Document:

EX-10.4

   

  Exhibit 10.4

   

  Non-Binding English Translation

  September 25, 2018

  ADVA Optical Networking SE

  (as borrower)

  and

  Bavarian State Bank and

  Deutsche Bank AG branch Germany business

  (as Mandated Lead Arrangers, Bookrunners and Joint coordinators)

   

  the financial institutions named in the loan agreement

  (as lenders)

  and

   

  Deutsche Bank Luxembourg S.A.

  (as agent)

  ______________________________

   

  SYNOPSIS LOAN AGREEMENT

  ______________________________

   

  Reuterweg 20

  60323 Frankfurt am Main | Germany

  +49.69.6062.6000 (phone)

  www.lw.com

   

   

   

  	 

  

   

    

  CONTENTS

  Item												Page

  1.	DEFINITIONS AND INTERPRETATION ..........................................................................................1

  2.	CREDIT COMMITMENTS.................................................................................................................16

  3.	INTENDED USE..............................................................................................................................19

  4.	REQUIREMENTS FOR PAYMENT ..................................................................................................19

  5.	OBTAINING LOANS ........................................................................................................................20

  6.	SUB-CREDIT LINES ........................................................................................................................21

  7.	TERM AND REIMBURSEMENT.......................................................................................................27

  8.	EARLY REDEMPTION .....................................................................................................................28

  9.	INTEREST RATES............................................................................................................................31

  10	LATE PAYMENT INTEREST............................................................................................................34

  11.         INTEREST PERIODS......................................................................................................................34

  12.	MARKET DISTURBANCE, ALTERNATIVE METHOD OF CALCULATION....................................35

  13.	COMMISSIONS AND FEES .............................................................................................................35

  14.	TAXES ...........................................................................................................................................36

  15	COST INCREASE........................................................................................................................... 42

  16	DISADVANTAGE REDUCTION ........................................................................................................44

  17.	OTHER INDEMNIFICATION OBLIGATIONS....................................................................................44

  18.	COSTS AND EXPENSES..................................................................................................................46

  19         GUARANTEES..........................................................................................................................46

  20	REPRESENTATIONS........................................................................................................................49

  21	INFORMATION OBLIGATIONS........................................................................................................54

  22	FINANCIAL INDICATORS................................................................................................................56

  23.	GENERAL CONDITIONS .................................................................................................................58

  24	TERMINATION.............................................................................................................................61

  25.	TRANSFER OF UNDERTAKING SHARES .....................................................................................64

  26.	ACCESSION OR WITHDRAWAL OF GUARANTORS....................................................................65

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  27.	RIGHTS AND OBLIGATIONS OF THE AGENT AND OTHER PARTIES........................................66

  28.	DISTRIBUTION OF PAYMENTS; BALANCING .............................................................................72

  29.	PAYMENTS AND ORDER OF PAYMENTS.....................................................................................73

  30	ON BILL..............................................................................................................................74

  31.	NOTICES AND REPRESENTATION ..............................................................................................74

  32.	MODIFICATIONS AND WAIVER ................................................................................................... 75

  33.	DISCLOSURE OF INFORMATION .................................................................................................80

  34.	CONFIDENTIALITY  OF REFINANCING EXPENSES AND LETTER SENTENCES...........................81

  35.	GENERAL PROVISIONS............................................................................................................82

  36.	ENTRY INTO FORCE .................................................................................................................82

  ANNEX 1 INITIAL LENDERS ................................................................................................................84

  ANNEX 2 PAYMENT REQUIREMENTS.................................................................................................85

  ANNEX 3 EXISTING AND REPLACED FINANCIAL LIABILITIES...............................................88

  ANNEX 4 SAMPLE REQUEST FOR PAYMENT....................................................................................90

  ANNEX 5 PROLONGATION APPLICATION..........................................................................................92

  ANNEX 6 MODEL AUTHORIZATION FOR CLAIMS .............................................................................93

  ANNEX 7 SAMPLE SUB-CREDIT LINE APPLICATION.........................................................................95

  ANNEX 8 INCREASE COMMITMENT ....................................................................................................97

  ANNEX 9 SAMPLE MAXIMUM AMOUNT GUARANTEE.......................................................................99

  ANNEX 10 SAMPLE COMPLIANCE CERTIFICATE ............................................................................107

  ANNEX 11 EXISTING LOAN GRANTS AND

  ASSUMPTION OF LIABILITY...................................................................................................109

  ANNEX 12 SAMPLE TRANSFER AND ACCESSION AGREEMENT....................................................110

  ANNEX 13 SAMPLE CREDIT COMMITMENT CONFIRMATION OF

  SUBSTITUTE LENDER ............................................................................................................113

  ANNEX 14 SAMPLE ACCESSION AGREEMENT GARANT.................................................................115

  ANNEX 15 SAMPLE EXIT APPLICATION ...............................................................................................116

  ANNEX 16 SIGNIFICANT GROUP COMPANIES ..................................................................................117

  ANNEX 17 COMPETITOR BLACKLIST..................................................................................................118

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  This Syndicated LOAN AGREEMENT (the "Credit Agreement") was entered into between

  (1)ADVA Optical Networking SE with its registered office in Meiningen, entered in the commercial register of the district court of Jena under HRB 508155 as parent company, borrower Initial Guarantor (the "Company" or the "Borrower"),

  (2)the Bayerische Landesbank and Deutsche Bank AG branch Germany business as Bookrunners and joint coordinators and together with Norddeutsche  Landesbank - Girozentrale - as Mandated Lead Arrangers and Commerzbank Aktiengesellschaft, DZ BANK AG Deutsche Zentral-Genossenschaftsbank, Frankfurt am Main and IKB Deutsche Industriebank AG as Lead Arrangers (together with the Mandated Lead Arrangers, the "Arrangers"),

  (3)the FINANCIAL INSTITUTIONS listed in Exhibit 1 (Initial Lenders) as initial Lenders (the "Initial Lenders") are listed, and 

  (4)Deutsche Bank Luxembourg SA as Agent (as defined below).

   1. 	DEFINITIONS AND INTERPRETATION

  1.1 Definitions

   In this Credit Agreement, the terms defined below have the meanings assigned to them, unless the context otherwise indicates:

  "Financial liabilities to be redeemed" means the financial liabilities specified in Part 2 of Schedule 3 (Financial liabilities to be redeemed) .

  "Agent" means Deutsche Bank Luxembourg SA or a successor designated as Agent pursuant to Clause 27.13 (Change of Agent) .

  "Initial Guarantors" means the Company and ADVA Optical Networking North America, Inc. and ADVA Optical Networking Ltd. after the Guarantee Agreement has been signed.

  "Defaulting Lender" means any Lender who

  (a)defaults in providing the Loans pursuant to Clause 5.3 (Accessing and Providing the Loans) or notifies the Agent that it will not honor its obligation to provide such Loans unless it fails to do so

  (i)the default is due to an administrative or technical disruption for which the creditor concerned is not responsible and he fulfills his obligation within three (3) bank working days, or

  (ii)the lender concerned the existence of its obligation to denies the provision of credit in good faith,

  (b)contested or declared adherence to a Funding Document Not wanting to comply with regulations, or 

  (c)is insolvent or overindebted according to the legal system applicable to him, or insolvency proceedings or comparable proceedings in a foreign legal system have been opened against his assets.

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   “Outstanding Sub-Line of Credit Amount” means, with respect to a Sub-Line of Credit and a Sub- Line of Credit, the sum (calculated by the Sub-Line of Credit) of the principal amounts of the following outstanding under the Sub-Line of Credit (but not under an Umbrella Facility). Amounts in EUR

  (a)the nominal amount of each overdraft facility and each short-term loan (less available balances held at the respective sub-credit bank accounts of the borrower),

  (b)the maximum amount (notional amount) of any guarantee, bond or bond letter of credit and

  (c)the total amount of the sub-credit bank drawdown (excluding interest and similar charges) under any other form of funding provided under this sub-credit line was granted,

  in each case as reasonably determined by the relevant sub-credit bank in accordance with normal banking practice in its reasonable discretion.

  "Application for payment" means an application essentially in the form of the sample in Annex 4 (application for payment sample), with which the payment of a loan is requested.

  "Business Day" means, in relation to the determination of EURIBOR and payments in EUR, each TARGET day and otherwise (ii) each day on which credit institutions in Luxembourg and Munich are open for business required under this Credit Agreement.

  "Affiliation Agreement" means any agreement for the affiliation of a Guarantor pursuant to Clause 26.2 (joining guarantors).

  "Existing Financial Indebtedness" means the Financial Indebtedness specified in Part 1 of Schedule 3 (Existing Financial Indebtedness) .

  "Existing Guarantee" means any Guarantee listed in Part 1 of Schedule 3 (Existing financial liabilities) is listed.

  "Working Credit" means the loans originated under the Working Capital Line.

  “Working Lender” means any Lender that has made a commitment to lend under the Working Capital Line of Credit or as provided in Section 2.2 (Upgrade Option). Section 2.3 (Termination and Increase of Loan Commitments), Section 25.1 (Transfer of Underwriters Interests) or Section 32.4 (Replacement of Lenders) and has not ceased to be a Working Capital Lender under this Loan Agreement.

  "Working Line of Credit" means the line of credit made available pursuant to Section 2.1(b) (Loan Commitments) .

  "Calculation Date" has the meaning given to that term in Clause 22.1 (Definitions) .

  "Budget" means the Group's consolidated 3-year budget for the current year financial year and the continuation of this planning for the following financial years, based on the applicable accounting regulations, a detailed forecast for the Profit and Loss Account, Balance Sheet, Cash Flow Statement and Investment Planning and contain detailed information on the forecast and the investment planning on which the planning premises are based, with corresponding explanations.

  "Compliance Certificate" has the meaning given to that term in Clause 21.3 (Compliance Certificates) .

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  "Loan" means any cash drawing made or to be made against a Line of Credit or the amount then outstanding under such cash drawing.

  "Maturity Date" means the date five (5) years after the execution of this Credit Agreement.

  "Permitted Acquisitions" means

  (a)the establishment of a legal entity limiting the liability of its shareholders Person according to European or respective national law ("corporation") or the acquisition of such a corporation as a shell company or

  (b)the acquisition of a company or shares in a company (including 50% or less of the share capital and voting rights in a company) or (if the acquisition is made by a limited liability company whose sole purpose is the completion of such acquisition) the acquisition one business or company, provided in each case that the consideration to be paid for the purchase (including costs and expenses)

  (i)together with the expenses (including costs and expenses) for other Permitted Acquisitions under this paragraph (b) and investments in joint ventures total no more than EUR 50,000,000 (or foreign currency equivalent) during the term of the Credit Agreement and thereof

  (ii)not more than EUR 20,000,000 (or the equivalent in other currencies) in the aggregate during the term of the loan agreement for the acquisition of shares of 50% or less of the share or common capital and voting rights and investments in joint ventures, together with the expenses (including costs and expenses). 

  "Permitted Financial Liabilities" means

  (a)Financial liabilities from the financing documents,

  (b)the Existing Financial Liabilities (including those related to Existing guarantees) as well as, up to the day of the first payment, the to be redeemed financial liabilities,

  (c)Financial Liabilities from Permitted Loans and Permitted assumption of liability,

  (d)Financial liabilities related to derivative transactions entered into in the ordinary course of business and not for speculative purposes,

  (e)Financial liabilities one after the date of the first payment by way of a Permitted acquisition acquired company if (x) existing at the time the company was acquired, (y) not as a result of the acquisition have been increased or extended and (z) within six (6) months of the execution of the be redeemed 

  (f)Financial liabilities arising from leases and hire-purchase agreements relating to vehicles, premises, equipment or computers and from sale and leaseback transactions up to an aggregate total value of EUR 10,000,000 or the equivalent in other currencies at any time during the term of this loan agreement, 

  (g)Financial liabilities of Non-Debtors up to an aggregate value of EUR 10,000,000 or the equivalent in other currencies at any time during the term of this Credit Agreement, and

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  (h)other financial liabilities up to an aggregate total value of EUR 10,000,000 or the equivalent in other currencies at any time during the term of this loan agreement.

   "Permitted Assumptions of Liability" means

  (a)Assumptions of liability under the financing documents (including any maximum amount guarantees issued) as well as those that exist at the time the contract is concluded and are listed in Annex 11 (Existing grants of credit and assumptions of liability),

  (b)Assumption of liability by a group company for an obligated party,

  (c)Assumption of liability by one non-obligor for another non-obligor obligated,

  (d)Assumptions of liability by an Obligor for a Non- Obligor up to an aggregated total value of EUR 10,000,000 or the equivalent in other currencies at any time during the term of the Credit Agreement (existing assumptions of liability for Non- Obligors at the conclusion of this Credit Agreement are excluded from the amount limit, already Permitted Assumptions of Liability under paragraph (a) of this Definition),

  (e)Assumptions of liability that constitute a Permitted Financial Liability,

  (f)Assumption of liability in the ordinary course of business for third parties, and

  (g)other assumptions of liability up to a total aggregate value of Permitted Loans pursuant to paragraph (g) of the definition "Permitted Loans" of EUR 5,000,000 or the equivalent in other currencies at any time during the term of the Loan Agreement.

   “Permitted Credit Grants" means

  (a)the credit lines existing at the time of entering into this Agreement, which are set out in Appendix 11 (Existing Loans and Guarantees),

  (b)Loans from a group company to an obligor,

  (c)Loans between group companies that are both non-obligors,

  (d)Loans from an obligor to a non-obligor if the claims outstanding under such loans total an aggregate amount of EUR 20,000,000 or the equivalent in other currencies at any time during the term exceed this credit agreement (except for the amount restrictions are existing loans at the time this loan agreement is concluded Non-Obligated those already Permitted under paragraph (a) of this Definition constitute credit grants),

  (e)Loans constituting a Permitted Financial Liability,

  (f)Loans to third parties in the ordinary course of business (including Supplier credits, granting of payment terms, usual employee loans), and

  (g)other loan originations which, together with the Permitted Indemnities referred to in paragraph (g) of the definition "Permitted Indemnities", do not exceed the aggregate total value of EUR 5,000,000 or foreign currency equivalent at any time during the term of the Loan Agreement.

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   "Permitted Collateral" means

  (a)customary (also extended) retention of title, arising by operation of law Liens and other security rights or rights of reservation as well as offsetting or set-off agreements under German law and comparable rights under foreign law (each within the scope of the normal business operations of a group company) 

  (b)all customary liens that arise under the general terms and conditions of the banks or savings banks with which a group company maintains bank connections in the ordinary course of business,

  (c)Collateral in connection with semi-retirement obligations pursuant to Section 8a Partial Retirement Act or with value credits in accordance with Section 7e of the Social Security Code IV in each case connection with the business operations of a group company,

  (d)Collateral over a after the date of the first disbursement by a Group company acquired assets if (i) these on already existed at the time the asset was acquired, (ii) the secured liabilities have not increased as a result of the acquisition and (iii) these are canceled within six (6) months of the completion of the acquisition,

  (e)Collateral on the leased assets of a group company due to Leases subject to paragraph (f) of the Definition “Allowed Financial liabilities" are allowed,

  (f)Collateral in connection with a Permitted Sale, in particular in Together with factoring or similar programs to the extent customary in the industry permitted under paragraph (f) of the "Permitted Disposals" definition,

  (g)Collateral provided as part of investment financing by a group company at the expense of the investment being financed, whereby the total amount of the financial liabilities secured in this way may not exceed the amount of EUR 10,000,000 or the equivalent in other currencies at any time during the term of this loan agreement,

  (h)a (no longer valid) land charge entered in the land register of Dreißigacker of the district court of Meiningen under sheet 777, serial no. 1 in favor of Bayerische Hypo- und Vereinsbank AG, which has already approved the deletion and a (no longer valid) land charge entered in the land register of Dreizigacker of the district court of Meiningen under sheet 777, running number 2 in favor of the IKB Deutsche Industriebank AG, which has also already approved the deletion and

  (i)other collateral if and as long as the value of such collateral or the financial liabilities secured in this respect does not exceed an aggregate amount of up to EUR 2,000,000 or the equivalent in other currencies at any time during the term of this loan agreement.

   "Permitted Disposals" means

  (a)Sales in the ordinary course of business and on terms that stand up to a third-party comparison (with the exception of company shares and industrial property rights),

  (b)Sale of assets at market value in exchange for equivalent or similar assets,

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  (c)Sale of assets that are no longer required for the business Market value and at conditions that stand up to a third-party comparison,

  (d)Disposals made as a result of a Permitted Collateral,

  (e)Sales within the group to an obligation or between Group companies, both of which are non-obligated,

  (f)Sales of accounts receivable (including factoring), provided that the buyer assumes the full risk of default (excluding any deductible)), up to an aggregate total value of EUR 20,000,000 or the equivalent in other currencies at any time during the term of this credit agreement,

  (g)Disposals of assets from an Obligor to a Non-Obligationer on arm's length terms and not exceeding an aggregate total selling price of (i) EUR 10,000,000 or the equivalent in other currencies per financial year of the Company, and (ii) not exceed EUR 25,000,000 or its equivalent in other currencies at any time during the term of this Credit Agreement, and

  (h)other disposals of Group assets aggregated up to a total purchase price of EUR 10,000,000 or the equivalent in other currencies in one financial year.

   "Permitted Payments" means

  (a)arm's length payments for directors' salaries and Employees, remuneration for members of the supervisory board and advisory board,

  (b)Payments resulting from a share repurchase provided that the Group's cash balance at the quarter-end following the payment is not less than a minimum of EUR 20,000,000 (or the equivalent in other currencies) and provided that such repurchase is to take place at the initiative of the Board of Directors , there is no reason for termination, and

  (c)Dividends, distributions and other payments to shareholders of the Company where permitted by law and required by a resolution of the General Meeting and provided that if such payment is made by virtue of the Initiative of the Board of Directors should take place, the Board of Directors adopting a resolution on a only proposes such a payment to the general meeting if there is no reason for termination.

  "EUR" means euros.

  "EURIBOR" means

  (a)the interbank money market rate of the European Money Markets Institute (or any other organization which undertakes the administration of the EURIBOR), which is published on the Thomson Reuters page "EURIBOR01" (or an equivalent page which replaces it for the purpose of publishing this money market rate). ) for the relevant Interest Period (prior to any correction, recalculation or redisplay by the Administrator) on the 11.00 a.m. (Brussels) Interest Determination Deadline ("Screen Rate"),

  (b)(to the extent that on an Interest Fixing Date at the relevant time the interest rate referred to under (a) is not for the relevant Interest Period on the relevant Thomson Reuters page is displayed) the Interpolated Interest Rate,

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  (c)(to the extent that there is no Interest Rate or no Interest Rate for the relevant Interest Period on the applicable Thomson Reuters page is displayed and the Interpolated Interest Rate cannot be determined), the Screen Rate for a one-month replacement interest period (and if the interest period of the relevant loan is longer, it shall be deemed to be reduced accordingly),

  (d)(to the extent that the Interest Period of the relevant Loan after application of the foregoing Paragraph (c) is either the applicable Replacement Interest Period or a shorter period and, in either case, no Screen Rate under Paragraph (a) is available and none Interpolated Interest Rate can be calculated) the latest applicable Screen Rate for a period equal to the Interest Period of the relevant loan originating on a date not more than 10 days prior to the relevant Quoting Date or if there is no such latest Screen Rate there, the interpolated Historical screen rate for a period equal to the interest period of the relevant loan or

  (e)(to the extent that paragraph (d) above is applicable and no Interpolated Historical Screen Rate is available) the Reference Interest Rate or, if no Reference Bank or only one Reference Bank reports (or reports late) a Reference Interest Rate and therefore no Reference Interest Rate is also available, then the EURIBOR applies to the relevant Loan as unavailable and Clause 12.2 (Alternative Method of Calculation) applies for the relevant Interest Period for the relevant Loan.

   referred to as "FATCA" .

  (a) Sections 1471 to 1474 of the IRC or any related regulation,

  (b) any treaty, law, regulation enacted in any other jurisdiction or with an intergovernmental agreement between the United States and any other jurisdiction and which (respectively) implement any law or regulation referred to in paragraph (a) above allow or

   (c) any agreement to implement in paragraph (a) or (b) above mentioned agreement, law or regulation with the United States Internal Revenue Service, the United States government, or any governmental agency or tax authority in any other jurisdiction. 

  "FATCA Deduction" means a FATCA required deduction or withholding from a payment pursuant to a Finance Document.

  "FATCA Exempt Party" means a party entitled to receive payments without a FATCA Deduction.

  "FATCA Effective Date" is

  (a)in relation to a "withholdable payment" within the meaning of Section 1473(1)(A)(i) of IRC (relating to interest payments and certain other payments from sources within the United States) on 1 July 2014,

  (b)in relation to a "withholdable payment" within the meaning of Section 1473(1)(A)(ii) of the IRC (referring to "gross proceeds" on the disposal of assets earning interest from sources within of the USA, refers) January 1, 2019 or

  (c)in relation to a " pass thru payment" within the meaning of Section 1471(d)(7) of IRC, which does not fall within the scope of paragraphs (a) above or (b) falls, January 1, 2019, 

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  or such other date as may be determined subsequent to the date of this Loan Agreement as a result of a change in FATCA from which such payment may be subject to a deduction or withholding specified in FATCA.

  "Funding Documents" means this Credit Agreement, the Guarantee Agreement, any Transfer Agreement, any Accession Agreement, any Maximum Amount Guarantee, any Disbursement Request, any Renewal Request, any Compliance Certificate, any Fee Agreement, any Sub-Credit Agreement, any Agreement to Modify the foregoing Agreements, and any documents issued by the Agent and the Company shall be referred to as the "Financing Document".

  "Financial Parties" means the arrangers, the lenders, the sub-lenders, and the agent.

  "Financial liabilities" means any liability

  (a)funds borrowed,

  (b)an acceptance, bill of exchange discount, guarantee or letter of credit,

  (c)a promissory note or a debenture or other securitized debt instrument,

  (d)Lease agreements and hire-purchase agreements to the extent that they are to be accounted for as finance leases under the applicable IFRS regulations (although those lease agreements and hire-purchase agreements which are accounted for as operating leases under the IFRS regulations before January 1, 2019, also after January 1 continue to be accounted for as operating leases in 2019),

  (e)receivables sold or discounted (including factoring unless the Buyer assumes full default risk), 

  (f)Derivative transactions with financial institutions (where the amount of the respective to calculate the liability on the basis of the current market price (mark to market value) or to apply the actual settlement amount),

  (g)Recourse obligations based on a guarantee, bond, letter of credit or other guarantee issued by a credit institution for financial liabilities,

  (h)Advance payments or deferrals received, insofar as these take place outside of the ordinary course of business,

  (i)Transactions, provided they are conducted in accordance with the applicable accounting principles of the Borrower to be classified as a financial liability and

  (j)a guarantee or other assumption of liability regarding losses from a transaction mentioned in (a) to (i) (without double counting).

   "Guarantors" means the Initial Guarantors and any other Group Companies after joining as Guarantor to the Guarantee Agreement or this Credit Agreement.

  "Warranty Agreement" means the warranty agreement dated September 25, 2018 between Agent, Company, ADVA Optical Networking North America, Inc. and ADVA Optical Networking Ltd. and any other group company that joins this guarantee agreement as an additional guarantor in connection with this credit agreement.

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  "Fee Agreements" means the Fees Agreement dated September 25, 2018 between the Arrangers and the Company, the Agent Fees Agreement dated September 25, 2018 between the Agent and the Company. September and any other agreement between the Company and one or more financial parties regarding fees in connection with this Credit Agreement.

  "Fiscal Year" means the fiscal year of the Company beginning on January 1st of each year and ending on December 31st of the same year.

  “Group” means the society and their subsidiaries and “Group Companies” means the respective companies belonging to the group.

  "Assumption of Liability" means any guarantee, suretyship, indemnity, hard letter of comfort (ie involving an obligation to furnish or indemnify a third party), assumption of debt, assumption of debt or other assumption of liability.

  "Holding Company" means, in relation to a company, any company of which the first-named company is a subsidiary.

  "Maximum Amount Guarantee" has the meaning given to that term in Clause 6.9(b) (Umbrella Schemes).

  "Interpolated Historical Screen Rate" means, in relation to a Loan, the Interest Rate (rounded to the same number of decimal places as the two relevant Screen Rates) resulting from a linear interpolation between:

  (a)the last applicable Screen Rate for the longest period of time (for which this Screen rate is available) that is shorter than the interest period of the relevant loan and

  (b)the last applicable Screen Rate for the shortest period of time (for which this Screen installment is available) that is longer than the interest period of the relevant loan, in each case for euros and in each case on a day that is no more than 10 days before the quotation day.

  "Interpolated Interest Rate" means in relation to that applicable to a Loan EURIBOR the value, which is the arithmetic mean between

  (a)that for the longest interest period shorter than that chosen for the loan interest period and

  (b)that for the shortest interest period longer than that chosen for the loan interest period, 

  applicable Interbank Money Market Rate as displayed from time to time on the Interest Determination Date on the Thomson Reuters page "EURIBOR01" (or any equivalent page which replaces it for the purpose of publishing such Money Market Rate) at 11.00 am (Brussels) on the Interest Determination Date.

  "Joint Venture" means a company in which a group company holds 50% of the company shares or voting rights.

  "Underlying Interest" has the meaning given to that term in Clause 25.1 (Transfer of Underlying Interests).

  "Underwriting Ratio" means, at the Relevant Time, the proportion of a Lender's commitment to the total of all Lenders' commitments to that line of credit.

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  "Change of control" means a change in the group of shareholders, according to which a person or a group of persons acting in concert (acting in concert) directly or indirectly holds more than 30% of the shares or voting rights in the company.

  "Lender" means the Initial Lenders in their capacity as Lenders and the additional persons who acceded to this Loan Agreement as Lenders pursuant to Section 2.2 (Upgrade Option), Section 2.3 (Termination and Increase of Loan Commitments) and Section 25.1 (Transfer of Underwriters Interests) are and have not ceased to be a Lender under this Credit Agreement.

  "Line of Credit A" means the line of credit made available pursuant to Section 2.1(a) (Credit Commitments).

  "Lines of Credit" means Line of Credit A and the Working Capital Line of Credit.

  "Loan Commitment" means in respect of a Line of Credit

  (a)in relation to an Initial Lender, the amount specified for it in Schedule 1 (Initial Lenders) plus the amounts due to it pursuant to Clause 25.1 (Transfer of Syndicate Shares) or pursuant to Section 2.2 (option to increase), item 2.3 (termination and increase of loan commitments) or item 32.4 (replacement of lenders) amounts assumed by them and

  (b)with respect to any other Lender, those transferred to it pursuant to Clause 25.1 (Transfer of Underwriters' Interests) or pursuant to Clause 2.2 (Upgrade Option), Clause 2.3 (Termination and Increase of Loan Commitments) or Clause 32.4 (Replacement of Lenders) amounts assumed by him less amounts transferred by him to a third party, 

  in each case less the amounts transferred by him to a third party in accordance with Section 25.1 (Transfer of Syndicated Shares) and the terminated part of the loan commitment. 

  “Reason for Termination” means a reason for termination as set out in Section 24.1 (Reason for Termination).

  "Termination Conditions" means a circumstance which would lead to a reason for termination according to Section 24.1 (Reasons for Termination) at the end of a possible healing period.

  "Local Lender" has the meaning given to that definition in Clause 6.9 (Umbrella Lines) .

  "Local Borrower" has the meaning given to that definition in Clause 6.9 (Umbrella Lines) .

  "Majority of Lenders" means Lenders

  (a)whose total loan commitments are at least 66 2/3% of all loan commitments Lender amount or

  (b)when the lending commitments of all lenders whose lending commitments immediately prior to the reduction totaled at least 66 2/3% of the lending commitments of all lenders have been reduced to zero.

  "Non-Obligor" means any Group Company that is not an Obligor.

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  “Renewal Request” means a request substantially in the form of the template in Attachment 5 (Prolongation Request Template) notifying a new interest period for a Loan under Credit Line A.

  "Quotation Date" means in relation to any period for which an Interest Rate is to be determined, the day two TARGET DAYS prior to the first day of such period, unless this is not in accordance with market practice in the European interbank market; in this case, the quoting day will be determined by the agent in accordance with market practice in the European interbank market (whereby, in the event that quotes are usually published on several days, the quoting day will be the last of those days).

  "Legal Restrictions" means

  (a)the principle that remedies may be granted or refused at the discretion of a court and the limitation of enforcement actions by bankruptcy laws, the right of appeal or other laws affecting creditors' rights generally;

  (b)the statute of limitations on claims and defenses of set-off or counterclaim; 

  (c)comparable legal principles, rights and remedies under the law of other applicable jurisdictions; and

  (d)any other matter set forth in the Legal Opinions accompanying the Finance Documents as limitations or caveats to legal matters of general application.

   "Reference Banks" means any credit institution designated by the Agent in consultation with and approved by the Company under this Credit Agreement.

  "Reference interest rate" means the arithmetic mean (rounded up to the fourth decimal place) of the asking rates pa quoted to the agent by at least two of the reference banks by 10 a.m. on the interest fixing date, at which the reference banks offered deposits in EUR on the interbank market in Frankfurt am Main ( if at or around 10:00 a.m. on that day, no quote is given, or only one of the reference banks quotes, then there is no reference interest rate for the relevant interest period). 

  "Reputable Accountant" means an accounting firm that is appropriately resourced in terms of experience, size, skill, and quality of work.

  "Rollover Loan" means the refinancing of an drawn Working Capital Loan (i) on the last day of the Interest Period applicable to the Working Capital Loan, and (ii) with another loan of equal or lesser amount.

  "Sanctions" has the meaning given to such definition in Clause 20.1(n) (Anti-Corruption, Sanctions, Anti-Money Laundering Provisions) .

  "Sanctioned Person" has the meaning given to that definition in Clause 20.1(n) (Anti- Corruption, Sanctions, Anti-Money Laundering Provisions) .

  "Sanctioned Countries" has the meaning given to such definition in Section 20.1(n) (Anti- Corruption, Sanctions, Anti-Money Laundering Provisions) .

  "Collateral" means all liens, land charges, security transfers, assignments by way of security and other real securities as well as corresponding security rights under foreign law.

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  "Taxes" means any tax, levy, duty or other charge or withholding of a similar nature (including related ancillary tax benefits).

  "First Payout Date" means the date on which any Line of Credit is first drawn.

  "TARGET2" means the "Trans-European Automated Real-Time Gross Settlement Express Transfer System" payment system with a common platform, which became operational on November 19, 2007.

  "TARGET day" means each day on which TARGET2 is available for payments in EUR.

  "Subsidiaries" means any person who is (i) a majority-owned company within the meaning of Section 16 AktG, (ii) a dependent company within the meaning of Section 17 AktG, or (iii) a subsidiary of a company within the meaning of (i ) or (ii) this definition.

  "Transfer Agreement" means any transfer agreement in the form of Exhibit 12 (Model Transfer and Accession Agreement) by which a Lender transfers all or part of an Underwriter Interest to another person.

  "Umbrella Line" has the meaning given to that term in Clause 6.9(a) (Umbrella Lines) .

  "Conversion amount" means the amount in EUR that results if an amount in a foreign currency is exchanged at the reference exchange rate for foreign exchange (purchase EUR, sale foreign currency) provided by the respective sub-credit bank ("exchange rate") is converted into EUR.

  "Sales Tax" means: 

  (a)any tax levied in accordance with Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax; and

  (b)any other tax of a similar nature, whether levied in any Member State of the European Union as a substitute for, or in addition to, any such tax under paragraph (a) above or elsewhere.

   "Sub-Lender" means (in that capacity) a Lender or an Affiliate of a Lender.

  “Sub-Line of Credit” means any bilateral line of credit provided by a Sub-Line of Credit under this Credit Agreement.

  “Sub-Line of Credit Commitment” means, in relation to a Sub-Line of Credit Bank and Sub-Line of Credit, the amount in EUR that the Sub-Line of Credit has agreed to make available under the Sub-Line of Credit, to the extent that such amount has not been terminated or reduced pursuant to this Agreement or the Sub-Line of Credit Documents.

  "Sub-Credit Agreement" means any agreement for the provision of a Sub-Credit Line.

  "USD" means United States Dollars.

  "Affiliate" means a subsidiary or a Holding company of any person and any other subsidiary thereof holding company

  “Sub-Line of Credit Availability Date” means, in relation to a Sub-Line of Credit, the date on which the Sub-Line of Credit is first drawn. This day must be a bank working day during the availability period.

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  "Availability Period" means

  (a)in relation to Line of Credit A, the period referred to in Section 5.1 (b) (Availability)

  and

  (b)with regard to the working capital credit line, the period specified in Section 5.1 (c) (Availability)  

  “Available Line of Credit” means, in relation to a Line of Credit, the aggregate of all Available Commitments of Credit from Lenders participating in that Line of Credit.

  "Available Credit Commitment" means, in relation to a Line of Credit, a Lender's credit commitment (uncancelled or lapsed) less the aggregate amounts

  (a)its interests in loans disbursed and outstanding under this facility and

  (b)in the case of the working capital line of credit, the amount of its sub-line of credit commitment.

   For purposes of calculating the Available Credit Commitment, the Available Credit Commitment (i) by the amount of all under the relevant Credit Facility before or on loan still to be paid out on the day of payment and a sub-credit line commitment in EUR With respect to each new Sub-Line of Credit outstanding by or on the requested Pay Date must be made available, reduced and (ii) by the amount of all under these Credit line to be repaid before or on the payment date as well as effective, terminated or expired sub-credit line around the appropriate commitment. 

  “Available Sub-Line Commitment” means the amount of a Sub-Line Commitment of a Sub- Line of Credit less the Outstanding Sub-Line Amount of such Sub-Line of Credit and the Notional Amounts of the Maximum Amount Guarantees supporting the Umbrella Lines collateral provided by branches or affiliated companies of this sub-credit bank.

  For purposes of calculating the Available Sub-Line of Credit Commitment, the Available Sub- Line of Credit Commitment amount shall be reduced by (i) the notional amounts of the Maximum Amount Guarantees required to be provided by or on the Availability Date of the Sub-Line of Credit and (ii) the amount of any Sub-Line of Credit commitments made under such Sub-Line of Credit or maximum amount guarantees to be returned or expired on the availability date.

  "Obligor" means the Borrower and any Guarantor.

  "Leverage Ratio" has the meaning given to it in Clause 22.1 (Definitions) .

  "Prepayment Penalty" means an indemnity to be determined by the relevant Lender in the event of early repayment during an ongoing Interest Period, equal to the difference between (a) the interest owed by the Borrower (pursuant to 9 (Interest rates)), but without the margin for the remaining term of the interest period and (b) the return that results for the respective lender from a hypothetical reinvestment of the repaid amount on the interbank market with the same term.

  "Significant group company" means each group company based on the most recent consolidated financial statements made available under this loan agreement contributes at least 7.5% to the Group's EBITDA (calculated in accordance with Section 22 (Financial Measures) on a consolidated basis) or to the Group's 

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  total assets on a consolidated basis. Group companies that meet these requirements as of June 30, 2018 are those listed in Appendix 16 (Major Group Companies).

  "Significant Adverse Impact" means an Event that has a Material Adverse Effect has effect on

  (a)the economic, asset, earnings or financial position of an Obligor or of the Group as a whole (although any future reason for termination under Paragraph (c) of Section 24.1 (Reasons for Termination) does not in itself constitute a case of this Paragraph (a)),

  (b)the ability of an obligor to meet its payment obligations under the to comply with financing documents, taking into account the total financial resources of the group, which this obligated party has in due time are available (including insurance payments), or

  (c)(subject to Legal Restrictions) the validity or enforceability of any Finance Document or the claims and rights of the Financial Parties (collectively) under any Finance Document (which is not cured within fifteen (15) banking days of Company becoming aware).

   "Material Termination Cause" means a Termination Cause as set out in paragraph (a) (non-payment), (f) (cross-default), (g) (insolvency), (h) (insolvency proceedings, moratorium, liquidation and other proceedings) or (i) (enforcement measures) of para. 24.1 (Reasons for Termination).

  "Competitor" means any person whose main business activity largely corresponds to that of the Group ("Relevant Person") or a person with a Relevant Person within the meaning of §§ 15ff. AktG affiliated company, each with the exception of:

  (a)lenders and

  (b)such companies affiliated with a relevant person that are managed independently of the relevant person or in respect of which appropriate measures and procedures are in place designed to prevent the exchange of operational information, and insofar as they are included in the list in Appendix 17 (competitor blacklist) , which the company may update once a year by naming other competitors who meet the above criteria.

  "Interest Determination Date" means the time two (2) Banking Days prior to the start of each Interest Period on which the Agent shall determine the Interest Rate for the following Interest Period Clause 9.7 (interest fixing date) .

  1.2 	Interpretation

  Unless this credit agreement expressly states otherwise or the context indicates otherwise, the following rules of interpretation shall apply.

  (a)Any reference to borrower, guarantor, arranger, lender, agent, sub-credit bank, etc. also includes their respective universal or individual successors in the rights and obligations under this Loan Agreement or any other financing document.

  (b)Any reference to a statutory requirement means, unless expressly provided otherwise, the statutory requirement, as amended from time to time, or successor statutory requirement, in effect after the execution of this Loan Agreement.

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  (c) Any reference to a contract or a provision in a contract means, unless expressly stated otherwise, the contract or the contractual provision as amended from time to time, including all modifications (however far-reaching), amendments and supersedes Contracts or contractual provisions made after the date of signing this Credit Agreement.

  (d)Any reference to a person means an entity, an individual, or a partnership.

  (e)The Company will ensure that Obligors who are not parties to this Loan Agreement comply with their obligations under this Loan Agreement and will make the acknowledgments and representations required of them under this Loan Agreement on their behalf. The Obligors entering into this Credit Agreement make the acknowledgments and representations for themselves and are bound to comply with the applicable obligations hereunder.

