Business Day into a Deposit Account subject to a Control Agreement, so long as such daily sweet is not terminated or modified (other than to provide that the balance in such Deposit Account is swept into another Deposit Account subject to a Control Agreement) without the consent of the Administrative Agent, or (e) any Deposit Account established by a Grantor with amounts on deposit that, when aggregated with the amounts on deposit in all other Deposit Accounts maintained by all Grantors for which Control Agreements have not been obtained (other than those specified in clauses (a) through (d)), do not exceed $1,000,000 at any time.

 

“Excluded Equity Interests” means any Equity Interests to the extent constituting Excluded Assets.

 

“Excluded Securities Account” means (a) any Securities Account maintained by a Grantor solely for the purpose of funding payroll, taxes and other compensation and benefits to employees, (b) any Securities Account used solely for escrow, customs or other fiduciary purposes, in each case, that solely contains property not beneficially owned by any Grantor, (c) any Securities Account the balance of which is swept at the end of each Business Day into a Securities Account subject to a Control Agreement, so long as such daily sweet is not terminated or modified (other than to provide that the balance in such Securities Account is swept into another Securities Account subject to a Control Agreement) without the consent of the Administrative Agent, or (d) any Securities Account established by a Grantor with amounts on deposit that, when aggregated with the amounts on deposit in all other Securities Accounts maintained by all Grantors for which Control Agreements have not been obtained (other than those specified in clauses (a) through (c)), do not exceed $1,000,000 at any time.

 

“Grantors” has the meaning assigned thereto in the Preamble of this Agreement.

 

“Intellectual Property” means, collectively, all of the following: (a)  all systems software and applications software owned by any Grantor, all documentation for such software, including, without limitation, user manuals, flowcharts, functional specifications, operations manuals, and all formulas, processes, ideas and know-how embodied in any of the foregoing, (b) all concepts, discoveries, improvements and ideas, know-how, technology, reports, design information, trade secrets, practices, specifications, test procedures, maintenance manuals, research and development owned by any Grantor, (c) all Patents and Patent Licenses, Copyrights and

 

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Copyright Licenses, Trademarks and Trademark Licenses, and (d) other licenses by or to any Grantor (except for any off-the-shelf software licenses) to use any of the items described in the foregoing clauses (a) and (b) to the extent not otherwise covered by the licenses described in the foregoing clause (c).

 

“Issuer” means any Subsidiary that is an issuer of any Equity Interests included in the Collateral (including, without limitation, any Issuer as defined in the UCC).

 

“Partnership/LLC Interests” means, with respect to any Grantor, the entire partnership interest, membership interest or limited liability company interest, as applicable, of such Grantor in each partnership, limited partnership or limited liability company owned by such Grantor, including, without limitation, such Grantor’s capital account, its interest as a partner or member, as applicable, in the net cash flow, net profit and net loss, and items of income, gain, loss, deduction and credit of any such partnership, limited partnership or limited liability company, as applicable, such Grantor’s interest in all distributions made or to be made by any such partnership, limited partnership or limited liability company, as applicable, to such Grantor and all of the other economic rights, titles and interests of such Grantor as a partner or member, as applicable, of any such partnership, limited partnership or limited liability company, as applicable, whether set forth in the partnership agreement or membership agreement, as applicable, of such partnership, limited partnership or limited liability company, as applicable, by separate agreement or otherwise.

 

“Patents” means collectively, all of the following owned by any Grantor: (a) all patents, all inventions and patent applications anywhere in the world, including, without limitation, those listed on Schedule 3.11, (b) all reissues, extensions, continuations (in whole or in part) and renewals of any of the foregoing, (c) all income, royalties, damages or payments now or hereafter due and/or payable under any of the foregoing or with respect to any of the foregoing, including, without limitation, damages or payments for past, present or future infringements of any of the foregoing, (d) the right to sue for past, present and future infringements of any of the foregoing and (e) all rights corresponding to any of the foregoing throughout the world.

 

“Patent License” means all agreements now or hereafter in existence providing for the grant by or to any Grantor of any right to manufacture, use or sell any invention covered in whole or in part by a Patent, including, without limitation, any of the foregoing referred to in Schedule 3.11.

 

“Restricted Securities Collateral” has the meaning assigned thereto in Section 5.3.

 

“Secured Obligations” means the “Secured Obligations” as defined in the Credit Agreement.

 

“Securities Act” means the Securities Act of 1933, including all amendments thereto and regulations promulgated thereunder.

 

“Security Interests” means the security interests granted pursuant to Article II, as well as all other security interests created or assigned as additional security for any of the Secured Obligations pursuant to the provisions of any Loan Document.

 

4

 

“Trademarks” means, collectively, all of the following of any Grantor: (a) all trademarks, trade names, corporate names, company names, business names, fictitious business names, internet domain names, trade styles, service marks, logos, other business identifiers, whether registered or unregistered, all registrations and recordings thereof, and all applications in connection therewith anywhere in the world, including, without limitation, those listed on Schedule 3.11, (b) all reissues, extensions, continuations (in whole or in part) and renewals of any of the foregoing, (c) all income, royalties, damages and payments now or hereafter due and/or payable under any of the foregoing or with respect to any of the foregoing, including, without limitation, damages or payments for past, present or future infringements of any of the foregoing, (d) the right to sue for past, present or future infringements of any of the foregoing and (e) all rights corresponding to any of the foregoing (including the goodwill) throughout the world.

 

“Trademark License” means any agreement now or hereafter in existence providing for the grant by or to any Grantor of any right to use any Trademark, including, without limitation, any of the foregoing referred to in Schedule 3.11.

 

“Vehicles” means all cars, trucks, trailers, construction and earth moving equipment and other vehicles covered by a certificate of title under the laws of any state, all tires and all other appurtenances to any of the foregoing.

 

SECTION 1.3  Other Definitional Provisions.  Terms defined in the Credit Agreement and not otherwise defined herein shall have the meaning assigned thereto in the Credit Agreement.  With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:  (a) the definitions of terms herein shall apply equally to the singular and plural forms of the terms defined, (b) whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms, (c) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (d) the word “will” shall be construed to have the same meaning and effect as the word “shall”, (e) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document, as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (f) any reference herein to any Person shall be construed to include such Person’s permitted successors and assigns, (g) 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, (h) 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, (i) 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, (j) the term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form, (k) in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including”, (l) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document and (m)

 

5

 

where the context requires, terms relating to the Collateral or any part thereof, when used in relation to a Grantor, shall refer to such Grantor’s Collateral or the relevant part thereof.

 

ARTICLE II

 

SECURITY INTEREST

 

SECTION 2.1  Grant of Security Interest.  Each Grantor hereby grants, pledges and collaterally assigns to the Administrative Agent, for the benefit of itself and the Secured Parties, a security interest in, all of such Grantor’s right, title and interest in the following property, now owned or at any time hereafter acquired by such Grantor or in which such Grantor now has or at any time in the future may acquire any right, title or interest, and wherever located or deemed located (collectively, after giving effect to the Excluded Assets, the “Collateral”), as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Secured Obligations:

 

(a)           all Accounts;

 

(b)           all cash and currency;

 

(c)           all Chattel Paper;

 

(d)           all Commercial Tort Claims identified on Schedule 3.9 (as updated from time to time);

 

(e)           all Deposit Accounts;

 

(f)            all Documents;

 

(g)           all Equipment;

 

(h)           all Fixtures;

 

(i)            all General Intangibles;

 

(j)            all Instruments;

 

(k)           all Intellectual Property;

 

(l)            all Inventory;

 

(m)          all Investment Property;

 

(n)           all Letter-of-Credit Rights;

 

(o)           all Vehicles;

 

(p)           all other Goods not otherwise described above;

 

6

 

(q)                                 all books and records pertaining to the Collateral; and

 

(r)                                    to the extent not otherwise included, all Proceeds and products of any and all of the foregoing, all Accessions to any of the foregoing and all collateral security and Supporting Obligations (as now or hereafter defined in the UCC) given by any Person with respect to any of the foregoing;

 

provided, that the Security Interests granted herein shall not attach to, and the term “Collateral” shall not include (all of the following, “Excluded Assets”):  (i) any Equity Interests issued by any Foreign Subsidiary in excess of sixty-five percent (65%) of all issued and outstanding shares of all classes of voting Equity Interests of such Foreign Subsidiary (or, such greater percentage as would not result in adverse federal income tax consequences for Holdings or any other Grantor), (ii) any obligation or property of any kind due from, owed by or belonging to any Sanctioned Person, (iii) any intent-to-use trademark application prior to the filing and acceptance by the United States Patent and Trademark Office of a “Statement of Use” or “Amendment to Allege Use” with respect thereto, to the extent, if any, that, and solely during the period, if any, in which, the grant of a security interest therein would impair the validity or enforceability of such intent-to-use trademark application or its resulting registration under applicable federal law, (iv) any Equity Interests to the extent that granting of a security interest thereon would be prohibited by Applicable Law, or (v)(A) any rights under any lease, instrument, contract or agreement of any Grantor, (B) any property subject to a purchase money security interest or similar arrangement or (C) any Equity Interests in any joint venture or non-Wholly-Owned Subsidiary, in each case under this clause (iv), to the extent that the granting of a security interest therein would (I) be prohibited by Applicable Law, (II) be prohibited or restricted under the express terms of such lease, instrument, contract or agreement, purchase money arrangement or joint venture or organizational documents governing such Equity Interests, or (III) result in a breach of the terms of, constitute a default under the express terms of or create a right of termination in favor of any party (other than Holdings or any Subsidiary) to any such lease, instrument, contract or agreement governing such right, any such purchase money arrangement, or any such joint venture or organizational documents governing such Equity Interests, unless (x) such prohibition, restriction, breach, default or right of termination is not enforceable or is otherwise rendered  ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction or any other Applicable Law (including any Debtor Relief Laws) or principles of equity) or (y) consent to such security interest has been obtained from any applicable third party; provided further, that the foregoing proviso shall not affect, limit, restrict or impair the grant by any Grantor of a Security Interest in, and the term “Collateral” shall include, any proceeds, products, substitutions or replacements of Excluded Assets (unless such proceeds, products, substitutions or replacements would otherwise constitute Excluded Assets); and provided further, that notwithstanding anything to the contrary contained in the foregoing two provisos, the Security Interests granted herein shall immediately and automatically attach to, and the term “Collateral” shall immediately and automatically include (and the term “Excluded Assets” shall no longer include) (1) any such intent-to-use trademark application upon the filing and acceptance by the United States Patent and Trademark Office of a “Statement of Use” or “Amendment to Allege Use” with respect thereto; (2) the rights under any such lease, instrument, contract or agreement, the property subject to any such purchase money arrangement, the Equity Interests in any such joint venture or non-Wholly-Owned Subsidiary at such time as the applicable prohibition, restriction, breach, default or right

 

7

 

of termination is no longer enforceable or effective or is waived or consent to such security interest has been obtained from any applicable third party; and (3) the Equity Interests in each such joint venture and non-Wholly-Owned Subsidiary at such time that all of the Equity Interests in such Person are owned by one or more Grantors.

 

Notwithstanding the foregoing, the payment and performance of the Obligations shall not be secured by any Hedge Agreement between any Grantor and any Secured Party.

 

SECTION 2.2  Provisions Relating to Equity Interests.

