Document:

Exhibit 10.10

 

TERM FACILITY SECURITY AGREEMENT

 

This TERM FACILITY SECURITY AGREEMENT (this “Agreement”), dated as of April 6th, 2012, by and among The Container Store, Inc., a Texas corporation (the “Borrower”), each of the guarantors listed on Schedule I hereto (each such Person, individually, a “Guarantor” and, collectively, the “Guarantors”) (the Borrower and the Guarantors are hereinafter referred to, individually, as a “Grantor” and, collectively together with any subsidiary that becomes a party hereto pursuant to Section 4.15, as the “Grantors”), and JPMorgan Chase Bank, N.A., a national banking association, as collateral agent (in such capacity, the “Collateral Agent”) for its own benefit and the benefit of the other Credit Parties (as defined in the Credit Agreement referred to below), in consideration of the mutual covenants contained herein and benefits to be derived herefrom.

 

WITNESSETH:

 

WHEREAS, reference is made to that certain Credit Agreement, dated as of April 6th, 2012 (as amended, modified, supplemented or restated and in effect from time to time, the “Credit Agreement”), by and among the Borrower, the Guarantors, JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”) for its own benefit and the benefit of the other Credit Parties, the Collateral Agent and the lenders from time to time party thereto (individually, a “Lender” and, collectively, the “Lenders”), pursuant to which the Lenders have agreed to make Loans to the Borrower upon the terms and subject to the conditions specified therein; and

 

WHEREAS, the obligations of the Lenders to make Loans are conditioned upon, among other things, the execution and delivery by the Grantors of an agreement in the form hereof to secure the Secured Obligations (as defined herein).

 

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in this Agreement, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Grantors and the Collateral Agent, on its own behalf and on behalf of the other Credit Parties (and each of their respective successors or permitted assigns), hereby agree as follows:

 

ARTICLE 1

 

Definitions

 

SECTION 1.01                     Generally. All references herein to the UCC shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, however, that if a term is defined in Article 9 of the UCC differently than in another Article thereof, the term shall have the meaning set forth in Article 9; provided  further that, if by reason of mandatory provisions of law, perfection, or the effect of perfection or non-perfection, of the Security Interest in any Collateral or the availability of any remedy hereunder is governed by the Uniform Commercial Code as in effect in a jurisdiction other

 

879182

 

 

than New York, “UCC” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or availability of such remedy, as the case may be.

 

SECTION 1.02                     Definition of Certain Terms Used Herein. Unless the context otherwise requires, all capitalized terms used but not defined herein shall have the meanings set forth in the Credit Agreement. In Addition, as used herein, the following terms shall have the following meanings:

 

“ABL Credit Agreement” shall mean the credit agreement governing the ABL Credit Facility, as in effect on the date hereof.

 

“ABL Collateral Agent” shall mean JPMorgan Chase Bank, N.A., in its capacity as Collateral Agent under the ABL Credit Facility, and its successors and permitted assigns.

 

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

 

“Accessions” shall have the meaning given that term in the UCC.

 

“Accounts” means “accounts” as defined in the UCC, and also means a right to payment of a monetary obligation, whether or not earned by performance, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (b) for services rendered or to be rendered, (c) for a policy of insurance issued or to be issued, (d) for a secondary obligation incurred or to be incurred, or (d) arising out of the use of a credit or charge card or information contained on or for use with the card.

 

“Account Debtor” shall have the meaning given that term in the UCC.

 

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

 

“Agreement” shall have the meaning assigned to such term in the preamble of this Agreement.

 

“Blue Sky Laws” shall have the meaning assigned to such term in Section 6.01 of this Agreement.

 

“Borrower” shall have the meaning assigned to such term in the preamble of this Agreement.

 

“Chattel Paper” shall have the meaning given that term in the UCC.

 

“Collateral” shall mean all personal property and fixtures of each Grantor, including, without limitation, all: (a) Accounts, (b) Chattel Paper, (c) Commercial Tort Claims (including, but not limited to, those Commercial Tort Claims listed on Schedule 3.07 hereto), (d) Deposit Accounts, (e) Documents, (f) Equipment, (g) Fixtures, (h) General Intangibles

 

2

 