  (f)A cash deposit means in respect of a guarantee or a liability the deposit of an amount in the currency of the guarantee (or the liability) to an interest-bearing one in the name of the debtor account if the following requirements are met: 

  (i)the account is held with the creditor to whom cash deposit is paid,

  (ii) until no more amounts are owed under the guarantee or the liability, the account may only be used to make payments required under the terms of this Agreement relating to the guarantee or the liability are due and

  (iii)the obligor has provided the creditor or the creditor with a first-ranking security over the account in a form and content that is satisfactory to him.

  (g)An Outstanding Sub-Line Amount is deemed to be repaid or prepaid when:

  (i)cash collateral is provided for the Outstanding Sub-Line Amount;

  (ii )the sub-credit facility is reduced or terminated, or

  (iii)the sub-credit bank has reasonably satisfied itself that it no longer has any further obligations under the sub-credit line, 

  and the amount of redemption or early redemption under paragraphs (i) and (ii) above is equal to the amount of the Cash Margin or Reduction.

  (h)Paragraph (g) applies mutatis mutandis to the amounts outstanding under an Umbrella Line.

  (i)An amount borrowed also includes any amount drawn under a sub-line of credit.

  (j)Headings in this Credit Agreement are for convenience only and should not be considered in the interpretation.

  (k)A reason for termination exists as long as it has not been remedied or waived. A reason for termination exists as long as it has not been waived.

  (l)Third party means persons or companies that do not constitute a group company.

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   2. LOAN COMMITMENTS

  2.1 Loan Commitments

   The lenders undertake to pro-rata in proportion and up to the amount of their Credit commitments, the following credit lines in accordance with this credit agreement To make available:

  (a)the company a credit line A up to a total of EUR 65,000,000 and

  (b)the company a working capital credit line up to a total of EUR 10,000,000.

   2.2	Increase Option 

  (a) The Company may make up to three (3) increases in the Working Capital Credit Facility totaling up to EUR 50,000 during the period of availability of the Working Capital Facility no later than twenty (20) banking days prior to the date on which the requested increase is to take effect (the "Increase Record Date") .000 by submitting a raise request to the agent.

   (b) Each request for an increase is irrevocable and must contain the following information:

   (i) the Increase Date, which must be six (6) months before the Final Maturity Date,

   (ii) the amount of the desired increase in a minimum amount of EUR 10,000,000 in total (together with the increases made up to that point) but not more than EUR 50,000,000 and

   (iii) a confirmation that no reason for termination has occurred or would occur as a result of the increase.

  (c)The company will initially offer the lenders the opportunity to participate in the increased working capital credit line in accordance with their respective consortium quotas under the credit lines. The Agent will promptly forward the increase request to the Lenders along with the amount of each Lender's potential share.

  (d)Each Lender shall notify the Agent within ten (10) business days of the Agent's receipt of the increase request whether or not it (i) wishes to participate in the Increased Working Capital Line of Credit and (ii) generally agrees (subject to its credit approval and other qualifications) , more than its share of the increased syndicate ratio under the lines of credit to take over the working capital credit line in the event that not all lenders want to participate in accordance with their syndicated quota. No lender is obligated to participate in an increase in the working capital line of credit.

  (e)The agent will promptly notify the Company to what extent the lenders wish to participate in the increased working capital facility. 

  (f)If a lender has declared within the above period that it does not want to participate in the increase in the working capital line of credit, or not to the extent of its consortium quota under the credit lines, or if there is no corresponding response within the above period, the amount promised by no lender will be paid was offered to those lenders who have agreed to participate. If this amount is not paid in full by those lenders within a further five (5) banking days, the Company may offer 

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  other banks or financial institutions to participate in the increased working capital credit line in the amount of the remaining amount. 

   

  (g)Each lender and each potential new lender pursuant to paragraph (f) will commit to the Agent its participation in the increased working capital line of credit in the form of an increase commitment pursuant to Schedule 8 (Increase Commitment) and therein, to the extent that it is not already a lender, accede to the Credit Agreement as a working capital lender . 

  (h)An increase in loan commitments will become effective on the Increase Record Date, or if later, on the date on which the following conditions are met if the agent

  (i)has countersigned an increase commitment corresponding to paragraph (g) and signed by the participating or acceding lenders and the company and

   (ii) has successfully completed all necessary know-your-customer checks in relation to the joining lenders.

  (i)An increase in loan commitments effective under paragraph (h) will result in:

  (i)the credit commitments in relation to the working capital credit line increase by the amount specified in the increase commitment,

   (ii) each newly acceding lender is contractual in relation to the borrower and the other financial parties and vice versa as if it were of been early to lenders under this loan agreement, and

   (iii) the credit commitments of the lenders who do not participate in the increase in the working capital credit line remain unchanged.

  (j)The agent will inform the company and the lenders of the amounts of the increased loan commitments due to them immediately after the increase has taken effect.

   2.3 Termination and Increase of Loan Commitments

  (a) If a Lender becomes a Defaulting Lender, the Company may terminate that Lender's Available Credit Commitment, if the Lender is then a Defaulting Lender, upon written notice to the Agent. The agent will immediately inform the lenders about this.

   (b) After terminating a Defaulting Lender’s loan commitment, the Company may, by giving written notice to the Agent, request that the relevant line of credit up to the amount of the Defaulting Lender’s terminated loan commitments be replaced by a loan commitment from another lender to be named by the Company and acceptable to the Agent or other acceptable means bank or financial institution (the "Replacement Lender") willing to assume all of the obligations associated with accepting a loan commitment pursuant to a Lender's Finance Documents.

   (c) The obligated parties hereby declare that the guarantee agreement existing at the time a substitute lender enters the contract includes the claims of the substitute lender from the increased loan commitment.

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   (d) The increase in loan commitments will take effect with

   (i) Countersigned by the replacement lender essentially in the Form of the sample in Appendix 13 (sample of the loan commitment confirmation Substitute Lender) signed and Credit approval confirmation by the agent and 

   (ii) if the replacement lender is not a lender at the time of entry, the successful completion of all know-your-customer checks by the agent.

  (e)By submitting the Loan Commitment Confirmation, the Substitute Lender confirms the Agent's authority to sign on its behalf all contract modifications and waivers made by the Lenders in accordance with this Loan Agreement prior to the effective date of its entry into this Loan Agreement.

  2.4 Rights and Obligations of Financial Parties

  (a) The financial parties are neither joint debtors nor joint creditors. Each financial party can assert its claims against the borrower independently of the other financial parties, unless otherwise stated in this loan agreement.

   (b) If one of the financial parties violates their obligations under this loan agreement, the borrower can only assert rights against them. The obligations of the borrower towards the other financial parties remain unaffected by such a breach of duty.

   3. USES

  3.1 Credit Line A

   Credit line A may only be used to refinance the financial liabilities to be redeemed.

  3.2 Working Capital Line of Credit

  The Working Capital Line of Credit may only be used to refinance Existing Financial Indebtedness and to cover general operational financing needs (including the financing of Permitted Acquisitions and to cover and (re) financing of transaction costs in connection with this credit agreement).

  3.3 Inspection Authority

   Lenders have the right, but not the obligation, to check that the loans are being used as intended.

  4. PAYMENT REQUIREMENTS

  4.1 General Withdrawal Requirements

   (a) The lenders are only obliged to participate in the initial disbursement of a loan in accordance with Section 5.3 (request and provision of the loan) for the disbursement of a loan if the (Requirements for Payout) have been submitted to the Agent in a form and content reasonably satisfactory to the Agent. The Agent will promptly notify the Company and Lenders as soon as this is the case.

   (b) Unless a majority of the Lenders instructs the Agent otherwise in writing prior to the Agent making the notice referred to in paragraph (a), the Lenders authorize (but have no obligation to) 

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  the Agent to make such notice. The Agent shall not be liable for any damages, costs, expenses or otherwise as a result of the issuance of this notice.

   (c) Notwithstanding paragraph (a), a loan will only be disbursed if in the case of a Rollover Loan, 

  (i)no termination has been given for cause of termination pursuant to Clause 24.2 (Lenders' Rights) and no Material Termination Reason exists; or

   (ii) in the case of any other Loan, no event of termination exists or would occur as a result of the disbursement and all representations to be made pursuant to Clause 20.2 (Making and Repeating the Representations) (unless already otherwise qualified, in material respects) are correct.

   4.2 Waiver

   A Disbursement Condition shall also be deemed to have been met if Lenders have requested its fulfillment in accordance with Clause 32.2 (Amendments and Waivers) have renounced.

  5. OBTAINING LOANS

  5.1 Availability

   (a) Credit line A and the working capital credit line can be used in the form of loans within the framework of the available credit commitments up to the amount of the respective available credit line.

   (b) Credit line A can be drawn from the date of signing this credit agreement until December 31, 2018 at the latest. Parts of credit line A that are not used when the availability expires automatically expire.

   (c) The Working Capital Line of Credit is available from the date of signing of this Credit Agreement until three (3) months prior to the Final Maturity Date.

   5.2 Amounts and number of draws

   (a) minimum amounts

   (i) Loans under Credit Line A can only be drawn down in an amount or in partial amounts of at least EUR 10,000,000 (and an integer multiple of EUR 1,000,000) and only in EUR.

   (ii) Loans under the working capital line of credit can only be drawn down in minimum amounts of EUR 1,000,000 and, if greater, higher integer multiples of EUR 500,000 and only in EUR.

  (b)Number of draws

  (i) No more than three (3) loans under Line of Credit A may be outstanding at any one time.

   (ii) No more than ten (10) loans may be outstanding under the Working Capital Line of Credit at any one time.

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   5.3 Access and Delivery of the Loans 

  (a) The provision of a loan is only possible after proof of fulfillment of the disbursement requirements according to Section 4 (disbursement requirements) . 

  The retrieval takes place through an irrevocable payment request addressed to the agent and in compliance with the requirements of Section 5.1 (availability) and 5.2 (amounts and number of drawings), by natural persons registered in the commercial register who are authorized to represent the company in an authorized number or in the form Annex 6 (sample power of attorney for claims) has been signed by an effectively authorized person and no later than the third (3) bank working day before the desired payment day, which must be a bank working day, by 11 a.m. (or one bank working day before the desired day of the first payment, the must be a bank working day, by 11:00 a.m.) must be received by the agent in the original, as a pdf file or by fax (on request with the original submitted later). A separate disbursement request must be used for each request for a loan.

  (b) The agent will immediately inform each lender in writing or electronically upon receipt of a proper payment request and request the amount due to the respective lender after his loan commitment. Subject to Clause 4.1 (General payment requirements) and Clause 5.3 (Settlement) , each lender is obliged to make the requested amount available on the date on the account specified by the agent for this purpose.

   6. SUB-CREDIT LINES

  6.1 Provision of sub-credit lines

   (a) Each Working Capital Lender (and each of its Affiliates pursuant to Section 6.6 (Affiliates as a Sub -Line of Credit )) may provide to the Borrower (and also other Group Companies pursuant to Section 6.7 (Affiliates as a Sub-Line Borrower)) in consultation with the Agent under its Provide available credit commitment for the working capital line of credit a sub- line of credit to draw on short-term fixed-rate loans, each with a term of up to 12 months, cash advances on current account or letters of credit (including letters of credit). No lender (and according to

   (b) Clause 6.6 (Affiliated companies as sub -credit bank ( none of its Affiliates) is obliged to provide a sub-credit line. A sub-credit line may not be provided if the sub-credit line commitment of this sub-credit line together with all other sub-credit line commitments of all sub-credit banks amounts to EUR 10,000,000 would exceed.

   (c) The provision of a sub-credit line by a sub-credit bank requires that the agent is no later than three (3) banking days before the availability date of the Sub-credit line A written request from the respective borrower for the provision of a sub-credit line in the form set out in Annex 7 (sample sub-credit request) has received.

   (d) (e) The Agent will notify the Company, the Sub-Line of Credit and the other Working Capital Line of Credit lenders of the provision of each Sub-Line of Credit. The respective sub-credit line is to be set up in EUR. Any utilization of the sub-credit line in a foreign currency (including USD), which is offered by the respective sub-credit bank within the framework of this sub-credit line, is possible after consultation with the respective sub-credit bank. 

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  6.2 Conditions of the sub-credit lines

   (a) The sub-credit banks are free to agree the conditions of the sub-credit lines with the respective borrowers within the scope of what is customary in the market, unless otherwise stipulated in this clause 6 (sub-credits) .

   (b) Each sub-credit agreement:

   (i) may only allow the Borrower or an Affiliate of the Lender pursuant to Clause 6.7 (Affiliates as Borrowers of a Sub-Line of Credit) to use the Sub-Line of Credit,

   (ii) shall not allow the amount of the Sub-Line of Credit Commitment to exceed the amount of the Sub-Line of Credit Bank's Available Credit Commitment for the Working capital line of credit (before deducting the relevant sub-credit line from the available loan commitment) exceeds

   (iii)may not to the borrower to overdraw the sub-credit line commitment, allow the amount of

  (iv) shall provide that no drawings may be made under the Sub-Line of Credit if (i) there is cause for termination and (ii) the Agent (at the direction of a majority of Lenders) within five (5) Banking days (A) after the agent was informed that a drawing request had been submitted, objected to a further drawing (except for the use of an overdraft facility), and/or (B), in the case of an overdraft facility, after the agent became aware of the existence of the reason for termination has informed that the sub- credit line is blocked. Notwithstanding this provision, further rights of the sub- credit bank can be agreed within the framework of the sub-credit agreement if there is a reason for termination and

  (v)must determine that no later than the Final Maturity Date (or such date that the applicable sub-credit bank's (or its Affiliate's) Affiliate's (or its Affiliates') Working Capital Line of Credit Commitment is zero for reasons other than the expiration of the Working Capital Line of Credit Availability Period) (A) the Loan Commitments for the Sub-Line of Credit are zero, (B) all amounts outstanding under the Sub-Line of Credit (including interest and other charges) are repaid, guarantees are returned or cash-backed, and (C) undrawn Sub-Lines of Credit expire.

  (c)The company or the respective borrower ensures that the sum of the loans outstanding under a sub-credit line does not exceed the available credit line at any time.

  (d)The terms of this Credit Agreement supersede the terms of any sub-credit agreement.

  (e)The company will notify the agent in writing in advance of the change or cancellation of a sub-credit line.

   6.3 Rights and obligations of sub-credit banks

   (a) Sub-credit banks act on their own account and are entitled to agree on and collect interest, fees and commissions in relation to the sub-credit lines they have extended at normal market conditions.

   (b) Each sub-credit bank is obliged to provide the agent with all information upon request regarding sub-credit lines (including outstanding sub-credit line amounts, but excluding the price conditions). Of the Agent notifies lenders of the balances of all sub-credit lines upon request. 

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   (c) Each sub-credit bank is only liable to the other lenders for intent and gross negligence.

   6.4 Repayment of Sub-Credit Lines

  (a)	A sub-credit line is only available until the end of its term in accordance with the provisions of the relevant sub-credit agreement or after its termination in accordance with the provisions of this credit agreement, but no later than the final maturity date.

  (b) No sub-credit bank may terminate a sub-credit line prematurely or prematurely Demand repayment of any Outstanding Sub-Line Amount unless

  (i)the working capital line of credit commitment has been canceled in full or all Working capital loans have been terminated in full or are otherwise due for repayment in full in accordance with the provisions of this loan agreement,

   (ii) it has become unlawful under any applicable jurisdiction for the sub-credit bank to perform its obligations under this Credit Agreement as contemplated or to disburse or maintain its interest in its sub-credit facility; or

   (iii) the Outstanding Sub-Line of Credit Amount (if any) under this Sub-Line of Credit may be refinanced by drawing down the Working Capital Line of Credit. For the purposes of determining whether an Outstanding Sub-Line of Credit Amount may be refinanced by drawing down the Working Capital Line of Credit, the Available Credit Commitment of the Sub-Line of Credit Lender (in consideration of Section 6.6(a) (Affiliates as Sub-Line of Credit)) with respect to the Working Line of Credit shall be as of Increase the Outstanding Sub-Line Amount to be Refinanced. Utilization of the working capital credit line pursuant to this Section 6.4(b)(iii) (unless Section 6.4(b)(i) applies) does not preclude the existence of a reason for termination and can be made independently of Section 5.2 (b) (amounts and drawing number ) take place. Upon payment of the loan intended for refinancing:

  (A)Each Working Party Lender will participate in such Loan in an amount (as determined by the Agent) that will result in the aggregate amount of its interests in the then outstanding Loans being in the same proportion to the aggregate amount of the loan stands as his loan approval to his working capital line of credit commitment; and

  (B)the relevant sub-credit line is deemed to have been terminated.

  (c)The Company will promptly notify the Agent when an Under-Loan has been fully and definitively repaid.

   6.5 Modifications to Sub-Lending Agreements

  Sub- credit agreement modifications or waivers with respect to a sub-credit agreement require the consent of the other financial parties only if the contractual modification or waiver relates to a matter that would require a modification or waiver under this Credit Agreement. In this case, the provisions of Section 32.2 (Amendments and Waivers) applicable to amendments or waivers under this Credit Agreement shall apply.

  6.6 Affiliates as Sub-Credit bank

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  (a) Affiliated companies may also act as sub-credit banks in compliance with the provisions of this credit agreement with a working capital lender. A Working Capital Lender and its Affiliate are treated as a single lender for purposes of this Loan Agreement whose lending commitment is equal to that Lender's lending commitment with respect to the Working Capital Line of Credit. To calculate the Available Credit Commitment with respect to a Lender, the amount of its Affiliates' Sub-Committed Line of Credit shall be deducted.

   (b) To the extent that this Loan Agreement or other Financing Document provides for an obligation of a Sub-Lender and the Sub-Lender is an Affiliate of the Working Capital Lender and is not a party to this Credit Agreement, the Working Capital Lender shall ensure that its Affiliate fulfills such obligation.

   6.7 Affiliates as Borrowers of a Sub-Line of Credit

  (a) Other Group companies can also act as borrowers of a sub-credit line, subject to compliance with the provisions of this credit agreement. In this case, a reference in a financing document to a borrower includes such group companies.

   (b) The Company must ensure that any other group company which, pursuant to paragraph (a), acts as a borrower under a sub-credit facility without being a party to the relevant sub-credit agreement, complies with the terms and obligations under the relevant sub-credit agreement.

   6.8 Compliance with loan commitments

   Regardless of the other terms of this Credit Agreement, each Working capital lenders ensure that their loan commitments are respected Working capital line of credit is not less than:

  (a)its sub-line of credit commitments; and

  (b)its Affiliate's sub-line of credit commitments. 

  6.9 Umbrella Lines

   (a) Subsidiaries of the Company (each a "Local Borrower") may obtain bilateral lines of credit from Affiliates or branches of a Sub-Lender (each a "Local Lender") under the applicable Sub-Lender's Available Sub-Line of Credit Commitment in the form of

   (i) Cash advances (on current account),

   (ii) short term fixed rate loans, and

   (iii) Guarantee credits (including letters of credit) in a currency chosen in consultation with the Local Lender ("Umbrella Lines").

  (c)The Umbrella Lines must be fully guaranteed by a maximum amount guarantee from the Company ("Maximum Amount Guarantee"). The Maximum Amount Guarantee must be in English and denominated in EUR to the Local Lender and (if it is not a Lender) to the Lender of which it is an Affiliate. be addressed and essentially the pattern in Appendix 9 (Maximum amount guarantee example) .

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  (d)The sub-credit line commitment of the relevant sub-credit bank is deemed to have been utilized in the amount of the nominal amount of the maximum amount guarantee. The respective nominal amount of the maximum amount guarantee together with the nominal amounts of all other maximum amount guarantees may not exceed an aggregated amount of EUR 10,000,000 at any time.

  (e)No sub-credit bank or its branch and no company Affiliated with a sub-credit bank is required to provide umbrella lines.

  (f)The following also applies to the conditions of the umbrella lines:

  (h)subject to the provisions below apply to the Umbrella does not govern the terms of this Loan Agreement, but only the terms agreed between the Local Lender and the relevant Local Borrower,

   (ii) 	the conditions of an umbrella line, in particular the amount of interest to be paid, commissions, guarantee fees and other costs can be freely agreed between the local lender and the respective local Borrowers are negotiated, but must be customary in the market,

  (iii) each Umbrella Facility must provide for a Local Lender's right of termination or Local Borrower's obligation to prepay all outstanding amounts and redeem or cash other borrowings if the credit commitment relating to the Working Capital Line of Credit and/or Sub-Line of Credit is terminated or expire automatically and all claims made under this credit agreement become due for early repayment in full.

  (g)The Company will ensure that the Umbrella Credit Agreement does not conflict with the terms of this Credit Agreement. 

   6.10 Loss Relief Among Working Capital Lenders

  (a)For the purposes of this Clause 6.10, a Working Lender's "Receivables" are :

   (i) that Working Lender's receivables from the Borrower under the Working Line of Credit (along with any interest, commissions and fees) and those charged by him pursuant to this sub-credit lines provided under the Credit Agreement (along with all interest, commissions and charges); and

   (ii) the claims of such Working Capital Lender, its branch or any of its Affiliates against the Company under a Cap Guarantee in connection with the Umbrella Lines; in each case to the exclusion of contingent liabilities. Claims by a working capital lender, one of its branches or an affiliated company under a maximum guarantee are not contingent liabilities for this purpose if and to the extent that they relate to umbrella lines that are due shortly after termination of this loan agreement.

  (b)In the event of insolvency proceedings against the Borrower's assets, termination pursuant to Section 24.2 (Lenders' Rights) , or if after the Final Maturity Date in respect of any claim under the Working Capital Line of Credit, Sub-Line of Credit and/or Maximum Amount Guarantee for a period of at least five (5 ) bank working days in arrears, the working capital lenders will bring their outstanding debts to such a level by assigning their claims and making appropriate compensation payments in the amount of the nominal amounts of the respective claims in EUR that for each 

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  working capital lender the total amount of his outstanding debts in the ratio to the total amount of all outstanding debts, which is the ratio of the amount of its loan commitment for the working capital line to the total loan commitment of all working capital lenders. If and to the extent that a Maximum Amount Guarantee secures claims of a Lender's Affiliate, such Lender shall be subject to: 

  (c)ensure the necessary assignment of claims from the maximum amount guarantee. The Agent will perform the calculations required for settlement under this paragraph (b) upon submission of the necessary information by the Working Capital Lender (in the case of sub-credits and umbrella lines in foreign currency, the relevant conversion amount applies).

  (d)Initially, there is no balance settlement for contingent liabilities of the working capital lenders. In particular, outstanding guarantees under sub-credit lines or umbrella lines are not taken into account when calculating outstanding amounts.

  (e)If three (3) months after the settlement of a balance has been made, the basis of its calculation has changed (e.g. due to clearing of balances, payments from a sub- credit bank or a local lender in connection with an umbrella line under a guarantee facility), the balances balance again taking into account this change.

  (e)The Agent will calculate new balances in accordance with paragraphs (b) through (d) above on a quarterly basis on the last day of each calendar quarter and for as long as outstanding balances are reported to it by the Working Capital Lenders and will notify the Working Capital Lenders.

  (f)A working capital lender's loan commitment may not be exceeded by the settlement of accounts pursuant to paragraphs (b) through (e) above.

   (g)The decisive point in time for the settlement of the balance is the point in time of the opening of insolvency proceedings, termination or default in accordance with paragraph (b), subject to subsequent adjustments in accordance with paragraphs (d) and (e). The original relevant date pursuant to paragraph (b) is also relevant for the conversion of outstanding amounts in foreign currency into EUR. Subsequent currency fluctuations are not taken into account.

   (h)If, for legal reasons, a balance cannot be settled with effect on the borrower or third parties, the working capital lenders are obliged to bring about a corresponding result internally.

   (i)The Company expressly and irrevocably agrees to this Section 6.10.

   7. TERM AND REFUNDS

  7.1 Duration

   The credit lines have a term from the date of signing this loan agreement to the final maturity date.

  7.2      Repayments

  The loans are to be repaid as follows:

  (a)loans drawn under Line of Credit A on each of the subsequent amortization dates in the amounts specified below Repayment rate in EUR: repayment date 06/30/2019 amortization rate EUR 3,000,000 12/30/2019 06/30/2020 EUR 3,000,000 EUR 3,000,000 12/30/2020 EUR 3,000,000 

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  06/30/2021 EUR 7,500,000 12/30/2021 EUR 7,500,000 06/30/2022 EUR 7,500,000 12/30/2022 EUR 7,500,000 06/30/2023 EUR 7,500,000 Maturity Date Any balance and 

  (b)Borrowings drawn under the Working Capital Line of Credit at the end of each Interest Period and no later than the Final Maturity Date. 7.3 Billing 

  If a loan under the Working Capital Line of Credit (“New Loan” ) is to be paid off on the same date that another such loan (“Maturing Loan”) is to be repaid and the New Loan is to be used in whole or in part to refinance the Maturing Loan, the borrower's claim for payment of the new loan is offset against each lender's claim for a pro rata repayment of the loan due. If the loan due exceeds the new loan, the borrower only has to repay the difference in cash. If the new loan exceeds the loan due, the lenders of the working capital line of credit are only obliged to pay out the difference in cash.

  8. EARLY REPAYMENT

  8.1 Voluntary Early Repayments

   (a) Voluntary early repayments of the loans are possible at the end of an interest period in the amount of at least EUR 500,000 or in the amount of any higher amount that represents a whole multiple of EUR 100,000. The Borrower will make a voluntary early repayment stating the amount five (5) Announce banking days in advance. The announcement cannot be made under conditions. After the announcement has been made, there is an obligation to make early repayment in the amount of the announced amount. 

  (b) A loan under Line of Credit A may be repaid no earlier than the expiry of the Line of Credit A availability period or at the point in time when the Line of Credit A commitment is zero, whichever is earlier. The loan commitment for credit line A is not revived by the repayment and credit line A may not be used again.

   8.2 Illegality

   Insofar as it becomes unlawful or unlawful for a lender to fulfill its obligations under a financing document under the relevant legal provisions or official orders,

  (a)the Lender shall promptly notify the Agent thereof,

  (b)Lender is entitled to increase its Available Credit Commitment and Available terminate sub-credit line commitment and

  (c)the lender is entitled:

  (i)its interests in the loans in full at the end of a Interest Period, or ,if earlier, the day on which Notice to the Agent is specified by the Lender (and which is no earlier than the last day of any time limit that may be required). to make repayment due and

   (ii) the Outstanding Sub-Line Amounts provided by that Lender or any Affiliate of that Lender to which date that this lender has stated in the information to the agent (and which is at the earliest the last day of any deadline that may have to be observed). repayment due, after which the borrower has to ensure that the outstanding amounts are covered under the umbrella lines provided by the Local Lenders have provided on the day that these lenders in the information provided to the Agent (and which is no earlier than the last day of any grace period that may be 

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  required) will be repaid and commitments under those Umbrella Lines will be terminated on that date.

  8.3 Change of Control

   (a)	Upon (i) the occurrence of a change of control; or (ii) the disposal of all or substantially all of the Group's assets, each lender shall, subject to paragraph (b) below, be entitled to any work done by him (or any person with affiliated companies) granted loan commitments and terminate sub-credit line commitments in whole or in part and:

  (A) its interests in the loans in full at the end of a interest period due;

   (B) call for repayment of the Outstanding Sub-Line Amounts provided by such Lender or an Affiliate of such Lender, whereupon the Borrower shall ensure repayment of the outstanding amounts under the Umbrella Lines provided by the Local Lenders, and the commitments under these Umbrella Lines are terminated on that date.

   (b) In the event of a change of control, the company must inform the agent and the agent the lenders immediately. The lender and the company undertake to negotiate in good faith for a period of 20 banking days from receipt of the notification by the agent about the continuation of the contract despite the change of control, possibly on changed contract terms. During this Negotiation Period, neither Lender shall have the right to exercise any of its rights under paragraph (a) nor any obligation to make any new loans or drawdowns. Only after the negotiation period has expired without result is each lender entitled to exercise his rights under paragraph (a) with a period of notice of a further 20 bank working days and a corresponding message to the agent (which the agent must immediately forward to the company).

   8.4 Mandatory special repayments

   Borrower has amounts equal to 100% of the net proceeds (i.e Gross proceeds of sale less costs associated with the transaction and taxes applicable to the proceeds of sale) received by a Group company as consideration in connection with the sale of fixed assets outside the ordinary course of business (excluding sales pursuant to paragraphs (b), (d), ( e), (f) and (g) of the definition "Permitted Sales"), for a repayment pursuant to Section 8.7 (Redemption Offsetting) , insofar as these exceed a total amount of EUR 2,500,000 in a financial year and not within nine (9) months after the cash inflow into investments in the Group's assets (or within fifteen (15) months if a commitment to do so is made within six (6) months).

  8.5 Notification

   The borrower will notify the agent immediately as soon as he becomes aware of circumstances triggering a mandatory special repayment within the meaning of Clause 8.3 (change of control) and Clause 8.4 (mandatory special repayments) . 

  8.6 Due date

   The mandatory special repayment is due ten (10) bank working days after the occurrence of the event triggering the mandatory special repayment according to Section 8.4 (mandatory special repayments) or after the end of the period provided for the reinvestment.

  8.7 Amortization Settlement

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   (a) Voluntary early repayments will count towards the credit line and repayment installments determined by the Company prior to repayment. If no determination is made, they will be applied pro rata to all outstanding loans and outstanding sub-credit line amounts. The amounts are distributed proportionately to the outstanding amounts of the lenders participating in the relevant credit line.

   (b) Mandatory special repayments are offset as follows:

   (i) first to repay outstanding loans under credit line A in reverse order of maturities,

   (ii) then on the working capital loans in the following order:

   (A)	first to repay outstanding loans under the working capital line of credit,

  (B) then to cancel Loan Commitments still available for the working capital line of credit and

   (C) finally, to repay the Outstanding Sub-Line Amounts and drawdowns under the Umbrella Facility and then to cancel any Available Sub-Line Commitments. If there are several loans under a credit line, all loans granted under the respective credit line are offset pro rata in proportion to the consortium shares of the lenders, unless otherwise specified in this credit agreement.

  8.8 Interest and Fees

   Voluntary early repayments and mandatory special repayments pursuant to Section 8 (Early Repayment) are to be made together with the interest, commissions, fees and other amounts owed (e.g. early repayment penalties) due on them.

  8.9 Revaluation

   A mandatory special repayment results in the immediate termination of the underlying loan commitments in the corresponding amount after offsetting in accordance with Section 8.7(b) (repayment offsetting). Insofar as the working capital loan was repaid in a manner other than in accordance with Clause 8.7(b) (repayment offsetting) , revaluation is permitted.

  8.10 Cancellation of Loan Commitments

  (a) Available credit commitments for each line of credit may be withdrawn in whole or in part by the borrower at any time with five (5) bank business days' notice in minimum amounts of EUR 500,000 or a higher multiple of EUR 100,000 at the end of an interest period without a prepayment penalty be terminated. The credit commitments of the lenders involved are reduced pro rata as a result.

  (b)Available credit commitments for Line of Credit A may be canceled no earlier than the expiry of the Line of Credit A availability period or when the credit commitment for Credit Line A is zero, whichever is earlier.

  (c)The Borrower shall ensure that the sum of the outstanding loans and sub-credit lines made available under a line of credit at no time exceeds the available line of credit and, if necessary, will prepay loans and terminate sub-credit lines.

   8.11 Termination of Loan Commitments by an Individual Lender

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  If at any time the borrower is in accordance with a lender Clause 14.2 (net tax clause) to pay an increased amount, according to Clause 14.3 (tax exemption) to refund or exemption from taxes (each without general taxes of the lender) or according to Clause 15 (cost increase) to pay increased costs etc , the borrower may, provided the circumstance giving rise to the obligation to pay the increased amount, refund or exemption from tax or payment increased costs, etc., terminate the credit commitments and sub-credit commitments of the relevant lender by written notice to the agent and the relevant lender. Upon receipt of the notification by the agent or on the later repayment date specified in the notification (which in the case of loans may not be after the end of the current interest period(s)), the borrower is obliged to do so immediately

  (a)(b) such Lender's interests in the Loans together with any accrued interest and other payable under the Finance Documents repay amounts the Outstanding Sub-Line Amounts of the Sub-Lines that this Lender or an Affiliate of such Lender has provided repayment, and

   (c) ensure that the amounts outstanding under the umbrella lines provided by the Local Lenders are repaid and the commitments under those umbrella lines are terminated as of that date.

   8.12 Prepayment Penalty

  For voluntary early repayments and mandatory special repayments in accordance with Section 8 (Early repayment) that are not paid at the end of an interest period, an early repayment penalty is payable to each lender, unless the mandatory special repayment is made on the basis of Section 8.2 (illegalness).

  9. 	INTEREST RATES

  9.1 Interest Rate

   The interest rate for the loans granted under a credit line is the percentage pa for a certain interest period, which is made up of

  (a) the EURIBOR applicable to the relevant Interest Period

  (b) the Initial Margin pursuant to Section 9.2 (Initial Margin) or the applicable Margin after a Margin Adjustment pursuant to Section 9.3 (Margin Adjustment) to Section 9.6 (Error Margin Determination) .

  If the EURIBOR is less than zero (0) percent pa, the EURIBOR is zero (0) percent pa as agreed.

  9.2 Initial Margin

   The initial margin is

  (a)for loans under credit line A 1.50% pa and

  (b)for loans under the working capital credit line 1.20% pa

   9.3 Margin Adjustment

  From the filing of the Compliance Certificate for the last quarter of 2018 (ending 31. December 2018) and subject to Sections 9.5 to 9.6, the applicable margin is calculated according to the table below depending on the gearing ratio (calculated according to Section 22 (financial ratio) and proven by submitting the respective compliance certificate according to Section 21.3 (Compliance Certificate )) determined :

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  Gearing	Applicable Margin Loans under Tran A (in basis points p.a.) Applicable Margin Loans under the Working Capital Line of Credit (in basis points p.a.)

  Greater than or equal to 2,50:1	170	140

  Greater than or equal to 2,00:1 but less than 2,50:1	160	130

  Greater than or equal to 1,50:1 but less than 2,00:1	150	120

  Greater than or equal to 1,00:1 but less than 1,50:1	140	110

  Greater than or equal to 0,50:1 but less than 1,00:1	135	105

  Lower 0,50:1	130	100

   9.4 Adjustment Time

   After the conditions for a margin adjustment according to Section 9.3 (margin adjustment) , the margin for each loan is adjusted at the beginning of the next interest period, which begins after submission of the respective compliance certificate or, if there is not at least five (5) banking days between them, on the expiration of five (5) banking days after submission of the compliance certificate (for the first time with the compliance certificate in relation to the financial statements for the financial year 2018). If there is no interest period due to the lack of utilization of the working capital line of credit, the margin adjustment is made for the purpose of calculating the commitment fee Item 13.1 (provision commission) at the beginning of the calendar quarter following the submission of the compliance certificate.

  9.5 Margin Increase

  If and as long as there is a reason for termination or if the Compliance Certificate is not submitted or is not submitted on time, the respective highest margin according to the table in Section 9.3 (margin adjustment) applies (plus, only if there is a material reason for termination and if there is a Reason for termination according to Section 24.1(d) (Other obligations) due to non-submission or late submission of the Compliance Certificate 1% pa). If the reason for termination is demonstrably cured or a waiver is issued or the compliance certificate is submitted later, the margin will be adjusted to the actual level of indebtedness no later than three (3) bank working days after healing has occurred or the waiver has been issued in accordance with Section 9.3 (margin adjustment) . corresponding margin adjusted. The right of the lenders to terminate under this credit agreement remains unaffected by a margin increase.

  9.6 	Incorrect margin determination

  If the audited consolidated financial statements show that the Group's gearing ratio was incorrectly stated in a compliance certificate and the margin was therefore wrongly reduced, increased or not adjusted, the agent has the right to retrospectively adjust the margin by the difference. The difference is to be paid by the Borrower to the Agent within three (3) business days after delivery of the Consolidated Financial Statements. If the Consolidated Financial Statements indicate that a lower margin should have been applied for a period of time, subsequent interest payments will be reduced by the amount necessary to place the Lender and the Borrower in the position in which they would have been if the correct margin had been applied. Payments to lenders are reduced under this rule only to lenders who were already lenders during the period in which the erroneous margin was applied.

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  9.7 	Interest Fixing Date

  At each interest rate date, the agent determines the interest rate for the following interest rate period and communicates it to the borrower and lenders.

  9.8	Maturity and Calculations of Interest

  (a)Interest is calculated based on actual elapsed days divided by 360 (including but excluding the first day of an interest period).

  (b)Interest on loans under a Line of Credit is payable on the last day of each Interest Period for that Interest Period, however, for Interest Periods longer than six months in duration, interest is payable on account at the end of the sixth month for the previous six (6) months to pay. 

  9.9 Billing

  The agent will send an interest statement to the borrower well in advance of the interest due date.

  10. DEFAULT INTEREST

  (a) The borrower is in arrears without the need for a reminder if he fails to make the payments owed under this credit agreement or not in full on the day they are due.

   (b) For the duration of the delay in payment, the borrower owes default interest on the outstanding loan amount and on all other amounts, with the exception of interest, at the applicable interest rate pursuant to Section 9 (Interest rates) plus 100 basis points pa. The lenders are entitled to claim further damages close. The borrower is entitled to prove that such damage has not occurred or only to a lesser extent.

   (c) The right of the financial parties to claim compensation for the damage caused by the delay in paying interest in accordance with the statutory provisions remains unaffected.

   11. INTEREST PERIODS

  11.1 Interest

  The borrower is obligated to pay interest on the outstanding loan amounts in accordance with the following provisions.

  11.2 Interest Periods

  The interest periods are three (3) or six (6) months at the borrower's option. The borrower shall inform the agent in writing and irrevocably of the choice of the interest period as part of his disbursement request or (if it is a loan already granted under credit line A) as part of his prolongation request by 9:30 a.m. on the third (3rd) bank working day at the latest before the start of the next interest period. If the borrower does not exercise his option in time by submitting an application for extension, the interest period is three (3) months. A shorter period may be chosen for the first or last interest period after consultation with the agent.