 

(a)                                 Each Issuer party to this Agreement agrees to be bound by the terms of this Agreement relating to the Equity Interests issued by it and will comply with such terms insofar as such terms are applicable to it and consents to such pledge of such Equity Interests.  In the case of each Grantor which is a partner in a partnership, such Grantor hereby consents to the extent required and the applicable partnership agreement (i) to the pledge by each other Grantor, pursuant to the terms hereof, of the pledged partnership interests in such partnership and (ii) upon the occurrence and during the continuance of an Event of Default, to the transfer of such pledged partnership interests to the Administrative Agent or its nominee and to the substitution of the Administrative Agent or its nominee as a substituted partner in such partnership with all the rights, powers and duties of a general partner or a limited partner, as the case may be.  In the case of each Grantor which is a member, manager or managing member of a limited liability company, such Grantor hereby consents to the extent required by the applicable limited liability company agreement (i) to the pledge by each other Grantor, pursuant to the terms hereof, of the pledged limited liability company interests in such limited liability company and (ii) upon the occurrence and during the continuance of an Event of Default, to the transfer of such pledged limited liability company interests to the Administrative Agent or its nominee and to the substitution of the Administrative Agent or its nominee as a substituted member, manager or managing member, as applicable, of the limited liability company with all the rights, powers and duties of a member, manager or managing member of the limited liability company in question.

 

(b)                                 No Grantor shall agree to any provision in, or amendment of, a limited liability company agreement or partnership agreement that adversely affects the perfection of the security interest of the Administrative Agent in any pledged partnership interests or pledged limited liability company interests pledged by such Grantor hereunder.

 

SECTION 2.3  Grantors Remain Liable.  Anything herein to the contrary notwithstanding: (a) each Grantor shall remain liable to perform all of its duties and obligations under the contracts and agreements included in the Collateral to the same extent as if this Agreement had not been executed, (b) the exercise by the Administrative Agent or any other Secured Party of any of the rights hereunder shall not release any Grantor from any of its duties or obligations under the contracts and agreements included in the Collateral, (c) neither the Administrative Agent nor any other Secured Party shall have any obligation or liability under the contracts and agreements included in the Collateral by reason of this Agreement, nor shall the Administrative Agent nor any other Secured Party be obligated to perform any of the obligations or duties of any Grantor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder, and (d) neither the Administrative Agent nor any other Secured Party shall have any liability in contract or tort for any Grantor’s acts or omissions.

 

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ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

 

To induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective Extensions of Credit to the Borrower thereunder, each Grantor hereby represents and warrants to the Administrative Agent and each Secured Party that:

 

SECTION 3.1  Organization; Power; Qualification.  Each Grantor (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation, (b) has the power and authority to own its Properties and to carry on its business as now being and hereafter proposed to be conducted and (c) is duly qualified and authorized to do business in each jurisdiction in which the character of its Properties or the nature of its business requires such qualification and authorization except in the case of preceding clauses (b) and (c) to the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

SECTION 3.2  Authorization of Agreement; Compliance with Laws; Non Contravention.  Each Grantor has the right, power and authority and has taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement in accordance with its terms.  This Agreement has been duly executed and delivered by the duly authorized officers of each Grantor, and this Agreement, upon execution, will constitute the legal, valid and binding obligation of each Grantor, enforceable against such Grantor in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar state or federal Debtor Relief Laws from time to time in effect which affect the enforcement of creditors’ rights in general and the availability of equitable remedies  The execution, delivery and performance by the Grantors of this Agreement does not and will not, by the passage of time, the giving of notice or otherwise, (a) require any Governmental Approval or violate any Applicable Law relating to any Grantor where the failure to obtain such Governmental Approval or such violation could reasonably be expected to have a Material Adverse Effect, (b) conflict with, result in a breach of or constitute a default under the articles of incorporation, bylaws or other organizational documents of any Grantor, (c) conflict with, result in a breach of or constitute a default under any Material Contract  to which any Grantor is a party or by which any of its properties may be bound or any Governmental Approval relating to such Person, which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or (d) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by any Grantor other than Permitted Liens.

 

SECTION 3.3  Governmental Approvals.  No approval, consent, exemption, authorization or other action by, notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against any Grantor or any Issuer of this Agreement, except (a) as may be required by laws affecting the offering and sale of securities generally, (b) filings with the United States Copyright Office and/or the United States Patent and Trademark Office, (c) filings under the UCC and/or the Assignment of Claims Act and (d) approvals, consents, exemptions,

 

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authorizations, filings or other acts or consents for which the failure to obtain or make could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

SECTION 3.4  Perfected First Priority Liens.  Each financing statement naming any Grantor as a debtor is in appropriate form for filing in the appropriate offices of the states specified on Schedule 3.6.  The acceptance for filing of such financing statements and the filing of any necessary registrations, recordations and notices with the United States Patent and Trademark Office or the United States Copyright Office, as applicable, is sufficient to perfect the Security Interests granted pursuant to this Agreement in that portion of the Collateral as comprises (a) Collateral under the UCC with respect to which a security interest may be perfected by filing of financing statements pursuant to the UCC and (b) Intellectual Property in which a security interest may be perfected by the filing of necessary registrations, recordations or notices thereof with the United States Patent and Trademark Office and the United States Copyright Office, as applicable.  Upon such perfection, and, as applicable, the timely filing thereafter by the Administrative Agent of UCC continuation statements in the appropriate UCC filing office, such perfected security interest shall be prior to all other Liens, except Permitted Liens.

 

SECTION 3.5  Title, No Other Liens.  Except for the Security Interests, each Grantor owns each item of the Collateral free and clear of any and all Liens or claims other than Permitted Liens.  No Grantor has authenticated any agreement authorizing any secured party thereunder to file a financing statement, except to perfect Permitted Liens.

 

SECTION 3.6  State of Organization; Locations of Inventory, Equipment and Fixtures; Other Information.

 

(a)                                 The exact legal name of each Grantor is set forth on Schedule 3.6 (as such schedule may be updated from time to time pursuant to Section 4.3).

 

(b)                                 Each Grantor is a Registered Organization organized under the laws of the state identified on Schedule 3.6 under such Grantor’s name (as such schedule may be updated from time to time pursuant to Section 4.3).  The taxpayer identification number and, to the extent applicable, Registered Organization number of each Grantor is set forth on Schedule 3.6 under such Grantor’s name (as such schedule may be updated from time to time pursuant to Section 4.3).

 

(c)                                  All Collateral consisting of Inventory, Equipment and Fixtures (whether now owned or hereafter acquired) is located at, or is in transit to, the locations specified on Schedule 3.6 (as such schedule may be updated from time to time pursuant to Section 4.3), other than Collateral that is disposed of in a transaction not prohibited by the Loan Documents.

 

(d)                                 The mailing address, chief place of business, chief executive office and office where each Grantor keeps its books and records relating to the Accounts, Documents, General Intangibles, Instruments (other than bills of lading, bills of sale, or similar instruments) and Investment Property in which it has any interest is located at the locations specified on Schedule 3.6 under such Grantor’s name (as such schedule may be updated from time to time pursuant to Section 4.3).   No Grantor has any other places of business (other than certain temporary

 

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locations) except those separately set forth on Schedule 3.6 under such Grantor’s name (as such schedule may be updated from time to time pursuant to Section 4.3).

 

SECTION 3.7  Accounts.  To the knowledge of the Grantors, no Account Debtor has any defense, set-off, claim or counterclaim against any Grantor that can be asserted against the Administrative Agent, whether in any proceeding to enforce the Administrative Agent’s rights in the Collateral or otherwise except defenses, setoffs, claims or counterclaims that are not, in the aggregate, material to the value of the Accounts, taken as a whole. None of the Accounts is, nor will any hereafter arising Account be, evidenced by a promissory note or other Instrument (other than a check) that has not been pledged to the Administrative Agent in accordance with the terms hereof.

 

SECTION 3.8  Chattel Paper; Instruments; Negotiable Documents Letter-of-Credit Rights.  Except as set forth on Schedule 3.8 (as such schedule may be updated from time to time pursuant to Section 4.4(c)(iv), Section 4.4(c)(v), Section 4.4(c)(vi) or Section 4.4(c)(vii)) no Grantor (a) holds or is the owner of any Chattel Paper having a value of in excess of $250,000, (b) holds any Instrument (other than bills of lading, bills of sale, or similar instruments)  having a face amount in excess of $250,000, (c) holds any negotiable Document (other than bills of lading, bills of sale, or similar instruments) evidencing title to goods having a value in excess of $250,000 or (d) has any Letter-of-Credit Rights with respect to any letter of credit having a face amount in excess of $250,000.

 

SECTION 3.9  Commercial Tort Claims.  All Commercial Tort Claims having a potential value in excess of $1,000,000 in which any Grantor is a plaintiff are listed on Schedule 3.9 (as such schedule may be updated from time to time pursuant to Section 4.4(c)(i)).

 

SECTION 3.10  Deposit Accounts and Securities Accounts.  All Deposit Accounts (including, without limitation, cash management accounts that are Deposit Accounts and all Excluded Deposit Accounts), Securities Accounts (including, without limitation, cash management accounts that are Securities Accounts and all Excluded Securities Accounts) and lockboxes are listed on Schedule 3.10 (as such schedule may be updated from time to time pursuant to Section 4.4(c)(ii) or Section 4.4(c)(iii)).

 

SECTION 3.11  Intellectual Property.

 

(a)                                 All United States Copyright registrations, Copyright applications, issued Patents, Patent applications, Trademark registrations and Trademark applications owned by any Grantor in its own name are listed on Schedule 3.11 or have been reported to the Administrative Agent pursuant Section 4.9(c).

 

(b)                                 Except as set forth in Schedule 3.11, none of the Intellectual Property owned by any Grantor is the subject of any licensing or franchise agreement pursuant to which such Grantor is the licensor or franchisor, except as could not reasonably be expected to have a Material Adverse Effect.

 

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SECTION 3.12  Reserved.

 

SECTION 3.13  Equity Interests.

 

(a)                                 All Equity Interests (other than Excluded Equity Interests and Equity Interests carried in Securities Accounts) held directly by any Grantor (rather than indirectly through a Securities Intermediary) are listed on Schedule 3.13 (as such schedule may be updated from time to time pursuant to Section 4.4(c)(viii)).

 

(b)                                 All Equity Interests issued by any Issuer to any Grantor and included in the Collateral (i) have been duly and validly issued and, if applicable, are fully paid and nonassessable, (ii) are beneficially owned as of record by such Grantor and (ii) constitute all the issued and outstanding shares or units of all classes of such Equity Interests of such Issuer issued to such Grantor.

 

(c)                                  None of the Partnership/LLC Interests (i) are dealt in or traded on a Securities exchange or in Securities markets, (ii) by their terms expressly provide that they are Securities governed by Article 8 of the UCC, (iii) are Investment Company Securities or (iv) are held in a Securities Account.

 

ARTICLE IV

 

COVENANTS

 

Until the Secured Obligations (other than contingent indemnity obligations and cost reimbursement obligations not yet due) shall have been paid in full and the Commitments terminated, unless consent has been obtained in the manner provided for in Section 7.2, each Grantor covenants and agrees that:

 

SECTION 4.1  Maintenance of Perfected Security Interest; Further Information.