(including Payment Intangibles), (i) Goods, (j) Instruments, (k) Inventory, (l) Investment Property, (m) Letter-of-Credit Rights, (n) Intellectual Property and Software, (o) Supporting Obligations, (p) money, policies and certificates of insurance, deposits, cash, or other property, (q) all books, records, and information relating to any of the foregoing ((a) through (p)) and/or to the operation of any Grantor’s business, and all rights of access to such books, records, and information, and all property in which such books, records, and information are stored, recorded and maintained, (r) all insurance proceeds, refunds, and premium rebates, including, without limitation, proceeds of fire and credit insurance, whether any of such proceeds, refunds, and premium rebates arise out of any of the foregoing ((a) through (q)) or otherwise, (s) all liens, guaranties, rights, remedies, and privileges pertaining to any of the foregoing ((a) through (r)), including the right of stoppage in transit, and (t) any of the foregoing, whether now owned or now due, or in which any Grantor has an interest, or hereafter acquired, arising, or to become due, or in which any Grantor obtains an interest, and all products, Proceeds, substitutions, and Accessions of or to any of the foregoing; provided, however, that the Collateral shall not include, and the Security Interest shall not attach to: (i) any governmental licenses or state or local franchises, charters and authorizations, to the extent security interests in such licenses, franchises, charters or authorizations are prohibited or restricted thereby (except to the extent such prohibition or restriction is ineffective under the Uniform Commercial Code of any applicable jurisdiction) other than proceeds thereof, the assignment of which is expressly deemed effective under the Uniform Commercial Code of any applicable jurisdiction notwithstanding such prohibition, (ii) any asset the pledge of which or a security interest in which is prohibited by applicable law (including any requirement to obtain the consent of any Governmental Authority), (iii) equity interests in joint ventures or any non-wholly-owned Subsidiaries, but only to the extent that the organizational documents or other agreements with other equity holders do not permit or restrict the pledge of such equity interests, (iv) agreements, licenses and leases the —pledge of which or the security interest in which is prohibited or restricted by such agreements, licenses and leases (including pursuant to any requirement to obtain the consent of any Governmental Authority or third party), to the extent prohibited or restricted thereby (except to the extent such prohibition or restriction is ineffective under the Uniform Commercial Code of any applicable jurisdiction) other than proceeds of such agreements, license or leases, the assignment of which is expressly deemed effective under the Uniform Commercial Code notwithstanding such prohibition, (v) any “intent to use” trademark applications, (vi) more than 65% of the outstanding Voting Equity Interests of any (x) CFC or (y) U.S. Subsidiary that is a disregarded entity for U.S. federal income tax purposes if substantially all of its assets consist of the capital stock of one or more Foreign Subsidiaries, (vii) Equity Interests in any Unrestricted Subsidiary, (viii) any fee owned real property with a value of less than $5,000,000 and any leasehold interest in real property and (ix) any specifically identified asset with respect to which the Collateral Agent has determined in writing (in its reasonable judgment) that the costs of obtaining, perfecting or maintaining a security interest in such assets exceeds the fair market value (as determined by the Borrower in its reasonable judgment) thereof or the practical benefit to the Credit Parties afforded thereby.

 

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

 

3

 

“Collateral Agent’s Rights and Remedies” shall have the meaning assigned to such term in Section 8.08.

 

“Commercial Tort Claim” shall have the meaning given that term in the UCC.

 

“Commodity Account” shall have the meaning given that term in the UCC.

 

“Commodity Account Control Agreement” shall mean, with respect to any Commodity Account as to which a Grantor is the Commodity Customer, an agreement by such Grantor, the Collateral Agent and the relevant Commodity Intermediary that the Commodity Intermediary will apply any value distributed on account of the Commodity Contracts carried in such Commodity Account as directed by the Collateral Agent without further consent by such Grantor. Each such agreement must be satisfactory in form and substance to the Collateral Agent.

 

“Commodity Contract” shall have the meaning given that term in the UCC.

 

“Commodity Customer” shall have the meaning given that term in the UCC.

 

“Commodity Intermediary” shall have the meaning given that term in the UCC.

 

“Control” shall have the meaning given that term in the UCC.

 

“Controlled Commodity Account” shall mean a Commodity Account as to which (i) a Grantor is the Commodity Customer and (ii) a Commodity Account Control Agreement is in effect.

 

“Controlled Deposit Account” means a Deposit Account that is subject to a Deposit Account Control Agreement.

 

“Controlled Securities Account” shall mean a Securities Account that (i) is maintained in the name of a Grantor at an office of a Securities Intermediary located in the United States and (ii) together with all Financial Assets credited thereto and all related Security Entitlements, is subject to a Securities Account Control Agreement among such Grantor, the Collateral Agent and such Securities Intermediary.