  11.3 Exercising the Right to Choose

  The borrower must exercise his right to choose pursuant to Clause 11.2 (Interest Periods) in such a way that an interest period for sufficient amounts also ends at each repayment date pursuant to Clause 7.2 

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  (Repayment) . For this purpose, an interest period with a shorter period of time than provided for in Section 11.2 (Interest Periods) can also be selected after prior consultation with the agent.

  11.4 Commencement and End of Interest Periods

  The first interest period begins at the beginning of the day of disbursement of the relevant loan (inclusive) and ends on the last day of the relevant interest period (not included). Each subsequent Interest Period begins at the beginning of the last day of the preceding Interest Period (inclusive) and ends on the last day of the relevant Interest Period (not included). If the last day of an interest period is not a bank working day, the interest period is deemed to have ended at the end of the next bank working day, unless the next bank working day falls in the next calendar month; in this case, the interest period is deemed to have ended on the bank working day immediately preceding the last day of the interest period. 

  11.5 Consolidation of Loans

  If multiple loans under Line of Credit A have interest periods ending on the same date, those loans will be consolidated and treated as a single loan beginning with the following interest period, unless the borrower exercises their election as provided Clause 11.2 (interest periods) otherwise.

  12. MARKET DISTURBANCE, ALTERNATIVE METHOD OF CALCULATION

  12.1 Market Disruption

  The agent will notify the borrower immediately if one or more lenders, whose loan commitments alone or together amount to at least 35%, have informed the agent by 10:00 a.m. at the latest on the interest rate fixing day that their respective refinancing costs for the following interest rate period have been reduced by the respective EURIBOR not be covered. In this case, Section 12.2 (alternative calculation method) applies.

  12.2 Alternative Calculation Method

  (a) If this Clause 12.2 applies, the interest owed to each Lender for its Underwriter Part shall be the applicable Margin pursuant to Clause 9 (Interest Rates) plus the interest rate notified to the Agent by the relevant Lender in respect of the relevant Interest Period as the Interest Rate to which he can refinance himself in the market. If this refinancing interest rate is less than zero (0)% pa, a refinancing interest rate of zero (0)% pa is applied.

   (b) The parties to this Credit Agreement will enter into negotiations for a maximum of 30 days with the aim of agreeing on an alternative calculation of interest (including an alternative arrangement for the refinancing of the affected loan disbursements, the applicable interest rate and the interest period) (e.g. the money market interest rate offered by German banks). If the parties mutually determine an alternative calculation method, this shall apply to all affected payouts as long as the market disruption pursuant to Section 12.1 (Market Disruption Event) persists – otherwise the interest rate reported under

  paragraph (a) shall remain for the relevant period.

   13. COMMISSIONS AND FEES

  13.1 Commitment Fee

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  The Borrower shall pay to the Agent (for onward transmission to the Lenders) a Commitment Fee of 35% of the applicable Margin on a Lender's Available Loan Commitment for the duration of the Available Period, accruing on or after the third Banking Day following the execution of this Loan Agreement or on the earlier of Date of the first payment and due and payable subsequently at the end of a calendar quarter and for the terminated part of a loan commitment upon termination. The commitment commission is calculated based on the number of days elapsed and a 360-day year.

  13.2 Utilization Fee

  The Borrower pays to the Agent (on behalf of the Lenders) on the drawn and uncancelled portion of the Loan Commitment relating to the A lender's working capital line of credit charges a utilization fee depending on the amount the utilization of the working capital credit line according to the following table (each excluding the utilization by setting up a sub-credit line, which, regardless of its utilization, is expressly only used for the purposes of this Section 13.2 in the calculations of the amount of the utilization of the credit commitment in relation to the working capital credit line and the available credit commitment in relation to the working capital credit line are disregarded):

  Amount of utilization in relationship to the Loan commitment (minus the established sub-credit lines) Utilization commission (in basis points pa)

  ≤ 33 1⁄3 % und > 0 %

  	10

  > 33 1⁄3 % und ≤ 66 2⁄3 %

  	20

  > 66 2⁄3 %

  	30

  The utilization fee is due and payable in arrears at the end of an interest period.

  13.3 Participation Fee

  The Borrower pays each Initial Lender a Participation Fee pursuant to a separate agreement.

  13.4 Agent's Commission

  The borrower pays to the agent (for its own account) an agent's commission according to a separate agreement.

  14. TAXES

  14.1 Definitions

  (a) In this contract, the following terms have the following meanings:

   "Protected Party" means a Financial Party that is or will be subject to any liability in connection with any amount received or to be received pursuant to a Finance Document (or any amount deemed to be 

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  received or to be received for Tax Purposes) or a payment for or due to Taxes has to pay or will have to pay.

  "Qualified Lender" means a Lender who is commercially The beneficiary of interest payments due to a loan disbursement in are payable to that lender as part of a financing document and which:

  (i) the loan is sufficient through a permanent establishment in Germany; or

  (ii) is an Eligible Lender;

   

   

  "Tax Credit" means a credit, reduction, remission or refund of any tax.

  "Tax Deduction" means a deduction or withholding from a payment under a Finance

  Document made for or on account of Tax, other than a FATCA Deduction.

  "Tax Payment" means either an increase in a payment made by an Obligor to a Financial Party under Section 14.2 (Tax Net Clause) or a payment under Section 14.3 (Tax Exemption).

  "Eligible Lender" means a Lender that:

  (iii) for the purposes of the double taxation treaty as in a treaty state is treated as a resident;

  (iv) does not conduct business in Germany through a permanent establishment to which that Lender's interest in the Loan is attributable.

  "Treaty State" means a state that has entered into a double taxation agreement (a "Double Taxation Agreement") with Germany that provides for total exemption from taxes levied in Germany on interest.

  (c)Unless there is an indication to the contrary, in this Clause 14.1 "determined" refers to a determination made in the sole discretion of the person making the determination.

   14.2 Tax Net Clause

  (a) Each Obligor shall make the payments it owes without any tax deduction, unless a tax deduction is required by law.

   (b) The Company shall promptly notify the Agent that an Obligor is required to deduct tax (or that there has been a change in the rate of tax or base applicable to the withholding of tax) upon becoming aware thereof. Likewise, a Lender shall notify the Agent if it becomes aware of any payment to be made to that Lender. If the agent if a notice to the effect is received from a lender, he shall notify the Company and the Obligor concerned. 

  (c) If an obligation is required by law to make a deduction of tax, the payment to be made by that obligation shall be increased by such an amount that the amount paid (after any deduction of tax has been made) equals the amount that would have been made had the deduction not been required would have been.

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   (d) A payment shall not be increased pursuant to paragraph (c) above as a result of a withholding tax imposed by Germany if, at the time the Payment:

   (i) the payment could have been made to the applicable Lender with no tax deduction had it been a Qualified Lender but the applicable Lender was not a Qualified Lender at that time Lender is (any longer) and is not a result of any event occurring after the time it became Lender under this Agreement

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  change (or change in interpretation, administrative practice or application) statutory regulation or one double tax treaty is a published administrative practice published tax benefit of a competent tax authority; or

  (ii) the applicable Lender is an Eligible Lender and the Obligor making the payment can demonstrate that payment to the Lender could have been made without the tax deduction had such Lender complied with its obligations under paragraph (g) below.

   (e)

  (f) If an Obligor is required to make a Withholding Tax, it shall make the Withholding Tax and any payment required in connection with such Withholding Tax within the time limits required by law and to the lowest amount required by law. Within thirty days of the making of any tax deduction or payment required in connection with such tax deduction, the withholding agent shall provide to the agent, on behalf of the financial party entitled to the payment, evidence reasonably satisfactory to that financial party that the tax has been deducted or (if applicable) that all relevant payments have been made to the appropriate taxing authority.

   (g) A Treaty Eligible Lender and any Obligor making a payment to which that Treaty Eligible Lender is entitled will cooperate to comply with the procedural and formal requirements necessary for such Obligor to make the applicable payment without withholding tax. 

  14.3 Tax Exemption

  (a) The Company shall pay (within three Banking Days upon request of the Agent) to a Protected Party an amount equal to any loss, liability or other charge which the Protected Party determines that it shall (directly or indirectly) owe him or her has suffered or will suffer for or as a result of any tax in connection with a Finance Document.

   (b) Paragraph (a) above does not apply:

   (i) on taxes paid against a finance party:

   (A) determined under the laws of the jurisdiction in which such Financial Party has its registered office or, if different, the jurisdiction or jurisdictions in which such Financial Party is considered to be tax resident; or

  (B) be determined under the laws of the State in which the permanent establishment of that financial party for amounts received or to be received in that country, if the tax on the net income received or 

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  receivable of this Financial Party charged or calculated on the basis of such net amount (other than such amounts deemed to be received or to be received only by such Financial Party); or

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  (ii) to the extent that losses, liabilities or costs:

  (A)be offset by an increased payment in accordance with Clause 14.2 (net tax clause) ;

   (B) would have been offset by an increased payment under Section

  14.2 (Net Tax Clause) , but were not offset solely because one of the exceptions in paragraph (d) of Section 14.2 (tax net clause) applied; or

   (C) based on a FATCA deduction to be made by a party.

   (c) A Protected Party who is making or intends to make a claim under paragraph (a) above shall promptly notify the Agent of the circumstance which will give rise to or has given rise to the claim: to inform, whereupon the agent has to inform the company.

   (d) A Protected Party shall notify the Agent of receipt of payment from an Obligor under this Section 14.3.

   14.4 Tax Credits

  If an Obligor makes a tax payment and the relevant Financial Party determines that:

  (a)a tax credit with an increased payment of which that tax payment is one forms part of, is related to a tax payment or a tax deduction as a result of which the tax payment had to be made; and

  (b)the financial party or a company with which there is an income tax group (or a comparable institution under foreign law) has received and used this tax credit,  the financial party has to pay the relevant obligor an amount which (after making the payment) according to the financial party's determination (taking into account the tax credit of a company with which there is an income tax group (or a comparable institution under foreign law)) into a position in which the finance party would be if the obligor had not had to pay the tax.

  14.5 Confirmation of Lender Status

  Each Lender who becomes a party to this Agreement after the conclusion of this Agreement shall indicate in the assignment agreement it signs to become a party as Lender, for the benefit of the Agent and without liability to any Obligor, which of the following categories it falls into:

  (j)not a Qualified Lender;

   (ii) Qualified Lender (but not an Eligible Lender); or

   (iii)        Eligible Lender.

  If a New Lender fails to declare its status in accordance with this Clause 14.5, such Lender will, for purposes of this Agreement (including by any Obligor), until then do so treated as if it is not a Qualified Lender until it notifies the Agent which category it falls into (the Agent shall notify the Company upon receipt of such 

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  notification). For the avoidance of doubt, failure by a Lender to comply with the provisions of this Clause 14.5 will not void a Transfer Agreement.

  14.6 Stamp Duty

  The Company shall, upon request, indemnify, within three Banking Days, any Finance Party against all costs, losses and liabilities incurred by that Finance Party in connection with stamp duty, registration duty or similar tax in respect of a Finance Document in an Obligor Jurisdiction and which are not based on a transfer of a consortium share are based.

  14.7 Sales Tax

  (a) Any sums payable by a party to a finance party under any Finance Document that are, in whole or in part, consideration for a service for the purposes of VAT law are free of any sales tax that may be applicable to that service; accordingly, subject to paragraph (b) below, if VAT is or becomes due on a performance by a Finance Party to another party to a Finance Document, that Finance Party party shall have an amount to the extent that it is required to remit VAT to the appropriate taxing authority payable in the amount of sales tax (in addition to and concurrent with the payment of any other consideration for that service) (and the relevant financial party shall promptly issue a proper sales tax invoice to the relevant party).

   (b) Occurs upon a delivery by one financial party (the "Performer") to another Financial Party (the "Beneficiary") in connection with a Finance Document VAT and is a party other than the Beneficiary (“Relevant Party”) in accordance with the terms of the applicable Finance Document to pay an amount equal to Obliged to provide consideration for the service in question (instead of being obliged to reimburse or indemnify the recipient of the service):

   (i) the Relevant Party shall pay to the Performer, to the extent that the Performer is required to pay VAT to the relevant taxing authority, an additional (and concurrent with the payment of the relevant amount) an amount equal to the VAT. The service recipient pays (to the extent this paragraph (i) applies) to the Relevant Party promptly an amount equal to any credit or refund from the relevant taxing authority that the Recipient reasonably determines relates to the sales tax that was to be charged on the relevant Service; and

   (ii) the Relevant Party shall promptly, upon request by the Recipient, to the extent that the Recipient is required to pay sales tax to the relevant taxing authority, pay an amount equal to the sales tax that is levied on the relevant Service, but only to the extent that the Service Recipient reasonably determines that it is not entitled to a VAT credit or refund from the relevant taxing authority.

  (c)To the extent that a Finance Document provides that a party is obligated to to reimburse or indemnify the financial party for costs or expenses, the relevant party shall reimburse or indemnify the Finance Party in full for such cost or expense, including that portion attributable to VAT, unless the Finance Party reasonably determines that it is entitled to a credit or refund of the relevant VAT from the relevant tax authority.

  (d)All references in this Section 14.7 to a party include (to the extent relevant and unless the context otherwise indicates) in the event that a party is treated as a member of a VAT group, references to the person who at that time in accordance with the group-related provisions in Article 11 of 

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  Council Directive 2006/112/EC, as amended (or in the version implemented by the relevant Member State of the European Union), is treated as the supplier or, where applicable, the recipient of the supply or service, so that a Reference to a party is to be construed as a reference to the relevant party or the relevant group or tax group to which the party belongs at the relevant time for sales tax purposes, or to the statutory representative or controlling company of this group or tax group.

  (e)With regard to a delivery or service provided by a finance party for a party within the framework of a financing document, the relevant party must, upon reasonable request of a finance party, immediately provide this finance party with information on the VAT registration of the party and transmit all other information relating to the VAT declaration obligations of the financial party with regard to the delivery or service in question can reasonably be required.

  (f)No obligor is obligated to pay sales tax amounts under the preceding paragraphs insofar as the sales tax was triggered by a financial party waiving a sales tax exemption and the obligor is not entitled to deduct input tax.

   14.8 FATCA Information

  (a) Subject to paragraph (c) below, either party shall, at the reasonable request of another party, within ten (10) business days

   (i) 	to confirm to the other party whether

  (a) they are a FATCA Exempt Party; or

   (b) is not a FATCA Exempt Party,

   (ii) provide that other party with all forms, documents and other information related to its FATCA

  status that that other party reasonably needs to comply with FATCA regulations by such other party requests and 

  (iii) provide that other party with any forms, documents and other information related to its status that that other party reasonably requests for that other party to comply with any other law, regulation or obligation under information sharing procedures. in the from

  (c)If a party certifies to another party pursuant to paragraph (a) above that it is a FATCA Exempt Party and provides that party  subsequently determines that it is not or no longer a FATCA Exempt Party, that party shall notify the other party thereof as soon as practicable.

  (d)Paragraph (a) above will not compel any Financial Party and paragraph (a)(iii) above will not compel any other party to take any action that, in its reasonable discretion, would or could constitute a violation of

  (k)a law or regulation,

   (ii) a duty of loyalty or

   (iii) a confidentiality obligation.

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   (d) If a party fails to confirm whether or not it is a FATCA Exempt Party or to provide any forms, documents or other information requested under paragraph (a)(i) or (a)(ii) above (for the avoidance of doubt : this also applies if paragraph (c) above applies), for the purposes of (and making payments under) the Finance Documents, the relevant party will be treated as not being a FATCA Exempted Party until it has received the requested confirmation or provides the requested forms, documents or other information.

  14.9 FATCA Deduction

  (a)

  (b) Each party shall be entitled to make any FATCA deductions required by FATCA and any other payments required in connection with the relevant FATCA deduction; neither party is obligated to increase any payment from which it makes a corresponding FATCA deduction or otherwise compensate the recipient of the payment for the relevant FATCA deduction. Once a party becomes aware that it is required to make a FATCA deduction (or that the tax rate or basis of assessment of the relevant FATCA deduction has changed), it shall notify the party to whom it is making payment and the Company and immediately notify the agent who will then notify the other financial parties.

   15. INCREASE IN COSTS

  In this clause 15 means

  "Basel II" means the framework "International Convergence of Capital Measurements and Requirements, Revised Framework, Comprehensive Version" published by the Basel Committee on Banking Supervision in June 2004, as amended, but excluding changes due to Basel III. "Basel III"

  (a)the agreements on capital requirements, leverage limits and liquidity standards contained in the framework adopted by the Baseler Committee on Banking Supervision in December 2010 and from (i) "Basel III: A global regulatory framework for more resilient banks and banking systems" (Basel III: A global regulatory framework for more resilient banks and banking systems), (ii) "Basel III: International Framework Agreement on Measurement, standards and monitoring in relation to liquidity risk" (Basel III: 

  (b)International framework for liquidity risk measurement, standards and monitoring) and (iii) the "Guidance for national authorities for the implementation of the countercyclical capital buffer" ("Guidance for national authorities operating the countercyclical capital buffer") (in its most recent version), the regulations published by the Basel Committee on Banking Supervision in November 2011 "Global systemically important banks: valuation methodology and requirements for the additional loss absorbing capacity - Framework Regulation" (Global important banks: assessment methodology and the additional loss absorbency requirement – Rules text) in the applicable version,

  (c)Regulation (EU) No. 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activities of credit institutions and the prudential supervision of credit institutions and investment firms (CRD IV) and

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  (d)any other guidance or standard issued by the Basel Committee on Banking Supervision in connection with "Basel III" and any other regulation (of the legislature, a regulator, a financial party or a financial party Affiliate) that implements Basel III.

   15.1 Cost Increase

  If, after entering into this Credit Agreement, the waiver or amendment of a to a Lender applicable legislation (including Basel III, or such Laws and regulations that implement or apply Basel III) or their changed interpretation by a public authority, a court or another competent official acting body and/or the compliance of the same by a lender has the consequence that

  (a)the costs incurred by a lender or an affiliated company through the granting of a loan, e.g. from the refinancing of a loan, increase,

  (b)a Lender or any Affiliate thereof forfeits interest or other income under this Loan Agreement; or

  (c)an amount owed to a lender or one associated with him Company is payable under this loan agreement, or the rate of return of a lender reduced from (the "Cost Increases") the Lender concerned will, promptly after becoming aware of this and making the decision to require reimbursement of such cost increases from the Borrower, notify the Borrower in writing through the Agent. The Borrower shall pay the relevant Lender, on behalf of the Lender, within five (5) business days of the Agent's written request, amounts corresponding to such cost increases (excluding such cost increases relating to a period of more than 180 days prior to the assertion of the cost increase relate). The plausibility of the cost increases must be checked in a comprehensible manner for the borrower, whereby the lender in question is not obliged to disclose circumstances and documents that are confidential. 

  15.2 Exceptions to Reimbursement

  Clause 15.1 (cost increase) does not apply to cost increases,

  (a)which the Borrower is already obligated to refund or exempt in full under Section 14.3 (Tax Exemption) (or would have been obligated had none of the exceptions in Section 14.3 (Tax Exemption ) applied) or which have been otherwise compensated under this Credit Agreement ,

  (b)attributable to a FATCA deduction to be made by a party,

  (c)which are related to the implementation and application of Basel II (in the version at the conclusion of this loan agreement), unless they result from an amendment to Basel II, in particular with the implementation and application of Basel III (or such laws and regulations that implement or apply Basel III),

  (d)which are related to the implementation and application of Basel III, provided that the information required to calculate the cost increase lenders on the day of signing this loan agreement were available; or

  (e)caused by breaches by the financial parties of their legal or contractual obligations.

   16. DAMAGES REDUCTION

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  (a) The lender concerned will make reasonable efforts to keep the disadvantages arising for the borrower from section 8.2 (illegalness), section 14 (taxes) or section 15 (increase in costs) as low as possible. In particular, if this is possible without detriment to him, he will transfer the rights and obligations under this credit agreement to an affiliated company or a branch in another country.

   (b) All obligations of the obligated party from the financing documents remain unaffected by paragraph (a).

   17. OTHER INDEMNIFICATION OBLIGATIONS

  17.1 Currency Exemption

  (a) If one is from an Obligor under a Funding Document, a decision or sum due from a judgment (a “Sum”) by the currency in which the sum is to be paid (the “First Currency”) to another currency (the “Secondary Currency”) must be converted in order to:

   (i) to assert or register a claim against the obligor; or

   (ii) a decision or judgment in respect of a judicial or initiate or enforce arbitration proceedings,  the obligor must, within five (5) banking days of the request of the financial party to whom the sum is owed, indemnify it against all costs, losses and any liability arising as a result of the conversion, including the discrepancies between (A) the exchange rate at which the sum was converted from the first currency to the second currency and (B) the exchange rate or rates available to that financial party when it received the sum.

  (a)Each Obligor waives any right it may have to pay amounts owed under the Finance Documents in a currency or unit of currency other than that specified in the Finance Documents.

   17.2 Indemnification Obligations

  The Company shall, upon request, indemnify (or arrange for an obligor to indemnify) any Financial Party within five (5) Business Days from all costs, losses and liabilities incurred by it as a result of any of the following circumstances arises:

  (a)occurrence of a reason for termination,

  (b)an Obligor's failure to pay any amount owed under a Funding Document when due, including costs, losses and obligations arising under Clause 28 (Distribution of Payments, Settlement) ;

  (c)Refinancing or entering into agreements to refinance their Participation in a loan by the borrower in a Request for Disbursement has been requested but has not been granted due to one or more provisions of this Credit Agreement (unless for reasons attributable to the Lenders) or

  (d)failure to prepay a Loan (or part of a Loan) pursuant to a Prepayment Notice issued by the Borrower.

   17.3 Agent Release

  The obligated are jointly and severally obliged to release the agent immediately from

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  (a)all costs, losses and liabilities incurred by the (reasonably acting) Agents arise due to the following measures:

  (h)Investigating events that he has reason to believe constitute grounds for termination or

   (ii) Acting in response to or in reliance on any communication, request or instruction which he reasonably believes is genuine, truthful and duly authorized or

   (iii) engagement of attorneys permitted under this Credit Agreement;

  auditors, tax advisors or other professional advisors or experts and

  (b)all costs, losses and liabilities incurred by the Agent (other than as a result of the Agent's gross negligence or willful misconduct) in acting as (reasonable) agent under the Finance Documents.

   18. COSTS AND EXPENSES

  (a) The Company will reimburse the Arrangers or Agent for all reasonable external consultants' fees (including attorneys' fees with caps previously agreed with the Company) and other reasonable out-of-pocket expenses incurred by the Arrangers or Agent in connection with the preparation, negotiation and amendment and legal review of the Finance Documents (including the legal opinions obtained in this regard) and the syndication, provided that these have been previously agreed with the company in each individual case.

   (b) If an Obligor requests a waiver or contract modification, or if a contract modification is required under Clause 32.3 (Replacement of the Reference Interest Rate), the Company will reimburse the Agent within five (5) days of the agent's request for all reasonable external costs and costs previously agreed with the Company out-of- pocket expenses (including capped attorneys' fees previously agreed with Company) incurred by the Agent in connection with the waiver or contract modification; substitute.

  (c) 	The Company shall reimburse any Finance Party, within five (5) days of its request, for all costs and expenses (including attorneys' fees) incurred by the Finance Party in enforcing (including examining) its rights under the Finance Documents.

  19. WARRANTIES

  19.1 Warranty and Indemnification Obligation

  Each Obligor party to this Credit Agreement:

  (a)guarantees - irrevocably and unconditionally and jointly and severally - by way of a separate promise to pay each Financial Party, to pay such Financial Party any principal, interest, costs, expenses or other amounts arising out of or relating to the Finance Documents that are not paid in full and irrevocably by the Borrower have been made; such payment shall be made within five (5) Banking Days upon written request by a Financial Party (or the Agent on its behalf) (stating the amount required by the relevant Obligor and confirming that such amount is principal, interest, costs, expenses or other amounts arising out of or in connection with the Financing Documents which have not yet been paid in full and irrevocably by the Borrower); and

  (b)undertakes - irrevocably and unconditionally as well as jointly and severally - to any Finance Party to indemnify that Finance Party against any costs, losses or liabilities incurred by the Finance Party 

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  because any obligation of the Borrower under or in connection with any Finance Document or any obligation guaranteed by the Borrower is or becomes unenforceable, void or unlawful. The amount of the cost, loss or liability shall be equal to the amount that the financial party would otherwise be entitled to receive (reimbursement of positive interest); such claim shall be due within five (5) Banking Days upon written request by the relevant Financial Party (or the agent on its behalf). 

  For the avoidance of doubt, this guarantee and indemnification obligation is not a first- demand guarantee and, in particular, receipt of any such written request shall not waive the rights and/or defenses that the affected Obligor may have with respect to any Financial Party (or Agent in on his behalf) may be entitled to any payment required under this warranty and indemnification obligation.

  19.2 Surviving and Independent Warranty and Indemnification

  (a) This guarantee and indemnification obligation are independent and separate from the Borrower's obligations and as a continuing guarantee and indemnification obligation, extending (notwithstanding any intervening payment or full or partial performance) to the ultimate balance payable by the Borrower pursuant to the Finance Documents , to watch.

   (b) The Guarantee and indemnification obligation extends to any additional obligations of the Borrower arising out of any modification, novation, amendment, renewal, rewrite or replace any Finance documents, in particular an extension or increase of a facility or the addition of a new facility under a financing document 

   19.3 Resurgence

  Where a payment by an Obligor or discharge of an obligation by a Financial Party (whether in respect of an Obligor's obligations, a security for those obligations or otherwise) is challenged or reduced as a result of bankruptcy or a similar event, so:

  (a) 	the liability of the obligor shall continue as if such payment, exemption, rescission or reduction has not taken place; and

  (b) each financial party shall be entitled to collect the value or amount of such security or payment from any Obligor as if the payment, discharge, avoidance or reduction had not occurred.

   19.4 Excluded Objections and Defenses

  (a) Any Obligor's obligations under this Clause 19 shall be governed by any act, omission or other circumstance relating to the Borrower's principal liability (or contemplated principal liability) which would reduce, prejudice or relieve any of its obligations under this Clause 19 , not touched. This also applies to defenses by the principal debtor or rights to contest or set-off by the borrower.

   (b) The obligations of each Obligor under this Clause 19 are independent of any other security or guarantee held by the Financial Parties may have been provided or may be provided in the future. In particular, each Obligor's obligations under this Clause 19 shall not be affected by:

   (i) the discharge of another obligation of its obligations or in relation to its obligations under or in connection with a financing document, its deferral, waiver thereof or any consent in relation thereto;

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  (ii) of adoption, of modification, of comparison, of exchange, of renewal or waiver of rights against an obligation or any other person or in relation to any security in the property of any obligated or another person as well as the refusal or failure to bring about the conditions necessary for such rights to be effective or to assert or enforce such rights or failure to obtain the full value of any security;

   (iii) any incapacity or lack of power, authority or legal personality of any other Obligor or its

  dissolution or deterioration of its financial condition; or

  (vi)any unenforceability, illegality or invalidity of any obligation of another Obligor to a Finance Document. out

  (c)For the avoidance of doubt, nothing in this Clause 19 shall preclude any objections or defenses that an Obligor (solely in its capacity as Guarantor) may raise against a Financial Party on the grounds that the Guarantee and indemnification obligation are not lawful, effective, legally binding and enforceable represent obligations on his part.

   19.5 Immediate Recourse

  No Financial Party (or any trustee or agent on its behalf) shall have any obligation prior to bringing any claim against any Obligor under this Clause 19 first to take action against another person or to enforce other rights or securities against another person or to demand payment from another person. This applies notwithstanding anything to the contrary in any Finance Document.

  19.6 Use of Funds

  As long as not all amounts that the obligated from or in connection with the Financing Documents, if any, are or will be payable, have been paid irrevocably and in full, any Finance Party (or any trustee or agent on their behalf):

  (a)refrain from giving any other monies, securities or rights to these financial party (or any fiduciary or agent on its behalf) holds or has received, use or enforce, or may use and enforce in such manner and order as it sees fit (whether against these amounts or otherwise), and no Obligor is entitled to the benefit of such funds, securities or rights; and 

  (b)deposit in an interest-bearing suspense account any monies received from, or as a result of, an obligor's liability under this Clause 19. 

  19.7 Deferral of Obligor Rights

  As long as not all amounts that the obligated from or in connection with the Financing Documents, if any, are or will be payable, have been irrevocably paid in full and provided the Agent does not object Instructions are given, no Obligor will exercise any rights conferred on it by virtue of the performance of its obligations under the Finance Documents or as a result of any action hereunder clause 19 or any liability hereunder you may be entitled to and are directed to:

  (a)Release by an Obligor;

  (b)Compensation by another guarantor of an Obligor's obligations under the Financing Documents;

  (c)exercising a right of set-off against an obligation; and or

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  (d)the right (whether in whole or in part and whether by subrogation or otherwise) to benefit from any rights of any Finance Party under the Finance Documents or any other guarantee or security made by any Finance Party under or in connection with the Finance Documents were granted to draw. To the extent that an Obligor receives any benefit, payment or distribution in respect of such rights, the Obligor shall have such benefit to hold such payment or distribution in trust for the Financial Party to the extent necessary to collect all amounts arising out of or in payable in connection with the Financing Documents by the Obligors to the Financial Party may be or may be payable in full; the obligor shall promptly pay or transfer them to the Agent or act at the Agent's direction for use in accordance with Clause 28 (Distribution of Payments, Settlement of Balances).

  19.8 Additional Security

  This guarantee is in addition to any other guarantee or guarantee now or hereafter held by any financial party and is not affected in any way by such other guarantee or guarantee.

  20. REPRESENTATIONS

  20.1 Representations

  Each Obligor (and the Company in relation to the other Obligors who are not party to this Credit Agreement) hereby (and where expressly referred to, on behalf of its affiliates) makes the following representations:

  (a)existence of the group companies. In the legal form evident from their respective company names, the obligated parties are duly founded and legally existing companies with the right to dispose of their assets in the ordinary course of business and to conduct their business in the current manner.

  (b)Binding Commitments. All subject to legal restrictions

  (i)the obligations assumed by the Obligors in the Financing Documents are lawful, legally binding and enforceable, 

  (ii) the choice of law of German law in the Finance Documents to which the relevant Obligor is a party is recognized and enforceable in the jurisdiction under which an Obligor was formed and

   (iii) any judgment rendered in the jurisdiction of the Federal Republic of Germany relating to the Finance Documents to which the Obligor is a party will be recognized and enforceable in the jurisdiction under which the Obligor was incorporated.

  (c)No Breach of Duty. The conclusion of the financing documents and the implementation of the legal transactions and legal acts provided therein, including the fulfillment of any obligations, do not violate any material legal or contractual obligations or duties (subject to the legal restrictions in each case) or contractual obligations (including those under the Articles of Association, Articles of association or other rules of procedure) of the obligated.

  (d)Authorization. The obliged entities are entitled to conclude the financing documents to which they are party and to carry out the legal transactions and legal acts provided for therein. All necessary (in particular corporate law) Approvals, approvals, applications or registrations are available or have taken place or will be available or have taken place in good time.

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   (e) Permissions and Permissions.

  (i)	All permissions required

  (A)	to make it an obligation to enable it to lawfully enter into Finance Documents and to exercise and/or perform its rights and obligations under the Finance Documents. 

    

  (B)for the Finance Documents to which an Obligor is a party to be admissible in evidence under the jurisdiction under which it is incorporated, have been obtained or effected and are effective.

  (ii) All permits necessary for the business operations of the Obligors and theMaterial Group Companies have been obtained and are effective.

   (iii) Each Obligor and each Material Group Company shall have title or effective interest in, or all necessary rights, licenses, permits and approvals to use, the assets and intellectual property rights to continue the business as it is then executed, unless the absence of which is not material Adverse effect result.

  (e)Insolvency. No application was made for the opening of insolvency proceedings or comparable proceedings under a foreign legal system regarding the assets of an obligated party or a material group company. There is no obligated party and no significant group company

  There is a reason for insolvency in accordance with §§ 17 or 19 of the InsO or a comparable provision of a foreign legal system applicable to a material group company and no enforcement is pursued in the amount of more than EUR 2,500,000.

  (f)No stamp duty or registration required. Under the jurisdiction under which an Obligor is formed, no stamp duty or similar tax or duty is payable in connection with the completion of the Finance Documents or any legal transactions and legal acts contemplated therein, and there is no registration requirement or other legal obligation to officially register the Finance Documents.

  (g)No reason for termination.

   (i)	There is no reason for termination.

  (ii)	At the time of signing this Credit Agreement and on the date of the first disbursement under this Credit Agreement, there is no reason for termination and no termination event.

  (h)Information.

  (i)All information and documents essential for their credit decision were made available to the Initial Lenders.

   (ii) All documents and written information provided to the agent or other financial party are correct in all material respects.

   (iii)	To the extent that opinions or expectations are expressed or financial forecasts and predictions are made in the documents, they are the result of careful examination by the authors and are based on assumptions and current information that are realistic at the time of preparation.

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  (iv) No event or circumstance has occurred which would render the documents and information referred to in sub-paragraph (ii) incorrect or misleading in any material respect.

  (j)Careful accounting. The agent as a disbursement requirement according to Part 1 ofAppendix 2 (disbursement requirements) or the lenders last according to Paragraph (a) of Section 21.1 (Regular Financial Information) and the most recent quarterly reports of the Group and Group companies submitted in accordance with Paragraph (b) of Section 21.1 (Regular Financial Information) are accurate and in compliance with the applicable accounting principles (including applicable valuation principles) have been created and communicate on the respective balance sheet date a (essentially in the case of unaudited financial statements or quarterly reports) picture of the assets, Financial position and results of operations of the group. Since the deadline of the last delivered Financial Statements no material adverse impact has occurred. 

  (k)litigation. There are no legal disputes, judicial or official proceedings of a civil, administrative, tax or other nature pending against the obligated or material group companies which, based on reasonable assessment, are likely to be to the detriment of them be decided and in that case would most likely have a Material Adverse Effect.

  (l)group structure. The group organizational chart provided to the agent as a payout requirement pursuant to Part 1 of Schedule 2 (Payout Requirements) represents an  accurate and up-to-date overview of the group.

  (m)tax deduction. All payments owed under the Credit Agreement can be made without tax deduction to Eligible Lenders.

  (n)Anti-Corruption, Sanctions and Money Laundering Provisions.

  (j)Subject to subparagraph (ii) below

   (A) Neither an Obligor nor, to the best of our knowledge, the obligated party, one of their board members or one of their Employee,

  (i)

  (ii) are the subject of (or involved in actions against) Sanctions (would be violated) imposed by the US Office of Foreign Assets Control of the US Department of Treasury ("OFAC") and the Office of Export Enforcement of the US Department of Commerce ("OEE") or equivalent sanctions or measures imposed by the United States, the Federal Republic of Germany, the EU or the UN (hereinafter collectively and including the US Foreign and Corrupt Practices Act 1977 and the UK Bribery Act 2010 or any other applicable anti-bribery and anti-corruption laws, "Sanctions") and is owned 50% or more by, or otherwise controlled by, or acting on behalf of, one or more persons who are the subject of Sanctions (collectively, "Sanctioned Persons") , or is located or organized in any country or territory which is subject to sanctions (in particular, but not limited to, Cuba, Sudan, Syria, Iran, North Korea and the Crimea region of Ukraine, collectively "Sanctioned Countries").

   (B) To the best of the Obligors' knowledge and belief, no action or investigation by any governmental or regulatory authority has been taken in the last seven years and will not be taken against any Obligor or, to the best of their knowledge, any of their Conducted or threatened by any director or any of their employees in connection with alleged violations of anti-bribery and anti-corruption laws.

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   (ii) The obligated parties make the representation under (i) only insofar as this does not give rise to any liability under applicable anti-boycott provisions for any of the persons named under (i) (including Regulation (EC) 2271/96 as amended by Regulation (EC) 807/2003). , and Section 7 Ordinance on the Implementation of the Foreign Trade Act (Foreign Trade Ordinance)).

   

  (iii) The Obligors will not make the representation under (i) to any Financial Party to the extent that doing so would give rise to liability under any applicable anti-boycott provisions (including Regulation (EC) 2271/96 as amended by Regulation (EC) 807/2003). , and Section 7 Ordinance on the Implementation of the Foreign Trade Act (Foreign Trade Ordinance).

  (iv) The Obligors confirm to the best of their knowledge that

  (a)they all regulations applicable to them to prevent the comply with money laundering and the financing of terrorism and have implemented appropriate measures to ensure compliance with the regulations applicable to them to prevent money laundering and the financing of terrorism; and

   (B) no proceedings are for violations of the applicable to them Anti-Money Laundering Regulations and terrorist financing are pending or specifically threatened 

   (o) collateral. No collateral is encumbered with the assets of the Obliged Persons or other group companies, with the exception of the Permitted Collateral and the conclusion of the financing documents, the fulfillment of their obligations and their execution by the Obliged Persons do not result in an obligation of an Obligor or a Group Company to provide any security other than the Permitted Collateral to order.

   (p) Financial liabilities: There are no financial liabilities of group companies except the permitted financial liabilities.

   (q) Pari Passu. The obligations of the Obligors to pay under the Finance Documents shall at all times rank at least pari passu with third party payment obligations not secured by collateral, except for obligations which, in the event of bankruptcy or otherwise by operation of law, have priority.

   (r) insurance coverage. All assets of the obligated and essential group companies that are necessary for the operation are effectively insured against damage and loss to the extent customary in the industry.

   (s) Market conditions. Each group company has only entered into contracts with third parties on terms customary in the market (“at arm's length terms”), whereby customary market conditions are to be determined with the due diligence of a prudent and conscientious businessman. 

  20.2 Making and Repeating Representations

  (a) The representations to be made under this Section 20 will be made on the date of signing of this Credit Agreement.

    

  (b)The representations made under paragraphs (a) (Existence of Group Companies) through (d) (Eligibility), (e) (i) and (ii) (Permissions and Permissions) and (h)(i) (No Reason for Termination) and the subsections (ii) and (iii) of paragraphs (i) (Information) through (j) (Prudent Accounting) 

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  of Section 20.1 (Representations) are provided by the Obligors (and by the Company for the other Obligors that are not parties to this Facility Agreement are or will be) on the date of accession in the event of a later accession by an Obligor to this Credit Agreement or the

  Guarantee contract, repeated when submitting each payment request and each time a prolongation request is submitted.