 

(a)                                 Each Grantor shall take all action that the Administrative Agent may reasonably request in order for the Administrative Agent to maintain the Security Interest created by this Agreement as a first priority perfected (other than with respect to the Excluded Deposit Accounts and Letter-of-Credit Rights of which such Grantor is not required to provide the Administrative Agent Control pursuant to Section 4.6(b)) Security Interest (subject only to Permitted Liens) and shall defend such Security Interest against the claims and demands of all Persons whomsoever (other than the holders of Permitted Liens); provided, that, notwithstanding anything contained herein to the contrary, no Grantor shall be required to make notations on the certificates of title or take any similar actions with respect to any Vehicles.

 

(b)                                 Each Grantor will from time to time furnish to the Administrative Agent upon the Administrative Agent’s or any Lender’s reasonable request statements and schedules further identifying and describing the Collateral granted by such Grantor and such other reports in connection therewith as the Administrative Agent or such Lender may reasonably request, all in reasonable detail.

 

SECTION 4.2  Maintenance of Insurance.  Each Grantor shall maintain insurance covering the Collateral in accordance with the provisions of Section 8.6 of the Credit Agreement.

 

SECTION 4.3  Changes in Locations; Changes in Name or Structure.  No Grantor will, except upon 15 days’ prior written notice to the Administrative Agent (which time period may be

 

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reduced by the Administrative Agent in its reasonable discretion by written notice to such Grantor) and delivery to the Administrative Agent of (a) all additional UCC financing statements or UCC financing statement amendments and other instruments and documents reasonably requested by the Administrative Agent to maintain the validity, perfection and priority of the Security Interests and (b) if applicable, a written supplement to Schedule 3.6 to this Agreement, change after the date hereof:

 

(i)                                     its jurisdiction of organization;

 

(ii)                                  its name, identity or corporate or organizational structure;

 

(iii)                               the location of its chief executive office or the location where any Grantor maintains its books and records relating to Accounts, Documents, General Intangibles, Instruments (other than bills of lading, bills of sale, or similar instruments) and Investment Property in which it has any interest from that identified on Schedule 3.6; or

 

(iv)                              the location of any Collateral consisting of Inventory, Equipment or Fixtures (whether now owned or hereafter acquired), other than Collateral that is in transit to a location on Schedule 3.6 or Collateral that is disposed of in a transaction not prohibited by the Loan Documents.

 

SECTION 4.4  Required Notifications.  Each Grantor shall promptly notify the Administrative Agent, in writing, of (and in the case of clauses (c) and (d), such Grantor shall deliver to the Administrative Agent an updated or new Schedule 3.8, Schedule 3.10, Schedule 3.13 or Schedule 3.14, as applicable): (a) any Lien (other than the Security Interests or Permitted Liens) on any of the Collateral which would adversely affect the ability of the Administrative Agent to exercise any of its remedies hereunder, (b) the occurrence of any other event which could reasonably be expected to have a Material Adverse Effect on the aggregate value of the Collateral or on the Security Interests and (c) the acquisition, possession, establishment or ownership by such Grantor after the date hereof of any (i) Commercial Tort Claim in which any Grantor is a plaintiff having a potential value in excess of $1,000,000, (ii) any Deposit Account, (iii) any Securities Account, (iv) any Electronic Chattel Paper or Chattel Paper having a value in excess of $250,000, (v) any Instrument (other than bills of lading, bills of sale, or similar instruments) having a face amount in excess of $250,000, (vi) any negotiable Document (other than bills of lading, bills of sale, or similar instruments) evidencing title to goods having a value in excess of $250,000, (vii) any Letter-of-Credit Rights with respect to any letter of credit having a face amount in excess of $250,000 or (viii) any Certificated Securities, Uncertificated Securities or Partnership/LLC Interests evidenced by a certificate (other than Excluded Equity Interests).

 

SECTION 4.5  Delivery Covenants.  Each Grantor will deliver (to the extent certificated) and pledge to the Administrative Agent, for the benefit of the Secured Parties, all Certificated Securities, Partnership/LLC Interests evidenced by a certificate, negotiable Documents (other than bills of lading, bills of sale, or similar instruments), Instruments  (other than bills of lading, bills of sale, or similar instruments) (in excess of $250,000), and Tangible Chattel Paper (in excess of $250,000), in each case, other than the Excluded Assets or as otherwise acquired, possessed or owned by such Grantor and for which such Grantor is required to notify the

 

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Administrative Agent of such Grantor’s acquisition, possession or ownership thereof pursuant to Section 4.4(c), in each case, together with an Effective Endorsement and Assignment and all Supporting Obligations, as applicable, in each case unless such delivery and pledge has been waived in writing by the Administrative Agent.

 

SECTION 4.6  Control Covenants.

 

(a)                                 Each Grantor shall instruct (and otherwise use commercially reasonable efforts to cause) (i) each depositary bank holding a Deposit Account (other than Excluded Deposit Accounts) owned by such Grantor and (ii) each Securities Intermediary holding any Securities Account (other than Excluded Securities Accounts) owned by such Grantor, to execute and deliver a Control Agreement, sufficient to provide the Administrative Agent with Control of such Deposit Account or Securities Account and otherwise in form and substance reasonably satisfactory to the Administrative Agent (any such depositary bank executing and delivering any such Control Agreement, a “Controlled Depositary”, and any such Securities Intermediary executing and delivering any such Control Agreement, a “Controlled Intermediary”).  In the event any such depositary bank or Securities Intermediary refuses to execute and deliver such Control Agreement, the Administrative Agent, in its sole discretion, may require that either (a) the applicable Deposit Account or Securities Account to be transferred to the Administrative Agent or a Controlled Depositary or Controlled Intermediary, as applicable, or (b) the balance from such Deposit Account be swept into a Deposit Account subject to a Control Agreement.  After the date hereof, all Deposit Accounts (other than Excluded Deposit Accounts) and all Securities Accounts (other than Excluded Securities Accounts) will be maintained with the Administrative Agent or with a Controlled Depository or a Controlled Intermediary, as applicable.

 

(b)                                 Upon the request of the Administrative Agent, each Grantor will take such actions and deliver all such agreements as are reasonably requested by the Administrative Agent to provide the Administrative Agent with Control of (i) the Letter-of-Credit Rights identified on Schedule 3.8 (as updated from time to time in accordance with Section 4.4(c)(vii)), (ii) each Electronic Chattel Paper identified on Schedule 3.8 (as updated from time to time in accordance with Section 4.4(c)(iv)), and (iii) each Uncertificated Security acquired, possessed or owned by such Grantor for which Grantor is required to notify the Administrative Agent of such Grantor’s acquisition, possession or ownership thereof pursuant to Section 4.4(c), including, without limitation, with respect to any such Electronic Chattel Paper, by having the Administrative Agent identified as the assignee of the Record(s) pertaining to the single authoritative copy thereof.

 

SECTION 4.7  Filing Covenants.  Pursuant to Section 9-509 of the UCC and any other Applicable Law, each Grantor authorizes the Administrative Agent to file or record financing statements and other filing or recording documents or instruments with respect to the Collateral in such form and in such offices as the Administrative Agent reasonably determines appropriate to perfect the Security Interests of the Administrative Agent under this Agreement.  Such financing statements may describe the Collateral in the same manner as described herein or may contain an indication or description of Collateral that describes such property in any other manner as the Administrative Agent may determine, in its reasonable discretion, is necessary, advisable or prudent to ensure the perfection of the Security Interest in the Collateral granted

 

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herein, including, without limitation, describing such property as “all assets” or “all personal property.”  .

 

SECTION 4.8  Accounts.

 

(a)                                 Other than in the ordinary course of business consistent with its past practice or as otherwise determined to be commercially reasonable, no Grantor will (i) grant any extension of the time of payment of any Account, (ii) compromise or settle any Account for less than the full amount thereof, (iii) release, wholly or partially, any Account Debtor, or (iv) amend, supplement or modify any Account in any manner that could reasonably be likely to adversely affect the value thereof, except where such extension, compromise, settlement, release, credit, discount, amendment, supplement or modification could not reasonably be expected to have a Material Adverse Effect, either individually or in the aggregate.

 

(b)                                 Reserved.

 

SECTION 4.9  Intellectual Property.

 

(a)                                 Except as consistent with reasonable and customary business practices and as otherwise could not reasonably be expected to have a Material Adverse Effect, each Grantor (either itself or through licensees) (i) will use each registered Trademark (owned by such Grantor) and Trademark for which an application (owned by such Grantor) is pending, to the extent reasonably necessary to maintain such Trademark in full force free from any claim of abandonment for non-use with respect to those goods or services actually offered under the Trademark, (ii) will generally maintain products and services offered under such Trademark at a level substantially consistent with the quality of the products and services of such Grantor as of the date hereof, (iii) will not (and will not permit any licensee or sublicensee thereof to) knowingly do any act or omit to do any act whereby such Trademark could reasonably be expected to become invalidated or impaired in any material way, (iv) will not knowingly do any act or omit to do any act whereby any issued Patent (owned by such Grantor) would reasonably be expected to become forfeited, abandoned or dedicated to the public, (v) will not (and will not permit any licensee or sublicensee thereof to) knowingly do any act or omit to do any act whereby any registered Copyright (owned by such Grantor) or Copyright for which an application is pending (owned by such Grantor) could reasonably be expected to become invalidated or otherwise impaired in any material way, and (vi) will not knowingly do any act whereby any material portion of such Copyright may fall into the public domain.

 

(b)                                 Except as consistent with reasonable and customary business practices and as otherwise could not reasonably be expected to have a Material Adverse Effect, each Grantor will notify the Administrative Agent and the Lenders promptly if it knows, or has reason to know, that any application or registration relating to any Intellectual Property owned by such Grantor may become forfeited, abandoned or dedicated to the public, or of any adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, the United States Copyright Office or any court or tribunal in any country, but excluding any examination of an application to register any Patent or Trademark by the United States Patent and Trademark Office or Copyright by the United States Copyright Office) regarding such Grantor’s ownership

 

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of, or the validity of, any Intellectual Property owned by such Grantor or such Grantor’s right to register the same or to own and maintain the same.

 

(c)                                  Whenever such Grantor, either by itself or through any agent, employee, licensee or designee, shall file an application for the registration of any Intellectual Property with the United States Patent and Trademark Office, the United States Copyright Office or any similar office or agency in any other country or any political subdivision thereof, such Grantor shall report such filing to the Administrative Agent within fifteen Business Days (which time period may be extended by the Administrative Agent in its sole discretion by written notice to such Grantor) after the last day of the fiscal quarter in which such filing occurs.  Upon request of the Administrative Agent, such Grantor shall execute and deliver, and have recorded, any and all agreements, instruments, documents, and papers as the Administrative Agent may reasonably request to evidence the security interest of the Administrative Agent, for the benefit of the Secured Parties, in any material Copyright, Patent or Trademark and the goodwill and General Intangibles of such Grantor relating thereto or represented thereby.

 

(d)                                 Except as consistent with reasonable and customary business practices and as otherwise could not reasonably be expected to have a Material Adverse Effect, each Grantor will take such actions as such Grantor shall reasonably deem appropriate under the circumstances, at such Grantor’s sole cost and expense and in such Grantor’s sole discretion, including, without limitation, in any proceeding before the United States Patent and Trademark Office, the United States Copyright Office or any similar office or agency in any other country or any political subdivision thereof, to maintain and pursue each application (and to obtain the relevant registration where reasonably possible) and to maintain each registration of the Intellectual Property, including, without limitation, filing of applications for renewal, affidavits of use and affidavits of incontestability, as applicable and permissible.