 

“Credit Agreement” shall have the meaning assigned to such term in the preliminary statement of this Agreement.

 

“Deposit Account” shall have the meaning given that term in the UCC and shall also include all demand, time, savings, passbook, or similar accounts maintained with a bank or other financial institution.

 

“Deposit Account Control Agreement” shall mean, (x) with respect to any Term Priority Cash Collateral Account, an agreement in form and substance satisfactory to the Collateral Agent among the relevant Grantor, the Collateral Agent, the ABL Collateral Agent and the relevant Depositary Bank and (y) with respect to any other Controlled Deposit

 

4

 

Account, a Blocked Account Agreement, substantially in the form of Exhibit K to the ABL Credit Agreement (as in effect on the date hereof), (with any changes that the Collateral Agent and the ABL Collateral Agent shall have approved,), in either case (i) providing that the relevant Depositary Bank will comply with instructions originated by the Collateral Agent or the ABL Collateral Agent, as applicable, directing disposition of the funds in such Deposit Account, without further consent by any Grantor, and (ii) subordinating to the Lien of the Credit Parties all claims of the Depositary Bank to such Controlled Deposit Account (except its right to deduct its normal operating charges and any uncollected funds previously credited thereto).

 

“Depositary Bank” shall mean a bank at which a Deposit Account is maintained.

 

“Documents” shall have the meaning given that term in the UCC.

 

“Electronic Chattel Paper” shall have the meaning given that term in the UCC.

 

“Entitlement Orders” shall have the meaning given that term in the UCC.

 

“Equipment” shall mean “equipment”, as defined in the UCC, and shall also mean all furniture, store fixtures, motor vehicles, rolling stock, machinery, office equipment, plant equipment, tools, dies, molds, and other goods, property, and assets which are used and/or were purchased for use in the operation or furtherance of a Grantor’s business, and any and all Accessions or additions thereto, and substitutions therefor.

 

“Excluded Account” means any (a) deposit account which is used for purposes of funding payroll, payroll taxes, employee benefit payments, (b) deposit accounts which are zero balance accounts, (c) other controlled disbursement accounts, (d) trust accounts, (e) petty cash accounts, (f) deposit accounts to the extent holding funds from unredeemed gift cards and (g) other deposit accounts with a demand deposit balance not exceeding $10,000 individually and $100,000 in the aggregate at any time.

 

“Financial Asset” shall have the meaning given that term in the UCC.

 

“Financing Statement” shall have the meaning given that term in the UCC.

 

“Fixtures” shall have the meaning given that term in the UCC.

 

“General Intangibles” shall have the meaning given that term in the UCC, and shall also include, without limitation, all: Payment Intangibles; rights to payment for credit extended; deposits; amounts due to any Grantor; credit memoranda in favor of any Grantor; warranty claims; tax refunds and abatements; insurance refunds and premium rebates; all means and vehicles of investment or hedging, including, without limitation, options, warrants, and futures contracts; records; customer lists; telephone numbers; goodwill; causes of action; judgments; rights to collect payments under any settlement or other agreement; literary rights; rights to performance; royalties; license and/or franchise fees; rights of admission; licenses, including, without limitation; franchises; license agreements, including all rights of any

 

5

 

Grantor to enforce same; permits, certificates of convenience and necessity, and similar rights granted by any governmental authority; developmental ideas and concepts; proprietary processes; blueprints, drawings, designs, diagrams, plans, reports, and charts; catalogs; technical data; tapes, disks, semi-conductors chips and printouts; IP Collateral (as defined in the Intellectual Property Security Agreement); proposals; cost estimates, and reproductions on paper, or otherwise, of any and all concepts or ideas, and any matter related to, or connected with, the design, development, manufacture, sale, marketing, leasing, or use of any or all property produced, sold, or leased, by or credit extended or services performed, by any Grantor, whether intended for an individual customer or the general business of any Grantor, or used or useful in connection with research by any Grantor.

 

“Goods” shall have the meaning given that term in the UCC.

 

“Grantor” and “Grantors” shall have the meaning assigned to such terms in the preamble of this Agreement.

 

“Guarantor” and “Guarantors” shall have the meaning assigned to such terms in the preamble of this Agreement.

 

“Indemnitee” shall have the meaning assigned to such term in Section 8.06 of this Agreement.

 

“Instruments” shall have the meaning given that term in the UCC.