  (c)In the event that an application for a renewal with regard to a new Interest Period is not submitted, the aforementioned representations shall be deemed repeated by each Obligor on the first day of the new Interest Period.

  (d)Any representations made after the date of signing of this Credit Agreement will be made with reference to the circumstances and facts then in existence.

   21. INFORMATION OBLIGATIONS

  21.1 Periodic Financial Information

  The company will inform the lenders regularly via the agent about the development of the economic situation of the group and, if applicable, each obligated party and submit the following documents to the agent (for forwarding to the lenders) immediately and without being asked:

  (a)Annual financial statements and bank overview: Immediately after preparation, but no later than 150 days after the end of each financial year (or in the case of the audited annual financial statements of ADVA Optical Networking Ltd., no later than 240 days after the end of the financial year, whereby the annual financial statements in unaudited form already no later than 150 days after the end of the financial year must be submitted) must be submitted:

  (i)audited consolidated financial statements and audited individual financial statements of the company (including balance sheet, income statement, cash flow statement with notes and management report, if required by law),

   (ii)

  (iii) Current bank analysis for the group (broken down by credit type, Borrowers, maturities, repayment modalities and collateral), and unconsolidated and, where available, consolidated financial statements (including balance sheet, income statement and Cash flow statement) of all other obligated parties, in each case to the extent available or legally required in certified form.

  (b)quarterly reports. Immediately upon preparation, but no later than 60 days after the end of each quarter, a consolidated unaudited quarterly report (including balance sheet, profit and loss account and cash flow statement) of the company for the second quarter and a consolidated balance sheet and profit and loss account for the first and third quarter of each fiscal year. The report must include a target/actual comparison with the same period of the previous year.

   (c) Budget. Budget signed by a number of natural persons authorized to represent the company registered in the commercial register, which must be reasonably prepared in a form acceptable to the agent and must be submitted no later than 30 days after the start of each financial year. 

  21.2 Change in Accounting

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  (a) The Company ensures that all financial statements to be submitted pursuant to Section

  21.1 (Regular Financial Information) are prepared in accordance with the same accounting,

   recognition or valuation policies (including the exercise of election rights) underlying the financial statements provided to the Agent as a disbursement condition pursuant to Part 1 of Schedule 2 (Disbursement Conditions) , unless promptly notifying the Agent in writing about a change in their accounting, recognition and valuation methods or the exercise of the option rights in the annual financial statements or quarterly reports to be submitted (compared to the financial statements provided to the agent as a disbursement requirement in accordance with Part 1 of Appendix 2 (Disbursement Requirements) ) and provides the lenders significant changes, a reconciliation statement satisfactory to the agent explaining the economic impact of the new methods is available from a Chartered Accountant (except for changes relating to the reclassification of operating leases as finance leases due to of the IFRS regulations that will apply after January 1, 2019).

  (b)        At the request of the Agent (acting at the direction of a majority of the Lenders), the Borrower and the Lenders shall for a period not exceeding three (3) Weeks of negotiations on an adjustment of the key financial figure in accordance with Section 22 (financial indicator) and the margin adjustment according to clause 9.3 (margin adjustment) (except for changes regarding the reclassification of operating leases as finance leases due to the IFRS regulations, which will apply after January 1, 2019). If no agreement is reached within this period or before the end of the current quarter, the financial ratio and the calculation of the leverage ratio for the margin adjustment will continue to be calculated based on the previous accounting, recognition and measurement methods. In this case, the borrowers are obliged to continue a pro forma account based on the previous accounting, recognition and valuation methods.

  21.3 Compliance Certificate

  The company will provide the agent with each quarterly report and each consolidated financial statement, for the first time together with the annual financial statements as of December 31, 2018, an audit certificate signed by a number of natural persons who are authorized to represent the company (but at least one member of the Management Board) entered in the commercial register ("Compliance Certificate ") in the form of the model in Annex 10 (model compliance certificate) with the addition of sufficiently detailed calculations, which

  (a)		confirms compliance with the financial ratio specified in Section 22 (financial ratio) and shows the gearing required for an adjustment of the margin

  (b) reports the amounts that the Company reports in accordance with the IFRS rules effective before January 1, 2019 for the purpose of calculating the financial ratio in accordance with paragraph 22 (Financial ratio) and the margin adjustment in accordance with Clause 9.3 (margin adjustment) has qualified as an operating lease and which, according to the IFRS regulations that will apply after January 1, 2019, will qualify as a finance lease and

   (c) additionally if submitted together with the audited consolidated financial statements of the company

   (i) a list of significant Group companies and

   (ii) a calculation showing that the warranty coverage according to para.

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  23.18 (Warranty Coverage, Joining of Guarantors) is complied with and which is accompanied by a confirmation from the Company's auditors that the list and the individual calculations are correct.

  21.4 Other information, bank meeting

  The obligated are (each for forwarding to the lenders) to the agent in case of paragraph (a) at the same time and in all other cases immediately, but in any case no later than five (5) banking days after becoming aware

  (a)all written information about their financial circumstances that a Obligor makes generally available to other lenders,

  (b)any other written information that the Agent (or a Lender through the Agent) reasonably requests. about the economic or financial situation of the group, the course of business, the annual accounts and interim reports to be submitted by the obligated parties and the budget (in text form) as well as explanation of this information by natural persons authorized to represent the company in a number of authorized representatives in a meeting with representatives of the lenders (max once in each financial year),

  (c)any other information and disclosure that a lender (about the Agents) reasonably to the financial and economic circumstances of obligated and the group requests,

  (d)Information regarding any material judicial, arbitration or regulatory proceeding against a Group company become pending, provided that these with predominant probability could have a negative outcome and this one could have a material adverse effect,

  (e)Information about (i) the existence of a reason for termination or termination, (ii) or changes in the composition of the board of directors company or the management of an obliged entity and (iii) change of financial year of the obligated,

  (f)Information about the initiation of insolvency proceedings or similar Proceedings in a jurisdiction other than the Federal Republic of Germany in relation to a member of the group, and

  (g)at the request of a finance party (via the agent), all information, documents and evidence that the relevant finance party reasonably requires in order to comply with its legal or regulatory obligations to identify a borrower and a beneficial owner (including but not limited to section 18 KWG and pursuant to the other provisions of the Money Laundering Act, the Banking Act and Section 154 of the Tax Code or comparable provisions in other applicable legal systems).

   22. FINANCIAL INDICATOR

  22.1 Definitions

  "Calculation Date" means March 31, June 30, September 30 and December 31 of each year during the term of this Credit Agreement beginning on December 31 of December 2018.

  "Financial debt" means (without double counting) all liabilities of Group companies (excluding those from derivative transactions) to banks plus liabilities

  (a)acceptances,

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  (b)sold or discounted receivables (e.g. fake factoring), unless recourse against a group company is excluded (if there is limited liability/recourse in the case of the sale of receivables without fundamental recourse against a group company, this amount is classified as financial debt to record (deductible))

  (c)repurchase agreements,

  (d)Borrowing on the capital market, promissory note loan, commercial Paper (including promissory notes, bonds, commercial paper, any other debenture or other securitized debt instrument),

  (e)Finance lease transactions to the extent that they are accounted for as finance leases under the applicable IFRS rules (although those leases and hire-purchase agreements that were accounted for as operating leases under the IFRS rules before January 1, 2019 will continue to be accounted for after January 1, 2019 can be accounted for as operating leases), and

  (f)other interest-bearing on-balance-sheet financial liabilities (excluding provisions) that have the economic effect of borrowing.

  "EBITDA" means operating income reported

  (a)plus write-downs on financial assets,

   (b)

  (c) plus amortization of goodwill, plus depreciation of intangible assets and property, plant and equipment.

   "Leverage" means the ratio of financial debt to EBITDA.

  22.2 Financial Covenant

  The company guarantees that the leverage ratio of 2.75 will not be exceeded on each calculation date during the term of this loan agreement.

  22.3 Calculation and Verification

  (a) The Financial Covenant is calculated on each Calculation Date subject to paragraph (c) on the basis of the Company's consolidated financial statements in accordance with Clause 21.1 (Periodic Financial Information) .

   (b)

  (c) The key financial figure is made up of earnings figures and/or balance sheet figures. Earnings figures and the interest and redemption payments always relate to the rolling period of twelve (12) months ending on the respective calculation date, the balance sheet figures to the value on the calculation date.  If a company or business is bought or sold during a 12-month period, for purposes of calculating the financial ratio, the Contribution of this company or company to the EBITDA and to Group financial indebtedness as if the acquisition or sale had taken place on the first day of the 12-month period.

  (c)The company will demonstrate compliance with the key financial figure by submitting the compliance certificates in accordance with Section 21.3 (Compliance Certificate). If the 

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  compliance certificate to be confirmed by the auditor shows that a previous compliance certificate was not applicable, the compliance certificate confirmed by the auditor is decisive.

   23. GENERAL CONDITIONS

  23.1 Permissions

  Each Obligor (and the Company in relation to the other Obligors who are not party to this Loan Agreement) warrant that they have obtained all permissions required by the jurisdiction in which they are incorporated from time to time to:

  (a)to be able to fulfill their obligations under the financing documents;

  (b)the effectiveness and enforceability of the financing documents and their ensure admission as evidence; and

  (c)to operate their business operations in the form exercised, promptly obtain, comply with and do whatever is necessary to ensure that they remain in force, in each case to the extent that breach of such permit requirement would have a Material Adverse Effect.

  23.2 Compliance with Laws and Contractual Obligations

  Each Obligor (and the Company in relation to the other Obligors who are not party to this loan agreement) warrant that

  (a)the laws and regulations applicable to the obligated parties and significant administrative and judicial orders; and

  (b)the obligations of the obligated party from material contracts with third parties or other binding agreements be complied with to the extent that breaching them would have a material adverse effect.

  23.3 Anti- Corruption, Sanctions and Money Laundering Provisions

  (a) Each Obligor (and the Company in respect of the other Obligors who are not parties to this Loan Agreement) warrant (subject to paragraph (b) below)

   (i) not to use, lend or otherwise use, directly or indirectly, the proceeds generated under this Credit Agreement for any purpose that violates any applicable sanctions would constitute, but solely for this in this purpose specified in the credit agreement or to a natural or legal person as a loan or in any other way exclusively for the purpose specified in this credit agreement to make available and 

  (ii) conduct its business in accordance with applicable sanctions, anti-corruption and money laundering regulations and implement and maintain policies, procedures and controls that ensure compliance by the obliged entities with applicable sanctions, anti-corruption and money laundering regulations.

  (c)The obligations under paragraph (a) above apply only to an Obligor or to a Financial Party to the extent that this does not result in a violation of applicable anti-boycott regulations (including Regulation (EC) 2271/96 as amended by Regulation (EC) 807). /2003, and § 7 Ordinance on the Implementation of the Foreign Trade Act (Foreign Trade Ordinance)).

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   23.4 Corporate Structural Measures

  Each Obligor (and the Company in relation to the other Group companies that are not parties to this Credit Agreement) warrants that no Group company will effect a merger, demerger, change of legal form, accrual or other corporate structural measure, unless it is such corporate reorganization in relation to (i) one or more Obligors (where the Company has an interest, this must be the remaining Company), or (ii) one or more Non-Obligors and payments or other dispositions resulting therefrom are made only for the benefit of other Group Members.

  23.5 Change of Business

  Each Obligor (and the Company in respect of the other Obligors not party to this Credit Agreement) will ensure that no Obligor will materially alter or cease to operate its business, except as otherwise permitted under the Credit Agreement Measure.

  23.6 Acquisitions and Joint Ventures

  Each Obligor (and the Company in relation to the other group companies that are not parties to this Credit Agreement) warrants that no group company will acquire shares, companies or parts of companies, establish new companies or invest in existing companies outside the group, with the exception of Permitted Acquisitions.

  23.7 Obligation to Maintain Intellectual Property Rights

  Each Obligor (and the Company, in respect of the other Obligors not party to this Loan Agreement) agrees to maintain all intellectual property rights necessary for the conduct of the Obligor's business, to defend against infringement and to have record keeping obligations related thereto (e.g. requesting required registrations, submitting required documents and paying required fees).

  23.8 Pari Passu Clause

  Each Obligor (and the Company in respect of the other Obligors not party to this Loan Agreement) warrants that its obligations under the Financing Documents will at all times rank at least par with unencumbered third party obligations other than obligations , which are to be fulfilled as a matter of priority in the event of insolvency or otherwise by operation of law.

  23.9 Negative Declaration

  Each Obligor (and the Company in relation to the other Group Companies which are not parties to this Loan Agreement) warrant that no Group Company will post or agree to any Collateral or allow any Collateral to remain in place, other than Permitted Collateral.

  23.10 Sale of Property

  Each Obligor (and the Company in respect of the other Group companies that are not parties to this Credit Agreement) warrant that no Group company will dispose of any assets other than Permitted Disposals.

  23.11 Normal Market Conditions

  Each Obligor (and the Company in relation to the other Group companies that are not party to this Credit Agreement) vouch that no Group Company enters into contracts with third parties or transact business 

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  that deviate significantly from normal market conditions and thus do not stand up to third-party comparison, es unless the group company could not recognize this when concluding the contract or transaction when applying the due diligence of a prudent businessman.

  23.12 Lending and Assumption of Liability

  Each Obligor (and the Company in relation to the other Group companies that are not parties to this Credit Agreement) will ensure that no Group Company grants or maintains any credit, guarantee, surety or other assumption of liability for the liabilities of third parties, other than Permitted Credit Grants and Permitted Assumptions of Liability.

  23.13 Payments to shareholders and related parties

  Each Obligor (and the Company in relation to the other group companies that are not parties to this Credit Agreement) will ensure that no group company will distribute any dividends or other payment or benefit to any direct or indirect shareholder or partner of the Company or any related party Person Makes Payments Except Permitted.

  23.14 Financial Liabilities

  Each Obligor (and the Company, in relation to the other Group companies that are not parties to this Credit Agreement) warrant that no Group Company will enter into or maintain any financial liabilities (including finance leases and sale and leaseback transactions), except as permitted financial liabilities.

  23.15 Insurance

  Each Obligor (and the Company in relation to the other Obligors or Significant group companies that are not parties to this credit agreement) are responsible for ensuring that the obligated parties and significant group companies take out or maintain the insurance policies that are necessary for their business operations and are customary in the industry and will provide evidence of this to the agent at his request.

  23.16 COMI

  The company guarantees that no obliged entity will relocate its registered office or its center of main interest (COMI) to another country.

  23.17 Use of Credit Funds

  The company is responsible for the intended use of the loans and claims under the sub-credit lines in accordance with this credit agreement.

  23.18 Warranty Coverage, Accession by Guarantors

  The Company warrants that as of the date of this Credit Agreement (based on EBITDA and total assets as of June 30, 2018) and thereafter within 45 days of the submission of the Consolidated Financial Statements pursuant to paragraph (a) of Section 21.1 (Regular Financial Information) , Group companies, their EBITDA (calculated according to Section 22 (Financial ratio)) or total assets (each on a consolidated basis) represent at least 75% of the consolidated Group EBITDA (calculated in accordance with Section 22 (Financial ratio)) or total assets of the Group on a consolidated basis (each based on the consolidated financial statements of the Company) , are guarantors in connection with this credit agreement or, if necessary, accede to this credit agreement or the guarantee agreement as guarantors in accordance with 

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  Section 26.2 (Accession of Guarantors , whereby, to the extent necessary to comply with the obligation under this Section 23.18, first of all Material Group Companies and, to the extent still necessary ,others thereafter Group Companies of this credit agreement or the guarantee agreement as guarantors should join.

  23.19 Subsequent Condition, Legal Opinion

  The Company warrants that within 60 days of the date of the first disbursement, a legal opinion (in a form and form and content reasonably satisfactory to the Agent) will be obtained from the Borrower's Legal Counsel under Georgia law recognizing the Choice of Law Clause and of the place of jurisdiction clause of the guarantee contract and for the recognition and enforceability of a German judgment in connection with the guarantee contract.

  24. TERMINATION

  24.1 Reasons for Termination

  Any of the following events and circumstances constitute grounds for termination:

  (a)Non-Payment: An Obligor fails to make any payment due under a Funding Document when due unless the non-payment is due to a technical or administrative error and is corrected within three (3) bank working days after the due date.

   (b)

  (c) Improper use: A loan used or a claim under a sub-credit line is used for a purpose other than that specified in Section 3 (Purposes) and, to the extent that this can be remedied, not remedied within fifteen (15) banking days after the Company has become aware or has been notified by the Agent.

  Financial ratio: The financial ratio according to clause 22 (financial ratio) is not met.

  (d)Other Obligations: Any other obligation contained in the Finance Documents (other than as set forth in paragraphs (a) (non-payment) through (c) (financial ratio)) is not complied with by an Obligor and, to the extent that the fulfillment of the relevant obligation can be rectified, is not rectified or rectified within fifteen (15) banking days after the Obligor became aware of it or the Agent notified the Obligor.

  (e)Representations: Any representation to be made or repeated or deemed to be repeated by the Company or an Obligor under any Finance Document is materially incorrect or misleading at the time made and, subject to the representations pursuant to Section 20.1 (Representations) (i) ( Information) and paragraph (j) (Prudent Accounting) , to the extent that it can be cured, is not cured within fifteen (15) banking days of the Obligor become knowledgeably or notifying the Obligor by the Agent.

  (f)Cross default: A financial liability of an obligated party or a material group company is not paid when it falls due and within a payment period granted; a creditor of an obligated party or a material group company is entitled to terminate a financial liability vis-à-vis an obligated party or a material group company extraordinarily early or a corresponding termination is already effective unless the affected financial liabilities of all affected obligated parties and significant group companies do not exceed a total of EUR 7,500,000 or the equivalent in other currencies.

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  (g)Insolvency:

   (i)	In the case of an obligated party or a material group company that was founded under German law or has its center of main interests (COMI) in Germany, there is a ground for insolvency pursuant to Sections 17 or 19 of the Insolvency Code.

  (ii) An Obligor or a Material Group Company has generally ceased or announced that it will make payments on its debt.

   (iii) An Obligor or a Material Group Company , due to financial difficulties, enters into negotiations with one or more of its creditors of financial liabilities with the aim of generally restructuring its liabilities.

   (iv) In respect of an Obligor or a Material Group Company which is not incorporated under the laws of Germany and does not have its center of principal interest (COMI) in Germany, an event occurs which gives rise to the circumstances set out in paragraph (i) above designated events.

  (h)Bankruptcy Proceedings, Moratorium, Liquidation and Other Proceedings: About the An application for the opening of insolvency proceedings or similar was filed against the assets of an obligated party or a significant group company Proceedings in accordance with a foreign legal system (unless one of Application made by a third party is obviously abusive and will be rejected or withdrawn within fifteen (15) banking days), provisional insolvency measures taken, or insolvency proceedings, moratorium, other debtor protection or similar proceedings opened in a relevant jurisdiction (or the opening of insolvency proceedings or a comparable one). proceedings under a foreign legal system were dismissed for lack of assets) or liquidation proceedings were applied for or initiated.

  (i)Foreclosure measures: Foreclosure measures or a corresponding measure (but not the mere threat thereof) will be taken against the assets of an Obligor or a Material Group Company in respect of an outstanding amount of more than EUR 3,500,000 in an individual case or the equivalent in other currencies and not within fifteen ( 15) bank working days after an obligated party has become aware of it again or temporarily suspended.

  (j)Unlawfulness, Invalidity: A Finance Party's right under a Finance Document is not effective or unenforceable or the performance of any obligation under the Finance Documents is unlawful for an Obligor and this will not be cured within five (5) banking days of an Obligor's knowledge.

  (k)Acknowledgment of a Funding Document: An Obligor does not acknowledge, contest or dispute its obligations under a Funding Document.

  (l)Legal Disputes: A legal dispute, judicial or administrative proceeding of a civil, administrative, tax or other nature is pending against an Obligor or a Material Group Company which will most likely have a Material Adverse Effect.

  (m)Expropriation: An expropriation is initiated in respect of an Obligor's or Material Group Company's property that could result in a Material Adverse Effect.

  (n)Cessation of business operations: an obliged entity ceases its business operations or substantial parts of its business operations.

  (o)Material Adverse Impact: A circumstance exists which results in a Material Adverse Impact.

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   24.2 Rights of Lenders

  After there is a reason for termination according to Section 24.1 (reasons for termination)

  (a)the lenders are not obliged to make further payments and

  (b)the agent is obligated at the direction of the majority of lenders

  (h)the loan commitments made under this Credit Agreement and Sub-credit line commitments and all other obligations of terminate Financial Parties in whole or in part; and or (ii) the immediate repayment of outstanding loans together with the interest accrued on each and all others under this credit agreement to demand amounts due; and or

   (iii) Demand immediate repayment of the Outstanding Sub-Line Amounts.

   24.3 Obligations of the Borrower

  After termination, the borrower is obliged to

  (a)immediately, but no later than within three (3) bank working days in the to repay any loans and other outstanding sums referred to in the notice of termination and paid to him and all interest thereon, Commissions, fees and other to the lenders in accordance with the Funding documents to pay amounts owed and

  (b)to pay a prepayment penalty if the loan is not repaid at the end of an interest period.

   25. TRANSFER OF UNDERTAKING SHAREHOLDINGS

  25.1 Transfer of Undergraduate Shares

  (a) Each Lender may, with the consent of the Company, (i) assign its rights in whole or in part, or (ii) assign and transfer its rights and obligations in whole or in part by way of underwriting, in each case those under this Loan Agreement in respect of each of its loan commitments together with its pro rata Rights and obligations from the remaining financing documents ("consortium share")) and in each case to other financial institutions, banks and, in the event of a material reason for termination, to a fund or other person who regularly issues loans, securities or other financial investments or invested in or incorporated for that purpose (each, a "Permitted New Lender"). A competitor is under any circumstances an Approved New Lender. 

  (b) Consent shall not be unreasonably withheld and is not required in the event of an assignment or transfer (if each is a Permitted New Lender) (i) to another Lender, (ii) to a Lender Affiliate, or (iii) during the existence of a reason for termination. The Company's consent shall be deemed to have been given unless it has expressly objected within ten (10) banking days after the existing lender has requested its consent.

   (c) For each transfer (except in the cases of paragraph (b) (i) and (ii) the accepting lender shall pay a transfer fee of EUR 3,500 to the agent.

   (d) A consortium share is transferred to a lender by concluding a transfer agreement between the transferring lender, the accepting lender and the agent, essentially in the form of the template in Annex 12 (model transfer and accession agreement). The other parties to this Loan Agreement, subject to the 

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  conditions set out in Section 25.1(a) required approvals already today or at the tme of their accession to this credit agreement irrevocably their consent to the contract accession. The assignment is effective only if the Agent is approved by the Permitted New Lender written confirmation (in form and content satisfactory to the Agent) that the Permitted New Lender assumes the same obligations to the other Financial Parties that it would have had it been an Initial Lender.

  (d)If a measure taken by the financial parties under this Section 25 results in a payment obligation on the part of an obligated party under Section 14 (Taxes) or Section 15 (Cost increase), the obligation under Section 14 (Taxes) or Section 15 (increase in costs) justified payment obligation, if the Obligation to pay without the action of the Financial Parties under this Clause 25 would not have arisen.

  (e)Both the transfer and the assignment will be effective only if the Agent has completed all necessary customer identification procedures or comparable identification procedures under all applicable laws and regulations in connection with an assignment or transfer, as applicable, under this Section 25; the agent will notify the parties concerned of the completion of these procedures without undue delay.

   25.2 Security Interests in Underwriters / Transfer of Economic Risk

  Any Lender may, without the consent or notice of the Company or any other Obligor, exercise its rights under or in connection with the Finance Documents securing claims on any member of the European System of Central Banks (e.g. the Deutsche Bundesbank), the European Investment Bank or any other supranational bank, a credit institution, the Kreditanstalt für Wiederaufbau (KfW) or another development bank, a financial services institution, a financial company, an insurance company, a pension scheme, a pension fund or a special-purpose vehicle established by the aforementioned  institutions for the purpose of securitizing loan claims or to create other security rights thereto or to insure the economic risk of the granting of the loan - including any associated collateral, if applicable - in whole or in part with a third party or on third parties, through credit derivatives the, under asset-backed securities transactions or through loan sub-participations,  provided that such action will not relieve the relevant lender of its obligations under the Financing Documents. The refinancing institute is in no way restricted in the realization of the collateral. In the event of assignment or transfer of Rights to the Deutsche Bundesbank, the borrower will provide balance sheet figures and/or a self-assessment  to the Deutsche Bundesbank upon request.

  26. ACCESSION OR WITHDRAWAL  OF GUARANTORS

  26.1 Transfers by Obligors

  No Obligor is entitled to transfer or pledge to third parties its rights and obligations under this

  Credit Agreement or the Guarantee Agreement.

  26.2 Joining of Guarantors

  (a) A group company can join this credit agreement or the guarantee agreement as a guarantor if

   (i) they have a membership agreement essentially in the form of the sample attached 14 (model accession agreement guarantors) or the model attached to the guarantee agreement and

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  (ii) all admission requirements according to Part 2 of Appendix 2 (disbursement requirements) or corresponding accession requirements under the guarantee agreement in relation to the acceding group company are met.

  (c)The obligated parties give their irrevocable consent to the accession to the contract already today or at the time of their accession to this credit agreement; the financial parties authorize the agent to enter into the accession agreement on their behalf.

   26.3 Retirement of Guarantors

  "Sale to Third Party" means any sale of a Guarantor to a person who is not a Group Company, provided such sale is a Permitted Sale or is approved by a majority of Lenders.

  (a)In the event of a sale to a third party, the company can request that a guarantor (with the exception of the company) from this loan agreement or .

  (b)The agent must accept a resignation request and the company and the Notify lenders when

  (i)in the case of a sale to third parties, the company has confirmed to the agent in accordance with the withdrawal request that a sale to third parties has taken place,

   (ii) no termination event exists or would result from the resignation (and the Company does so to the Agent pursuant to the has confirmed the request to leave) and

   (iii) in the event of withdrawal, no payments are due from the guarantor in accordance with clause 19 (guarantees) or the respective guarantee contract.

  (c)The resignation becomes effective upon acceptance by the agent, but in the case of a sale to a third party only upon completion of the sale, so that the relevant group company remains guarantor up to this point. Upon the consummation of the third party sale or other exit, the relevant group company is no longer a guarantor and has no rights or obligations under the financing documents as guarantor.

   27. RIGHTS AND OBLIGATIONS OF AGENT AND OTHER PARTIES

  27.1 Order

  Each Lender engages the Agent pursuant to and in connection with the Finance Documents.

  27.2 Power of Attorney

  Each lender grants the agent power of attorney to make all declarations and in to receive, to exercise rights and to take actions, insofar as this is for the performance of the duties assigned to the Agent by the Financing Documents is necessary or expedient and for this purpose releases the Agent from the

  Restrictions of § 181 BGB, insofar as this is legally permissible; any lender who cannot grant this exemption, the agent will be informed immediately. The agent is entitled to grant sub-authorizations to the same extent.

  27.3 Directions of Majority of Lenders

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  (a) Except as otherwise provided in a Finance Document, (i) the Agent shall exercise or refrain from exercising any rights, powers and discretions it may have as Agent as directed by a majority of the Lenders and (ii) the Agent shall have no liability for Acts or omissions done or done at the direction of the majority of lenders.

   (b) Unless otherwise provided in a Finance Document, all instructions of the majority of Lenders are binding on all Lenders.

   (c) The agent is authorized

   (i) instructions or clarification of any of the majority of lenders to request instructions as to whether and how he exercises his rights, powers and exercise discretion or refrain from doing so and may remain inactive until he has received corresponding instructions or clarifications and

   (ii) require the lenders to provide sufficient security with regard to the costs, expenses, damages or liabilities (including any sales tax that may be incurred) that may arise in connection with the fulfillment of the instruction before the execution of an instruction and can refrain from following an instruction from the majority of the lender (or, where relevant, all lenders) until he has received the security he requested.

  (d)In the absence of direction from a majority of the Lenders (or, as applicable, all Lenders or a group of Lenders), the Agent may act or refrain from acting in what is believed to be the best interests of the Lenders. The Agent will not take any legal action on their behalf without the consent of a financial party.

   27.4 Agent's Obligations

  (a) The agent's tasks are purely technical and administrative in nature. The Agent has no obligations to the Financial Parties other than those expressly assumed in this Loan Agreement and the other Financing Documents, if any.

   (b) Subject to the provisions of paragraph (c), the agent of a party will promptly forward the original or copy of any document received on its behalf from another party.

   (c) Notwithstanding the provisions of Section 25 (Transfer of Underlying Interests) , paragraph (b) shall not apply to transfer agreements.

   (d) Except as expressly provided in any Finance Document, the Agent shall have no obligation to review or verify the adequacy, completeness or accuracy of any documents it transmits to any other party.

   (e) If the agent

   

  (j)with reference to this Credit Agreement, a notice from a receives party describing the circumstances of a termination event and advising that this constitutes an event of termination, or

   (ii) becomes aware of any non-payment of principal, interest or fees or other charges owed to any financial party (other than the Agent) under this Credit Agreement, he will immediately notify the other financial parties.

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  (e)The Agent is under no obligation to monitor or investigate whether a Termination Event has occurred. It must not be assumed that the agent is aware of the occurrence of a termination event.

   27.5 The Arrangers

  Except as expressly provided otherwise in the Finance Documents, the Arrangers have no obligations to any other party in connection with the Finance Documents.

  27.6 No Fiduciary Duties

  (a) Nothing in this Credit Agreement appoints the Agent or the Arrangers as a fiduciary of any other person. The agent and the arranger have no duty of care towards another person.

   (b) Neither the Agent nor the Arrangers or sub-credit lenders (or any Affiliate of such sub-credit lender) shall be under any obligation to account to any other financial party for any amount due on their behalf or any profits derived therefrom.

   27.7 Doing Business with the Group

  The Agent, Arrangers and Sub-Lending Banks (or an Affiliate of any such Sub-Lending Bank) may accept deposits from, make loans to, and generally have a banking or other business relationship with any Group Company.

  27.8 Agent's Rights and Discretion

  (a) The agent can

   (i) rely on any representation, communication or document which he believes to be genuine, accurate and signed by an authorized signatory; and

   (ii) rely on any statement made by a director, authorized signatory, or employee of any person regarding matters which may reasonably be believed to be within his or her knowledge or control.

  (c)The agent may accept, insofar as he is in his capacity as an agent for the Lender has not received notice to the contraryno event of termination has occurred, unless he is actually aware of the occurrence of a non-payment pursuant to Section 24.1(a) (Non-Payment) ,

   (ii)	if it receives instructions pursuant to Clause 27.3 (Instructions of the Majority of Lenders) and these have not been withdrawn, that the conditions required by the Finance Documents for the execution of such instruction have occurred,

  (iii) neither party nor required under this Credit Agreement group of lenders has exercised its rights, authority or discretion and

  (iv) any notification or request by the Company (other than a request for payment or a request for renewal) is also made for the other Obligors with their knowledge and consent.

  (c) 	The Agent may retain, pay and rely on attorneys, accountants, surveyors or other advisers in connection with the Finance Documents and shall not be liable for any damages, costs or losses to any person, depreciation or other liability arising out of its reliance on them . In addition, the Agent may from 

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  time to time seek the advice or services of lawyers, accountants, accountants, appraisers and other professional advisers or experts (including the services of lawyers acting as independent (and thus separate from any lawyers retained by the Lenders) advisors to the Agent , to the extent that the Agent deems it necessary.

  (d) The Agent may perform its duties under the Finance Documents through employees and representatives and shall not be liable for any damage caused by their misconduct or omission unless caused by the Agent's willful misconduct or gross negligence.

   (e) The Agent shall have the right, in its sole discretion, to disclose to any party to this Credit Agreement any information which it reasonably believes it has received in its capacity as Agent. In this respect, the obligated parties release the agent and the other financial parties from banking secrecy.

   (f) The Agent shall have the right not to take any action which in its opinion violates any law, regulation, confidentiality obligation or may give rise to a duty of care.

   (g) The Agent shall not be authorized to represent the Lender in any litigation or arbitration relating to the Finance Documents without the prior consent of the relevant Lender.

   27.9 Accuracy and Completeness, Credit Check

  The Agent has no obligation to any Lender to verify the accuracy or completeness of any documentation submitted to it or any other information provided by any person, whether or not such information was circulated by the Agent. In particular, each lender is solely responsible for assessing the borrower's creditworthiness and the legal validity and enforceability of the financing documents.

  27.10 Reimbursement of Expenses, Release

  (a) Upon the agent's request for payment, the lenders will reimburse the agent for all reasonable external costs incurred in connection with the preparation and legal review of the financing documents and the fulfillment of his other duties as an agent, insofar as they have not been reimbursed by the borrower. The agent will prove the costs incurred to the lenders at their request. He can demand reasonable advances from the lenders.

   (b) The Lenders shall indemnify the Agent, at the Agent's request, for any claim made against the Agent in connection with any Financing Document.

   (c) Lenders are liable to the agent in proportion to their respective loan commitments. Joint and several liability of the lenders is excluded.

   27.11 Agent Liability

  The agent is only responsible for intent and gross negligence.

  27.12 Agent's Working Hours

  (a) Any amount payable to the Agent pursuant to Section 18 (Costs and Expenses), Section 17.3 (Agent Indemnification) or Section 27.10 (Reimbursement of Expenses, Indemnification) , as the case may be, shall include the cost of using the time or other resources of the include Agents and shall be calculated on the basis of reasonable daily or hourly rates made known by the Agent to the Lenders and the Company 

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  and shall be in addition to any fees paid or payable to the Agent pursuant to Section 13.4 (Agent's Commission) .

   (b) The Agent may under this Clause 27.12 only recover such expenses from the Company or any group company as to the cause and amount of which it has previously agreed with the Company and which has agreed to be reimbursed.

   27.13 Change of Agent

  The Agent may at any time terminate the order placed by the Lenders pursuant to Clause 27.1 (Order) . The termination must be declared in writing to the lenders and the borrower with a notice period of 30 days. After hearing the company, the lenders can revoke the order at any time by resolution. The decision will take effect 30 days after it is made. The majority of lenders may appoint a successor with the consent of the company (which shall not be unreasonably withheld). If he does not appoint a successor or does not appoint a successor within 20 days, the previous agent may, with the consent of the Company (which may not be unreasonably withheld) appoint a successor. The incumbent agent is relieved of his obligations under this Credit Agreement if a successor is named and the named successor has accepted his appointment as agent. The previous agent must hand over to the new agent all documents that are necessary for the fulfillment of his duties. The new agent takes over all the rights and obligations of the previous agent from the financing agreements. The other parties to this loan agreement already agree to this contract takeover by the successor. The parties to this Credit Agreement will cooperate in all actions necessary for such change of agent. The borrower shall bear the costs incurred in connection with the change of agent.

  27.14 Termination of Agent Due to FATCA

  The Agent must terminate the engagement given to it by the Lenders pursuant to Clause

  27.1 (Appointment) pursuant to Clause 27.13 (Change of Agent) (and the Agent shall make all reasonable efforts to find a successor pursuant to clause 6 of Clause 27.13 (Change of Agent). Agent(s) ) if three months prior to the earliest FATCA Effective Date applicable to payments made to the Agent under the Finance Documents or any time thereafter

  (a) the Agent fails to comply with a request by a Party pursuant to Clause 14.8 (FATCA Information) and the Company or a Lender reasonably believes that the Agent is not, or will not be, a FATCA Exempt Party on or after the FATCA Effective Date,

   (b) it is apparent from the information provided by the agent pursuant to Clause 14.8 (FATCA Information) that the agent is not or will not be (any longer) a FATCA Exempt Party on or after the FATCA Effective Date; or

   (c) 	the Agent notifies the Borrower and the Lenders that it is not or will not be a FATCA Exempt Party on or after the FATCA Effective Date, and (in each such case) Company or a Lender reasonably believes that a party will need to make a FATCA Withholding that would not be necessary if the Agent were a FATCA Exempt Party and Company or such Lender requests the Agent to do so to terminate the order given to him by the Lenders pursuant to Clause 27.1 (Order) .

  27.15 Confidentiality

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  (a) 		In terms of acting as a representative of the financial parties, the agent's relevant department is treated as a separate organizational unit from its other units and departments.

  (b) If another internal entity of the Agent receives certain information, that entity may treat it as confidential and the Agent need not be held responsible for having knowledge of it.

   27.16 Role of Reference Banks

  No Reference Bank shall be liable for its actions under or in connection with the Funding Documents or for the Ask Rates it quotes in determining the Reference Interest Rate, unless it acted with intent or gross negligence. No party (other than the relevant Reference Bank) may initiate any proceeding against any officer, employee or agent of any Reference Bank with respect to any action taken against such Reference Bank or for any act or omission of any kind by such officer, employee or agent in connection with any Funding Document or any Initiate quoting of the claim due to a reference bank. An officer, employee or agent of any reference bank may rely on this clause

  27.16 pursuant to section 328 paragraph 1 of the German Civil Code (genuine qualifying

  contract for the benefit of third parties) .

  A reference bank that is not a party may invoke this Section 27.16, Clause 32.2 (d) (Changes to Waivers) and Section 34 (Confidentiality of Refinancing Costs and Asking Rates) pursuant to Section 328 Paragraph 1 BGB (genuine qualifying contract in favor of third parties) . 

  28. DISTRIBUTION OF PAYMENTS; BALANCING

  28.1 Distribution of Payments

  Except as otherwise provided in a Finance Document, all Obligor and Lender payments (except under a sub-credit agreement) shall be made through the Agent. The agent will forward incoming payments to the respective entitled parties in compliance with the provisions of clause

  29.5 (order of repayment) and subject to receipt by the agent on the correct value date.

  28.2 Repayments, interest payments etc.

  Amounts repaid under the individual credit lines (including voluntary early repayments and mandatory special repayments), interest, commitment commission, etc. are to be distributed among the lenders according to their respective claims.