 

(e)                                  In the event that any material Intellectual Property owned by a Grantor is infringed, misappropriated or otherwise violated by a third party, the applicable Grantor shall (i) at such Grantor’s sole cost and expense, take such actions as such Grantor shall reasonably deem appropriate under the circumstances to protect such Intellectual Property and (ii) if such Intellectual Property is of material economic value, promptly notify the Administrative Agent after it learns of such infringement, misappropriation or violation.

 

SECTION 4.10  Equity Interests.

 

(a)                                 Without the prior written consent of the Administrative Agent, no Grantor will (i) vote to enable, or take any other action to permit, any applicable issuer to issue any Equity Interests, except for those additional Equity Interests that will be subject to the Security Interest granted herein in favor of the Administrative Agent, for the benefit of the Secured Parties, or (ii) enter into any agreement or undertaking restricting the right or ability of such Grantor or the Administrative Agent to sell, assign or transfer any Equity Interests or Proceeds thereof, in each case of (i) and (ii), other than Excluded Equity Interests,  The Grantors will defend the right, title and interest of the Administrative Agent in and to any Equity Interests against the claims and demands of all Persons whomsoever.

 

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(b)                                 If any Grantor shall become entitled to receive or shall receive any Certificated Securities (including, without limitation, any certificate representing a stock dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights in respect of any Equity Interests included in the Collateral, whether in addition to, in substitution of, as a conversion of, or in exchange for, any Investment Property, or otherwise in respect thereof, such Grantor shall accept the same as the agent of the Secured Parties, hold the same in trust for the Secured Parties, segregated from other funds of such Grantor, and promptly deliver the same to the Administrative Agent, on behalf of the Secured Parties, in accordance with the terms hereof.

 

SECTION 4.11  Reserved.

 

SECTION 4.12   Further Assurances.  Upon the request of the Administrative Agent and at the sole expense of the Grantors, each Grantor will promptly and duly execute and deliver (or cause to be executed and delivered), and have recorded, such further instruments and documents and take such further actions as the Administrative Agent may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, all applications, certificates, instruments, registration statements, and all other documents and papers the Administrative Agent may reasonably request and as may be required by law in connection with the obtaining of any consent, approval, registration, qualification, or authorization of any Person deemed necessary or appropriate for the effective exercise of any rights under this Agreement.

 

SECTION 4.13  Burdensome Requirements.  Notwithstanding anything to the contrary in this Article IV, if the Administrative Agent and the Borrower reasonably agree that the cost associated with any of the actions in Section 4.5 or Section 4.6 is excessive or disproportionate to the benefit to the Secured Parties of the security to be afforded thereby, then the Administrative Agent may waive or indefinitely defer the Grantors’ obligations to perform any or all of such actions.  Notwithstanding anything else contained in this Agreement to the contrary, the Administrative Agent’s security interest in the Collateral consisting of (x) Inventory in transit, which may or may not be subject to a bill of lading, and (y) bills of lading, bills of sale, or similar instruments, shall not be perfected by any actions other than filing appropriate UCC financing statements in the appropriate filing offices.

 

ARTICLE V
 REMEDIAL PROVISIONS

 

SECTION 5.1  General Remedies.  If an Event of Default shall occur and be continuing, the Administrative Agent, on behalf of the Secured Parties, may exercise, in addition to all other rights and remedies granted to them in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Secured Obligations, all rights and remedies of a secured party under the UCC or any other Applicable Law.  Without limiting the generality of the foregoing, the Administrative Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred to below) to or upon any Grantor or any other Person (all and each of which demands,

 

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defenses, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of the Administrative Agent or any Secured Party or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk.  The Administrative Agent may disclaim all warranties in connection with any sale or other disposition of the Collateral, including, without limitation, all warranties of title, possession, quiet enjoyment and the like.  The Administrative Agent or any other Secured Party shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold; provided that the Administrative Agent shall conduct any such private sale in a commercially reasonable manner.  Each Grantor further agrees, at the Administrative Agent’s request, to assemble the Collateral and make it available to the Administrative Agent at places which the Administrative Agent shall reasonably select, whether at such Grantor’s premises or elsewhere.  To the extent permitted by Applicable Law, each Grantor waives all claims, damages and demands it may acquire against the Administrative Agent or any Secured Party arising out of the exercise by them of any rights hereunder except to the extent any such claims, damages, or demands are determined by a court of competent jurisdiction by final nonappealable judgment to have resulted solely from the gross negligence, bad faith or willful misconduct of the Administrative Agent or any other Secured Party, in each case against whom such claim is asserted.  If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least 10 days before such sale or other disposition.

 

SECTION 5.2  Specific Remedies.

 

(a)                                 The Grantor shall continue to collect Grantor’s Accounts; provided that, the Administrative Agent may curtail or terminate such authority at any time after the occurrence and during the continuance of an Event of Default.

 

(b)                                 Upon the occurrence and during the continuance of an Event of Default:

 

(i)                                     the Administrative Agent may communicate with Account Debtors of any Account subject to a Security Interest and upon the request of the Administrative Agent, each Grantor shall notify (such notice to be in form and substance satisfactory to the Administrative Agent) its Account Debtors and parties to the Material Contracts subject to a Security Interest that such Accounts and the Material Contracts have been assigned to the Administrative Agent, for the benefit of the Secured Parties;

 

(ii)                                  upon the reasonable request of the Administrative Agent, each Grantor shall forward to the Administrative Agent, on the last Business Day of each week, a statement showing the application of all payments on the Collateral during such week and a collection report with regard thereto, in form and substance reasonably satisfactory to the Administrative Agent;

 

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(iii)                               whenever any Grantor shall receive any cash, money, checks or any other similar items of payment relating to any Collateral (including any Proceeds of any Collateral), subject to the terms of any Permitted Liens, such Grantor agrees that it will, within three (3) Business Days of such receipt, deposit all such items of payment into a cash collateral account at the Administrative Agent (the “Collateral Account”) or in a Deposit Account (other than an Excluded Deposit Account) at a Controlled Depositary, and until such Grantor shall deposit such cash, money, checks or any other similar items of payment in the Collateral Account or in a Deposit Account (other than an Excluded Deposit Account) at a Controlled Depositary, such Grantor shall hold such cash, money, checks or any other similar items of payment in trust for the Administrative Agent and the Secured Parties and as property of the Secured Parties, separate from the other funds of such Grantor, and the Administrative Agent shall have the right in to transfer or direct the transfer of the balance of each Deposit Account (other than an Excluded Deposit Account) to the Collateral Account.  All such Collateral and Proceeds of Collateral received by the Administrative Agent hereunder shall be held by the Administrative Agent in the Collateral Account as collateral security for all the Secured Obligations and shall not constitute payment thereof until applied as provided in Section 5.4;

 

(iv)                              the Administrative Agent shall have the right to receive any and all cash dividends, payments or distributions made in respect of any Investment Property or Partnership/LLC Interests included in the Collateral or other Proceeds paid in respect of any Investment Property or Partnership/LLC Interests included in the Collateral, and any or all of such Investment Property or Partnership/LLC Interests may, at the option of the Administrative Agent and the Secured Parties, be registered in the name of the Administrative Agent or its nominee, and the Administrative Agent or its nominee may thereafter exercise (A) all voting, corporate and other rights pertaining to such Investment Property or Partnership/LLC Interests at any meeting of shareholders, partners or members or otherwise and (B) any and all rights of conversion, exchange and subscription and any other rights, privileges or options pertaining to such Investment Property or Partnership/LLC Interests as if it were the absolute owner thereof (including, without limitation, the right to exchange at its discretion any and all of such Investment Property or Partnership/LLC Interests upon the merger, consolidation, reorganization, recapitalization or other fundamental change in the corporate, partnership or limited liability company structure of any issuer thereof upon the exercise by any Grantor or the Administrative Agent of any right, privilege or option pertaining to such Investment Property or Partnership/LLC Interests, and in connection therewith, the right to deposit and deliver any and all of such Investment Property or Partnership/LLC Interests with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Administrative Agent may determine), all without liability except to account for property actually received by it; but the Administrative Agent shall have no duty to any Grantor to exercise any such right, privilege or option and the Administrative Agent and the other Secured Parties shall not be responsible for any failure to do so or delay in so doing.  In order to permit the Administrative Agent to exercise the voting and other consensual rights which it may be entitled to exercise pursuant to this Agreement with respect to all Investment Property and Partnership/LLC Interests included in the Collateral and to receive all dividends and other distributions which it may be entitled to receive under this Agreement with respect to such Investment

 

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Property and Partnership/LLC Interests, (i) each Grantor shall promptly execute and deliver (or cause to be executed and delivered) to the Administrative Agent all such proxies, dividend payment orders and other instruments as the Administrative Agent may from time to time reasonably request and (ii) without limiting the effect of clause (i) above, such Grantor hereby grants to the Administrative Agent an irrevocable proxy to vote upon the occurrence and the continuance of an Event of Default all or any part of such Investment Property or Partnership/LLC Interests held by such Grantor and to exercise all other rights, powers, privileges and remedies to which a holder of such Investment Property or Partnership/LLC Interests would be entitled (including giving or withholding written consents of shareholders, partners or members, as the case may be, calling special meetings of shareholders, partners or members, as the case may be, and voting at such meetings), which proxy shall be effective automatically and without the necessity of any action (including any transfer of such Investment Property or Partnership/LLC Interests on the record books of the issuer thereof) by any other Person (including the issuer of such Equity Interests or any officer or agent thereof) during each period of time that an Event of Default has occurred and is continuing.  Each Grantor acknowledges and agrees that the irrevocable proxy granted to the Administrative Agent by such Grantor pursuant to the preceding sentence with respect to the Investment Property or Partnership/LLC Interests held by such Grantor is coupled with an interest and shall be exercisable by the Administrative Agent during each period of time that an Event of Default has occurred and is continuing, regardless of the length of any such period of time. In furtherance thereof, each Grantor hereby authorizes and instructs each Issuer with respect to any Collateral consisting of Equity Interests to (i) comply with any instruction received by it from the Administrative Agent in writing that (A) states that an Event of Default has occurred and is continuing and (B) is otherwise in accordance with the terms of this Agreement, without any other or further instructions from such Grantor, and each Grantor agrees that each Issuer shall be fully protected in so complying following receipt of such notice and prior to notice that such Event of Default is no longer continuing, and (ii) except as otherwise expressly permitted hereby, pay any dividends, distributions or other payments with respect to any Equity Interests directly to the Administrative Agent; and

 

(v)                                 the Administrative Agent shall be entitled to (but shall not be required to):  (A) proceed to perform any and all obligations of the applicable Grantor under any Material Contract and exercise all rights of such Grantor thereunder as fully as such Grantor itself could, (B) do all other acts which the Administrative Agent may deem necessary or proper to protect its Security Interest granted hereunder, provided such acts are not inconsistent with or in violation of the terms of any of the Credit Agreement, of the other Loan Documents or Applicable Law, and (C) sell, assign or otherwise transfer any Material Contract in accordance with the Credit Agreement, the other Loan Documents and Applicable Law, subject, however, to the prior approval of each other party to such Material Contract, to the extent required under the Material Contract.

 

(c)                                  Unless an Event of Default shall have occurred and be continuing and the Administrative Agent shall have given notice to the relevant Grantor of the Administrative Agent’s intent to exercise its corresponding rights pursuant to Section 5.2(b), each Grantor shall continue to receive all cash dividends, payments or other distributions made in respect of any

 

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Investment Property or Partnership/LLC Interests included in the Collateral, in each case paid in the normal course of business of the relevant issuer, to the extent permitted in the Credit Agreement, and to exercise all voting and other corporate, company and partnership rights with respect to such Investment Property and Partnership/LLC Interests.

 

SECTION 5.3  Registration Rights.

 

(a)                                 If the Administrative Agent shall determine that in order to exercise its right to sell any or all of the Collateral it is necessary or advisable to have such Collateral registered under the provisions of the Securities Act (any such Collateral, the “Restricted Securities Collateral”), the relevant Grantor will cause each applicable Issuer (and the officers and directors thereof) to (i) execute and deliver all such instruments and documents, and do or cause to be done all such other acts as may be, in the opinion of the Administrative Agent, necessary or advisable to register such Restricted Securities Collateral, or that portion thereof to be sold, under the provisions of the Securities Act, (ii) use its commercially reasonable efforts to cause the registration statement relating thereto to become effective and to remain effective for a period of one year from the date of the first public offering of such Restricted Securities Collateral, or that portion thereof to be reasonably sold, and (iii) make all amendments thereto and/or to the related prospectus which, in the opinion of the Administrative Agent, are necessary, all in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto.  Each Grantor agrees to cause each applicable Issuer (and the officers and directors thereof) to comply with the provisions of the securities or “Blue Sky” laws of any and all jurisdictions which the Administrative Agent shall designate and to make available to its security holders, as soon as practicable, an earnings statement (which need not be audited) which will satisfy the provisions of the Securities Act.

 

(b)                                 Each Grantor recognizes that the Administrative Agent may be unable to effect a public sale of any or all the Restricted Securities Collateral, by reason of certain prohibitions contained in the Securities Act and applicable state securities laws or otherwise, and may be compelled to resort to one or more private sales thereof to a restricted group of purchasers which will be obliged to agree, among other things, to acquire such securities for their own account for investment and not with a view to the distribution or resale thereof.  Each Grantor acknowledges and agrees that any such private sale may result in prices and other terms less favorable than if such sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall not, solely as a result of the restricted nature of such sale, be deemed to have been made in a non-commercially reasonable manner.  The Administrative Agent shall be under no obligation to delay a sale of any of the Restricted Securities Collateral for the period of time necessary to permit the Issuer thereof to register such securities for public sale under the Securities Act, or under applicable state securities laws, even if such Issuer would agree to do so; provided that any private sale shall be conducted by the Administrative Agent in a commercially reasonable manner.

 

(c)                                  Each Grantor agrees to use its commercially reasonable efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales of all or any portion of the Restricted Securities Collateral valid and binding and in compliance with any and all other Applicable Laws.  Each Grantor further agrees that a breach of any of the covenants contained in this Section 5.3 will cause irreparable injury to the Administrative Agent and the other Secured

 

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Parties, that the Administrative Agent and the other Secured Parties have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 5.3 shall be specifically enforceable against such Grantor, and such Grantor hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that no Event of Default has occurred under the Credit Agreement.

 

SECTION 5.4  Application of Proceeds.  If an Event of Default shall have occurred, at any time at the Administrative Agent’s election, the Administrative Agent may apply all or any part of the Collateral or any Proceeds of the Collateral in payment in whole or in part of the Secured Obligations (after deducting all reasonable and documented costs and expenses of every kind incurred in connection therewith or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights of the Administrative Agent and the other Secured Parties hereunder, including, without limitation, reasonable attorneys’ fees and disbursements) in accordance with Section 10.4 of the Credit Agreement. Only after (i) the payment by the Administrative Agent of any other amount required by any provision of Applicable Law, including, without limitation, Section 9-610 and Section 9-615 of the UCC and (ii) the payment in full of the Secured Obligations (other than contingent indemnification obligations and cost reimbursement obligations not then due)  and the termination of the Commitments, shall the Administrative Agent account for the surplus, if any, to any Grantor, or to whomever may be lawfully entitled to receive the same (if such Person is not a Grantor).

 

SECTION 5.5  Waiver, Deficiency.  Each Grantor hereby waives, to the extent permitted by Applicable Law, all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any Applicable Law in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral or any portion thereof.  Each Grantor shall remain liable for any deficiency if the proceeds of any sale or other disposition of the Collateral are insufficient to pay its Secured Obligations and the fees and disbursements of any attorneys employed by the Administrative Agent or any other Secured Party to collect such deficiency.

 

ARTICLE VI

 

THE ADMINISTRATIVE AGENT

 

SECTION 6.1  Appointment of Administrative Agent as Attorney-In-Fact.

 

(a)                                 Each Grantor hereby irrevocably constitutes and appoints each of the Administrative Agent and any officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of such Grantor and in the name of such Grantor or in its own name, for the purpose of carrying out the terms of this Agreement, effective upon the occurrence and continuance of an Event of Default, to take any and all appropriate action and to execute any and all documents and instruments which may be necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the generality of the foregoing, each Grantor hereby gives each of the Administrative Agent the power and right, on behalf of such Grantor, without notice to or assent

 

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by such Grantor, to do any or all of the following upon the occurrence and during the continuation of an Event of Default:

 

(i)                                     in the name of such Grantor or its own name, or otherwise, take possession of and indorse and collect any checks, drafts, notes, acceptances or other instruments for the payment of moneys due under any Account or Material Contract subject to a Security Interest or with respect to any other Collateral and file any claim or take any other action or proceeding in any court of law or equity or otherwise deemed appropriate by the Administrative Agent for the purpose of collecting any and all such moneys due under any Account or Material Contract subject to a Security Interest or with respect to any other Collateral whenever payable;

 

(ii)                                  in the case of any Intellectual Property, execute and deliver, and have recorded, any and all agreements, instruments, documents and papers as the Administrative Agent may request to evidence the Administrative Agent’s and the Secured Parties’ security interest in such Intellectual Property and the goodwill and General Intangibles of such Grantor relating thereto or represented thereby;

 

(iii)                               pay or discharge taxes and Liens levied or placed on or threatened against the Collateral, effect any repairs or any insurance called for by the terms of this Agreement and pay all or any part of the premiums therefor and the costs thereof;

 

(iv)                              execute, in connection with any sale provided for in this Agreement, any endorsements, assignments or other instruments of conveyance or transfer with respect to the Collateral; and

 

(v)                                 (A) direct any party liable for any payment under any of the Collateral to make payment of any and all moneys due or to become due thereunder directly to the Administrative Agent or as the Administrative Agent shall direct; (B) ask or demand for, collect, and receive payment of and receipt for, any and all moneys, claims and other amounts due or to become due at any time in respect of or arising out of any Collateral; (C) sign and indorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications, notices and other documents in connection with any of the Collateral; (D) commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Collateral or any portion thereof and to enforce any other right in respect of any Collateral; (E) defend any suit, action or proceeding brought against such Grantor with respect to any Collateral; (F) settle, compromise or adjust any such suit, action or proceeding and, in connection therewith, give such discharges or releases as the Administrative Agent may deem appropriate; (G) license or assign any Copyright, Patent or Trademark (along with the goodwill of the business to which any such Trademark pertains), for such term or terms, on such conditions, and in such manner, as the Administrative Agent shall in its sole discretion determine; and (H) generally, sell, transfer, pledge and make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though the Administrative Agent was the absolute owner thereof for all purposes, and do, at the Administrative Agent’s option and such Grantor’s expense, at any time, or from time to time, all acts and things which the

 

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Administrative Agent deems necessary to protect, preserve or realize upon the Collateral and the Administrative Agent’s and the Security Interests of the Secured Parties therein and to effect the intent of this Agreement, all as fully and effectively as such Grantor might do.

 

(b)                                 If any Grantor fails to perform or comply with any of its agreements contained herein, the Administrative Agent, at its option, but without any obligation so to do, may perform or comply, or otherwise cause performance or compliance, with such agreement in accordance with the provisions of Section 6.1(a).

 

(c)                                  The expenses of the Administrative Agent incurred in connection with actions taken pursuant to the terms of this Agreement shall be payable by such Grantor to the Administrative Agent on demand.

 

(d)                                 Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof in accordance with Section 6.1(a).  All powers, authorizations and agencies contained in this Agreement are coupled with an interest and are irrevocable until this Agreement is terminated and the Security Interests created hereby are released.

 

SECTION 6.2  Duty of Administrative Agent.  The sole duty of Administrative Agent with respect to the custody, safekeeping and physical preservation of the Collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Administrative Agent deals with similar property for its own account.  Neither the Administrative Agent, any other Secured Party nor any of their respective officers, directors, employees or agents shall be liable for failure to demand, collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of any Grantor or any other Person or to take any other action whatsoever with regard to the Collateral or any part thereof.  The powers conferred on the Administrative Agent and the other Secured Parties hereunder are solely to protect the interests of the Administrative Agent and the other Secured Parties in the Collateral and shall not impose any duty upon the Administrative Agent or any other Secured Party to exercise any such powers.  The Administrative Agent and the other Secured Parties shall be accountable only for amounts that they actually receive as a result of the exercise of such powers, and neither they nor any of their officers, directors, employees or agents shall be responsible to any Grantor for any act or failure to act hereunder, except for their own gross negligence, bad faith or willful misconduct, as determined by a court of competent jurisdiction by final nonappealable judgment.

 

SECTION 6.3  Authority of Administrative Agent.  Each Grantor acknowledges that the rights and responsibilities of the Administrative Agent under this Agreement with respect to any action taken by the Administrative Agent or the exercise or non-exercise by the Administrative Agent of any option, voting right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Agreement shall, as between the Administrative Agent and the Lenders, be governed by the Credit Agreement and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Administrative Agent and the Grantors, the Administrative Agent shall be conclusively presumed to be acting as agent for the Secured Parties with full and valid authority so to act or refrain from acting, and no

 

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Grantor shall be under any obligation, or entitlement to make any inquiry respecting such authority.

 

ARTICLE VII

 

MISCELLANEOUS

 

SECTION 7.1  Notices.  All notices and communications hereunder shall be given to the addresses and otherwise made in accordance with Section 12.1 of the Credit Agreement; provided that notices and communications to the Grantors shall be directed to the Grantors, at the address of the Borrower set forth in Section 12.1 of the Credit Agreement.

 

SECTION 7.2  Amendments, Waivers and Consents.  None of the terms or provisions of this Agreement may be amended, supplemented or otherwise modified, nor may they be waived, nor may any consent be given, except in accordance with Section 12.2 of the Credit Agreement.

 

SECTION 7.3  Expenses, Indemnification, Waiver of Consequential Damages, etc.

 

(a)                                 The Grantors, jointly and severally, shall pay all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent and each other Secured Party to the extent the Borrower would be required to do so pursuant to Section 12.3 of the Credit Agreement.

 

(b)                                 The Grantors, jointly and severally, shall pay and shall indemnify each Indemnitee (which for purposes of this Agreement shall include, without limitation, all Secured Parties) against Indemnified Taxes and Other Taxes to the extent the Borrower would be required to do so pursuant to Section 5.11 of the Credit Agreement.