  28.3 Recovery

  If the agent has paid an amount to another party but has not received the amount itself, the receiving party will immediately refund the amount plus interest to the agent upon a corresponding request. The amount of interest corresponds to the agent's refinancing costs from the time the agent pays out until the day the agent recovers the amount.

  28.4 Settlement

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  (a) If at any time a lender (the "Beneficiary" ) receives a payment in derogation of Section 29 (Payments and Order of Payment) in respect of its claims under this Loan Agreement or otherwise (e.g., by offsetting) those claims from funds of an obligor are to be repaid (the "received amount"), the following applies:

  (i)

  (ii) the recipient will inform the agent immediately, but no later than three (3) bank working days after receipt, of the amount received and the circumstances of receipt, the agent determines whether the amount received exceeds the amount that the recipient would have received if the amount received pursuant to clause 29.5 (Order of repayment) paid to the agent and paid by him according to clause 28.1 (distribution of payments) would have been distributed, and (iii) at the Agent's request, the Recipient shall within five (5) Bank Business Days, forward to the Agent an amount ("Settlement Amount") equal to the amount received less the amount determined by the Agent to be due to the Recipient.

  (b)The debt to the Recipient shall be deemed settled only to the extent due to the Recipient and the Agent shall distribute the Settlement Amount among the remaining Lenders in accordance with Clause 29.5 (Order of Repayment) .

  (c)If the amount received is to be returned by the recipient, the lenders benefiting from this Clause 28.4 must repay to the recipient the amounts distributed to them plus pro rata interest to be paid by the recipient. The claims of the lenders are deemed not to have been met in the amount of the repaid amounts. 

  (d)The provisions of this clause 28.4 do not apply in the event that a recipient receives payments as a result of court or arbitration proceedings in which the other financial parties have not participated despite being asked to do so.

   28.5 Applicability

  This Section 28 (Distribution of Payments; Balance Settlement) shall not apply to amounts that

  (a)

  (i) (ii) a sub-credit bank under a sub-credit line, a Local Lender under an umbrella line, and a Lender or a Local Lender under a Maximum Amount Guarantee prior to giving notice of termination under Section 24(Termination) . Upon giving notice of termination pursuant to Section 24 (Termination) , this Section 28 (Distribution of Payments; Settlement) shall also apply to such amounts provided that the Lender of which Affiliate the applicable Local Lender is the Lender Beneficiary.

  29. PAYMENTS AND ORDER OF PAYMENT

  29.1 Currency

  All payments under this credit agreement will be made in EUR.

  29.2 Maturity

  If a payment is due on a day that is not a bank working day, the due date is the next bank working day, unless this falls in the next calendar month; in this case, the due date is the immediately preceding bank working day.

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  29.3 Paying Agent

  (a) All payments by the obligated parties in favor of the lenders are made to an account to be designated by the agent.

   (b) All payments in connection with the sub-credit lines are made to an account designated by the respective sub-credit bank.

   (c) Payments made in deviation from the aforementioned provisions have no repayment effect.

   29.4 Settlement Accounts

  The borrower is obliged to ensure that there are sufficient funds on the account specified in Section 29.3 (Paying Agent) on the respective due date in order to offset the amounts due resulting from the loan agreement. The agent is entitled to debit the amounts due from the accounts. The Borrower hereby grants the Agent the necessary direct debit authorizations.

   

  29.5 Order of Redemption

  If one payment is not sufficient, all claims due at the time of payment To meet financial parties, their claims will be repaid in the following order, unless otherwise provided in this Credit Agreement:

  (a)reimbursement of costs and expenses,

  (b)fees and commissions,

  (c)Interest charges,

  (d)repayment of outstanding loans under credit line A in reverse order of maturities,

  (e)Working capital loans in the following order: 

   (i)

  (ii) Initially to repay outstanding loans under the working capital line of credit then to cancel Loan Commitments still available for the Working capital line of credit and

   (iii) finally, to repay the Outstanding Sub-Line Amounts and drawdowns under the Umbrella Facility and then to cancel any Available Sub-Line Commitments. If several claims have the same priority, offsetting takes place in the ratio of the amounts claimed by the financial parties to one another, unless otherwise stipulated in this loan agreement.

  29.6 Change in Billing

  The financial parties are entitled to change the aforementioned clearing order at any time.

  30. OFFSET

  The obligated parties are oanrley entitled to assert offsetting and retention rights against the payment claims of the financial parties on the basis of this credit agreement if and to the extent that the counterclaims between them and the financial parties are undisputed or have been legally established.

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  31. NOTICES AND REPRESENTATION

  31.1 Notices

  (a) All notices in connection with this Credit Agreement shall be in writing on the Obligor's side to or through the Company and on the Financial Party's side to or through the Agent. They must either be handed over personally or sent by letter, fax or pdf file to the following addresses or to the different addresses notified in writing by the parties at a later date:
 

   

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  For the financial parties:

  Deutsche Bank Luxembourg SA

  e.g. Attn: Alexey Alert / Joerg Frahs

  Email: Alexey.alert@db.com / joerg.frahs@db.com

  Fax no.: +352 421 22 95 9480 /+352 421 22 95 5780

  For the obligated:

  ADVA Optical Networking SE

  e.g. Hd. Christian Rieder / Steven Williams

  Email: crieder@advaoptical.com / swilliams@advaoptical.com

  Fax: +49 89 890665 22931

  (b)

  (c) Unless expressly agreed otherwise in this Loan Agreement, each party's correspondence with the Financial Parties, potential future lenders, an Obligor and/or any external advisors to the Financial Parties may also be conducted via email or a data room such as Debtdomain; however, this does not apply to legally binding declarations of intent (such as termination, requests for payment, requests for extension or determination of interest periods), unless these are attached to the e-mail as a duly signed pdf file. The parties expressly agree that this e-mail traffic may also be unencrypted. The financial parties are not liable for any consequences arising from the use of unencrypted e-mails, including the unintentional disclosure of confidential information. However, this does not apply if a financial party sends an unencrypted e-mail with content that the borrower has prohibited in writing from being passed on by unencrypted e-mail or if the knowledge of an unauthorized person is due to the fact that the respective financial party in sending the e-mail has intentionally or grossly negligently violated his duty of care.

   31.2 Representation of Obligors

  The obligated parties hereby commission the company to safeguard their interests in connection with the financing documents and hereby authorize it to make and receive all declarations required for this, to exercise rights and to take actions. For this purpose, the obligated release the company from the restrictions of § 181 BGB. The company is entitled to grant sub-authorizations to the same extent.

  32. MODIFICATIONS AND WAIVERS

  32.1 Voting

  (a) Lenders shall pass their resolutions by the votes of a majority of Lenders, unless unanimity or another majority is required by Clause 32.2 (Changes and Waivers) or Clause 32.3 (Replacement of Reference Interest Rate) or any other provision of a Finance Document. Where a Lender has sub-interested a third party (a "Sub-Participant") in one of its Underwriters' Interests and has notified the Agent in writing that it is sub-interested and the amount of such sub-interest therein, such Lender may exercise its voting rights 

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  in respect of its Underwriter's Interest in which the sub-participation exists, other than to exercise its voting rights with respect to the remaining underwriter interest.

  (b)If a Lender does not notify the Agent within ten (10) business days whether it consents to a waiver or modification of this Loan Agreement, its Underwriter Interest shall not be taken into account for the purposes of calculating whether the required majorities have been reached. This also applies in the case of a unanimity requirement.

  (c)As long as a Lender is a Defaulting Lender, the Defaulting Lender's Commitments are reduced by its Syndicated Share of its Available Commitments when weighting votes.

   32.2 Amendments and Waivers

  (a) The Agent may (after the prior consent of the parties referred to in this Section 32.2 required majority of Lenders) with the Borrower and other Obligors party to this Credit Agreement, agree on behalf of the Financial Parties amendments and supplements to this Credit Agreement and waive the exercise of any rights or compliance with any obligations under this Credit Agreement.

   (b) The issuance of a waiver of termination upon cause for termination requires a written request by the borrower, (subject to paragraph (c)) a resolution passed by a majority of the lenders, and the written waiver of the agent.

   (c) Subject to paragraph (e) and Clause 32.3 (Replacement of Reference Rate) , waivers and contract modifications with respect to the Lenders require the prior approval of all Lenders

   (i) the definition of "Majority of Lenders" and any other change in the Majorities required for Resolution, including this Section 32.2	,

   (ii) a change of currency in which a payment is made under one financing document is to be provided,

   (iii) a waiver or deferral of interest and principal payments (except for special principal payments) and any change in a repayment date pursuant to Section

  7.2 (Repayment),

   (iv) a reduction in Margin, to the extent not already provided for in this Credit Agreement, the amount of Fees or any other amount payable to a Lender,

   (v) the increase of a credit line (other than an increase in accordance with Section 2.2 (Increase Option)), the granting of an additional credit line or an extension of the availability period,

   (vi) an opt-out or accession of a Guarantor, except in accordance with Clause 23.18 (Guarantee Coverage, Accession of Guarantors) or Clause 26.3 (withdrawal of guarantors), 

  (vii)       an amendment to Section 2.4 (Rights and Obligations of Financial Parties), Section8.2 (Illegalness), Section 8.3 (Change of Control), Section 8.7 (Repayment offsetting), Section 23.3 (Anti-Corruption, Sanctions and Money Laundering Provisions), Section 25 (Transfer of Syndicate Shares),

  Section 33 (Disclosure of information) or Section 35.2 (Applicable law and place of jurisdiction),

  (viii)	a change in the order or repayment in accordance with Clause 29.5 (order of repayment)

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  (ix) an amendment or waiver of any provision requiring the approval of all lenders,

   (iv) a change in clause 19 (guarantees) or pursuant to clause 23.18 (guarantee coverage, entering into guarantors) warranties; or

   (v) a release of the guarantees granted pursuant to Section 23.18 (Guarantee Coverage, Submission of Guarantors) or as a disbursement condition pursuant to Part 1 Clause 2(b) of Schedule 2 (Disbursement Conditions) .

   (d) Any modification or waiver relating to the rights of the Arrangers, the Agent, a sub-credit bank or a reference bank requires the consent of such party.

   (e) In principle, each sub-credit bank makes its own decisions about the details of the processing of a sub-credit line, the assertion of related reclaims or its continuation, but always in accordance with the provisions of this credit agreement.

   32.3 Replacement of Reference Interest Rate

  (a) Subject to the provisions of paragraph (d) of Clause 32.2 (Modifications and Waivers) , if a Substitution Event has occurred, the Agent (acting at the direction of a majority of the Lenders) and the Company may agree to a modification of the Loan Agreement or a waiver of any requirements of the Loan Agreement be made regarding the following content of the regulation:

   (i) Using a substitute interbank rate instead of the screen rate and

   (ii)

  (A)	adapting any provisions of a Finance Document to the use of this replacement interbank rate,

  (B)	Adjustment of the financing documents to the extent that the Substitute interbank rate for interest calculations under the credit agreement can be used.

  (C)	Introduction of market practices relevant to the replacement interbank rate apply

  (D)	Regulation of alternative calculation methods (and market disruption rules) for the backup interbank rate, or

  (E)	Price adjustments to accommodate, where reasonably practicable, the transfer of economic value from one party to another party to settle as a result of the application of the replacement interbank rate (whereby, if an adjustment or a calculation method for an adjustment has been formally determined, designated or recommended by the Competent Body, the adjustment based on that provision, designation or recommendation.  In this clause 32.3 says:

   "Relevant Body" means any central bank, regulatory or supervisory authority, or an association thereof, or any working group or committee assisted or moderated by, or constituted at the request of, any such central bank or authority or the Financial Stability Board.

  "Replacement  Interbank Rate" means an interbank rate that

  (i)formally through

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  (A)the body managing the respective screen rate (provided that the respective screen rate is based on the same market and economic conditions as the screen rate to be replaced); or

  (B)the responsible body, is intended, named or recommended as a substitute for Screen Rate; where a replacement has been formally determined, nominated or recommended by two of the said bodies, then the interbank rate determined under subparagraph (ii) shall prevail,

  (ii)in the opinion of the Company and the majority of lenders in the international or a relevant domestic market for syndicated Credit is generally accepted as a reasonable substitute for the applicable Screen Rate, or

   (iii)      is, in the opinion of the Company and the majority of Lenders, a reasonable substitute for the applicable Screen Rate.

  "Replacement  Event" means, in relation to Screen Rate, one of the following events:

  (i)the calculation method, formula or any other way of calculating the Screen Rate has, in the opinion of the company and the majority of the Lenders changed significantly

   (ii)

  (A) 

  (i) the administrator of the screen rate or its parent Body publicly announces that the Administrator is insolvent or

   (ii) it will be through a court, a stock exchange, a supervisory authority or similar official, regulatory or judicial body publishes information that reasonably confirms that the administrator of Screen installment is insolvent and at this time there is no successor to the administrator who continues to publish the screen rate,

  (B) the Administrator of the Screen Rate publicly announces that it has ceased or will cease to publish the Screen Rate permanently or indefinitely and at that time there is no successor to the Administrator who will continue to publish the Screen Rate,

   (C) the governing body of Screen Rate publicly announces that Screen Rate will cease to be published permanently or indefinitely, or

   (D) the administrator of the screen rate or its superior publicly announces that the screen rate may no longer be used as a reference rate, or

   (iii) the administrator of the screen rate determines that the screen rate is in accordance with the arrangements that have been made in the event that not by all Reference banks ask rates are announced, or other contingency agreement is established and either:

  (A)the circumstances or events giving rise to such determination, (in the opinion of the Company and the majority of the Lenders) are not just temporary, or

  (B)the screen rate will be based on such for a period of time Schemes calculated not over a period of one month goes out, or

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   (iv)        in the opinion of the Company and the majority of the Lenders, the Screen Rate is no longer an appropriate basis for calculating interest under the Loan Agreement.

  32.4 Replacement of Lenders

  (a) If (i) a Lender becomes a Defaulting Lender, (ii) the Borrower is required to repay an amount early pursuant to Clause 8.2 ( Illegalness), (iii) a Market Disruption Event is reported pursuant to Clause 12.1 (Market Disruption Event) , or (iv) the Borrower is required to pay to a Lender an amount in excess of the amount generally payable to Lenders in accordance with Section 14.2 (Tax Net Clause), Section 14.3 (Tax Exemption) or Section 15 (Cost Increase) , the Company may replace such lender ("Retiring Lender") by requiring it to comply with its rights and obligations under the Finance Documents Section 25.1 (Transfer of Underwriters' Interests) to another lender or bank or financial institution nominated by the Company (a "Replacement Lender") . The Retiring Lender is obliged to comply with the Company's request. The Replacement Lender must have been accepted by the Agent and declared its willingness to assume the rights and obligations of the Departing Lender and pay a cash purchase price on the date of acquisition equal to the face value of the assumed outstanding loans equal to accrued interest, commissions, fees and all other amounts payable to the Retiring Lender pursuant to the Financing Documents.

  (b) The Company may only make the request under paragraph (a) subject to the following conditions:

  (i)the company may not replace the agent,

  (ii)neither the Agent nor the Outgoing Lender has any obligation to Find replacement lenders, and

  (iii)the Defaulting Lender is not obligated to pay any fee to the Replacement Lender unless it is a Defaulting Lender.

   32.5 No Waiver

  A (even temporary or partial) non-exercise of a right to which the lenders are entitled, in particular a right of termination, does not constitute a waiver and does not lead to forfeiture.

  33. DISCLOSURE OF INFORMATION

  (a) 	Each Lender is entitled (and to this extent is also released from banking secrecy by the Borrower) to use the information provided to it by the Borrower about the Group and details of the content and obligations of the parties under or in connection with the Financing Documents (e.g. loan amount, Maturity date, name and address of the Borrower) to any Affiliated Company and any third party (and Affiliated Company)

  (i) to which the relevant Lender transfers or assigns its rights and/or obligations under the Financing Documents or is considering doing so, to the extent that such a transfer or assignment is permitted under Section 25.1 (Transfer of Underwriters’ Interests) , or with which the relevant Lender enters into a sub- participation agreement or this checked (as well as to those persons who are to be involved in the processing),

   (ii) who intends to provide an umbrella line as a lender,

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   (iii) in whose favor the respective lender assigns or pledges his rights from the financing documents pursuant to clause 25.2 (security interests in consortium shares) or creates another security interest in them,

  (iv)who is involved in the initiation (e.g. for the KYC check), the approval, the processing and monitoring of the loan as part of the credit management or in connection with the above paragraphs (i) to (iii) for the purpose of providing administrative or processing services was ordered in connection with one or more of the financing documents (including those relating to the trading of shares), to the extent that disclosure is necessary for this service provider to be able to provide the relevant service or

  (v)to the Information (i) pursuant to an order of any court or governmental agency, banking, tax or other regulatory authority or similar body, the rules of any relevant stock exchange or any other applicable law or regulation, or (ii) in connection with in or for the purposes of any judicial, arbitration, administrative or other proceeding; or dispute and related investigations must be reported,  in the case of paragraphs (a)(i) and (a)(iv), however, only if the recipient of the disclosed information enters into a non-disclosure agreement with the relevant lender in respect of the information, unless such an obligation already exists as a result of statutory or professional/professional regulations .

  (b) In addition, each Lender is entitled to disclose information about the Group to its advisers or, with the Company's consent, to any other third party.

   34. CONFIDENTIALITY OF REFINANCING COSTS AND LETTER RATES

  34.1 Confidentiality

  (a) The agent and the obligors handle the creditors' and Refinancing costs mentioned by reference banks and the asking rates mentioned for determining the reference interest rate (the "Ask Rates") are confidential, unless otherwise regulated under paragraphs (b) or (c).

   (b) The agent can

   (i) to the extent required by the borrower within the scope of Section 12.2 (Alternative Calculation Method) , disclose the refinancing costs of each lender and

   (ii) disclose refinancing costs and asking rates quoted to him to any third party who performs administrative tasks for him in relation to a financing document, to the extent necessary for that purpose and if the third party has pre-signed a confidentiality agreement with the agent to the satisfaction of the Lender or Reference Bank concerned.

  (c)The agent may be quoted refinancing costs or asking rates and each Obliged party may disclose refinancing costs that have been made known to it

  (i)to affiliated companies and their consultants and auditors if they are informed in advance in writing that the information is confidential and possibly price- sensitive, unless the respective recipient is already legally or otherwise professionally bound to secrecy,

  (ii)insofar as he is obliged to pass on the information due to the applicable statutory provisions or as part of official, court or arbitration proceedings or any other procedure, if he is informed in 

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  writing in advance, as far as practicable, that the information is confidential and possibly price-sensitive information acts and

  (iii)with the consent of the relevant lender or reference bank.

   34.2 No Reason for Termination

  A breach of the obligations provided for in section 34.1 (confidentiality) by an obligated party does not in itself lead to the existence of a reason for termination.

  35. GENERAL PROVISIONS

  35.1 Partial Invalidity

  Should individual provisions of this credit agreement be or become void, ineffective or unenforceable in whole or in part, or should there be a gap in this credit agreement, this shall not affect the validity of the remaining provisions. In place of the void, ineffective or unenforceable provision or to fill the gap, an appropriate, effective and enforceable provision shall apply which, as far as legally possible, comes as close as possible to what the parties wanted or would have wanted based on the spirit and purpose of this loan agreement, if they had considered the point. The same applies to the ineffectiveness of a time determination or the determination of another dimension.

  35.2 Governing Law and Jurisdiction

  (a) (b) This credit agreement is subject to the laws of the Federal Republic of Germany.

   

  The exclusive place of jurisdiction for all disputes arising from or in connection with this credit agreement is Frankfurt am Main. This paragraph protects financial parties only. Accordingly, no financial party shall be precluded from pursuing any proceedings relating to this Credit Agreement in any other court of competent jurisdiction. To the extent permitted by law, financial parties may pursue parallel proceedings in any number of jurisdictions.

   35.3 Written Form Requirement

  Changes to this credit agreement can only be made jointly by all parties and in writing. The written form requirement also applies to an amendment to this Section 35.3.

  36. ENTRY INTO FORCE

  (a) This credit agreement comes into force upon its signature by all contracting parties.

   (b) The contracting parties can bring about the conclusion of the contract by exchanging signed signature pages, which are transmitted by telecommunications (e.g. by fax or electronic copy).

   (c) Should the contracting parties decide to enter into this form of contract, they will send the signed signature pages of this credit agreement to Latham & Watkins LLP, Reuterweg 20, 60323 Frankfurt, for the attention of Kim Woggon (kim.woggon@lw.com)  (the "Recipient") . This credit agreement is concluded as soon as the signature pages from all contracting parties are sent to the recipient (by fax, 

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  electronic copy or in any other telecommunication way) received at the time the last outstanding signature page was received by the recipient.

  (d) For these purposes, the contracting parties appoint the recipient as their receiving agent and expressly authorize him to receive the signed signature pages of all contracting parties. In addition, no obligations should arise for the recipient from his function as recipient. In particular, the recipient may of the agreement of the original signature pages with the tele communicatively transmitted copies, 

  authenticity of all signatures on the original signature pages and the signing authority of the signatory. 

   

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  Annex 1

  INITIAL LENDERS

  Credit line A (EUR 65,000,000)

  Lender	Loan Commitment in EUR

  Bayerische Landesbank	13.538.461,54

  Deutsche Bank Luxembourg S.A.	13.538.461,54

  Norddeutsche Landesbank - Girozentrale -	11.000.000,00

  IKB Deutsche Industriebank AG	10.000.000,00

  Commerzbank Aktiengesellschaft	8.461.538,46

  DZ BANK AG Deutsche Zentral-Genossenschaftsbank,

  Frankfurt am Main	8.461.538,46

  Working capital line of credit (EUR 10.000.000)

  Lender	Loan Commitment in EUR

  Bayerische Landesbank	2.461.538,46

  Deutsche Bank Luxembourg S.A.	2.461.538,46

  Norddeutsche Landesbank - Girozentrale -	2.000.000,00

  Commerzbank Aktiengesellschaft	1.538.461,54

  DZ BANK AG Deutsche Zentral-Genossenschaftsbank,

  Frankfurt am Main	1.538.461,54

   

   

   

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  ANNEX 2

  PAYMENT REQUIREMENTS

  Part 1

  Withdrawal Requirements for First Claim

  1. 	Bank documents. Submission of the following current documents in relation to the Borrower or comparable documents customary under foreign law in relation to the Initial Guarantors:

  (a) Electronic copy of an excerpt from the commercial register (not older than 20 days before signing this credit agreement),

   (b) list of board members,

   (c) any rules of procedure of the Management Board and the Supervisory Board,

   (d) Statute,

   (e) Supervisory board resolution and management board resolution, with which the supervisory board and the Board of Directors gives its consent to the completion of the financing documents and the fulfillment of all related obligations, and

   (f) Confirmation from a number of natural persons who are authorized to represent the company and who are entered in the commercial register that all of the aforementioned corporate law documents they have submitted are up-to-date, correct and complete

   (i) Signature samples and copies of current identity cards or

  Passports of the authorized signatories and the other persons named under paragraph (ii), and

  (ii)appropriate proof of the authorization to represent other persons who should be authorized to make declarations to the agent or the lenders, including the submission of powers of attorney or excerpts from the commercial register.

   2. 	Funding Documents. Submission of duly signed copies of the following documents:

  (a) this credit agreement,

   (b) the guarantee contract, and

   (c) the fee agreements.

   3. 	Legal Opinions

  (a) Legal opinions of the legal advisors of the lenders on the effectiveness and Enforceability of the financing documents (enforceability opinion) and

   (b) Legal opinion of the borrower's legal advisor on the effective conclusion of the financing documents by the obligated party (Capacity Opinion).

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  4.	Bilateral Loans / Lines of Credit. Evidence of termination and repayment of the financial liabilities to be redeemed with the credit funds made available under this loan agreement.

  5.	Degrees. Copies of the audited consolidated financial statements and the audited separate financial statements of the Company and (if required by law in audited form) the separate financial statements of the Initial Guarantors for each of the financial year 2017 and the consolidated quarterly reports of the Company for the first and second quarters of 2018.

  6.	group structure. Submission of an up-to-date group organizational chart.

  7.	Budget. Budget submission.

  8.	Fees and Costs. Evidence satisfactory to Agents of payment, or payment immediately following the first drawdown of any Loan, on the date of first disbursement of then-due fees and reimbursements owed by Obligors in connection with the Finance Documents.

  9.	Know your customer. Confirmation of the successful completion of the KYC check of each financial party.

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  Part 2

  Conditions for the accession of guarantors

  1.	Accession Agreement. Submission of the accession agreement to the credit agreement or the guarantee agreement.

  2.		Bank documents. Submission of the following documents of the acceding company (or comparable documents customary under foreign law) that are current on the date of signing of the respective accession contract:

  (a) (i) Excerpt from the commercial register, not older than 20 days, together with a written confirmation from the managing directors in the number authorized to represent that no measures have been or will be taken or decided in relation to these extracts from the commercial register by the date of accession, (ii) list of shareholders, if existing, (iii) Rules of Procedure, if any, and (iv) Articles of Association, if any,

   (b) Shareholders' resolution by which the shareholders' meeting gives its consent to the accession to the financing documents and the fulfillment of all related obligations and

   (c) Confirmation from a number of natural persons authorized to represent the company (entered in the commercial register) that all of the aforementioned corporate law documents they have submitted are up-to-date, correct and complete

  (i) Sample signatures and copies of identity cards or passports

  Authorized Signatories and

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  (iii)suitable proof of the authorization to represent other persons who should be authorized to make declarations to the agent or the lenders, including the submission of powers of attorney and excerpts from the commercial register.

   3.	Status. If available or required by law, submission of annual financial statements (audited and unqualified and signed) by a number of managing directors, officers or directors of the company authorized to represent.

  4.	Legal Opinions

  (a) Satisfactory legal opinion of the lenders' legal advisers on the Effectiveness and enforceability of the Accession Agreement (Enforceability Opinion) and

   (b) Satisfactory legal opinion of the borrower's legal advisors, including the effective representation of the joining company in the conclusion of the joining agreement and other financing documents (Capacity Opinion).

   5.	Know your customer. Submission of other documents requested by the lenders and other evidence that the lenders need for their incumbent know-your-customer checks and other checks (e.g. under the Money Laundering Act) that the lenders are obliged to carry out due to legal and other regulatory obligations.

  6.	Appointment of an authorized recipient. If a foreign company joins, proof that the company has accepted your appointment as authorized recipient.

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  ANNEX 3

  EXISTING AND SETTLEMENT OF FINANCIAL LIABILITIES

  Part 1: Existing Financial Liabilities

  Existing financial liabilities:

  LOAN

  ORIGINAL VOLUME IN EUR 			VALUE IN EUR (AS OF 09/16/2018)

  IKB REDEMPTION LOAN IKB REDEMPTION LOAN

  15,000,000

  25,000,000

  9,375,000

  15,625,000

  IKB REDEMPTION LOAN

  10,000,000

  6,250,000

  Existing guarantees (as of September 19, 2018)

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  Part 2: Financial liabilities to be redeemed

  LOAN

  ORIGINAL VOLUME IN EUR 				        VALUE IN EUR (AS OF 09/16/2018)

  GERMAN BANK BRIDGE LOAN	21,500,000	21,500,000

  NORDLB BRIDGE LOAN	21,500,000	21,500,000

  BAYERNLB BRIDGE LOAN	12,000,000	12,000,000

  BAYERNLB REDEMPTION LOAN	10,000,000	10,000,000

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  ANNEX 4

   

  	86

   

  

   

  ANNEX 5

   

   

   

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  ANNEX 6

   

   

   

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  ANNEX 7

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  ANNEX 8

  INCREASE COMMITMENT

  To: Deutsche Bank Luxembourg SA

  – as an agent –

  By: ADVA Optical Networking SE

  [Date]

  Syndicated Credit Agreement ADVA Optical Networking SE

  here: increase commitment

  Ladies and Gentlemen

  we refer to the credit agreement between, among others, ADVA Optical Networking SE and [●] and Deutsche

  Bank Luxembourg SA as agent dated [●] 2018, as amended (the "Credit Agreement").

  1.	Terms used in this Enhancement Notice have the meanings ascribed to them in the Credit Agreement unless otherwise specified in this Enhancement Notice.

  2.	We have agreed with the following credit institutions that they will increase at the

  Participate in loan commitments under the working capital facility as follows:

  Name of the credit institution Existing creditor (yes/no)

  Increased loan approval under the

  [working capital line of credit] (EUR)

  In total:

  3.	The above credit commitments will become effective as of the following date (December

  "Increase Effective Date") effective:

  [...]

  4.	We hereby confirm, on our own behalf and on behalf of the other guarantors, in favor of all financial parties, that the financial parties in favor of the credit agreement pursuant to Clause 19 (Guarantees) as well as the guarantees granted by [•] in the separate guarantee agreement (i) remain fully effective notwithstanding the increase in the loan commitment with regard to the working capital credit line, and (ii) also extend to the resulting payment obligations.

  ........................................

  [authorized signatory]

  ........................................

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  [authorized signatory]

  For ADVA Optical Networking SE

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  [For lenders who are already party to the loan agreement:]

  1.	We confirm that we are willing to increase/participate in our lending commitments to the working capital facility as described above.

  2.	Section 35.2 (Governing Law and Venue) of the Credit Agreement applies mutatis mutandis to this letter.

  .....................................

  [authorized signatory]

  ........................................

  [authorized signatory]

  For [●] as lender

  OR

  [For Lenders who are not yet a party to the Loan Agreement and are now joining:]

  1.	Accession. The Joining Lender joins the Agreement as a Lender on the Increase Date and thereby acquires all of the rights and obligations of a Lender with respect to the loan commitment it has made under the Working Capital Line of Credit.

  2.	Messages. All communications from the Agent to the Acceding Lender will be made to the address below until the Acceding Lender notifies the Agent in writing of an alternate address:

  3.	Clause 35.2 (Governing Law and Venue) of the Credit Agreement applies mutatis mutandis to this letter.

  .....................................

  [authorized signatory]

  ........................................

  [authorized signatory]

  For [●] as an acceding lender

  Noted as an increase commitment within the meaning of Section 2.2 (increase option):

  For the agent:

  [authorized signatory]

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  ANNEX 9

  SAMPLE MAXIMUM AMOUNT GUARANTEE

  [Letterhead of [•] AKTIENGESELLSCHAFT]

  To:       [Name of Ancillary Lender] under the Ancillary Facility ( as defined in the

  Credit Agreement (as defined below) as beneficiary (the Beneficiary 1)

  From:  ADVA Optical Networking SE as guarantor (the Guarantor)

  Date: [•]

  Dear Sirs,

  ADVA Optical Networking SE – EUR [•] facility agreement dated [•]

  (A) Reference is made to a EUR [•] credit facilities agreement dated [•] September 2018 and made between, amongst others, the guarantor as borrower and guarantor (together with any other guarantor, the obligors), Bayerische Landesbank and Deutsche Bank AG, German branch as joint coordinators (the Coordinators) and Deutsche Bank AG, German branch, Bayerische Landesbank and [•] as mandated lead arrangers (the Mandated Lead Arrangers), Deutsche Bank Luxembourg SA as agent (the Agent) and certain other finance parties named therein (the Credit Agreement).

  (B)This is a maximum amount guarantee agreement pursuant to schedule 9 of the Credit Agreement (the Maximum Amount Guarantee).

   (C) The Beneficiary 1 is an Ancillary Lender (sub-credit bank) under the Credit Agreement. The branches and/or Affiliates of the Beneficiary 1 specified in Schedule 1 hereto (each of them as well as any person specified in accordance with Clause 2 below a Local Lender and together the Local Lenders) and the Guarantor's Subsidiaries specified in Schedule 1 hereto ( each of them as well as any person specified in accordance with Clause 2 below a Local Borrower and together the Local Borrowers) have (to the extent specified in Schedule 1 at the date of this Agreement) a current business relationship. The Local Lenders and the Local Borrowers intend to enter into certain agreements pursuant to which the local lenders will make available to the Local Borrowers certain credit facilities as specified in Schedule 1 hereto (each of them an Agreement and together, the Agreements). Schedule 1 may be amended from time to time and in accordance with the procedure set out in Clause 2 below.

   1.

  1.1

  DEFINITIONS AND INTERPRETATIONS

  In this Maximum Amount Guarantee:

  Affiliate has the meaning given to the term Affiliates in the Credit Agreement Agreements has the meaning given to it in recital (C) above. Ancillary Facility means any ancillary facility made available by a lender in accordance with Clause 6 of the Credit Agreement. Ancillary Lender means each Lender (or 

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  Affiliate of a Lender ) which makes available an Ancillary Facility in accordance with Clause 6 of the Credit Agreement.

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  Beneficiary means the Beneficiary 1 and/or any Local Lender.

  Credit Agreement has the meaning given to it in recital (A) above.

  Local Borrower has the meaning given to it in recital (C) above.

  Local Lender has the meaning given to it in recital (C) above.

  Maximum Amount Guarantee has the meaning given to it in recital (B) above.

  1.2       Any reference in this Maximum Amount Guarantee to a defined document is a reference to that defined document as amended, varied, novated or supplemented from time to time.

  1.3       Any reference to a person includes its respective successor(s) in law (including any universal successor of that person by way of merger (merger), any other reorganization contemplated in the German Transformation Act (Umwandlungsgesetz) or otherwise) and any assign(s) and transferee(s) of that person and, to the extent legally possible, any legal provision to the contrary is waived.

  1.4 The headings in this Maximum Amount Guarantee are for convenience only and are to be ignored in constructing this Maximum Amount Guarantee.

   1.5       Where the context so admits, the singular includes the plural and vice versa.

  1.6

  2. This Maximum Amount Guarantee is made in the English language. For the avoidance of doubt, the English language version of this Maximum Amount Guarantee shall prevail over any translation of this Maximum Amount Guarantee. However, where a German translation of a word or phrase appears in the text of this Maximum Amount Guarantee, the German translation of such word or phrase shall prevail.

  Amendments to Schedule 1

  The Guarantor and the Beneficiary 1 May, after the date of this Maximum Amount Guarantee, agree (in writing, by letter or telefax) on any amendments to Schedule 1 from time to time.

  3.	Maximum Amount Guarantee and Undertaking to Reimburse, contract for the benefit of third parties

  3.1 The Guarantor hereby irrevocably and unconditionally guarantees by way of an independent guarantee (Garantie) to each of the Beneficiaries up to a maximum aggregate amount of:

   EUR [•]

  the payment of all principal, interest (including default interest, if any), costs, expenses or other amount which are due and payable by any Local Borrower under any Agreement (for the avoidance of doubt without limitation to the relevant amounts specified in Schedule 1 hereto) from time to time in the 

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  currency and at the place provided in that agreement or, at the option of either of the beneficiaries, in euros, at its stated or accelerated maturity irrespective of the factual or legal circumstances and motives by reason of which any local borrower may fail to pay such amount.

  3.2        Any Beneficiary shall be entitled to demand direct payment hereunder from the Guarantor.

  With regard to Beneficiaries which are Affiliates of the Beneficiary 1, this Maximum Amount Guarantee constitutes a contract for the benefit of third parties according to Section 328 of the German Civil Code. Irrespective of the above, the Beneficiary 1 may claim payment of the guaranteed amounts on behalf of any other Beneficiary for the purpose of forwarding the received amounts to the respective Beneficiary.

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  3.3 The Guarantor shall effect payment under this Maximum Amount Guarantee within five days after receipt of a written demand of the respective Beneficiary which shall be accompanied by a confirmation by the relevant Beneficiary that the amount claimed from the Guarantor equals the amount which any of the Local Borrowers has not paid when due. The Guarantor hereby waives its right under any jurisdiction applicable to it to payment in any other currency than Euro.

   3.4 		This Maximum Amount Guarantee and the undertaking to reimburse (promise to pay) under Clauses 3.1 and 3.2 above constitute the Guarantor's primary and independent obligation to make payment to the Beneficiaries in accordance with the terms hereof, under any and all circumstances, regardless of the validity, legality or enforceability of the obligations of any Local Borrower irrespective of all objections, exceptions or defenses from any Local Borrower under any Agreement or from any other person.

   3.5

   For the avoidance of doubt,

  (a)this Maximum Amount Guarantee does not constitute a guarantee upon first demand and nothing in this Maximum Amount Guarantee, in particular receipt of the written demand referred to in Clause 3.3 above, shall preclude any rights or defenses (Einden und Objections) the Guarantor may have (in its capacity as Guarantor only) with respect to any payment requested by any of the Beneficiary under this Maximum Amount Guarantee; other

  (b)an amendment to Schedule 1 pursuant to, and in accordance with, Clause 2 above shall not be construed as an increase of the maximum aggregate amount referred to in Clause 3.1 above.

   4. 	Immediate recourse

  The Beneficiaries (including in their capacity as Local Lenders) are not obliged first to claim payment from, to take any legal action against, or enforce any claims or security, if any, granted by any Local Borrower or any other person before making demand from the Guarantor hereunder.

  5. 	Exclusion of defenses

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  The obligations of the Guarantor hereunder shall not be contingent upon the legal relationship between the Beneficiaries (or any of them) on the one hand and the Local Borrowers on the other hand and accordingly shall without limitation be independent of:

  (a)any amendment or any defect in any provision of any Agreement;

  (b)any absence or insufficiency of corporate resolutions relating to the indebtedness of any Local Borrower under any Agreement;

  (c)any inadequate representation of any local borrower;

  (d)any absence of any authorization or any factual or legal restriction or limitation existing or introduced in the country of the Local Borrower (including, but not limited to, force majeure or any event or action delaying or preventing any conversion or transfer of any amount to, or its receipt in, the agreed account);

  (e)any deferral or waiver of obligations or a consent or approval in favor of any local borrower;

  (f)any agreement made between the beneficiaries (or any of them) on the one side and the local borrowers on the other side concerning their respective obligations under

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  ny agreement, including any extension of the term of payment and any rescheduling or restructuring of their indebtedness, whether or not the guarantor shall have given its consent thereto;

  (G) the taking, existence, variation or release of any other collateral provided to the Beneficiaries (or any of them) for the obligations of the Guarantor or the Local Borrowers and the Beneficiaries' legal relationship with any provider of such other collateral;

   (H) any right of any local borrower to rescind any agreement; other

   (i) any right that a beneficiary may have to set-off the indebtedness against a counterclaim of the guarantor or any local borrower.