 

(c)                                  The Grantors, jointly and severally, shall indemnify each Indemnitee to the extent the Borrower would be required to do so pursuant to Section 12.3 of the Credit Agreement.

 

(d)                                 Notwithstanding anything to the contrary contained in this Agreement, to the fullest extent permitted by Applicable Law, no Grantor or Indemnitee shall assert, and hereby each Grantor and Indemnitee hereby waives, any claim against any Grantor or Indemnitee, 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, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof; provided that nothing in this clause (d) shall limit the Credit Parties’ indemnification and reimbursement obligations to the extent set forth in this Agreement and the other Loan Documents.

 

(e)                                  No Grantor or Indemnitee referred to in this Section 7.3 shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement, or the other Loan Documents or the transactions contemplated hereby or thereby; provided that nothing in this clause (e) shall limit the Credit

 

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Parties’ indemnification and reimbursement obligations to the extent set forth in this Agreement and the other Loan Documents.

 

(f)                                   All amounts due under this Section 7.3 shall be payable promptly after demand therefor, which demand shall be accompanied by a summary statement thereof.

 

SECTION 7.4  Right of Set Off.  If an Event of Default shall have occurred and be continuing, each Secured Party and each of its respective Affiliates is hereby authorized at any time and from time to time, after obtaining the prior written consent of the Administrative Agent, to the fullest extent permitted by Applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Secured Party or any such Affiliate to or for the credit or the account of such Grantor against any and all of the obligations of such Grantor now or hereafter existing under this Agreement or any other Loan Document, any Secured Hedge Agreement or any Secured Cash Management Agreement to such Secured Party irrespective of whether or not such Secured Party shall have made any demand under this Agreement or any other Loan Document, any Secured Hedge Agreement or any Secured Cash Management Agreement and although such obligations of such Grantor may be contingent or unmatured or are owed to a branch or office of such Secured Party different from the branch or office holding such deposit or obligated on such indebtedness.  The rights of each Secured Party and its respective Affiliates under this Section are in addition to other rights and remedies (including other rights of set off) that such Secured Party or its respective Affiliates may have.  Each Secured Party agrees to notify such Grantor and the Administrative Agent promptly after any such set off and application; provided that the failure to give such notice shall not affect the validity of such set off and application.

 

SECTION 7.5  Governing Law; Jurisdiction; Venue; Service of Process.

 

(a)                                 Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.

 

(b)                                 Submission to Jurisdiction.  Each Grantor irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any kind or description, whether in law or equity, whether in contract or in tort or otherwise, against the Administrative Agent or any other Secured Party of the foregoing in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, in any forum other than the courts of the State of New York sitting in New York County, and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in respect of any such action, litigation or proceeding may be heard and determined in such New York State court or, to the fullest extent permitted by Applicable Law, in such federal court.  Each of the parties hereto agrees that a final judgment in any such action, litigation 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 in any other Loan Document shall affect any right that the Administrative Agent or any other Secured Party may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Grantor or its properties in the courts of any jurisdiction.

 

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(c)                                  Waiver of Venue.  Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by Applicable Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(d)                                 Service of Process.  Each party hereto irrevocably consents to service of process in the manner provided for notices in Section 12.1 of the Credit Agreement.  Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by Applicable Law.

 

(e)                                  Appointment of the Borrower as Agent for the Grantors.  Each Grantor hereby irrevocably appoints and authorizes the Borrower to act as its agent for service of process and notices required to be delivered under this Agreement or under the other Loan Documents, it being understood and agreed that receipt by the Borrower of any summons, notice or other similar item shall be deemed effective receipt by each Grantor and its Subsidiaries.

 

SECTION 7.6  Waiver of Jury Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

 

SECTION 7.7  Reserved.

 

SECTION 7.8  No Waiver By Course of Conduct; Cumulative Remedies.  Neither the Administrative Agent nor any other Secured Party shall by any act (except by a written instrument pursuant to Section 7.2), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default.  No delay or failure to take action on the part of the Administrative Agent or any other Secured Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  A waiver by the Administrative Agent or any other Secured Party of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which the Administrative Agent or such other Secured Party would otherwise have on any future occasion.  The enumeration of the rights and remedies of the Administrative Agent and the other Secured Parties set forth in this Agreement is not intended to be exhaustive and the exercise by the Administrative Agent and the other Secured Parties of any right or remedy shall not preclude the exercise of any other rights or remedies, all of which shall be cumulative, and shall be in addition to any other right or remedy given hereunder or under the other Loan Documents or that may now or hereafter exist at law or in equity or by suit or otherwise.

 

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SECTION 7.9  Successors and Assigns.  The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns; except that no Grantor may assign or otherwise transfer any of its rights or obligations under this Agreement without the prior written consent of the Administrative Agent and the other Lenders (except as otherwise provided by the Credit Agreement).SECTION 7.10  Survival of Indemnities.  Notwithstanding any termination of this Agreement, the indemnities to which the Administrative Agent and the other Secured Parties are entitled under the provisions of Section 7.3 and any other provision of this Agreement and the other Loan Documents shall continue in full force and effect and shall protect the Administrative Agent and the other Secured Parties against events arising after such termination as well as before.SECTION 7.11  Titles and Captions.  Titles and captions of Articles, Sections and subsections in, and the table of contents of, this Agreement are for convenience only, and neither limit nor amplify the provisions of this Agreement.SECTION 7.12  Severability of Provisions.  Any provision of this Agreement or any other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remainder of such provision or the remaining provisions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction.SECTION 7.13  Counterparts.  This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and shall be binding upon all parties, their successors and assigns, and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of a signature page to this Agreement or any document or instrument delivered in connection herewith by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Agreement or such other document or instrument, as applicable.SECTION 7.14  Integration.  This Agreement, together with the other Loan Documents, comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter.  In the event of any conflict between the provisions of this Agreement or any other Loan Document and those of the Credit Agreement, the provisions of the Credit Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Administrative Agent or the other Secured Parties in any other Loan Document shall not be deemed a conflict with this Agreement.SECTION 7.15  Advice of Counsel; No Strict Construction.  Each of the parties represents to each other party hereto that it has discussed this Agreement with its counsel.  The parties hereto have participated jointly in the negotiation and drafting of this Agreement.  In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement.

 

SECTION 7.16  Acknowledgements.

 

(a)                                 Each Grantor hereby acknowledges that:

 

(i)                                     it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents to which it is a party;

 

(ii)                                  it has received a copy of the Credit Agreement and has reviewed and understands same;

 

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(iii)                               neither the Administrative Agent nor any other Secured Party has any fiduciary relationship with or duty to any Grantor arising out of or in connection with this Agreement or any of the other Loan Documents, and the relationship between the Grantors, on the one hand, and the Administrative Agent and the other Secured Parties, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and

 

(iv)                              no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby or thereby among the Secured Parties or among the Grantors and the Secured Parties.

 

(b)                                 Each Issuer party to this Agreement acknowledges receipt of a copy of this Agreement and agrees to be bound thereby and to comply with the terms thereof insofar as such terms are applicable to it.  Each Issuer party to this Agreement agrees to provide such notices to the Administrative Agent as may be necessary to give full effect to the provisions of this Agreement.

 

SECTION 7.17  Releases.

 

(a)                                 At such time as the Secured Obligations shall have been paid in full in cash and the Commitments have been terminated (other than (1) contingent indemnification obligations and cost reimbursement obligations and (2) obligations and liabilities under Secured Cash Management Agreements or Secured Hedge Agreements as to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made), the Collateral shall be released from the Liens created hereby, and this Agreement and all obligations (other than those expressly stated to survive such termination) of the Administrative Agent and each Grantor hereunder shall terminate, all without delivery of any instrument or performance of any act by any party, and all rights to the Collateral shall revert to the Grantors.

 

(b)                                 If any of the Collateral shall be sold, transferred or otherwise disposed of by any Grantor in a transaction permitted by the Credit Agreement, then the Administrative Agent, at the request and sole expense of such Grantor, shall execute and deliver to such Grantor all releases or other documents reasonably necessary or desirable to evidence the release of the Liens created hereby on such Collateral.  In the event that all the Equity Interests of any Grantor that is a Subsidiary of the Borrower shall be sold, transferred or otherwise disposed of in a transaction permitted by the Credit Agreement, then, at the request of the Borrower and at the reasonable expense of the Grantors, such Grantor shall be released from its obligations hereunder; provided that the Borrower shall have delivered to the Administrative Agent, at least 5 Business Days prior to the date of the proposed release, a written request for release identifying the relevant Grantor and a description of the sale or other disposition in reasonable detail, together with a certification by the Borrower stating that such transaction is in compliance with the Credit Agreement and the other Loan Documents.

 

SECTION 7.18  Additional Grantors.  Each Subsidiary of the Borrower that is required to become a party to this Agreement pursuant to Section 8.13 of the Credit Agreement shall become a Grantor for all purposes of this Agreement upon execution and delivery by such Subsidiary of a joinder agreement in form and substance reasonably satisfactory to the Administrative Agent.

 

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SECTION 7.19  All Powers Coupled With Interest.  All powers of attorney and other authorizations granted to the Secured Parties, the Administrative Agent and any Persons designated by the Administrative Agent or any other Secured Party pursuant to any provisions of this Agreement or any of the other Loan Documents shall be deemed coupled with an interest and shall be irrevocable so long as any of the Secured Obligations remain unpaid or unsatisfied, any of the Commitments remain in effect or the Credit Facility has not been terminated.

 

[Signature Pages to Follow]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed under seal by their duly authorized officers, all as of the day and year first written above.

 

	
 
    	
BOOT BARN HOLDING, INC., as Grantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Greg Hackman
    
	
 
    	
 
    	
Name:
    	
Greg Hackman
    
	
 
    	
 
    	
Title:
    	
Chief Financial Officer and Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
BOOT BARN, INC., as Grantor and Issuer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Greg Hackman
    
	
 
    	
 
    	
Name:
    	
Greg Hackman
    
	
 
    	
 
    	
Title:
    	
Chief Financial Officer and Secretary
    

 

[Signature Pages Continue]

 

 

	
 
    	
WELLS FARGO BANK, NATIONAL ASSOCIATION, as   Administrative Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Belle Villaseñor
    
	
 
    	
 
    	
Name:
    	
Belle Villaseñor
    
	
 
    	
 
    	
Title:
    	
Vice President
    

 

 

SCHEDULE 3.6

to

Collateral Agreement

 

Exact Legal Name; Jurisdiction of Organization; Taxpayer Identification Number; Registered Organization Number; Mailing Address; Chief Executive Office; Locations of Inventory, Equipment and Fixtures; Locations of Books and Records

 

	
Exact Legal
   Name
    	
 
    	
Jurisdiction
   of
   Organization
    	
 
    	
Taxpayer
   Identification
   Number,
   Registered
   Organization
   Number
    	
 
    	
Mailing Address, Chief
   Executive Office
    	
 
    	
Locations of
   Inventory,
   Equipment,
   Fixtures,
   Books, and
   Records
    
	
Boot Barn Holdings, Inc.
    	
 
    	
Delaware
    	
 
    	
90-0776290
    	
 
    	
15776 Laguna Canyon Road, Irvine, CA   92618
    	
 
    	
[See Attached.]
    
	
Boot Barn, Inc.
    	
 
    	
Delaware
    	
 
    	
26-1081729
    	
 
    	
15776 Laguna Canyon Road, Irvine, CA   92618
    	
 
    	
[See Attached.]
    

 

 

Locations of Inventory, Equipment and Fixtures; Locations of Books and Records

 

(i)                                     Inventory Locations

 

1.                                      607 North Tustin, Orange, CA.

 

2.                                      6587 Ventura Blvd., Ventura, CA 93003.

 

3.                                      1414 West 7th St., Upland, CA 91786.

 

4.                                      464 Redlands Blvd., San Bernardino, CA.

 

5.                                      27564 Sierra Hwy, Canyon Country, CA.

 

6.                                      3394 Tyler, Riverside, CA.

 

7.                                      18420 Hawthorne Blvd., Torrance, CA.

 

8.                                      23762-B Mercury Road, Lake Forest, CA 92630.

 

9.                                      659 West Arrow Hwy, San Dimas, CA.

 

10.                               2405 Vista Way, Oceanside, CA 92054.

 

11.                               853 Arnele Avenue, El Cajon, CA.

 

12.                               4411 Mercury Street, Ste. 100, San Diego, CA 92611.

 

13.                               27250 Madison Ave, Stes. A & B, Temecula, CA.

 

14.                               13785 Park Avenue, Ste. G & H, Victorville, CA 92392.

 

15.                               43517 13th Street West, Lancaster, CA 93535.

 

16.                               1340 Spring St., Paso Robles, CA.

 

17.                               7265 Las Vegas Blvd South, Las Vegas, NV 89119.

 

18.                               3462 Katella, Los Alamitos, CA.

 

19.                               7020 Topanga Canyon Blvd., Canoga Park, CA 91303.

 

20.                               6600 Menaul NE, Albuquerque, NM.

 

21.                               6322 W. Sahara, Las Vegas, NV 89146.

 

22.                               4250 East Bonanza Road, Las Vegas, NV 89110.

 

23.                               3913 Buck Owens Blvd., Bakersfield, CA 93308.

 

 

24.                               12915 Monterey Road, San Martin, CA 95046.

 

25.                               331 6th Street, Turlock, CA 95380.

 

26.                               101 South Broadway, Santa Maria, CA 93454.

 

27.                               3320 E. Stockton Hill Road #D2, Kingman, AZ.

 

28.                               4670 Central Way, Fairfield, CA 94534.

 

29.                               7909 West Campo Bello Drive, Ste 1, Glendale, AZ 85308.

 

30.                               1710 S. Alma School Rd., Mesa, AZ 85210.

 

31.                               603 Colusa Avenue, Stes A — D, Yuba City, CA 95991.

 

32.                               4401 Granite Drive, Ste. 100, Rocklin, CA.

 

33.                               960 6th St., Suite 104, Norco, CA 92860.

 

34.                               10299 E. Stockton Blvd., Elk Grove, CA 95624-9

 

35.                               1799 Retherford St., Tulare, CA 93274-0806.

 

36.                               3300 Broadway, Suite 308, Eureka, CA 95501.

 

37.                               1705 Highway #273, Anderson, CA 96007.

 

38.                               285 West Shaw Avenue, Clovis, CA 93612

 

39.                               2225 Plaza Parkway, Modesto, CA 95350.

 

40.                               1445 Santa Rosa Avenue, Suites A1-A4, Santa Rosa, CA 95405.

 

41.                               1475 N. Davis Road, Salinas, CA 93907

 

42.                               1203 S. Carson, Carson City, NV 89701.

 

43.                               3345 Kietzke Lane, Reno, NV 89502.

 

44.                               2539 Esplanade Rd., Chico, CA 95973-1163

 

45.                               3776 South 16th Avenue, Tucson, AZ.

 

46.                               3719 North Oracle Road, Tucson, AZ.

 

47.                               6701 East Broadway, Tucson, AZ 85710.

 

 

48.                               284 West Mariposa, Nogales, AZ 85621.

 

49.                               242 West 32nd Street, Yuma, AZ 85364.

 

50.                               7321 Pav Way, Prescott Valley, AZ 86314.

 

51.                               700 S. Telshor, Space 1208, Las Cruces, NM 88001.

 

52.                               2700 South Woodlands Village Boulevard, Suite 500, Flagstaff, AZ 86001.

 

53.                               2200 El Mercado Loop, Space 1200, Sierra Vista, AZ 85635.

 

54.                               1955 S. Casino Dr., Laughlin, NV 89029.

 

55.                               4481 South White Mountain Road, Show Low, AZ 85901.

 

56.                               804 North US Highway 491, Gallup, NM.

 

57.                               10701 Corrales Road, NW, Suites 12 & 14, Albuquerque, NM 87109.

 

58.                               4250 Cerrillos Road, Santa Fe, NM 87507.

 

59.                               4601 E. Main, Farmington, NM 87402

 

60.                               6210 San Mateo Blvd., NE, Albuquerque, NM 87109

 

61.                               1518 Capital Ave., Cheyenne, WY.

 

62.                               4519 Frontier Mall Dr., Cheyenne, WY.

 

63.                               158 North Third, Laramie, WY.

 

64.                               1625 Stampede Dr., Cody, WY.

 

65.                               1683 Sunset Dr., Rock Springs, WY.

 

66.                               150 North Main, Sheridan, WY.

 

67.                               3510 E. 2nd Street, Casper, WY.

 

68.                               2610 S. Douglas Hwy, Suite 100, Gillette, WY.

 

69.                               727 N. Federal, Riverton, WY.

 

70.                               1850 Harrison Blvd., Evanston, WY.

 

71.                               840 West Broadway, Jackson, WY.

 

72.                               1920 E. Idaho, Elko, NV.

 

 

73.                               1460 W. Winnemucca Blvd., Winnemucca, NV 89445.

 

74.                               327 South 24th Street West, Ste #1, Billings, MT 59102.

 

75.                               830 S. Camino Del Rio, Durango, CO 81310

 

76.                               5720 North Academy Boulevard, Colorado Springs, CO 80918

 

77.                               2424 Highway 6 & 50, Grand Junction, CO 81505

 

78.                               10910 Olson Drive, Suite #140, Rancho Cordova, CA 95670

 

79.                               15776 Laguna Canyon Road, Irvine, CA 92618 (Corporate)

 

80.                               15770 Laguna Canyon Road, Irvine, CA 92618 (Corporate)

 

81.                               2772 Main Street,  Irvine, CA 92618 (Corporate Warehouse)

 

82.                               4414 South College Avenue, Fort Collins, CO 80525

 

83.                               2221 NE 3rd Street, Bend, OR

 

84.                               840 Biddle Road, Medford, OR 97504

 

85.                               1108 NW Frontage Road, Troutdale, OR 97060

 

86.                               5352 South Freeway Park Drive, Riverdale, UT 84405

 

87.                               1175 Addison Avenue East, Twin Falls, Idaho 83301

 

88.                               8525 W. Franklin Road, Boise, ID 83709

 

89.                               1008 Cumberland Center Blvd., Lebanon, TN 37087

 

90.                               1681 3rd Avenue West Unit 9, Dickinson, ND 58601

 

91.                               1183 Eglin Street, Rapid City, SD 57701

 

92.                               51027 Hwy 6, Ste 200, Glenwood Springs, CO

 

93.                               2230 N.W. 10 Street, Ocala, FL 34475

 

94.                               2520 North U.S. Highway 441/27, Fruitland, FL 34731

 

95.                               240 Long Hollow Pike, Goodlettsville, TN

 

96.                               Mall of America, 386 N. Garden, Ste. #N386, Bloomington, MN

 

97.                               3443 SW Williston Road, Gainesville, FL 32608

 

 

98.                               Gurnee Mills Mall, 6170 West Grand Avenue, Gurnee, IL 60031

 

99.                               Kirkwood Mall, 635 Kirkwood Mall, Bismarck, ND 58504

 

100.                        North Park Mall, 320 West Kimberly Rd, Ste. 206, Davenport, IA

 

101.                        Valley West Mall, 1551 Valley West Dr. #187, Des Moines, IA

 

102.                        249 Blanding Blvd., Orange Park, FL 32073

 

103.                        West Acres Mall, 3902 13th Avenue SW, #301D, Fargo, ND

 

104.                        3120 North Oak Street Extension, Valdosta, GA 31605

 

105.                        Columbia Mall, 2800 S. Columbia Rd ., Grand Forks, ND

 

106.                        Crossroad Center, 4201 Division St. W., St. Cloud, MN

 

107.                        Southern Hills Mall, 4400 Sergeant Rd.,#116, Sioux City, IA

 

108.                        1208 20th Avenue SW, Ste 10, Minot, ND 58701

 

109.                        Oakwood Mall, 4800 Golf Road, Ste 420, Eau Claire, WI 54701

 

110.                        Eastland Mall, 800 N. Green River Road, #452, Evansville, IN

 

111.                        8105 Moores Lane, Ste 205, Brentwood, TN 37027

 

112.                        3134 North 11th Street, Bismarck, ND 58503

 

113.                        2805 W. 41st Street, Sioux Falls, SD

 

114.                        Opry Mills Mall, 405 Opry Mills Drive, Nashville, TN 37214

 

115.                        8111 Concord Mills Blvd. #538, Concord, NC 28027

 

116.                        2431 E. Colorado Blvd., Spearfish, SD 57783

 

117.                        10203 Birchridge, Suite 500, Humble, Texas 77338

 

118.                        10203 Birchridge, 2nd Floor, Humble, Texas 77338

 

119.                        10203 Birchridge, Suite E, Humble, Texas 77338

 

120.                        4600 South Medford Drive, Suite 1000, Lufkin, Texas 75901

 

121.                        2309 Highway 79 South, Henderson, Texas 75654

 

122.                        620 Pan American Drive Livingston, Texas 77351

 

 

123.                        Suite #4, 3801 North Street, Nacogdoches, Texas 75961

 

124.                        4530 South Broadway, Tyler, Texas 75703

 

125.                        1001 Main Street, Liberty, Texas 77575

 

126.                        118 Col. Etheredge, Blvd., Huntsville, Texas 77340

 

127.                        1300 Pinecrest Drive East, Marshall, Texas 75670

 

128.                        327 S. Wheeler St., Jasper, Texas 75951

 

129.                        725 E. Villa Maria, Suite 4700, Bryan, Texas, 77802

 

130.                        850 N. Main Street, Vidor, Texas 77662

 

131.                        1908 N. Frazier St., Conroe, Texas 77301

 

132.                        3445 Gulf Freeway, Dickinson, Texas 77539

 

133.                        2419 Gilmer Road, Longview, Texas 75604

 

134.                        28000 Southwest Fwy, Rosenberg, Texas 77471

 

135.                        120 Hwy 332 W 3, Lake Jackson, Texas 77566

 

136.                        3201 North Hwy 75 Suite 102, Sherman, Texas 75090

 

137.                        4123 Gibson Road, Texarkana, Texas 75503

 

138.                        1220 Airline Road, Corpus Christi, Texas 78412

 

139.                        240 N. New Road, Waco, Texas 76710

 

140.                        8154 Agora Parkway, Suite 100, Live Oak, Texas 78233

 

141.                        1131 N. Burleson Blvd., Burelson, Texas 76028

 