   6.	Currency Indemnity

  Payments made by the Guarantor to a Beneficiary pursuant to a judgment or order of a court or tribunal in a currency other than the currency owed according to Clause 3.1 above shall only constitute a discharge of the Guarantor's obligation hereunder to the extent that the respective Beneficiary, immediately after receipt of such payment in such other currency, would be able to purchase with the amount of the other currency so received the owed currency on a recognized foreign exchange market. If the amount so received in the currency owed in accordance with Clause 3.1 should be less than the amount due, then as a separate and independent obligation, which gives rise to a separate cause of action, the guarantor is obliged to pay the difference.

  7.

  7.1

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  7.2 Obligations not Discharged and Deferral of Guarantor's Rights

  So long as any sum remains payable under any Agreement or this Maximum Amount Guarantee, the Guarantor undertakes not to assert or enforce any claim it may have against any Local Borrower by reason of the performance of the Guarantor's obligations hereunder whether on contractual grounds or on any other legal basis, until all amounts payable to the Beneficiary 1 or the Local Lenders under the Agreements and this Maximum Amount Guarantee have been fully and irrevocably received or recovered; any amount received or recovered by the Guarantor from a Local Borrower shall be held in trust for and immediately paid to the Beneficiary 1 on behalf of himself and the Local Lenders. The obligations of the Guarantor hereunder shall remain in force notwithstanding any dissolution or change in the structure or legal form of the Local Borrower or the Guarantor.

   8. expiration

   The obligations of the Guarantor hereunder are effective as of the date hereof and shall expire on the date on which all amounts expressed to be payable by the Guarantor and the Local Borrowers under the Agreements and this Maximum Amount Guarantee (respectively) have finally and irrevocably been paid or repaid in full to the beneficiaries.

  9.	enforcement

  The obligations of the Guarantor hereunder may be enforced against the Guarantor by each

  Beneficiary in any proceedings including enforcement proceedings

  10	clean statement

  Should any of the Beneficiaries become liable to return monies received in payment of indebtedness payable by the Guarantor or any Local Borrower under the Agreements or any other document (including, for the avoidance of doubt, this Maximum Amount Guarantee) as

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  11.

  a result of any bankruptcy, composition or similar proceedings affecting the Guarantor or a Local Borrower after expiry of this guarantee in accordance with Clause 8 (Expiry) above, the obligations of the Guarantor hereunder shall be reinstated and become effective again notwithstanding such expiration.

  Additional security

  This Maximum Amount Guarantee and the undertaking to pay is in addition to and is not in any way prejudiced by any other guarantee or security now or subsequently held by any of the Beneficiaries.

  12. Payments and set-off

  12.1 All payments owed by the Guarantor shall be made in immediately available, freely convertible funds for value on the due date to such account with such bank as the relevant Beneficiary

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  specifies and only irrevocable crediting of such payment in full onto the account specified by the relevant Beneficiary shall discharge the Guarantor's payment obligation.

  12.2 The Beneficiaries may set-off any obligation due from the Guarantor under this Maximum Amount Guarantee or any other agreement against any satisfiable obligation (whether due or not) owed by any of the Beneficiaries to the Guarantor, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the relevant Beneficiary may convert either obligation at a market rate of exchange in its usual course of business for the purpose of set-off.

  13. taxes

   All payments owed by the Guarantor under this Maximum Amount Guarantee:

  (a) shall be paid without any deduction or withholding for or on account of tax (a “Tax Deduction”) unless a Tax Deduction is required by law. If a Tax Deduction is required by law to be made, the amount of the payment shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required . If in connection with payments under this Maximum Amount Guarantee any amounts on account of tax are imposed on the Beneficiary (other than by way of a Tax Deduction) in any jurisdiction (other than the jurisdiction where the relevant Beneficiary is tax resident or, if different , maintains a permanent establishment to which such payment is attributable), the Guarantor shall indemnify and hold harmless the relevant Beneficiary against any such tax; other

  (b) are exclusive of any value added tax or similar charge (VAT). If VAT is chargeable, the Guarantor shall also and at the same time pay to the relevant Beneficiary an amount equal to the amount of the VAT.

  14	contact details

  14.1 The contact details for all communications in connection with this Maximum Amount

  Guarantee:

  (a) in respect of the Guarantor for this purpose are:

  Address: Fax: Note:

  [•] [•] [•]

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  and

  (b) in respect of the Beneficiary 1 and each Beneficiary for this purpose are:

  Address: Fax:

  Note:

  [•] [•]

  [•]

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  14.2 Any party hereto may change its contact details by giving seven days prior written notice to the Beneficiary 1 (in the case of the Guarantor) or to the Guarantor (in the case of the Beneficiaries). Where a party to this Maximum Amount Guarantee nominates a particular department or officer to receive a communication, a communication will not be effective if it fails to specify that department or officer.

  15.Communications

  15.1 Unless otherwise required by statutory law or unless otherwise agreed in writing from time to time, any notice given under or in connection with this Maximum Amount Guarantee must be made in writing (including, for the avoidance of doubt, by way of facsimile) in the English or German language.

  15.2 All other documents provided under or in connection with this Maximum Amount Guarantee must be:

  (a) in English or German; or

   (b) if not in English or German and unless the document is a statutory, corporate, constitutional or other official document if so required by the Beneficiary 1, accompanied by a certified English or German translation.

   16 	Miscellaneous

  16.1 This Maximum Amount Guarantee may be executed (manually or by facsimile) in any number of counterparts. This shall have the same effect as if the signatures on the counterparts were on a single copy of this Maximum Amount Guarantee.

  16.2 If any term of this Maximum Amount Guarantee is or becomes illegal, void , invalid or unenforceable in any respect under any jurisdiction, that will not affect:

  (a)

  (b) the legality, validity or enforceability in that jurisdiction of any other term of the maximum amount guarantee; or the legality, validity or enforceability in other jurisdictions of that or any other term of the Maximum Amount Guarantee, without any party having to argue and prove the parties intent to uphold the agreement made pursuant to this Maximum Amount Guarantee even without the illegal, void, invalid or unenforceable provision(s), which intent shall be indisputable ). The illegal, void, invalid or unenforceable provision shall be deemed to be replaced by such legal, valid and enforceable provision that in legal and economic terms comes closest to what the parties intended or would have intended in accordance with the purpose of this Maximum Amount Guarantee if they had considered the point at the time of conclusion of this Maximum Amount Guarantee. The same shall apply mutatis mutandis to any gap in this Maximum Amount Guarantee.

  16.3 Changes to and amendments to this Guarantee (including this Clause 16) must be made in

   

   

  	99

   

  

   

  writing.

  16.4     No failure to exercise, nor any delay in exercising, on the part of the Agent or the other Finance Parties (or any of them), any right or remedy under this Maximum Amount Guarantee shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy prevent any further or other exercise thereof or the exercise of any other right or remedy. The rights and remedies provided hereunder are cumulative and not exclusive of any rights or remedies provided by law.

  16.5    The Guarantor may not assign and/or transfer any of its rights and/or obligations under this Maximum Amount Guarantee to another person without the prior written consent of the Beneficiaries.

  17 	Governing law

  This Maximum Amount Guarantee and any non-contractual obligations arising out of or in connection with it shall be governed by and constructed in accordance with the laws of the Federal Republic of Germany.

  18 	Jurisdiction

  18.1    The courts of Frankfurt am Main, Germany shall have non-exclusive jurisdiction to settle any dispute arising out of or in connection with this Maximum Amount Guarantee.

  18.2   This Clause is for the benefit of the Beneficiaries only. To the extent allowed by law, the beneficiaries may take:

  (a) proceedings in any other competent court; other

   (b) concurrent proceedings in any number of jurisdictions.

   18.3 References in this Clause to a dispute in connection with this Maximum Amount Guarantee include any dispute as to the existence, validity or termination of this Maximum Amount Guarantee.

  Yours sincerely,

  ADVA Optical Networking SE

  Acknowledged and agreed:

  [•] as Beneficiary 1

  dates:

   

  Schedule 1

  to the Maximum Amount Guarantee from

  ADVA Optical Networking SE

  dated [•] in the amount of EUR [•]

  Local	Local Lender Local		

  	100

   

  

   

  Local Facility	

  Local Facility	Total in EUR

  Borrowers currency (if cash (if not guarantees (if not EUR) denominated in not denominated EUR, converted into EUR) in EUR, converted into EUR)	

  Total local facilities under maximum

  Amount Guarantee from ADVA Optical

  Networking SE

  place and date

  place and date

  - 106 -

   

   

  	101

   

  

   

  ANNEX 10

   

  - 108 -

   

   

  	102

   

  

   

  ANNEX 11

  EXISTING CREDITS AND ASSUMPTIONS OF LIABILITY

  Part 1 (Lending)

  Company	Borrower	Value in EUR (8/22/2018)

  Adva Optical Networking SE	ADVA Optical Networking North America Inc.	48.011.843

  Adva Optical Networking SE	ADVA Optical Networking Israel Ltd.	4.553.946

  Adva Optical Networking SE	Oscilloquartz Finland Oy	350.000

  ADVA Optical Networking North America Inc.	Charlotte’s Web Ltd.	44.962.826

  ADVA Optical Networking North America Inc.	MRV Communications GmbH	1.971.971

  ADVA Optical Networking North America Inc.	Nbase Communications Ltd.	260.857

  ADVA Optical Networking North America Inc.	Nbase Fibronics Ltd.	979.402

  ADVA Optical Networking North America Inc.	ADVA Optical Networking Israel Ltd.	31.177.794

  Part 2 (Assumption of Liability)

  Company	Warrantee	Value in EUR ( per 8/19/2018)

  Adva Optical Networking SE	ADVA Optical Networking Ltd.	1.691.000

  Adva Optical Networking SE	ADVA Optical Networking (India) Private Limited	2.184.000

  Adva Optical Networking SE	ADVA Optical Networking Singapore Ptd. Ltd.	624.000

  Adva Optical Networking SE	Oscilloquartz	854.000

  - 109 -

   

   

  	103

   

  

   

  ANNEX 12

  - 112 -

   

   

  	104

   

  

   

  ANNEX 13

  - 114 -

   

   

  	105

   

  

   

  ANNEX 14

  - 115 -

   

   

  	106

   

  

   

  ANNEX 15

  - 116 -

   

   

  	107

   

  

   

  ANNEX 16

  - 117 -

   

   

  	108

   

  

   

  ANNEX 17

  - 118 -

   

  	109

   

  

   

   

  SIGNATURE

   

  SIGNATURE

   

  Kreditnehmer und Garant

  ADVA Optical Networking SE

   

  /s/ Ulrich Dopfer						/s/ Thomas Zeiner

  Name:  Ulrich Dopher					Name:  Thomas Zeiner

       CFO								     Director

   

   

  	110

   

  

   

   

   

  	111

   

  

   

   

   

  	112

   

  

   

  Agent

  Deutsche Bank Luxembourg S.A.

   

  /s/ Marco Kaster						/s/ A. Alert

  Name:  Marco Kaster						Name:  A. Alert

   

   

  Banken

  Bayerische Landeshank

  (als Mandated Lead Arranger und Krditgeber)

   

  /s/ Von Ducker							/s/ Keck

  Name:  Von Ducker						Name:  Keck

   

   

  Deutsche Bank AG Filiale Deutschlandgeschaft

   

  (als Mandated Lead Arranger)

   

  /s/ Florian Frank							/s/ Oliver Bolus

  Name:  Florian Frank						Name:  Oliver Bolus

  										    Director

   

  Deutsche Bank Luxembourg S.A.

   

  (als Kreditgeber)

   

  /s/ S Jabbar							/s/ C Koch

  Name:  S. Jabbar						Name: C. Koch

   

  Norddeutsche Landesbank – Girozentrale – 

   

  (als Mandated Lead Arranger und Kreditgeber)

   

  /s/ Prinzhausen							/s/ Pohler

  Name:  Prinzhausen						Name: Pohler

   

  [Signature page: revolving credit agreement with ADVA Optical Networking]

   

  	113

   

  

   

  Deutsche Bank Luxembourg S.A.

  (als Kreditgeber)

  /s/ S Jabbar

  Name:

  S. Jabbar

  /s/ C Koch

  Name:

  C. Koch

   

  Norddeutsche Landesbank – Girozentrale - 

  (als Mandated Lead Arranger und Kreditgeber)

  /s/ Prinzhausen

  Name:

  Prinzhausen

  /s/ Pohler

  Name:

  Pohler

   

   

   

   

   

   

   

  [Signature page: revolving credit agreement with ADVA Optical Networking]

   

   

  	114

   

  

   

  Commersbank Aktlengesellschaft

   

  (als Lead Arranger und Kreditgeber)

   

  /s/ J Huber							/s/ Michael Breitwieser

  Name:  J Huber							Name: Michael Breitwieser

   

   

  DZ Bank AG Deutsche Zentral-Genossenschaftsbank, Frankfurt am Main

   

  (als Lead Arranger und Kreditgeber)

   

  /s/ V Sonnenberg						/s/ Jens Doht

  Name:  V Sonnenbert						Name:  Jens Doht

   

   

  IKB Deutsche Industriebank AG

   

  (als Lead Arranger und Kreditgeber)

   

  /s/ I. V. Roosen							/s/ Luck

  Name:  Roosen							Name: Luck

   

   

   

   

   

   

   

   

   

   

   

   

   

  [Signature page: revolving credit agreement with ADVA Optical Networking]

  	115ex_444892.htm

Exhibit 10.1

 

Redactions with respect to certain portions hereof denoted with “***”

 

 

LOAN AND SECURITY AGREEMENT

 

THIS LOAN AND SECURITY AGREEMENT (this “Agreement”) is dated as of the Effective Date between SILICON VALLEY BANK, a California corporation (“Bank”), and the borrower listed on Schedule I hereto (“Borrower”). The parties agree as follows:

 

1        LOAN AND TERMS OF PAYMENT

 

1.1    Term Loan.

 

(a)    Availability. Subject to the terms and conditions of this Agreement, upon Borrower’s request, during Draw Period A, Bank shall make term loan advances in an aggregate principal amount not exceeding the Term A Loan Availability Amount (each such advance is referred to herein as a “Term A Loan Advance” and, collectively, as the “Term A Loan Advances”); provided that, Borrower shall request, and subject to the terms and conditions of this Agreement, Bank shall make, on or about the Effective Date, one (1) Term A Loan Advance in an original principal amount of at least $20,000,000.00 (the “Initial Term Loan Advance”). Subject to the terms and conditions of this Agreement, upon Borrower’s request, during Draw Period B, Bank shall make one (1) term loan advance equal to the Term B Loan Availability Amount (the “Term B Loan Advance”). Subject to the terms and conditions of this Agreement, upon Borrower’s request, during Draw Period C, Bank shall make one (1) term loan advance equal to the Term C Loan Availability Amount (the “Term C Uncommitted Loan Advance”). The Term A Loan Advances, the Term B Loan Advance, and the Term C Uncommitted Loan Advance are each referred to herein as a “Term Loan Advance” and, collectively, as the “Term Loan Advances”. Borrower may request Term Loan Advances as set forth on Schedule I hereto.

 

(b)    Repayment. Borrower shall repay each Term Loan Advance as set forth in Schedule I hereto. All outstanding principal and accrued and unpaid interest under each Term Loan Advance, and all other outstanding Obligations with respect to such Term Loan Advance, are due and payable in full on the Term Loan Maturity Date.

 

(c)    Permitted Prepayment. Borrower shall have the option to prepay all, but not less than all, of the Term Loan Advances, provided Borrower (i) delivers written notice to Bank of its election to prepay the Term Loan Advances at least ten (10) days prior to such prepayment, and (ii) pays, on the date of such prepayment (A) the outstanding principal plus accrued and unpaid interest with respect to the Term Loan Advances, (B) the Prepayment Fee, (C) the Final Payment, and (D) all other sums, if any, that shall have become due and payable with respect to the Term Loan Advances, including interest at the Default Rate with respect to any past due amounts.

 

(d)    Mandatory Prepayment Upon an Acceleration. If the Term Loan Advances are accelerated by Bank following the occurrence and during the continuance of an Event of Default, Borrower shall immediately pay to Bank an amount equal to the sum of (i) all outstanding principal plus accrued and unpaid interest with respect to the Term Loan Advances, (ii) the Prepayment Fee, (iii) the Final Payment, and (iv) all other sums, if any, that shall have become due and payable with respect to the Term Loan Advances, including interest at the Default Rate with respect to any past due amounts.

 

1.2    Payment of Interest on the Credit Extensions.

 

(a)    Interest Payments. Interest on the principal amount of each Term Loan Advance is payable as set forth on Schedule I hereto.

 

(b)    Interest Rate.

 

 

 

 

(i)    Term Loan Advances. Subject to Section 1.2(c), the outstanding principal amount of any Term Loan Advance shall accrue interest as set forth on Schedule I hereto.

 

(ii)    All-In Rate. Notwithstanding any terms in this Agreement to the contrary, if at any time the interest rate applicable to any Obligations is less than zero percent (0.0%), such interest rate shall be deemed to be zero percent (0.0%) for all purposes of this Agreement.

 

(c)    Default Rate. Immediately upon the occurrence and during the continuance of an Event of Default, the outstanding Obligations shall bear interest at a rate per annum which is three percent (3.0%) above the rate that is otherwise applicable thereto (the “Default Rate”). Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Bank Expenses) but are not paid when due shall bear interest until paid at a rate equal to the highest rate applicable to the Obligations. Payment or acceptance of the increased interest rate provided in this Section 1.2(c) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Bank.

 

(d)    Adjustment to Interest Rate. Each change in the interest rate applicable to any amounts payable under the Loan Documents based on changes to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of such change.

 

(e)    Interest Computation. Interest shall be computed as set forth on Schedule I hereto. In computing interest, the date of the making of any Credit Extension shall be included and the date of payment shall be excluded; provided, however, that if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension.

 

1.3    Fees. Borrower shall pay to Bank:

 

(a)    Prepayment Fee. The Prepayment Fee, when due hereunder, which shall be fully earned and non-refundable as of such date;

 

(b)    Final Payment. The Final Payment, when due hereunder, which shall be fully earned and non-refundable as of such date; and

 

(c)    Bank Expenses. All Bank Expenses incurred through and after the Effective Date, when due (or, if no stated due date, upon demand by Bank).

 

Unless otherwise provided in this Agreement or in a separate writing by Bank, Borrower shall not be entitled to any credit, rebate, or repayment of any fees earned by Bank pursuant to this Agreement notwithstanding any termination of this Agreement or the suspension or termination of Bank’s obligation to make loans and advances hereunder. Bank may deduct amounts owing by Borrower under the clauses of this Section 1.3 pursuant to the terms of Section 1.4(c). Bank shall provide Borrower written notice of deductions made pursuant to the terms of the clauses of this Section 1.3.

 

1.4    Payments; Application of Payments; Debit of Accounts. 

 

(a)    All payments (including prepayments) to be made by Borrower under any Loan Document shall be made in immediately available funds in Dollars, without setoff, counterclaim, or deduction, before 12:00 p.m. Pacific time on the date when due. Payments of principal and/or interest received after 12:00 p.m. Pacific time are considered received at the opening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid.

 

(b)    Bank has the exclusive right to determine the order and manner in which all payments with respect to the Obligations may be applied. Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified elsewhere in this Agreement.

 

 

 

 

(c)    Bank may debit any of Borrower’s deposit accounts maintained with Bank, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due under the Loan Documents. These debits shall not constitute a set-off.

 

1.5    Change in Circumstances.

 

(a)    Increased Costs. 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, Bank, (ii) subject Bank to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes, and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitment, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, or (iii) impose on Bank any other condition, cost or expense (other than Taxes) affecting this Agreement or Credit Extensions made by Bank, and the result of any of the foregoing shall be to increase the cost to Bank of making, converting to, continuing or maintaining any Credit Extension (or of maintaining its obligation to make any such Credit Extension), or to reduce the amount of any sum received or receivable by Bank hereunder (whether of principal, interest or any other amount) then, upon written request of Bank, Borrower shall promptly pay to Bank such additional amount or amounts as will compensate Bank for such additional costs incurred or reduction suffered.

 

(b)    Capital Requirements. If Bank determines that any Change in Law affecting Bank regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on Bank’s capital as a consequence of this Agreement, any term loan facility, or the Credit Extensions made by Bank to a level below that which Bank could have achieved but for such Change in Law (taking into consideration Bank’s policies with respect to capital adequacy and liquidity), then from time to time upon written request of Bank, Borrower shall promptly pay to Bank such additional amount or amounts as will compensate Bank for any such reduction suffered.

 

(c)    Delay in Requests. Failure or delay on the part of Bank to demand compensation pursuant to this Section 1.5 shall not constitute a waiver of Bank’s right to demand such compensation; provided that Borrower shall not be required to compensate Bank pursuant to subsection (a) for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that Bank notifies Borrower of the Change in Law giving rise to such increased costs or reductions (except that if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine (9) month period shall be extended to include the period of retroactive effect).

 

1.6    Taxes. 

 

(a)    Payments Free of Taxes. Any and all payments by or on account of any obligation of Borrower 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 Borrower) requires the deduction or withholding of any Tax from any such payment by Borrower, then (i) Borrower shall be entitled to make such deduction or withholding, (ii) Borrower shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with Applicable Law, and (iii) if such Tax is an Indemnified Tax, the sum payable by Borrower 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 1.6) Bank receives an amount equal to the sum it would have received had no such deduction or withholding been made.

 

(b)    Payment of Other Taxes by Borrower. Without limiting the provisions of subsection (a) above, Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.

 

 

 

 

(c)    Tax Indemnification. Without limiting the provisions of subsections (a) and (b) above, Borrower shall, and does hereby, indemnify Bank, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 1.6) payable or paid by Bank or required to be withheld or deducted from a payment to Bank and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to Borrower by Bank shall be conclusive absent manifest error.

 

(d)    Evidence of Payments. As soon as practicable after any payment of Taxes by Borrower to a Governmental Authority pursuant to this Section 1.6, Borrower shall deliver to Bank a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Bank.

 

(e)    Status of Bank. If Bank (including any assignee or successor) is entitled to an exemption from or reduction of withholding tax with respect to payments made under any Loan Document, it shall deliver to Borrower, at the time or times reasonably requested by Borrower, such properly completed and executed documentation reasonably requested by Borrower as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, Bank, if reasonably requested by Borrower, shall deliver such other documentation prescribed by Applicable Law or reasonably requested by Borrower as will enable Borrower to determine whether or not Bank is subject to backup withholding or information reporting requirements. Without limiting the generality of the foregoing, Bank shall deliver whichever of IRS Form W-9, IRS Form W-8BEN-E, IRS Form W-8ECI or W-8IMY is applicable, as well as any applicable supporting documentation or certifications.

 

1.7    Procedures for Borrowing.

 

(a)    Subject to the prior satisfaction of all other applicable conditions to the making of a Term Loan Advance set forth in this Agreement (which must be satisfied no later than 12:00 p.m. Pacific time on the applicable Funding Date), to obtain a Term Loan Advance, Borrower shall notify Bank (which notice shall be irrevocable) by 12:00 p.m. Pacific time at least two (2) Business Days prior to the proposed Funding Date of the Term Loan Advance. Such notice shall be made by electronic mail or by telephone and, together with any such notification, Borrower shall deliver to Bank by electronic mail a completed Payment/Advance Form executed by an Authorized Signer and such other reports and information as Bank may reasonably request. Bank may rely on any telephone notice given by a person whom Bank believes is an Authorized Signer. Borrower will indemnify Bank for any loss Bank suffers due to such belief or reliance other than any loss caused by Bank’s gross negligence or willful misconduct. Bank shall have received satisfactory evidence that the Board has approved that such Authorized Signer may provide such notices and request such Term Loan Advance (which requirement may be deemed satisfied by the prior delivery of Borrowing Resolutions or a secretary’s certificate that certifies as to such Board approval).

 

(b)    Bank shall credit proceeds of a Credit Extension to the Designated Deposit Account. Bank may make Term Loan Advances under this Agreement based on instructions from an Authorized Signer or without instructions if such Term Loan Advances are necessary to meet Obligations which have become due.

 

2       CONDITIONS OF CREDIT EXTENSIONS

 

2.1    Conditions Precedent to Initial Credit Extension. Bank’s obligation to make the initial Credit Extension is subject to the condition precedent that Bank shall have received, in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate, including, without limitation:

 

(a)    duly executed Loan Documents;

 

(b)    duly executed Control Agreement from SVB Asset Management and US Bank;

 

(c)    the Operating Documents of each Borrower and long-form good standing certificates of each Borrower (other than Global Cooling) certified by the Secretary of State of the State of Delaware and the Secretary of State (or equivalent agency) of each other jurisdiction in which Borrower is qualified to conduct business, in each case as of a date no earlier than 30 days prior to the Effective Date;

 

 

 

 

(d)    certificate duly executed by a Responsible Officer or secretary of each Borrower with respect to such Borrower’s (i) Operating Documents and (ii) Borrowing Resolutions;

 

(e)    certified copies, dated as of a recent date, of searches for financing statement filed in the central filing office of the State of Delaware, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Credit Extension, will be terminated or released;

 

(f)    duly executed Perfection Certificate of each Borrower;

 

(g)    evidence that (i) the Liens securing Indebtedness owed by Borrower to Enhanced Capital Ohio Rural Fund, LLC have or will, concurrently with the initial Credit Extension, be terminated, have or will, concurrently with the initial Credit Extension, be terminated and (ii) the documents and/or filings evidencing the perfection of such Liens, including without limitation any financing statements and/or control agreements, have or will, concurrently with the initial Credit Extension, be terminated;

 

(h)    duly executed Subordination Agreement;

 

(i)    a legal opinion of Borrower’s counsel dated as of the Effective Date; and

 

(j)    payment of the fees and Bank Expenses then due as specified in Section 1.3 hereof.

 

2.2    Conditions Precedent to all Credit Extensions. Bank’s obligation to make each Credit Extension, including the initial Credit Extension, is subject to the following conditions precedent:

 

(a)    receipt of Borrower’s Credit Extension request and the related materials and documents as required by and in accordance with Section 1.7;

 

(b)    the representations and warranties in this Agreement shall be true and correct in all material respects as of the date of any Credit Extension request and as of the Funding Date of each Credit Extension; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true and correct in all material respects as of such date, and no Default or Event of Default shall have occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in this Agreement remain true and correct in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true and correct in all material respects as of such date; and

 

(c)    a Material Adverse Change shall not have occurred and be continuing.

 

2.3    Covenant to Deliver. Borrower shall deliver to Bank each item required to be delivered to Bank under this Agreement as a condition precedent to any Credit Extension. A Credit Extension made prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and the making of any Credit Extension in the absence of a required item shall be in Bank’s sole discretion.

 

3       CREATION OF SECURITY INTEREST

 

3.1    Grant of Security Interest.

 

(a)    Borrower hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.

 

 

 

 

(b)    Borrower acknowledges that it previously has entered, or may in the future enter, into Bank Services Agreements with Bank. Regardless of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to be Obligations hereunder and that it is the intent of Borrower and Bank to have all such Obligations secured by the first priority perfected security interest in the Collateral granted herein (subject to Permitted Liens).

 

3.2    Authorization to File Financing Statements. Borrower hereby authorizes Bank to file financing statements, without notice to Borrower, with all jurisdictions deemed necessary or appropriate by Bank to perfect or protect Bank’s interest or rights hereunder. Such financing statements may indicate the Collateral as substantially the same as set forth in the definition of Collateral in Section 12.2 hereof.

 

3.3    Termination. If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash. Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at Borrower’s sole cost and expense, terminate its security interest in the Collateral and all rights therein shall revert to Borrower. In the event (a) all Obligations (other than inchoate indemnity obligations), except for Bank Services, are satisfied in full, and (b) this Agreement is terminated, Bank shall terminate the security interest granted herein upon Borrower providing cash collateral acceptable to Bank in its sole discretion for Bank Services, if any. In the event such Bank Services consist of outstanding Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to at least (x) 105.0% of the face amount of all such Letters of Credit denominated in Dollars and (y) 115.0% of the Dollar Equivalent of the face amount of all such Letters of Credit denominated in a Foreign Currency, plus, in each case, all interest, fees, and costs due or estimated by Bank to become due in connection therewith, to secure all of the Obligations relating to such Letters of Credit.

 

4       REPRESENTATIONS AND WARRANTIES

 

Borrower represents and warrants as follows:

 

4.1    Due Organization, Authorization; Power and Authority.

 

(a)    Each Borrower and each of its Subsidiaries (other than Global Cooling until the date which is 30 days after the Effective Date) are each duly existing and in good standing as a Registered Organization in their respective jurisdiction of formation and are qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of their respective business or their ownership of property requires that they be qualified except where the failure to do so could not reasonably be expected to have a material adverse effect on such Borrower’s business or operations.

 

(b)    All information set forth on the Perfection Certificate pertaining to such Borrower and each of its Subsidiaries is true and correct in all material respects (it being understood and agreed that such Borrower may from time to time update certain information in the Perfection Certificate after the Effective Date to the extent permitted by one or more specific provisions in this Agreement and the Perfection Certificate shall be deemed to be updated to the extent such notice is provided to Bank of such permitted update).

 

(c)    The execution, delivery and performance by Borrower and each of its Subsidiaries of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s or any such Subsidiary’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Applicable Law, (iii) contravene, conflict with or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect), or (v) conflict with, contravene, constitute a default or breach under, or result in or permit the termination or acceleration of, any material agreement by which Borrower or any of its Subsidiaries is bound. Neither Borrower nor any of its Subsidiaries are in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a material adverse effect on Borrower’s or any of its Subsidiary’s business or operations.

 

 

 

 

4.2    Collateral.

 

(a)    The security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral (subject to Permitted Liens). Borrower has good title to, rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens.

 

(b)    Borrower has no Collateral Accounts at or with any bank or financial institution other than Bank or Bank’s Affiliates except for the Collateral Accounts described in the Perfection Certificate delivered to Bank in connection herewith and which Borrower has taken such actions as are necessary to give Bank a perfected security interest therein, pursuant, but subject to the limitations contained in, to the terms of Section 5.7(c). The Accounts are bona fide, existing obligations of the Account Debtors.

 

(c)    The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise provided in the Perfection Certificate or as permitted pursuant to Section 6.2. None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Section 6.2.

 

(d)    All Inventory is in all material respects of good and marketable quality, free from material defects.

 

(e)    Borrower owns, or possesses the right to use to the extent necessary in its business, all Intellectual Property, licenses and other intangible assets that are used in the conduct of its business as now operated, except to the extent that such failure to own or possess the right to use such asset would not reasonably be expected to have a material adverse effect on Borrower’s business or operations, and no such asset, to the best knowledge of Borrower, conflicts with the valid Intellectual Property, license, or intangible asset of any other Person to the extent that such conflict could reasonably be expected to have a material adverse effect on Borrower’s business or operations.

 

(f)    Except as noted on the Perfection Certificate or for which notice has been given to Bank pursuant to and in accordance with Section 5.8(b), Borrower is not a party to, nor is it bound by, any Restricted License.

 

4.3    Litigation.  Other than as set forth in the Perfection Certificate or as disclosed to Bank pursuant to Section 5.3(h), there are no actions, investigations or proceedings pending or, to the knowledge of any Responsible Officer, threatened in writing by or against Borrower or any of its Subsidiaries involving more than, individually or in the aggregate, $200,000.00, not covered by independent third party insurance as to which liability has been accepted by the carrier providing such insurance.

 

4.4    Financial Statements; Financial Condition.  All consolidated financial statements for Borrower and any of its Subsidiaries delivered to Bank by submission to the Financial Statement Repository or otherwise submitted to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations for the periods covered thereby, subject, in the case of unaudited financial statements, to normal year-end adjustments and the absence of footnote disclosures. There has not been any material deterioration in Borrower’s consolidated financial condition since the date of the most recent financial statements submitted to the Financial Statement Repository or otherwise submitted to Bank.

 

4.5    Solvency. The fair salable value of Borrower’s consolidated assets (including goodwill minus disposition costs) exceeds the fair value of Borrower’s liabilities; Borrower is not left with unreasonably small capital after the transactions in this Agreement; and Borrower and each of its Subsidiaries are able to pay their debts (including trade debts) as they mature.

 

 

 

 

4.6    Regulatory Compliance. Borrower is not an “investment company” or a company “controlled” by an “investment company” under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower and each of its Subsidiaries (a) have complied in all material respects with all Applicable Law, and (b) have not violated any Applicable Law the violation of which could reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower and each of its Subsidiaries have duly complied with, and their respective facilities, business, assets, property, leaseholds, real property and Equipment are in compliance with, Environmental Laws, except where the failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business or operations; there are no outstanding citations, notices or orders of non-compliance issued to Borrower or any of its Subsidiaries or relating to their respective facilities, businesses, assets, property, leaseholds, real property or Equipment under such Environmental Laws. Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted, except where the failure to obtain or make or file the same would not reasonably be expected to have a material adverse effect on Borrower’s business or operations.

 

4.7    Subsidiaries; Investments. Borrower does not own any stock, partnership, or other ownership interest or other equity securities except for Permitted Investments.

 

4.8    Tax Returns and Payments; Pension Contributions.

 

(a)    Borrower and each of its Subsidiaries have timely filed, or submitted extensions for, all required tax returns and reports, and Borrower and each of its Subsidiaries have timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries except (a) to the extent such taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor, or (b) if such taxes, assessments, deposits and contributions do not, individually or in the aggregate, exceed $200,000.00. Borrower is unaware of any claims or adjustments proposed for any of Borrower’s or any of its Subsidiary’s prior tax years which could result in additional taxes becoming due and payable by Borrower or any of its Subsidiaries in excess of $200,000.00 in the aggregate.

 

(b)    Borrower and each of its Subsidiaries have paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and neither Borrower nor any of its Subsidiaries has withdrawn from participation in, and has not permitted partial or complete termination of, or permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected to result in any liability of Borrower or any of its Subsidiaries, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other Governmental Authority.

 

4.9    Full Disclosure.  No written representation, warranty or other statement of Borrower or any of its Subsidiaries in any report, certificate or written statement submitted to the Financial Statement Repository or otherwise submitted to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such reports, certificates and written statements submitted to the Financial Statement Repository or otherwise submitted to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the reports, certificates or written statements not misleading in light of the circumstances under which they were made (it being recognized by Bank that the projections and forecasts provided by Borrower or any of its Subsidiaries in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).

 

4.10    Sanctions. Neither Borrower nor any of its Subsidiaries is: (a) in violation of any Sanctions; or (b) a Sanctioned Person. Neither Borrower nor any of its Subsidiaries, directors, officers, employees, agents or Affiliates: (i) conducts any business or engages in any transaction or dealing with any Sanctioned Person, including making or receiving any contribution of funds, goods or services to or for the benefit of any Sanctioned Person; (ii) deals in, or otherwise engages in any transaction relating to, any property or interests in property blocked pursuant to any Sanctions; (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Sanctions; or (iv) otherwise engages in any transaction that could cause Bank to violate any Sanctions.

 

 

 

 

4.11    Healthcare Permits. (a) Borrower has obtained all Healthcare Permits and other rights from, and has made all declarations and filings with, all applicable Governmental Authorities, all self-regulatory authorities and all courts and other tribunals necessary to engage in the management and/or operation of their respective business; (b) each such Healthcare Permit is valid and in full force and effect, and Borrower is in compliance with the terms and conditions of all such Healthcare Permits; and (c) Borrower has not received notice from any Governmental Authority with respect to the revocation, suspension, restriction, limitation or termination of any Healthcare Permit nor, to the knowledge of Borrower, is any such action proposed or threatened in writing.

 

4.12    Compliance with Healthcare Laws.

 

(a)    Borrower is in compliance with all applicable Healthcare Laws. Without limiting the generality of the foregoing, Borrower has not received written notice by a Governmental Authority of any violation (or of any investigation, audit, or other proceeding involving allegations of any violation) of any Healthcare Laws, and no investigation, inspection, audit or other proceeding involving allegations of any violation is, to the knowledge of Borrower, threatened in writing or contemplated.

 

(b)    To the knowledge of Borrower, Borrower is not in default or violation of any law which is applicable to Borrower or its respective assets or the conduct of its respective businesses and Borrower has not been debarred or excluded from participation under a state or federal health care program, including any state or federal workers compensation program.

 

(c)    Borrower is not a party to any corporate integrity agreements, deferred prosecution agreements, monitoring agreements, consent decrees, settlement orders or similar agreements with or imposed by any Governmental Authority.

 

5       AFFIRMATIVE COVENANTS

 

Borrower shall do all of the following:

 

5.1    Use of Proceeds. Cause the proceeds of the Credit Extensions to be used solely (a) as working capital or (b) to fund its general business purposes, and not for personal, family, household or agricultural purposes.

 

5.2    Government Compliance. 

 

(a)    Maintain its and all of its Subsidiaries’ legal existence (except as permitted under Section 6.3 with respect to Subsidiaries only) and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on Borrower’s business or operations. Borrower shall comply, and have each Subsidiary comply, in all material respects, with all laws, ordinances and regulations to which it is subject.

 

(b)    Obtain all of the Governmental Approvals necessary for the performance by Borrower and each of its Subsidiaries of their obligations under the Loan Documents to which it is a party, including any grant of a security interest to Bank. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank.

 

(c)    Cause the operations and property of Borrower, each of its Subsidiaries to comply with all applicable Healthcare Laws. Without limiting the foregoing, the operations and property of Borrower and each of its Subsidiaries shall comply with HIPAA in all material respects. Borrower established and maintains a corporate compliance program that (i) addresses the material Requirements of Law, including all applicable Healthcare Laws, of Governmental Authorities having jurisdiction over its business and operations, and (ii) has been structured to account for the guidance issued by the U.S. Department of Health and Human Services regarding characteristics of effective corporate compliance programs. As of the Effective Date, Borrower has delivered to Bank an accurate and complete copy of each material report, study, survey or other document of which Borrower has knowledge that addresses or otherwise relates to the compliance by Borrower and each of its Subsidiaries, with applicable Healthcare Laws.

 

 

 

 

5.3    Financial Statements, Reports.  Deliver to Bank by submitting to the Financial Statement Repository:

 

(a)    Quarterly Financial Statements. As soon as available, and in any event within (i) 45 days after the end of each of the first three fiscal quarters of Borrower and (ii) 90 days after the last fiscal quarter of Borrower, company prepared consolidated balance sheet and income statement covering Borrower’s consolidated operations for such quarter in a form reasonably acceptable to Bank;

 

(b)    Compliance Statement. Within (i) 45 days after the end of each of the first three fiscal quarters of Borrower and (ii) 90 days after the last fiscal quarter of Borrower, and together with the statements set forth in Section 5.3(a), a duly completed Compliance Statement, confirming that as of the end of such month, Borrower was in compliance with all of the terms and conditions of this Agreement, and setting forth calculations showing compliance with the financial covenants set forth in this Agreement and such other information as Bank may reasonably request;

 

(c)    Annual Operating Budget and Financial Projections. As soon as available, and in any event no later than 60 days following the end of Borrower’s fiscal year, and contemporaneously with any updates or amendments thereto, (A) annual operating budgets (including income statements, balance sheets and cash flow statements, by month) for the then-current fiscal year of Borrower, and (B) annual financial projections for the then-current fiscal year (on a quarterly basis), in each case as approved by the Board, together with any related business forecasts used in the preparation of such annual financial projections;

 

(d)    Annual Audited Financial Statements. As soon as available, and in any event within 90 days following the end of Borrower’s fiscal year, audited consolidated financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements from an independent certified public accounting firm reasonably acceptable to Bank;

 

(e)    SEC Filings. Within five (5) days of filing, notification of the filing and copies of all periodic and other reports, proxy statements and other materials filed by Borrower and/or any of its Subsidiaries or any Guarantor with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with any national securities exchange, or distributed to its shareholders, as the case may be. Documents required to be delivered pursuant to the terms hereof (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 on which Borrower or any of its Subsidiaries posts such documents, or provides a link thereto, on Borrower’s or any of its Subsidiaries’ website on the internet at Borrower’s or any of its Subsidiaries’ website address; provided, however, Borrower shall promptly notify Bank in writing (which may be by electronic mail) of the posting of any such documents;

 

(f)    Security Holder and Subordinated Debt Holder Reports. Within five (5) days of delivery, copies of all statements, reports and notices made available to Borrower’s security holders or to any holders of Subordinated Debt (solely in their capacities as security holders or holders of Subordinated Debt and not in any other role);

 

(g)    Beneficial Ownership Information. If applicable to Borrower, prompt written notice of any changes to the beneficial ownership information set out in Section 14 of the Perfection Certificate. Borrower understands and acknowledges that Bank relies on such true, accurate and up-to-date beneficial ownership information to meet Bank’s regulatory obligations to obtain, verify and record information about the beneficial owners of its legal entity customers;

 

(h)    Legal Action Notice. Prompt written notice of any legal actions, investigations or proceedings pending or threatened in writing against Borrower or any of its Subsidiaries that could reasonably be expected to result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate, $200,000.00 or more;

 

 

 

 

(i)    Tort Claim Notice. If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank;

 

(j)    Government Filings. Within five (5) days after the same are sent or received, copies of all correspondence, reports, documents and other filings by Borrower or any of its Subsidiaries with any Governmental Authority regarding compliance with or maintenance of Governmental Approvals or Applicable Law or that could reasonably be expected to have a material effect on any of the Governmental Approvals or otherwise on the business of Borrower or any of its Subsidiaries;

 

(k)    Registered Organization. If Borrower is not a Registered Organization as of the Effective Date but later becomes one, promptly notify Bank of such occurrence and provide Bank with Borrower’s organizational identification number;

 

(l)    Default. Prompt written notice of the occurrence of a Default or Event of Default; and

 

(m)    Other Information. Promptly, from time to time, such other information regarding Borrower or any of its Subsidiaries or compliance with the terms of any Loan Documents as reasonably requested by Bank.

 

Any submission by Borrower of a Compliance Statement or any other financial statement submitted to the Financial Statement Repository pursuant to this Section 5.3 or otherwise submitted to Bank shall be deemed to be a representation by Borrower that (i) as of the date of such Compliance Statement or other financial statement, the information and calculations set forth therein are true and correct (provided that, with respect to financial statements only, such financial statements are subject to the same terms and qualifications set forth in Section 4.4 of this Agreement), (ii) as of the end of the compliance period set forth in such submission, Borrower is in complete compliance with all required covenants except as noted in such Compliance Statement or other financial statement, as applicable, (iii) as of the date of such submission, no Events of Default have occurred or are continuing, (iv) all representations and warranties other than any representations or warranties that are made as of a specific date in Section 4 remain true and correct in all material respects as of the date of such submission except as noted in such Compliance Statement or other financial statement, as applicable, (v) as of the date of such submission, Borrower and each of its Subsidiaries has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as otherwise permitted pursuant to the terms of Section 4.8, and (vi) as of the date of such submission, no Liens have been levied or claims made against Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of which Borrower has not previously provided written notification to Bank.

 

5.4    Taxes; Pensions.

 

(a)    Timely file, and require each of its Subsidiaries to timely file (in each case, unless subject to a valid extension), all required tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of Section 4.8(a) hereof, and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay, and require each of its Subsidiaries to pay, all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms.

 

(b)    To the extent Borrower or any of its Subsidiaries defers payment of any contested taxes, (i) notify Bank in writing of the commencement of, and any material development in, the proceedings, and (ii) post bonds or take any other steps required to prevent the Governmental Authority levying such contested taxes from obtaining a Lien upon any of the Collateral that is other than a “Permitted Lien.”

 

 

 

 

5.5    Insurance. 

 

(a)    Keep its business and the Collateral insured for risks and in amounts standard for companies of Borrower’s size in Borrower’s industry and location and as Bank may reasonably request. Insurance policies shall be in a form, with financially sound and reputable insurance companies that are not Affiliates of Borrower, and in amounts that are reasonably satisfactory to Bank.

 

(b)    All property policies shall have a lender’s loss payable endorsement showing Bank as lender loss payee. All liability policies shall show, or have endorsements showing, Bank as an additional insured. Bank shall be named as lender loss payee and/or additional insured with respect to any such insurance providing coverage in respect of any Collateral.

 

(c)    Ensure that proceeds payable under any property policy are, at Bank’s option, payable to Bank on account of the Obligations. Notwithstanding the foregoing, (i) so long as no Event of Default has occurred and is continuing, Borrower shall have the option of applying the proceeds of any casualty policy up to $1,500,000.00 individually or in the aggregate for all losses under all casualty policies in any 12 month period, toward the replacement or repair of destroyed or damaged property; provided that any such replaced or repaired property (A) shall be of equal or like value as the replaced or repaired Collateral and (B) shall be deemed Collateral in which Bank has been granted a first priority security interest (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s Lien), and (ii) after the occurrence and during the continuance of an Event of Default, all proceeds payable under such casualty policy shall, at the option of Bank, be payable to Bank on account of the Obligations then due.

 

(d)    At Bank’s request, Borrower shall deliver certified copies of insurance policies and evidence of all premium payments. Each provider of any such insurance required under this Section 5.5 shall agree, by endorsement upon the policy or policies issued by it or by independent instruments furnished to Bank, that it will give Bank 30 days’ prior written notice before any such policy or policies shall be canceled or altered in any material respect. If Borrower fails to obtain insurance as required under this Section 5.5 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 5.5, and take any action under the policies Bank deems prudent.

 

5.6    Access to Collateral; Books and Records.  At reasonable times, on three (3) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is continuing), Bank, or its agents, shall have the right to inspect the Collateral and the right to audit and copy Borrower’s Books. Such inspections and audits shall be conducted no more often than once every 12 months, unless an Event of Default has occurred and is continuing, in which case such inspections and audits shall occur as often as Bank shall determine is necessary. The foregoing inspections and audits shall be conducted at Borrower’s expense and the charge therefor shall be $1,000.00 per person per day (or such higher amount as shall represent Bank’s then-current standard charge for the same), plus out-of-pocket expenses. In the event Borrower and Bank schedule an audit more than eight (8) days in advance, and Borrower cancels or seeks to or reschedules the audit with less than eight (8) days written notice to Bank, then (without limiting any of Bank’s rights or remedies) Borrower shall pay Bank a fee of $2,000.00 plus any out-of-pocket expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling.

 

5.7    Accounts.

 

(a)    Maintain all of Borrower’s, any of its Subsidiaries’, and any Guarantor’s operating accounts, depository accounts and excess cash with Bank or Bank’s Affiliates. Notwithstanding the foregoing, (i) during the Transition Period, Borrower may maintain (A) one (1) account with Chase Bank (the “Chase Account”), (B) one (1) account with Pacific Western Bank (the “PacWest Account”), and (C) one (1) account with PNC Bank (the “PNC Account”; together with the Chase Account and the PacWest Account, the “Permitted Temporary Accounts”), in an aggregate amount not to exceed (for all Permitted Temporary Accounts together) $3,000,000.00 at any time and (ii) Borrower and its Subsidiaries may maintain up to six (6) foreign bank accounts with HSBC in an aggregate amount not to exceed the lesser of (x) $5,000,000.00 or (y) 20.0% of Borrower’s, its Subsidiaries’ and Guarantor’s consolidated cash wherever located at any time (the “Permitted Foreign HSBC Accounts”).

 

(b)    In addition to the foregoing, Borrower, any Subsidiary of Borrower and any Guarantor, shall obtain any letter of credit exclusively from Bank.

 

 

 

 

(c)    In addition to and without limiting the restrictions in (a), Borrower shall provide Bank five (5) days prior written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any time maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder which Control Agreement may not be terminated without the prior written consent of Bank. The provisions of the previous sentence shall not apply to (i) the Permitted Temporary Accounts during the Transition Period, (ii) the Permitted Foreign HSCBC Accounts, or (iii) deposit accounts exclusively used for payroll, payroll taxes, and other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such.

 

5.8    Protection of Intellectual Property Rights. 

 

(a)    (i) Protect, defend and maintain the validity and enforceability of Borrower’s and each Subsidiary’s Intellectual Property, except to the extent that such failure to do so would not reasonably be expected to have a material adverse effect on Borrower’s business or operations; (ii) promptly advise Bank in writing of infringements or any other event that could reasonably be expected to materially and adversely affect the value Borrower’s and each Subsidiary’s Intellectual Property; and (iii) not allow any Intellectual Property material to Borrower’s or any Subsidiary’s business to be abandoned, forfeited or dedicated to the public without Bank’s written consent.

 

(b)    Provide written notice to Bank within ten (10) days of entering or becoming bound by any Restricted License (other than over-the-counter software that is commercially available to the public). Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (i) any such Restricted License to be deemed “Collateral” and for Bank to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such Restricted License, whether now existing or entered into in the future, and (ii) Bank to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under this Agreement and the other Loan Documents.

 

5.9    Financial Covenant – ***. Upon the occurrence of the Funding Milestone, to be tested as of the last day of each calendar quarter during a ***, Borrower shall achieve, calculated on a consolidated basis with respect to Borrower and its Subsidiaries and measured on *** basis, *** for such *** period of at least the amounts set forth below; provided that, testing for such financial covenant shall commence and continue for *** on and after the date that the Funding Milestone occurs:

 

***

 

5.10    Litigation Cooperation. From the date hereof and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers, employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower.

 

5.11    Inventory; Returns. Keep all Inventory in good and marketable condition, free from material defects. Returns and allowances between Borrower and its Account Debtors shall follow Borrower’s customary practices as they exist at the Effective Date. Borrower shall promptly notify Bank of all returns, recoveries, disputes and claims that involve more than $500,000.00.

 

5.12    Further Assurances. Execute any further instruments and take such further action as Bank reasonably requests to perfect, protect, ensure the priority of or continue Bank’s Lien on the Collateral or to effect the purposes of this Agreement.

 

5.13    Sanctions. (a) Not, and not permit any of its Subsidiaries to, engage in any of the activities described in Section 4.10 in the future; (b) not, and not permit any of its Subsidiaries to, become a Sanctioned Person; (c) ensure that the proceeds of the Obligations are not used to violate any Sanctions; and (d) deliver to Bank any certification or other evidence requested from time to time by Bank in its sole discretion, confirming each such Person’s compliance with this Section 5.13. In addition, have implemented, and will consistently apply while this Agreement is in effect, procedures to ensure that the representations and warranties in Section 4.10 remain true and correct while this Agreement is in effect.

 

 

 

 

5.14    Post-Closing Conditions. Within 30 days after the Effective Date, Borrower shall deliver to Bank:

 

(a)    Evidence satisfactory to Bank that the insurance policies and endorsements required by Section 5.5 hereof are in full force and effect, together with appropriate evidence showing lender loss payable and additional insured clauses or endorsements in favor of Bank;

 

(b)    Duly executed landlord’s consent in favor of Bank for each of Borrower’s leased locations at 3301 Monte Villa Pkwy Bothell, WA 98021, 3303 Monte Villa Pkwy Bothell, WA 98021, 4209 Balloon Park Rd NE Albuquerque, NM 87109, 74100 Van Dyke Rd Bruce Township, MI 48065, 74180 Van Dyke Rd Bruce Township, MI 48065, ***, 6000 Poston Rd Athens, OH 45701, and 296 South Harper St Nelsonville, OH 45764 by the respective landlord thereof, for Borrower;

 

(c)    Duly executed bailee’s waiver in favor of Bank for Borrower’s third party location at 4715 McLeod Rd NE Albuquerque, NM 87109, by such third party;

 

(d)    A long form Certificate of Good Standing from the Delaware Secretary of State with respect to Global Cooling (dated within 30 days of the date of delivery); and

 

(e)    Certificates of Good Standing/Foreign Qualification from the Secretary of State from each of the following jurisdictions (each dated within 30 days of the date of delivery): (i) with respect to BioLife, Washington and (ii) with respect to Arctic, Michigan.

 

6       NEGATIVE COVENANTS

 

Borrower shall not do any of the following without Bank’s prior written consent:

 

6.1    Dispositions. Convey, sell, lease, transfer, assign, or otherwise dispose of (including, without limitation, pursuant to a Division) (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete Equipment that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of Permitted Liens and Permitted Investments; (d) consisting of the issuance of any stock, partnership, membership, or other ownership interest or other equity securities of Borrower permitted under Section 6.2 of this Agreement; (e) consisting of Borrower’s or its Subsidiaries’ use or transfer of money or Cash Equivalents in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents; (f) consisting of non-exclusive licenses for the use of the property of Borrower or its Subsidiaries in the ordinary course of business; and (g) other immaterial assets not otherwise permitted under this Section 6.1 with a value not exceeding $500,000.00 in any fiscal year.

 

6.2    Changes in Business, Management, Control, or Business Locations. (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve or permit any of its Subsidiaries to liquidate or dissolve; (c) fail to provide notice to Bank of any Key Person departing from or ceasing to be employed by Borrower within 10 days after such Key Person’s departure from Borrower; (d) permit, allow or suffer to occur any Change in Control; or (e) without at least 15 days prior written notice to Bank, (i) add any new offices or business locations, including warehouses (unless such new offices or business locations contain less than $500,000.00 in Borrower’s assets or property) or deliver any portion of the Collateral valued, individually or in the aggregate, in excess of $500,000.00 to a bailee at a location other than to a bailee and at a location already disclosed in the Perfection Certificate, (ii) change its jurisdiction of organization, (iii) change its organizational structure or type, (iv) change its legal name, or (v) change any organizational number (if any) assigned by its jurisdiction of organization. If Borrower intends to add any new offices or business locations, including warehouses, containing in excess of $500,000.00 of Borrower’s assets or property, then Borrower will cause the landlord of any such new offices or business locations, including warehouses, to execute and deliver a landlord consent in form and substance satisfactory to Bank. If Borrower intends to deliver any portion of the Collateral valued, individually or in the aggregate, in excess of $500,000.00 to a bailee, and Bank and such bailee are not already parties to a bailee agreement governing both the Collateral and the location to which Borrower intends to deliver the Collateral, then Borrower will cause such bailee to execute and deliver a bailee agreement in form and substance satisfactory to Bank.

 

 

 

 

6.3    Mergers or Acquisitions. Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the stock, partnership, membership, or other ownership interest or other equity securities or property of another Person (including, without limitation, by the formation of any Subsidiary or pursuant to a Division). A Subsidiary may merge or consolidate into another Subsidiary or into Borrower.

 

6.4    Indebtedness. Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness.

 

6.5    Encumbrance. Create, incur, allow, or suffer to exist any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to be subject to the first priority security interest granted herein, or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank) with any Person which directly or indirectly prohibits or has the effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s or any Subsidiary’s Intellectual Property, except as is otherwise permitted in Section 6.1 hereof and the definition of “Permitted Liens” herein.

 

6.6    Maintenance of Collateral Accounts. Maintain any Collateral Account except pursuant to the terms of Section 5.7(c).

 

6.7    Distributions; Investments. (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any stock, partnership, membership, or other ownership interest or other equity securities; or (b) directly or indirectly make any Investment (including, without limitation, by the formation of any Subsidiary) other than Permitted Investments, or permit any of its Subsidiaries to do so.

 

6.8    Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person.

 

6.9    Subordinated Debt. Except as expressly permitted under the terms of the subordination, intercreditor, or other similar agreement to which any Subordinated Debt is subject: (a) make or permit any payment on such Subordinated Debt; or (b) amend any provision in any document relating to such Subordinated Debt which would increase the amount thereof, provide for earlier or greater principal, interest, or other payments thereon, or adversely affect the subordination thereof to Obligations owed to Bank.

 

6.10    Compliance. (a) Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; (b)(i) fail to meet the minimum funding requirements of ERISA, (ii) permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur, (iii) fail to comply with the Federal Fair Labor Standards Act or (iv) violate any other law or regulation, if the foregoing subclauses (i) through (iv), individually or in the aggregate, could reasonably be expected to have a material adverse effect on Borrower’s business or operations, or permit any of its Subsidiaries to do so; or (c) withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other Governmental Authority.

 

 

 

 

7      EVENTS OF DEFAULT

 

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

 

7.1    Payment Default. Borrower fails to (a) make any payment of principal or interest on any Credit Extension on its due date, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day cure period shall not apply to payments due on the Term Loan Maturity Date). During the cure period, the failure to make or pay any payment specified under clause (b) hereunder is not an Event of Default (but no Credit Extension will be made during the cure period);

 

7.2    Covenant Default.

 

(a)    Borrower fails or neglects to perform any obligation in Section 5 (other than Sections 5.2 (Government Compliance), 5.10 (Litigation Cooperation), 5.11 (Inventory; Returns) and 5.12 (Further Assurances)) or violates any covenant in Section 6; or

 

(b)    Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 7) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed 30 days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period). Cure periods provided under this section shall not apply, among other things, to financial covenants or any other covenants that are required to be satisfied, completed or tested by a date certain or any covenants set forth in clause (a) above;

 

7.3    Material Adverse Change. A Material Adverse Change occurs;

 

7.4    Attachment; Levy; Restraint on Business. 

 

(a)    (i) The service of process seeking to attach, by trustee or similar process, any funds of Borrower or any Subsidiary, or (ii) a notice of lien or levy is filed against any of Borrower’s or any of its Subsidiaries’ assets by any Governmental Authority, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period; or

 

(b)    (i) any material portion of Borrower’s or any of its Subsidiaries’ assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains, or prevents Borrower or any of its Subsidiaries from conducting all or any material part of its business;

 

7.5    Insolvency. (a) Borrower or any of its Subsidiaries is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower or any of its Subsidiaries begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower or any of its Subsidiaries and is not dismissed or stayed within 45 days (but no Credit Extensions shall be made while any of the conditions described in clause (a) exist or until any Insolvency Proceeding is dismissed);

 

7.6    Other Agreements. There is, under any agreement to which Borrower, any of Borrower’s Subsidiaries, or any Guarantor is a party with a third party or parties, (a) any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount individually or in the aggregate in excess of $200,000.00; or (b) any breach or default by Borrower, any of Borrower’s Subsidiaries, or Guarantor, the result of which could have a material adverse effect on Borrower’s, any of Borrower’s Subsidiaries’, or any Guarantor’s business or operations;

 

 

 

 

7.7    Judgments; Penalties. One or more fines, penalties or final judgments, orders or decrees for the payment of money in an amount, individually or in the aggregate, of at least $200,000.00 (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower or any of its Subsidiaries by any Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof, discharged, or after execution thereof, or stayed pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the discharge, or stay of such fine, penalty, judgment, order or decree);

 

7.8    Misrepresentations. Borrower or any of its Subsidiaries or any Person duly authorized to be acting for Borrower or any of its Subsidiaries makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Bank or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made (it being agreed and acknowledged by Bank that the projections and forecasts provided by Borrower or any of its Subsidiaries in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results);

 

7.9    Subordinated Debt. If: (a) any document, instrument, or agreement evidencing the subordination of any Subordinated Debt shall for any reason be revoked or invalidated or otherwise cease to be in full force and effect, or any Person (other than Bank) shall be in breach thereof or contest in any manner the validity or enforceability thereof or deny that it has any further liability or obligation thereunder; (b) a default or event of default (however defined) has occurred under any document, instrument, or agreement evidencing any Subordinated Debt, which default shall not have been cured or waived within any applicable grace period; or (c) the Obligations shall for any reason be subordinated or shall not have the priority contemplated by this Agreement or any applicable subordination or intercreditor agreement;

 

7.10    Lien Priority. There is a material impairment in the perfection or priority of Bank’s security interest in the Collateral;

 

7.11    Guaranty. (a) Any guaranty of any Obligations terminates or ceases for any reason to be in full force and effect; (b) any Guarantor does not perform any obligation or covenant under any guaranty of the Obligations; (c) any circumstance described in Sections 7.3, 7.47.4, 7.5 , 7.6, 7.7 or 7.8 of this Agreement occurs with respect to any Guarantor, (d) the death, liquidation, winding up, or termination of existence of any Guarantor; or (e)(i) a material impairment in the perfection or priority of Bank’s Lien in the collateral provided by Guarantor or in the value of such collateral or (ii) a material adverse change in the general affairs, management, results of operation, condition (financial or otherwise) or the prospect of repayment of the Obligations occurs with respect to any Guarantor; or

 

7.12    Governmental Approvals. Any Governmental Approval shall have been (a) revoked, rescinded, suspended, modified in a materially adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described in clause (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) causes, or could reasonably be expected to cause, a Material Adverse Change, or (ii) materially and adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably be expected to materially and adversely affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other jurisdiction.

 

7.13    Delisting. After an initial public offering of the Borrower’s common stock on an exchange or market, such shares are delisted from such exchange or market because of Borrower’s failure to comply with continued listing standards thereof or due to a voluntary delisting which results in such shares not being listed on such exchange or market.

 

8       BANK’S RIGHTS AND REMEDIES

 

8.1    Rights and Remedies. Upon the occurrence and during the continuance of an Event of Default, Bank may, without notice or demand, do any or all of the following:

 

 

 

 

(a)    declare all Obligations immediately due and payable (but if an Event of Default described in Section 7.5 occurs all Obligations are immediately due and payable without any action by Bank);

 

(b)    stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Bank;

 

(c)    demand that Borrower (i) deposit cash with Bank in an amount equal to at least (A) 105.0% of the aggregate face amount of any Letters of Credit denominated in Dollars remaining undrawn, and (B) 115.0% of the Dollar Equivalent of the aggregate face amount of any Letters of Credit denominated in a Foreign Currency remaining undrawn (plus, in each case, all interest, fees, and costs due or estimated by Bank to become due in connection therewith), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;

 

(d)    terminate any FX Contracts (it being understood and agreed that (i) Bank is not obligated to deliver the currency which Borrower has contracted to receive under any FX Contract, and Bank may cover its exposure for any FX Contracts by purchasing or selling currency in the interbank market as Bank deems appropriate; (ii) Borrower shall be liable for all losses, damages, costs, margin obligations and expenses incurred by Bank arising from Borrower’s failure to satisfy its obligations under any FX Contract or the execution of any FX Contract; and (iii) Bank shall not be liable to Borrower for any gain in value of a FX Contract that Bank may obtain in covering Borrower’s breach);

 

(e)    verify the amount of, demand payment of and performance under, and collect any Accounts and General Intangibles, settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Bank considers advisable, and notify any Person owing Borrower money of Bank’s security interest in such funds;

 

(f)    make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral. Borrower shall assemble the Collateral if Bank requests and make it available as Bank designates. Bank may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be prior or superior to its security interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s rights or remedies;

 

(g)    apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) amount held by Bank owing to or for the credit or the account of Borrower;

 

(h)    ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral. For use solely upon the occurrence and during the continuation of an Event of Default, Bank is hereby granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s labels, Patents, Copyrights, mask works, rights of use of any name, trade secrets, trade names, Trademarks, and advertising matter, or any similar property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section 8.1, Borrower’s rights under all licenses and all franchise agreements inure to Bank’s benefit;

 

(i)    place a “hold” on any account maintained with Bank and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral;

 

(j)    demand and receive possession of Borrower’s Books; and

 

(k)    exercise all rights and remedies available to Bank under the Loan Documents or at law or equity, including all remedies provided under the Code or any Applicable Law (including disposal of the Collateral pursuant to the terms thereof).

 

 

 

 

8.2    Power of Attorney. Borrower hereby irrevocably appoints Bank as its true and lawful attorney-in-fact, (a) exercisable upon the occurrence and during the continuance of an Event of Default, to: (i) endorse Borrower’s name on any checks, payment instruments, or other forms of payment or security; (ii) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (iii) demand, collect, sue, and give releases to any Account Debtor for monies due, settle and adjust disputes and claims about the Accounts directly with Account Debtors, and compromise, prosecute, or defend any action, claim, case, or proceeding about any Collateral (including filing a claim or voting a claim in any bankruptcy case in Bank’s or Borrower’s name, as Bank chooses); (iv) make, settle, and adjust all claims under Borrower’s insurance policies; (v) pay, contest or settle any Lien, charge, encumbrance, security interest, or other claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (vi) transfer the Collateral into the name of Bank or a third party as the Code permits; and (b) regardless of whether an Event of Default has occurred, to sign Borrower’s name on any documents necessary to perfect or continue the perfection of Bank’s security interest in the Collateral. Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and powers, coupled with an interest, are irrevocable until such time as all Obligations (other than inchoate indemnity obligations) have been satisfied in full, Bank is under no further obligation to make Credit Extensions and the Loan Documents have been terminated. Bank shall not incur any liability in connection with or arising from the exercise of such power of attorney and shall have no obligation to exercise any of the foregoing rights and remedies.

 

8.3    Protective Payments. If Borrower fails to obtain the insurance called for by Section 5.5 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document or which may be required to preserve the Collateral, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the Collateral. Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Bank are deemed an agreement to make similar payments in the future or Bank’s waiver of any Event of Default.

 

8.4    Application of Payments and Proceeds. Bank may apply any funds in its possession, whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to the Obligations in such order as Bank shall determine in its sole discretion. Any surplus shall be paid to Borrower or other Persons legally entitled thereto; Borrower shall remain liable to Bank for any deficiency. If Bank, in its commercially reasonable discretion, directly or indirectly, enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor.

 

8.5    Bank’s Liability for Collateral. Bank’s sole duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession or under its control, under Section 9-207 of the Code or otherwise, shall be to deal with it in the same manner as Bank deals with its own property consisting of similar instruments or interests. Borrower bears all risk of loss, damage or destruction of the Collateral.

 

8.6    No Waiver; Remedies Cumulative. Bank’s failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Bank thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall be effective unless signed by the party granting the waiver and then is only effective for the specific instance and purpose for which it is given. Bank’s rights and remedies under this Agreement and the other Loan Documents are cumulative. Bank has all rights and remedies provided under the Code, by law, or in equity. Bank’s exercise of one right or remedy is not an election and shall not preclude Bank from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Bank’s waiver of any Event of Default is not a continuing waiver. Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence.

 

8.7    Demand Waiver. Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Bank on which Borrower is liable.

 

 

 

 

8.8    Borrower Liability. Any Borrower may, acting singly, request Credit Extensions hereunder. Each Borrower hereby appoints each other as agent for the other for all purposes hereunder, including with respect to requesting Credit Extensions hereunder. Each Borrower hereunder shall be liable for the Credit Extensions and Obligations as set forth on Schedule I hereto. Each Borrower waives (a) any suretyship defenses available to it under the Code or any other Applicable Law, and (b) any right to require Bank to: (i) proceed against any Borrower or any other person; (ii) proceed against or exhaust any security; or (iii) pursue any other remedy. Bank may exercise or not exercise any right or remedy it has against any Borrower or any security it holds (including the right to foreclose by judicial or non-judicial sale) without affecting any Borrower’s liability. Notwithstanding any other provision of this Agreement or other related document, each Borrower irrevocably waives all rights that it may have at law or in equity (including, without limitation, any law subrogating Borrower to the rights of Bank under this Agreement) to seek contribution, indemnification or any other form of reimbursement from any other Borrower, or any other Person now or hereafter primarily or secondarily liable for any of the Obligations, for any payment made by Borrower with respect to the Obligations in connection with this Agreement or otherwise and all rights that it might have to benefit from, or to participate in, any security for the Obligations as a result of any payment made by Borrower with respect to the Obligations in connection with this Agreement or otherwise. Any agreement providing for indemnification, reimbursement or any other arrangement prohibited under this Section Error! Reference source not found. shall be null and void. If any payment is made to a Borrower in contravention of this Section Error! Reference source not found., such Borrower shall hold such payment in trust for Bank and such payment shall be promptly delivered to Bank for application to the Obligations, whether matured or unmatured.

 

9      NOTICES

 

All notices, consents, requests, approvals, demands, or other communication by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address or email address indicated below; provided that, for clause (b), if such notice, consent, request, approval, demand or other communication is not sent during the normal business hours of the recipient, it shall be deemed to have been sent at the opening of business on the next Business Day of the recipient. Bank or Borrower may change its mailing or electronic mail address by giving the other party written notice thereof in accordance with the terms of this Section 9.

 

	 	If to Borrower:	BioLife Solutions, Inc.
	 	 	SAVSU Technologies, Inc.
	 	 	Arctic Solutions, Inc.
	 	 	SciSafe Holdings, Inc.
	 	 	Global Cooling, Inc.
	 	 	Sexton Biotechnologies, Inc.
	 	 	 
	 	 	3303 Monte Villa Pkwy, STE 310, Bothell, WA 98021
	 	 	Attn: Troy Wichterman
	 	 	Email: twichterman@biolifesolutions.com
	 	 	 
	 	 	 
	 	If to Bank:	Silicon Valley Bank
	 	 	505 Howard Street, 3rd Floor
	 	 	San Francisco, California 94105
	 	 	Attn: Shawn Parry
	 	 	Email: SParry@svb.com
	 	 	 
	 	 	 
	 	with a copy to (which shall not	Morrison & Foerster LLP
	 	constitute notice):	200 Clarendon Street
	 	 	Boston, Massachusetts 02116
	 	 	Attn:          David A. Ephraim, Esquire
	 	 	Email: DEphraim@mofo.com

 

 

 

 

10       CHOICE OF LAW, VENUE AND JURY TRIAL WAIVER

 

Except as otherwise expressly provided in any of the Loan Documents, New York law governs the Loan Documents without regard to principles of conflicts of law that would require the application of the laws of another jurisdiction. Borrower and Bank each irrevocably and unconditionally submit to the exclusive jurisdiction of the State and Federal courts in New York, New York; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction with respect to the Loan Documents or to realize on the Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Bank. Borrower expressly, irrevocably and unconditionally submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and Borrower hereby irrevocably and unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby irrevocably and unconditionally consents to the granting of such legal or equitable relief as is deemed appropriate by such court. Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in, or subsequently provided by Borrower in accordance with, Section 9 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid.

 

TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT. EACH PARTY HERETO HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

 

This Section 10 shall survive the termination of this Agreement and the repayment of all Obligations.

 

11       GENERAL PROVISIONS

 

11.1    Termination Prior to Maturity Date; Survival.  All covenants, representations and warranties made in this Agreement shall continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations) have been satisfied. So long as Borrower has satisfied the Obligations (other than inchoate indemnity obligations, and any other obligations which, by their terms, are to survive the termination of this Agreement and the repayment of all Obligations, and any Obligations under Bank Services Agreements that are cash collateralized in accordance with Section 3.3 of this Agreement), this Agreement may be terminated prior to the Term Loan Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Bank. Those obligations that are expressly specified in this Agreement as surviving this Agreement’s termination and the repayment of all Obligations shall continue to survive notwithstanding this Agreement’s termination and the repayment of all Obligations.

 

11.2    Successors and Assigns. This Agreement binds and is for the benefit of the successors and permitted assigns of each party. Borrower may not assign or transfer this Agreement or any rights or obligations under it without Bank’s prior written consent (which may be granted or withheld in Bank’s sole discretion) and any other attempted assignment or transfer by Borrower shall be null and void. Bank has the right, without the consent of or notice to Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in, Bank’s obligations, rights, and benefits under this Agreement and the other Loan Documents.

 

 

 

 

11.3    Indemnification. 

 

(a)    General Indemnification. Borrower shall indemnify, defend and hold Bank and its Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of Bank and its Affiliates (each, an “Indemnified Person”) harmless against: all losses, claims, damages, liabilities and related expenses (including Bank Expenses and the reasonable fees, charges and disbursements of any counsel for any Indemnified Person) (collectively, “Claims”) 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, (ii) any Credit Extension or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or release of hazardous materials on or from any property owned or operated by Borrower or any of its Subsidiaries, or any environmental liability related in any way to Borrower or any of its Subsidiaries, 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 Borrower, and regardless of whether any Indemnified Person is a party thereto; provided that such indemnity shall not, as to any Indemnified Person, be available to the extent that such losses, claims, damages, liabilities or related 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 Indemnified Person. All amounts due under this Section 11.3 shall be payable promptly after demand therefor.

 

(b)    Waiver of Consequential Damages, Etc. To the fullest extent permitted by Applicable Law, Borrower shall not assert, and hereby waives, any claim against any Indemnified Person, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) or any loss of profits 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 Credit Extension, or the use of the proceeds thereof. No Indemnified Person 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.

 

This Section 11.3 shall survive the termination of this Agreement and the repayment of all Obligations until all statutes of limitation with respect to the Claims, losses, and expenses for which indemnity is given shall have run.

 

11.4    Time of Essence. Time is of the essence for the performance of all Obligations in this Agreement.

 

11.5    Severability of Provisions. Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.

 

11.6    Amendments in Writing; Waiver; Integration. No purported amendment or modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be effective unless, and only to the extent, expressly set forth in a writing signed by each party hereto. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment, supplement or waiver or have any other effect on any Loan Document. Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver. The Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of the Loan Documents merge into the Loan Documents.

 

11.7    Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement. Delivery of an executed signature page of this Agreement by electronic mail transmission shall be effective as delivery of a manually executed counterpart hereof.

 

 

 

 

11.8    Confidentiality. Bank agrees to maintain the confidentiality of Information (as defined below), except that Information may be disclosed (a) to Bank’s Subsidiaries and Affiliates and their respective employees, directors, agents, attorneys, accountants and other professional advisors (collectively, “Representatives” and, together with Bank, collectively, “Bank Entities”); (b) to prospective transferees, assignees, credit providers or purchasers of Bank’s interests under or in connection with this Agreement and their Representatives (provided, however, Bank shall use commercially reasonable efforts to obtain any such prospective transferee’s, assignee’s, credit provider’s, purchaser’s or their Representatives’ agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Bank’s regulators or as otherwise required or requested in connection with Bank’s examination or audit; (e) in connection with the exercise of remedies under the Loan Documents or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder; and (f) to third-party service providers of Bank so long as such service providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein. “Information” means all information received from Borrower regarding Borrower or its business, in each case other than information that is either: (i) in the public domain or in Bank’s possession when disclosed to Bank, or becomes part of the public domain (other than as a result of its disclosure by Bank in violation of this Agreement) after disclosure to Bank; or (ii) disclosed to Bank by a third party, if Bank does not know that the third party is prohibited from disclosing the information.

 

11.9    Electronic Execution of Documents. The words “execution,” “signed,” “signature” and words of like import in any Loan Document shall be deemed to include electronic signatures, including any Electronic Signature as defined in the Electronic Transactions Law (2003 Revision) of the Cayman Islands (the “Cayman Islands Electronic Signature Law”), if applicable, or the keeping of records in electronic form, including any Electronic Record, as defined in Cayman Islands Electronic Signature Law, each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping systems, as the case may be, to the extent and as provided for in any Applicable Law, including, without limitation, any state law based on the Uniform Electronic Transactions Act or the Cayman Islands Electronic Signature Law; provided, however that sections 8 and 19(3) of the Cayman Islands Electronic Signature Law shall not apply to this Agreement or the execution or delivery thereof.

 

11.10    Right of Setoff. Borrower hereby grants to Bank a Lien and a right of setoff as security for all Obligations to Bank, whether now existing or hereafter arising upon and against all deposits, credits, collateral and property, now or hereafter in the possession, custody, safekeeping or control of Bank or any entity under the control of Bank (including a subsidiary of Bank) or in transit to any of them, and other obligations owing to Bank or any such entity. At any time after the occurrence and during the continuance of an Event of Default, without demand or notice, Bank may setoff the same or any part thereof and apply the same to any liability or Obligation of Borrower even though unmatured and regardless of the adequacy of any other collateral securing the Obligations. ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

 

11.11    Captions and Section References. The headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement. Unless indicated otherwise, section references herein are to sections of this Agreement.

 

11.12    Construction of Agreement. The parties hereto mutually acknowledge that they and their attorneys have participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist.