142.                        2990 East Prien Lake Road, Lake Charles, Louisiana 70615

 

143.                        3111 Midwestern Parkway, Sikes Senter Mall, Wichita Falls, Texas 76308

 

144.                        Space No. 6501, Alexandria Mall, 3437 Masonic Drive, Alexandria, Louisiana 71301

 

145.                        10533 South Mall Drive, Baton Rouge, Louisiana 70809

 

146.                        3320 Ambassador Caffery Parkway, Lafayette, Louisiana 70502

 

147.                        9795 FM 1960, Humble, Texas 77338

 

 

148.                        24421 Katy Freeway, Katy, Texas 77494

 

149.                        6550 Garth Rd., Baytown, Texas 77521

 

150.                        127 NorthShore Blvd, Suite 2, Slidell, Louisiana 70460

 

151.                        Rayzor Ranch Marketplace, Denton, Texas

 

154.                        1951 South 25th East, Ammon, ID 83406

 

155.                        3666 Brooks Street, Missoula, MT 59801

 

156.                    8698 East Raintree Drive, Scottsdale, AZ 85260

 

157.                    2651 W. 29th Street, Greeley, CO 80631

 

158.                    2020 Gunbarrel Road, Chattanooga, TN 37421

 

159.                    Fallschase Shopping Center, Tallahassee, FL 32317

 

160.                        915 W. Main Street, Bozeman, MT 59715

 

161.                        1010 NE Coronado Drive, Blue Springs, MO 64014

 

162.                        14384 Lincoln Street, Thornton, CO 80023

 

163.                        2200 War Admiral Way, Lexington, KY 40509

 

164.                        65 Treeline Road, Kalispell, MT 59901

 

165.                        17815 La Cantera Parkway, San Antonio, TX

 

166.                        318 Broadway, Nashville, TN 37201

 

167.                        2315 Summa Drive, Ste. 1C, Las Vegas, NV 37201

 

168.                        152 Stratford Commons Court, Suite. 05, Winston-Salem, NC 27103

 

169.                        3310 West Shaw Avenue, Suite 02A, Fresno, CA 93711

 

170.                        1000 Commerce Avenue, Suite 0500, Atwater, CA 95301

 

171.                        Alamance Crossing West Shopping Center

 

University Drive & I-85, Burlington, NC.

 

172.                        25895 Highway 290, Cypress, TX 77429

 

173.                        U.S. 11W & Interstate 81, Bristol, TN 37620

 

 

174.                        15185 W. 119th Street, Olathe, KS 66002

 

175.                        3103 W. Highway 74, Monroe, NC 44648

 

176.                        2625 Scottsville Road, Bowling Green, KY 42104

 

177.                        1991 West Highway 40, Vernal, UT 84078

 

178.                        211 Rolling Hills Circle, Easley, SC 29640

 

179.                        4501 Outer Loop Drive, Louisville, KY 40219

 

180.                        640 Centerview Blvd., Ste. 120, Kissimmee, FL 34741

 

181.                        6360 S. Parker Road, #5, Aurora, CO 80016

 

182.                        Polaris Pointe Shops, Colorado Springs, CO 80921

 

183.                        195 W. Esplanade Drive, Oxnard, CA 93036

 

184.                        The Shoppes at Southport West, Omaha, NE

 

185.                        The Marketplace, Council Bluffs, IA

 

186.                        Glade Park Shopping Center, Euless, TX

 

187.                        Four Corners Shopping Center, Tomball, TX

 

188.                        1683 Sunflower Avenue, Costa Mesa, CA 92626

 

From time to time certain equipment, including, without limitation, motor vehicles and computers, may be offsite in the ordinary course of business.

 

 

SCHEDULE 3.8

to

Collateral Agreement

 

Chattel Paper; Instruments; Negotiable Documents; Letter-of-Credit Rights

 

None.

 

 

SCHEDULE 3.9

to
 Collateral Agreement

 

Commercial Tort Claims

 

None.

 

 

SCHEDULE 3.10

to
 Collateral Agreement

 

Deposit Accounts and Securities Accounts

 

	
Grantor
    	
 
    	
Financial
   Institution
    	
 
    	
Account Number
    	
 
    	
Account Purpose
    
	
Boot Barn Holdings Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026573401
    	
 
    	
Funding Account
    
	
Boot Barn, Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026 263 008
    	
 
    	
Funding Account
    
	
Boot Barn, Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026 263 016
    	
 
    	
Internet Credit Cards
    
	
Boot Barn, Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026 263 024
    	
 
    	
Store Credit Cards
    
	
Boot Barn, Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026 263 032
    	
 
    	
Wire Transfers and Other Deposits
    
	
Boot Barn, Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026 587 707
    	
 
    	
RCC Collection
    
	
Boot Barn, Inc.
    	
 
    	
PNC Bank
    	
 
    	
8026 587 715
    	
 
    	
RCC Credit Card
    
	
Boot Barn, Inc.
    	
 
    	
City National Bank
    	
 
    	
004 342 925
    	
 
    	
Payroll
    
	
Boot Barn, Inc.
    	
 
    	
Wells Fargo Bank
    	
 
    	
562-7688962
    	
 
    	
Store Cash and Check deposits
    
	
Boot Barn, Inc.
    	
 
    	
BBVA Compass
    	
 
    	
6712231538
    	
 
    	
Store Cash and Check deposits
    
	
Boot Barn, Inc.
    	
 
    	
Chase Bank
    	
 
    	
220386039
    	
 
    	
Store Cash and Check deposits
    

 

 

SCHEDULE 3.11

to
 Collateral Agreement

 

Intellectual Property

 

1.                                      The listing of Registered Trademarks (as defined in the Collateral Agreement) should include: (a) the Trademark; (b) Registration Number or Serial Number; and (c) the Owner of Record.

 

See attached.

 

2.                                      The listing of Trademark Licenses (as defined in the Collateral Agreement) should include: (a) Name of Licensee/Licensor; and (b) Date.

 

None.

 

3.                                      The listing of Patents (as defined in the Collateral Agreement) should include: (a) Country; (b) Patent Number or Application Number; (c) Title of Invention; and (d) the Owner of Record.

 

None.

 

4.                                      The listing of Patent Licenses (as defined in the Collateral Agreement) should include: (a) Name of Licensee/Licensor; and (b) Date.

 

None.

 

5.                                      The listing of Registered Copyrights (as defined in the Collateral Agreement) should include: (a) Registration Number; (b) Title as listed in Registration; and (d) the Copyright Claimant.

 

None.

 

6.                                      The listing of Copyright Licenses (as defined in the Collateral Agreement) should include: (a) Name of Licensee/Licensor; and (b) Date.

 

None.

 

 

Listing of Trademarks

 

	
Mark
    	
 
    	
Registration number
    Registration date
    	
 
    	
Application
   number
    	
 
    	
Current
    Owner
    
	
BOOT BARN
    	
 
    	
2,307,397 

01/11/2000
    	
 
    	
75/579,578
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
3,696,624 

10/13/2009
    	
 
    	
77/467,382
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
WESTERN WAREHOUSE
    	
 
    	
1,197,321* 

06/08/1982
    	
 
    	
73,229,113
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
WESTERN WAREHOUSE
    	
 
    	
1,786,004 

08/03/1993
    	
 
    	
74/334,293
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CORRAL WEST
    	
 
    	
3,135,148 

8/29/2006
    	
 
    	
78/569,082
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CORRAL WEST RANCHWEAR
    	
 
    	
3,135,156 

08/29/2006
    	
 
    	
78/569,628
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CWR WORKWEAR DEPOT
    	
 
    	
CANCELED
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CWR
    	
 
    	
CANCELED
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
CODY JAMES
    	
 
    	
1,818,497 

01/25/1994
    	
 
    	
74/209,357
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
JOB SITE
    	
 
    	
2,193,695 

10/06/1998
    	
 
    	
75/346,364
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
AMERICAN WORKER HEAD TO TOE WORK WEAR
    	
 
    	
3,941,630 

04/05/2011
    	
 
    	
77/891,409
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
SHYANNE
    	
 
    	
3,615,901 

05/05/2009
    	
 
    	
77/584,307
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
STINKY BOOT
    	
 
    	
4247245 

11/20/2012
    	
 
    	
85/465,810
    	
 
    	
Boot Barn, Inc.
    

 

 

	

    	
 
    	
N/A
    	
 
    	
85722240
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
N/A
    	
 
    	
85718520
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
RCC WESTERN STORES
    	
 
    	
3,676,190 

9/01/2009
    	
 
    	
77673023
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
3,685,540 

9/22/2009
    	
 
    	
77673019
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
4,164,753 

6/26/2012
    	
 
    	
85506201
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
RCC WESTERN WEAR
    	
 
    	
4,164,271 

6/26/2012
    	
 
    	
85457801
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Baskins
    	
 
    	
4256229 

12/11/2012
    	
 
    	
85446448
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
4157456 

6/12/2012
    	
 
    	
85446755
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Diamond B
    	
 
    	
3541365 

12/2/2008
    	
 
    	
77293760
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
3457163 

7/1/2008
    	
 
    	
77294779
    	
 
    	
Boot Barn, Inc.
    

 

 

	
Outfitting Texans Since 1972
    	
 
    	
4260163 

12/18/2012
    	
 
    	
85446958
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
The Official Western Store of Texas
    	
 
    	
4326046 

4/23/2013
    	
 
    	
85446863
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
CANCELED
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
BB RANCH
    	
 
    	
4666995
    	
 
    	
86292745
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
SHYANNE
    	
 
    	
4659704
    	
 
    	
86324810
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
MOONSHINE SPIRIT BY BRAD PAISLEY
    	
 
    	
 
    	
 
    	
86376463
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
MOONSHINE SPIRIT
    	
 
    	
 
    	
 
    	
86327572
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
B
    	
 
    	
 
    	
 
    	
86279959
    	
 
    	
Boot Barn, Inc.
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	

    	
 
    	
 
    	
 
    	
86296606
    	
 
    	
Boot Barn, Inc.
    

 

 

SCHEDULE 3.13

to
 Collateral Agreement

 

Equity Interests Held Directly by Grantors

 

Certificated Securities:

 

	
Name of Issuer
    	
 
    	
Class and
   Series
    	
 
    	
Par Value
    	
 
    	
Certificate
   Number
    	
 
    	
Number (and
   Percentage) of
   Securities of
   such Class and
   Series
    
	
Boot Barn, Inc.
    	
 
    	
Common Stock
    	
 
    	
 
    	
 
    	
2
    	
 
    	
1,000 (100% owned by Boot Barn   Holdings, Inc.)
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
RCC Western Stores, Inc.
    	
 
    	
Common Stock
    	
 
    	
 
    	
 
    	
51
    	
 
    	
2,000 (100% owned by Boot Barn, Inc.)
    

 

Uncertificated Securities:

 

	
Name of Issuer
    	
 
    	
Class and
   Series
    	
 
    	
Par Value
    	
 
    	
Certificate
   Number
    	
 
    	
Number (and
   Percentage) of
   Securities of
   such Class and
   Series
    
	
Baskins Acquisition Holdings, LLC
    	
 
    	
Membership interests
    	
 
    	
N/A
    	
 
    	
N/A
    	
 
    	
Boot Barn, Inc. is the sole member and   owner of membership interests.
    

 

Partnership/LLC Interests:

 

None.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00240-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00240-of-00352.parquet"}]]