 

11.13    Relationship. The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement. The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or incidents different from those of parties to an arm’s-length contract.

 

11.14    Third Parties. Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights or remedies under or by reason of this Agreement on any Persons other than the express parties to it and their respective permitted successors and assigns; (b) relieve or discharge the obligation or liability of any Person not an express party to this Agreement; or (c) give any Person not an express party to this Agreement any right of subrogation or action against any party to this Agreement.

 

 

 

 

11.15    Anti-Terrorism Law. Bank hereby notifies Borrower that, pursuant to the requirements of Anti-Terrorism Law, Bank may be required to obtain, verify and record information that identifies Borrower, which information may include the name and address of Borrower and other information that will allow Bank to identify Borrower in accordance with Anti-Terrorism Law. Borrower hereby agrees to take any action necessary to enable Bank to comply with the requirements of Anti-Terrorism Law.

 

12       ACCOUNTING TERMS AND OTHER DEFINITIONS

 

12.1    Accounting and Other Terms.

 

(a)    Accounting terms not defined in this Agreement shall be construed following GAAP. Calculations and determinations must be made following GAAP (except for with respect to unaudited financial statements for the absence of footnotes and subject to year-end audit adjustments), provided that 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 Borrower or Bank shall so request, Borrower and Bank shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP; provided, further, that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) Borrower shall provide Bank 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.

 

(b)    As used in the Loan Documents: (i) the words “shall” or “will” are mandatory, the word “may” is permissive, the word “or” is not exclusive, the words “includes” and “including” are not limiting, the singular includes the plural, and numbers denoting amounts that are set off in brackets are negative; (ii) the term “continuing” in the context of an Event of Default means that the Event of Default has not been remedied (if capable of being remedied) or waived; and (iii) whenever a representation or warranty is made to Borrower’s knowledge or awareness, to the “best of” Borrower’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of any Responsible Officer.

 

12.2    Definitions. Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in this Section 12.2. All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein. As used in this Agreement, the following capitalized terms have the following meanings:

 

“Account” is, as to any Person, any “account” of such Person as “account” is defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to such Person.

 

“Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made.

 

***

 

“Affiliate” is, with respect to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.

 

“Agreement” is defined in the preamble hereof.

 

“Anti-Terrorism Law” means any law relating to terrorism or money-laundering, including Executive Order No. 13224 and the USA Patriot Act.

 

 

 

 

“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.

 

“Arctic” is defined in Schedule I hereof.

 

“Authorized Signer” means any individual listed in Borrower’s Borrowing Resolution who is authorized to execute the Loan Documents, including making (and executing if applicable) any Credit Extension request, on behalf of Borrower.

 

“Bank” is defined in the preamble hereof.

 

“Bank Entities” is defined in Section 11.8.

 

“Bank Expenses” are all audit fees, costs and reasonable expenses (including reasonable, out-of-pocket and documented attorneys’ fees and expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower or any Guarantor.

 

“Bank Services” are any products, credit services, and/or financial accommodations previously, now, or hereafter provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without limitation, merchant services, direct deposit of payroll, business credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank’s various agreements related thereto (each, a “Bank Services Agreement”).

 

“Bank Services Agreement” is defined in the definition of Bank Services.

 

“BioLife” is defined in Schedule I hereof.

 

“Board” is Borrower’s board of directors or equivalent governing body.

 

“Borrower” is set forth on Schedule I hereto.

 

“Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.

 

“Borrowing Resolutions” are, with respect to any Person, those resolutions adopted by such Person’s board of directors (and, if required under the terms of such Person’s Operating Documents, stockholders) and delivered by such Person to Bank approving the Loan Documents to which such Person is a party and the transactions contemplated thereby, together with a certificate executed by its secretary on behalf of such Person certifying (a) such Person has the authority to execute, deliver, and perform its obligations under each of the Loan Documents to which it is a party, (b) that set forth as a part of or attached as an exhibit to such certificate is a true, correct, and complete copy of the resolutions then in full force and effect authorizing and ratifying the execution, delivery, and performance by such Person of the Loan Documents to which it is a party, (c) the name(s) of the Person(s) authorized to execute the Loan Documents, including making (and executing if applicable) any Credit Extension request, on behalf of such Person, together with a sample of the true signature(s) of such Person(s), and (d) that Bank may conclusively rely on such certificate unless and until such Person shall have delivered to Bank a further certificate canceling or amending such prior certificate.

 

“Business Day” is a day other than a Saturday, Sunday or other day on which commercial banks in the State of California are authorized or required by law to close, except that if any determination of a “Business Day” shall relate to an FX Contract, the term “Business Day” shall also mean a day on which dealings are carried on in the country of settlement of the Foreign Currency.

 

 

 

 

“Cash Equivalents” are (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue; and (d) money market funds at least 95.0% of the assets of which constitute Cash Equivalents of the kinds described in clauses (a) through (c) of this definition.

 

“Cayman Islands Electronic Signature Law” is defined in Section 11.9.

 

“Change in Control” means (a) at any time, any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), shall become, or obtain rights (whether by means of warrants, options or otherwise) to become, the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)‐5 under the Exchange Act), directly or indirectly, of 49.0% or more of the ordinary voting power for the election of directors, partners, managers and members, as applicable, of Borrower (determined on a fully diluted basis) other than by the sale of Borrower’s equity securities in a public offering or to venture capital or private equity investors so long as Borrower identifies to Bank the venture capital or private equity investors at least seven (7) Business Days prior to the closing of the transaction and provides to Bank a description of the material terms of the transaction; (b) during any period of 12 consecutive months, a majority of the members of the Board of Borrower cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body; or (c) at any time, Borrower shall cease to own and control, of record and beneficially, directly or indirectly, 100.0% of each class of outstanding stock, partnership, membership, or other ownership interest or other equity securities of each Subsidiary of Borrower free and clear of all Liens (except Permitted Liens).

 

“Change in Law” means the occurrence, after the Effective Date, of: (a) the adoption or taking effect of any law, rule, regulation or treaty; (b) any change in Applicable Law 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 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.

 

“Chase Account” is defined in Section 5.7(a).

 

“Claims” is defined in Section 11.3.

 

“CMS” is defined in the definition of Medicare Regulations.

 

“Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of New York; provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to, Bank’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of New York, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions.

 

 

 

 

“Collateral” consists of all of Borrower’s right, title and interest in and to the following personal property:

 

(a)    (i) all goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles (except as provided below), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, securities accounts, securities entitlements and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and (ii) all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.

 

(b)    Notwithstanding the foregoing, the Collateral does not include any Intellectual Property; provided, however, the Collateral shall include all Accounts and all proceeds of Intellectual Property. If a judicial authority (including a U.S. Bankruptcy Court) would hold that a security interest in the underlying Intellectual Property is necessary to have a security interest in such Accounts and such property that are proceeds of Intellectual Property, then the Collateral shall automatically, and effective as of the Effective Date, include the Intellectual Property to the extent necessary to permit perfection of Bank’s security interest in such Accounts and such other property of Borrower that are proceeds of the Intellectual Property.

 

(c)    Pursuant to the terms of a certain negative pledge arrangement with Bank, Borrower has agreed not to encumber any of its Intellectual Property without Bank’s prior written consent.

 

“Collateral Account” is any Deposit Account, Securities Account, or Commodity Account.

 

“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made.

 

“Compliance Statement” is that certain statement in the form attached hereto as Exhibit A.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

 

“Contingent Obligation” is, for any Person, any direct or indirect liability of that Person for (a) any direct or indirect guaranty by such Person of any indebtedness, lease, dividend, letter of credit, credit card or other obligation of another, (b) any other obligation endorsed, co-made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (c) any obligations for undrawn letters of credit for the account of that Person; and (d) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.

 

“Control Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such Deposit Account, Securities Account, or Commodity Account.

 

“Copyrights” are any and all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret.

 

“Credit Extension” is any FX Contract, Term Loan Advance, or any other extension of credit by Bank for Borrower’s benefit.

 

 

 

 

“Currency” is coined money and such other banknotes or other paper money as are authorized by law and circulate as a medium of exchange.

 

“Default” means any event which with notice or passage of time or both, would constitute an Event of Default.

 

“Default Rate” is defined in Section 1.2(c).

 

“Deposit Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter be made.

 

“Designated Deposit Account” is the deposit account established by Borrower with Bank for purposes of receiving Credit Extensions.

 

“Division” means, in reference to any Person which is an entity, the division of such Person into two (2) or more separate Persons, with the dividing Person either continuing or terminating its existence as part of such division, including, without limitation, as contemplated under Section 18-217 of the Delaware Limited Liability Company Act for limited liability companies formed under Delaware law, Section 17-220 of the Delaware Revised Uniform Limited Partnership Act for limited partnerships formed under Delaware law, or any analogous action taken pursuant to any other Applicable Law with respect to any corporation, limited liability company, partnership or other entity.

 

“Dollars,” “dollars” or use of the sign “$” means only lawful money of the United States and not any other currency, regardless of whether that currency uses the “$” sign to denote its currency or may be readily converted into lawful money of the United States.

 

“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer to the country issuing such Foreign Currency.

 

“Domestic Subsidiary” means a Subsidiary organized under the laws of the United States or any state or territory thereof or the District of Columbia.

 

“Draw Period A” is set forth on Schedule I hereto.

 

“Draw Period B” is set forth on Schedule I hereto.

 

“Draw Period C” is set forth on Schedule I hereto.

 

“Effective Date” is set forth on Schedule I hereto.

 

“Environmental Laws” means any Applicable Law (including any permits, concessions, grants, franchises, licenses, agreements or governmental restrictions) relating to pollution or the protection of health, safety or the environment or the release of any materials into the environment (including those related to hazardous materials, air emissions, discharges to waste or public systems and health and safety matters).

 

“Equipment” is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing.

 

“ERISA” is the Employee Retirement Income Security Act of 1974, as amended, and its regulations.

 

“Event of Default” is defined in Section 7.

 

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

 

 

 

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to Bank or required to be withheld or deducted from a payment to Bank, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of Bank being organized under the laws of, or having its principal office or its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) U.S. federal withholding Taxes imposed on amounts payable to or for the account of Bank with respect to an applicable interest in a Credit Extension pursuant to a law in effect on the date on which (i) Bank acquires such interest in the Credit Extensions or (ii) Bank changes its lending office, except in each case to the extent that, pursuant to Section 1.6, amounts with respect to such Taxes were payable either to Bank’s assignor immediately before Bank became a party hereto or to Bank immediately before it changed its lending office, (c) Taxes attributable to Bank’s failure to comply with Section 1.6(e), and (d) any withholding Taxes imposed under FATCA.

 

“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Internal Revenue Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Internal Revenue Code.

 

“Final Payment” is a payment (in addition to and not a substitution for the regular monthly payments of principal plus accrued interest) due on the earliest to occur of (a) the Term Loan Maturity Date, (b) the repayment of the Term Loan Advances in full, (c) as required pursuant to Sections 1.1(c) or 1.1(d), or (d) the termination of this Agreement, in an amount equal to the aggregate principal amount of the Term Loan Advances extended by Bank multiplied by 5.75%.

 

“Financial Statement Repository” is Bank’s e-mail address specified in Section 9 or such other means of collecting information approved and designated by Bank after providing notice thereof to Borrower from time to time.

 

“Foreign Currency” is the lawful money of a country other than the United States.

 

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

 

“Funding Date” is any date on which a Credit Extension is made to or for the account of Borrower which shall be a Business Day.

 

“Funding Milestone” is set forth on Schedule I hereto.

 

“FX Contract” is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency at a set price or on a specified date.

 

“GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination.

 

“General Intangibles” is all “general intangibles” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.

 

“Global Cooling” is defined in Schedule I hereof.

 

 

 

 

“Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority, including, without limitation, Healthcare Permits.

 

“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.

 

“Guarantor” is any Person providing a Guaranty in favor of Bank.

 

“Guaranty” is any guarantee of all or any part of the Obligations, as the same may from time to time be amended, restated, modified or otherwise supplemented.

 

“Healthcare Laws” means all applicable laws relating to the operation or management of hospitalist practices, the provision of hospitalist services, proper billing and collection practices relating to the payment for healthcare services, insurance law (including law related to payment for “no-fault” claims) and workers compensation law as they relate to the provision of, and billing and payment for, healthcare services, patient healthcare, patient healthcare information, patient abuse, the quality and adequacy of rehabilitative care, rate setting, equipment, personnel, operating policies, fee splitting, including, without limitation, (a) all federal and state fraud and abuse laws, including, without limitation, the federal Anti-Kickback Statute (42 U.S.C. §1320a-7b(b)), the Stark Law (42 U.S.C. §1395nn), the civil False Claims Act (31 U.S.C. §3729 et seq.), the administrative False Claims Law (42 U.S.C. § 1320a-7b(a)), the Anti-Inducement Law (42 U.S.C. § 1320a-7a(a)(5)), the exclusion laws (42 U.S.C. § 1320a-7); (b) the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009; (c) the Medicare Regulations and the Medicaid Program (Title XIX of the Social Security Act); (d) quality, safety and accreditation standards and requirements of all applicable state laws or regulatory bodies; (e) all laws, policies, procedures, requirements and regulations pursuant to which Healthcare Permits are issued; (f) any laws, regulations or administrative guidance with respect to fee splitting by healthcare professionals and the corporate practice of medicine in any jurisdiction in which any Borrower or any Guarantor operates; and (g) any and all comparable state or local laws and other applicable health care laws, regulations, manual provisions, policies and administrative guidance, each of (a) through (g) as may be amended from time to time and the regulations promulgated pursuant to each such law.

 

“Healthcare Permit” means, with respect to any Person, a permit issued or required under Healthcare Laws applicable to the business of Borrower or any Guarantor, or necessary in the possession, ownership, warehousing, marketing, promoting, sale, labeling, furnishing, distribution or delivery of goods or services under Healthcare Laws applicable to the business of Borrower or any Guarantor.

 

“HHS” is defined in the definition of OIG.

 

“HIPAA” means, collectively, the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic Clinical Health (HITECKH) Act and the implementing regulations thereto.

 

“Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, (d) Contingent Obligations and (e) other short- and long-term obligations under debt agreements, lines of credit and extensions of credit.

 

“Indemnified Person” is defined in Section 11.3.

 

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

 

 

 

 

“Information” is defined in Section 11.8.

 

“Insolvency Proceeding” is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, receivership or other relief.

 

“Intellectual Property” means, with respect to any Person, all of such Person’s right, title, and interest in and to the following:

 

(a)    its Copyrights, Trademarks and Patents;

 

(b)    any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how and operating manuals;

 

(c)    any and all source code;

 

(d)    any and all design rights which may be available to such Person;

 

(e)    any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and

 

(f)    all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.

 

“Interest Expense” means for any fiscal period, interest expense (whether cash or non-cash) determined in accordance with GAAP for the relevant period ending on such date, including, in any event, interest expense with respect to any Credit Extension and other Indebtedness of Borrower and its Subsidiaries, including, without limitation or duplication, all commissions, discounts, or related amortization and other fees and charges with respect to letters of credit and bankers’ acceptance financing and the net costs associated with interest rate swap, cap, and similar arrangements, and the interest portion of any deferred payment obligation (including leases of all types).

 

“Interest Rate Ceiling” is set forth on Schedule I hereto.

 

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

 

“Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower’s custody or possession or in transit and including any returned goods and any documents of title representing any of the above.

 

“Investment” is any beneficial ownership interest in any Person (including stock, partnership, membership, or other ownership interest or other equity securities), and any loan, advance or capital contribution to any Person.

 

“Key Person” is each of Borrower’s (a) Chairman and Chief Executive Officer, who is Michael Rice, as of the Effective Date and (b) Executive Vice President and Chief Scientific Officer, who is Aby J. Mathew, as of the Effective Date.

 

“Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application, guarantee, indemnity, or similar agreement.

 

 

 

 

“Lien” is a claim, mortgage, deed of trust, levy, attachment charge, pledge, hypothecation, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

 

“Loan Documents” are, collectively, this Agreement and any schedules, exhibits, certificates, notices, and any other documents related to this Agreement, the Perfection Certificate, the Subordination Agreement, any Bank Services Agreement, any Control Agreement, any other subordination agreement, any note, or notes or guaranties executed by Borrower or any Guarantor, landlord waivers and consents, bailee waivers and consents, and any other present or future agreement by Borrower and/or any Guarantor with or for the benefit of Bank in connection with this Agreement or Bank Services, all as amended, restated, or otherwise modified in accordance with the terms thereof.

 

“Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or condition (financial or otherwise) of Borrower; (c) a material impairment of the prospect of repayment of any portion of the Obligations; or (d) Bank determines, based upon information available to it and in its reasonable judgment, that there is a substantial likelihood that Borrower shall fail to comply with one or more of the financial covenants in Section 5 during the next succeeding financial reporting period.

 

“Net Income” means, as calculated on a consolidated basis for Borrower and its Subsidiaries for any period as at any date of determination, the net profit (or loss), after provision for taxes, of Borrower and its Subsidiaries for such period taken as a single accounting period.

 

“Medicare Regulations” means, collectively, all federal statutes (whether set forth in Title XVIII of the Social Security Act or elsewhere) affecting the health insurance program for the aged and disabled established by Title XVIII of the Social Security Act and any statutes succeeding thereto; together with all applicable provisions of all rules, regulations, manuals and orders and administrative, reimbursement and other guidelines having the force of law of all Governmental Authorities (including The Centers for Medicare & Medicaid Services (“CMS”), the OIG, HHS, or any person succeeding to the functions of any of the foregoing) promulgated pursuant to or in connection with any of the foregoing having the force of law, as each may be amended, supplemented or otherwise modified from time to time.

 

“Obligations” are Borrower’s obligations to pay when due any debts, principal, interest, fees, Bank Expenses, the Prepayment Fee, the Final Payment, and other amounts Borrower owes Bank now or later, whether under this Agreement, the other Loan Documents, or otherwise, including, without limitation, all obligations relating to Bank Services and interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Bank, and to perform Borrower’s duties under the Loan Documents.

 

“OFAC” is the Office of Foreign Assets Control of the United States Department of the Treasury and any successor thereto.

 

“OIG” means The Office of Inspector General of the United States Department of Health and Human Services (“HHS”) and any successor thereof.

 

“Operating Documents” are, for any Person, such Person’s formation documents, as certified by the Secretary of State (or equivalent agency) of such Person’s jurisdiction of organization on a date that is no earlier than 30 days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership or limited partnership, its partnership agreement or limited partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto.

 

“Other Connection Taxes” means, with respect to Bank, Taxes imposed as a result of a present or former connection between Bank and the jurisdiction imposing such Tax (other than connections arising from Bank 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 Credit Extension 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.

 

“PacWest Account” is defined in Section 5.7(a).

 

“Patents” means all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.

 

“Payment/Advance Form” is that certain form in the form attached hereto as Exhibit B.

 

“Payment Date” is set forth on Schedule I hereto.

 

“Perfection Certificate” is the Perfection Certificate delivered by Borrower in connection with this Agreement.

 

“Permitted Foreign HSBC Accounts” is defined in Section 5.7(a).

 

“Permitted Temporary Accounts” is defined in Section 5.7(a).

 

“Permitted Indebtedness” is:

 

(a)    Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents;

 

(b)    Indebtedness existing on the Effective Date which is shown on the Perfection Certificate;

 

(c)    Subordinated Debt;

 

(d)    unsecured Indebtedness to trade creditors incurred in the ordinary course of business;

 

(e)    Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;

 

(f)    Indebtedness secured by Liens permitted under clauses (a) and (c) of the definition of “Permitted Liens” hereunder;

 

(g)    extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through (f) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be;

 

(h)    unsecured Indebtedness in connection with corporate credit cards maintained by (i) Borrower with any credit card issuer in an aggregate amount not exceed $1,000,000.00 at any time and (ii) Foreign Subsidiaries with foreign financial institutions in which Bank does not have a presence in an aggregate amount not to exceed $500,000.00 at any time; and

 

(i)    other unsecured Indebtedness not otherwise permitted by Section 6.4 not exceeding $200,000.00 in the aggregate outstanding at any time.

 

“Permitted Investments” are:

 

(a)    Investments (including, without limitation, Subsidiaries) existing on the Effective Date which are shown on the Perfection Certificate;

 

(b)    Investments consisting of Cash Equivalents;

 

 

 

 

(c)    Investments consisting of deposit accounts (but only to the extent that Borrower is permitted to maintain such accounts pursuant to Section 5.7 of this Agreement) in which, to the extent required pursuant to Section 5.7, Bank has a first priority perfected security interest;

 

(d)    Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower’s business;

 

(e)    Investments accepted in connection with Transfers permitted by Section 6.1;

 

(f)    Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers, directors, partners, managers and members relating to the purchase of equity securities of Borrower pursuant to employee equity purchase plans or similar agreements approved by the Board;

 

(g)    Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business;

 

(h)    Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business; provided that this paragraph (h) shall not apply to Investments of Borrower in any Subsidiary;

 

(i)    Investments by Borrower in (i) its Subsidiaries which are co-Borrowers under this Agreement and (ii) its Subsidiaries which are not co-Borrowers under this Agreement for ordinary, necessary and current operating expenses in an aggregate amount not to exceed $7,000,000.00 in any twelve (12) month period, provided that an Event of Default does not exist at the time of any such Investment and would not exist after giving effect to any such Investment;

 

(j)    other Investments not otherwise permitted by Section 6.7 not exceeding $200,000.00 in the aggregate in any fiscal year.

 

“Permitted Liens” are:

 

(a)    Liens existing on the Effective Date which are shown on the Perfection Certificate or arising under this Agreement or the other Loan Documents;

 

(b)    Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable or (ii) being contested in good faith and for which Borrower maintains adequate reserves on Borrower’s Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code;

 

(c)    purchase money Liens (i) on Equipment acquired or held by Borrower incurred for financing the acquisition of the Equipment securing no more than $7,500,000.00 in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment;

 

(d)    Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA);

 

(e)    leases or subleases of real property granted in the ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), and leases, subleases, non-exclusive licenses or sublicenses of personal property (other than Intellectual Property) granted in the ordinary course of Borrower’s business (or, if referring to another Person, in the ordinary course of such Person’s business), if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest therein;

 

 

 

 

(f)    non-exclusive licenses of Intellectual Property granted to third parties in the ordinary course of business;

 

(g)    Liens arising from attachments or judgments, orders, or decrees in circumstances not constituting an Event of Default under Sections 7.4 and 7.7;

 

(h)    easements, rights-of-way, restrictions and other similar encumbrances affecting real property which, in the aggregate, are not substantial in amount, and which do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person;

 

(i)    Liens arising from the filing of any precautionary financing statement on operating leases covering the leased property, to the extent such operating leases are permitted under this Agreement;

 

(j)    customary Liens of any bank in connection with statutory, common law and contractual rights of setoff and recoupment with respect to any deposit account or securities account of Borrower or its Subsidiaries, provided that (i) to the extent required by Section 5.7, Bank has a first priority perfected security interest in such account and (ii) such account is permitted to be maintained pursuant to Section 5.7 of this Agreement; and

 

(k)    Liens incurred in the extension, renewal or refinancing of the Indebtedness secured by Liens described in (a) through (j), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase.

 

“Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

 

“PNC Account” is defined in Section 5.7(a).

 

“Prepayment Fee” shall be an additional fee, payable to Bank, with respect to each Term Loan Advance, in an amount equal to:

 

(a)         for a prepayment of the Term Loan Advances made on or prior to the first (1st) anniversary of the Effective Date, 2.0% of the then-outstanding principal amount of the Term Loan Advances immediately prior to the date of such prepayment; and

 

(b)          for a prepayment of the Term Loan Advances made after the first (1st) anniversary of the Effective Date, but prior to the Term Loan Maturity Date, 1.00% of the then-outstanding principal amount of the Term Loan Advances immediately prior to the date of such prepayment.

 

“Prime Rate” is set forth on Schedule I hereto.

 

“Prime Rate Margin” is set forth on Schedule I hereto.

 

“Registered Organization” is any “registered organization” as defined in the Code with such additions to such term as may hereafter be made.

 

“Representatives” is defined in Section 11.8.

 

“Responsible Officer” is any of the Chief Executive Officer, President, Chief Financial Officer and Controller of Borrower.

 

“Restricted License” is any material license or other material agreement with respect to which Borrower is the licensee (a) that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or any other property, or (b) for which a default under or termination of could interfere with Bank’s right to sell any Collateral.

 

 

 

 

“Sanctioned Person” means a Person that: (a) is listed on any Sanctions list maintained by OFAC or any similar Sanctions list maintained by any other Governmental Authority having jurisdiction over Borrower; (b) is located, organized, or resident in any country, territory, or region that is the subject or target of Sanctions; or (c) is 50.0% or more owned or controlled by one (1) or more Persons described in clauses (a) and (b) hereof.

 

“Sanctions” means the economic sanctions laws, regulations, embargoes or restrictive measures administered, enacted or enforced by the United States government and any of its agencies, including, without limitation, OFAC and the U.S. State Department, or any other Governmental Authority having jurisdiction over Borrower.

 

“SEC” is the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.

 

“Securities Account” is any “securities account” as defined in the Code with such additions to such term as may hereafter be made.

 

“Subordination Agreement” is that certain Subordination Agreement by and among, Bank, Borrower, and Advantage Capital Community Development Fund XXXII, L.L.C., Advantage Capital Community Development Fund XXXIII, L.L.C., and Midwest Community Development Fund IX, L.L.C dated as of the Effective Date.

 

“Subordinated Debt” is indebtedness incurred by Borrower or any of its Subsidiaries subordinated to all of Borrower’s or any of its Subsidiaries’ now or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered into between Bank and the other creditor), on terms acceptable to Bank.

 

“Subsidiary” is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock, partnership, membership, or other ownership interest or other equity securities having ordinary voting power (other than stock, partnership, membership, or other ownership interest or other equity securities having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless the context otherwise requires, each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower or Guarantor.

 

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

 

“Term A Loan Advance” and “Term A Loan Advances” are each defined in Section 1.3.

 

“Term A Loan Availability Amount” is set forth on Schedule I hereto.

 

“Term B Loan Advance” is defined in Section 1.3.

 

“Term C Uncommitted Loan Advance” is defined in Section 1.3.

 

“Term B Loan Availability Amount” is set forth on Schedule I hereto.

 

“Term B Milestone Event” is set forth on Schedule I hereto.

 

“Term C Loan Availability Amount” is set forth on Schedule I hereto.

 

 

 

 

“Term C Milestone Event” is set forth on Schedule I hereto.

 

“Term Loan Amortization Date” is set forth on Schedule I hereto.

 

“Term Loan Maturity Date” is set forth on Schedule I hereto.

 

***

 

“Trademarks” means, with respect to any Person, any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of such Person connected with and symbolized by such trademarks.

 

“Transfer” is defined in Section 6.1.

 

“Transition Period” means the period of time commencing on the Effective Date and continuing through the earlier to occur of (i) March 19, 2023 and (ii) an Event of Default.

 

“USA Patriot Act” means the “Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001” (Public Law 107-56, signed into law on October 26, 2001), as amended from time to time.

 

[Signature page follows]

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the Effective Date.

 

	 	BORROWER:	 
	 	 	 	 
	 	BIOLIFE SOLUTIONS, INC.	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Troy Wichterman	 
	 	 	 	 
	 	Name: Troy Wichterman	 
	 	 	 
	 	Title: Chief Financial Officer	 
	 	 	 	 
	 	SAVSU TECHNOLOGIES, INC.	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Troy Wichterman	 
	 	 	 	 
	 	Name: Troy Wichterman	 
	 	 	 	 
	 	Title: Secretary, Vice President, Treasurer	 
	 	 	 	 
	 	ARCTIC SOLUTIONS, INC.	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Troy Wichterman	 
	 	 	 	 
	 	Name: Troy Wichterman	 
	 	 	 	 
	 	Title: Secretary, Vice President, Treasurer	 
	 	 	 	 
	 	SCISAFE HOLDINGS, INC.	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Troy Wichterman 	 
	 	 	 	 
	 	Name: Troy Wichterman	 
	 	 	 	 
	 	Title: Secretary, Vice President, Treasurer	 
	 	 	 	 
	 	GLOBAL COOLING, INC.	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Troy Wichterman 	 
	 	 	 	 
	 	Name: Troy Wichterman	 
	 	 	 	 
	 	Title: Secretary, Vice President, Treasurer	 
	 	 	 	 
	 	SEXTON BIOTECHNOLOGIES, INC.	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Troy Wichterman 	 
	 	 	 	 
	 	Name: Troy Wichterman	 
	 	 	 	 
	 	Title: Secretary, Vice President, Treasurer	 
	 	 	 	 
	 	BANK:	 
	 	 	 	 
	 	SILICON VALLEY BANK	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Shawn Parr	 
	 	 	 	 
	 	Name: Shawn Parry	 
	 	 	 	 
	 	Title: Managing Director	 
	 	 	 	 

 

 

 

 

SCHEDULE I

LSA PROVISIONS

 

	
			LSA Section

				
			LSA Provision

			
	
			1.1(a) – Term Loan – Availability

				
			Each Term A Loan Advance (other than the Initial Term Loan Advance) must be in an amount equal to at least $5,000,000.00. After repayment, no Term Loan Advance (or any portion thereof) may be reborrowed.

			
	
			1.1(b) – Term Loan – Repayment

				
			Commencing on the Term Loan Amortization Date and continuing on each Payment Date thereafter, Borrower shall repay each Term Loan Advance in (i) 24 consecutive equal monthly installments of principal, plus (ii) monthly payments of accrued interest at the rate set forth in Section 1.2(b)(i).

			
	
			1.2(a) – Interest Payments – Term Loan Advances

				
			Interest on the principal amount of each Term Loan Advance is payable in arrears monthly (A) on each Payment Date commencing on the first Payment Date following the Funding Date of each such Term Loan Advance, (B) on the date of any prepayment and (C) on the Term Loan Maturity Date.

			
	
			1.2(b)(i) – Interest Rate – Term Loan Advances

				
			Subject to the Interest Rate Ceiling, the outstanding principal amount of any Term Loan Advance shall accrue interest at a floating rate per annum equal to the greater of (1) 5.75% and (2) the Prime Rate plus the Prime Rate Margin, which interest shall be payable in accordance with Section 1.2(a).

			
	
			1.2(e) – Interest Computation

				
			Interest shall be computed on the basis of the actual number of days elapsed and a 360-day year.

			
	
			8.8 – Borrower Liability

				
			Each Borrower hereunder shall be jointly and severally obligated to repay all Credit Extensions made hereunder and any other Obligations related thereto, regardless of which Borrower actually receives said Credit Extension, as if each Borrower hereunder directly received all Credit Extensions.

			
	
			12.2 – “Borrower”

				
			“Borrower” means, individually and collectively, jointly and severally (a) BIOLIFE SOLUTIONS, INC., a Delaware corporation (“BioLife”), (b) SAVSU TECHNOLOGIES, INC., a Delaware corporation, (c) ARCTIC SOLUTIONS, INC., a Delaware corporation (“Arctic”), (d) SCISAFE HOLDINGS, INC., a Delaware corporation, (e) GLOBAL COOLING, INC., a Delaware corporation (“Global Cooling”), and (f) SEXTON BIOTECHNOLOGIES, INC., a Delaware corporation.

			
	
			12.2 – “Draw Period A”

				
			“Draw Period A” is the period commencing on the Effective Date and ending on the earlier to occur of (a) June 30, 2023, and (b) an Event of Default.

			
	
			12.2 – “Draw Period B”

				
			“Draw Period B” is the period commencing upon the occurrence of the Term B Milestone Event and ending on the earlier to occur of (a) June 30, 2023, and (b) an Event of Default.

			
	
			12.2 – “Draw Period C”

				
			“Draw Period C” is the period commencing upon the occurrence of the Term C Milestone Event and ending on the earlier to occur of (a) December 31, 2023, and (b) an Event of Default.

			
	
			12.2 – “Effective Date”

				
			“Effective Date” is September 20, 2022.

			

 

 

 

 

	
			12.2 – “Funding Milestone”

				
			“Funding Milestone” occurs if any when (if ever) the Bank has made Term Loan Advances to Borrower in an aggregate original principal amount greater than $20,000,000.00.

			
	
			12.2 – “Interest-Only Extension Event” 

				
			***

			
	
			12.2 – “Interest Rate Ceiling”

				
			“Interest Rate Ceiling” means the overall rate of interest applicable to any Term Loan Advance shall not increase more than 1.0% above the overall rate of interest applicable to such Term Loan Advance on the Funding Date of such Term Loan Advance.

			
	
			12.2 – “Payment Date”

				
			“Payment Date” is the first (1st) calendar day of each month.

			
	
			12.2 – “Prime Rate”

				
			“Prime Rate” is the rate of interest per annum from time to time published in the money rates section of The Wall Street Journal or any successor publication thereto as the “prime rate” then in effect; provided that if such rate of interest, as set forth from time to time in the money rates section of The Wall Street Journal, becomes unavailable for any reason as determined by Bank, the “Prime Rate” shall mean the rate of interest per annum announced by Bank as its prime rate in effect at its principal office in the State of California (such Bank announced Prime Rate not being intended to be the lowest rate of interest charged by Bank in connection with extensions of credit to debtors); provided that, in the event such rate of interest is less than zero percent (0.0%) per annum, such rate shall be deemed to be zero percent (0.0%) per annum for purposes of this Agreement.

			
	
			12.2 – “Prime Rate Margin”

				
			“Prime Rate Margin” is 0.50%.

			
	
			12.2 – “Term A Loan Availability Amount”

				
			“Term A Loan Availability Amount” is an aggregate principal amount equal to $30,000,000.00.

			
	
			12.2 – “Term B Loan Availability Amount”

				
			“Term B Loan Availability Amount” is an original principal amount equal to $10,000,000.00.

			
	
			12.2 – “Term C Loan Availability Amount”

				
			“Term C Loan Availability Amount” is an original principal amount equal to $10,000,000.00.

			
	
			12.2 – “Term B Milestone Event”

				
			***

			
	
			12.2 – “Term C Milestone Event”

				
			“Term C Milestone Event” occurs if and when (if ever), if at any time prior to December 31, 2023, Bank confirms in writing that: (a) Borrower has requested the Term C Uncommitted Loan Advance, (b) all Term A Loan Advances and the Term B Loan Advance has been made, (c) Bank has received all necessary internal and credit approvals to make the Term C Uncommitted Loan Advance, (d) no Event of Default exists at the time the Term C Uncommitted Loan Advance is requested or would exist as a result of the Term C Uncommitted Loan Advance, and (e) Bank has provided written approval in its sole discretion that the Term C Uncommitted Loan Advance shall occur. For clarity, upon satisfaction of each of the conditions in (a) through (e), the determination of whether to provide any such increase shall be in Bank’s sole discretion.

			
	
			12.2 – “Term Loan Amortization Date”

				
			“Term Loan Amortization Date” is, for each Term Loan Advance, July 1, 2024, which shall be extended to July 1, 2025 upon the occurrence of the Interest-Only Extension Event.

			
	
			12.2 – “Term Loan Maturity Date”

				
			“Term Loan Maturity Date” is June 1, 2026, which shall be executed to June 1, 2027 upon the occurrence of the Interest-Only Extension Event.

			

 

 

 

 

EXHIBIT A

COMPLIANCE STATEMENT

 

***

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

 

 

 

 

Schedule 1 to Compliance Statement

 

***

 

 

 

 

EXHIBIT B

LOAN PAYMENT/ADVANCE REQUEST FORM

 

Deadline for same day processing is Noon Pacific Time

 

	 	Date:	 

 

	Loan Payment: BIOLIFE SOLUTIONS, INC., SAVSU TECHNOLLGIES, INC., ARCTIC SOLUTIONS, INC., SCISAFE HOLDINGS, INC., GLOBAL COOLING, INC., AND SEXTON BIOTECHNOLOGIES, INC.
	 	 	 	 	 
	From Account #	 	 	To Account #	 
	 	(Deposit Account #)	 	 	(Loan Account #)
	 	 	 	 	 
	Principal	$	 	and/or Interest	$
	 	 	 	 	 
	Authorized Signature:	 	 	Phone Number:	 
	Print Name/Title:	 	 	 	 
	 	 	 	 	 

 

	Loan Advance:	 	 	 
	 	 	 	 	 
	Complete Outgoing Wire Request section below if all or a portion of the funds from this loan advance are for an outgoing wire.
	 	 	 	 	 
	From Account #	 	 	To Account #	 
	 	(Loan Account #)	 	 	(Deposit Account #)
	 	 	 	 	 
	Amount of Term Loan Advance	$	 	 	 
	 	 	 	 	 
	All Borrower’s representations and warranties in the Loan and Security Agreement are true, correct and complete in all material respects on the date of the request for an advance; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true and correct in all material respects as of such date:
	 	 	 	 	 
	Authorized Signature:	 	 	Phone Number:	 
	Print Name/Title:	 	 	 	 
	 	 	 	 	 

 

	Outgoing Wire Request:	 	 	 
	Complete only if all or a portion of funds from the loan advance above is to be wired.	 	 	 
	Deadline for same day processing is noon, Pacific Time	 	 	 
	 	 	 	 	 
	Beneficiary Name:	 	 	Amount of Wire:	$
	Beneficiary Bank:	 	 	Account Number:	 
	City and State:	 	 	 	 
	 	 	 	 	 
	Beneficiary Bank Transit (ABA) #:	 	 	Beneficiary Bank Code (Swift, Sort, Chip, etc.):	 
	 	 	 	 	(For International Wire Only)
	 	 	 	 	 	 
	Intermediary Bank:	 	 	Transit (ABA) #:	 
	For Further Credit to:	 
	 	 	 	 	 	 
	Special Instruction:	 
	 	 	 	 	 	 
	By signing below, I (we) acknowledge and agree that my (our) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements(s) covering funds transfer service(s), which agreements(s) were previously received and executed by me (us).
	 	 	 	 	2nd Signature (if required):	 
	Authorized Signature:	 	 	Print Name/Title:	 
	Print Name/Title:	 	 	Telephone #:	 
	Telephone #:

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