 

“Intellectual Property Security Agreement” shall mean that certain Intellectual Property Security Agreement dated the date hereof among the Borrower and the Collateral Agent.

 

“Inventory” shall have the meaning given that term in the UCC, and shall also include, without limitation, all: (a) Goods which (i) are leased by a Person as lessor, (ii) are held by a Person for sale or lease or to be furnished under a contract of service, (iii) are furnished by a Person under a contract of service, or (iv) consist of raw materials, work in process, or materials used or consumed in a business; (b) Goods of said description in transit; (c) Goods of said description which are returned, repossessed or rejected; and (d) packaging, advertising, and shipping materials related to any of the foregoing.

 

“Investment Property” shall have the meaning given that term in the UCC.

 

“Joinder Agreement” shall mean an agreement substantially in the form of Exhibit A hereto.

 

“Lender” and “Lenders” shall have the meaning assigned to such terms in the preliminary statement of this Agreement.

 

“Letter-of-Credit Right” shall have the meaning given that term in the UCC and shall also mean any right to payment or performance under a letter of credit, whether or not the beneficiary has demanded, or is at the time entitled to demand, payment or performance.

 

6

 

“Letters of Credit” shall have the meaning given that term in the UCC.

 

“Payment Intangible” shall have the meaning given that term in the UCC and shall also mean any General Intangible under which the Account Debtor’s primary obligation is a monetary obligation.

 

“Permitted Dispositions” shall mean any transfer, disposition or asset sale not prohibited by Section 7.05 of the Credit Agreement.

 

“Permitted Liens” shall mean Liens permitted pursuant to the terms of Section 7.01 of the Credit Agreement.

 

“Proceeds” shall mean “proceeds”, as defined in the UCC, and shall also mean each type of property described in the definition of Collateral.

 

“Secured Obligations” shall mean, collectively, the Obligations (as defined in the Credit Agreement).

 

“Securities Act” shall have the meaning assigned to such term in Section 6.01 of this Agreement.

 

“Securities Account” shall have the meaning given that term in the UCC.

 

“Securities Account Control Agreement” shall mean, when used with respect to a Securities Account, a Securities Account Control Agreement among the relevant Securities Intermediary, the relevant Grantor and the Collateral Agent to the effect that such Securities Intermediary will comply with Entitlement Orders originated by the Collateral Agent with respect to such Securities Account without further consent by the relevant Grantor.

 

“Securities Intermediary” shall have the meaning given that term in the UCC.

 

“Security” shall have the meaning given that term in the UCC.

 

“Security Entitlement” shall have the meaning given that term in the UCC.

 

“Security Interest” shall have the meaning assigned to such term in Section 2.01 of this Agreement.

 

“Software” shall have the meaning given that term in the UCC.

 

“Supporting Obligation” shall have the meaning given that term in the UCC and shall also refer to a Letter-of-Credit Right or secondary obligation that supports the payment or performance of an Account, Chattel Paper, a Document, a General Intangible, an Instrument, or Investment Property.

 

“Term Priority Cash Collateral Account” shall mean a Deposit Account established pursuant to Section 2.03(b) of the Credit Agreement.

 

7

 

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

 

“Voting Equity Interests” shall mean, with respect to any Person, the Equity Interests of all classes (or equivalent interests) which ordinarily, in the absence of contingencies, entitle holders thereof to vote for the election of directors (or Persons performing similar functions) of such Person, even though the right so to vote has been suspended by the happening of such contingency.

 

SECTION 1.03                     Rules of Interpretation. The rules of interpretation specified in Sections 1.02 through 1.06 of the Credit Agreement shall be applicable to this Agreement.

 

ARTICLE 2

 

Security Interest

 

SECTION 2.01                     Security Interest. As security for the payment or performance, as the case may be, in full of the Secured Obligations, each Grantor hereby grants to the Collateral Agent, its successors and permitted assigns, for its own benefit and the benefit of the other Credit Parties, a security interest in all of such Grantor’s right, title and interest in, to and under the Collateral (the “Security Interest”). Without limiting the foregoing, each Grantor hereby designates the Collateral Agent as such Grantor’s true and lawful attorney, exercisable by the Collateral Agent whether or not an Event of Default exists, with full power of substitution, at the Collateral Agent’s option, to file one or more Financing Statements, continuation statements, or to sign other documents for the purpose of perfecting, confirming, continuing, or protecting the Security Interest granted by each Grantor, without the signature of any Grantor (each Grantor hereby appointing the Collateral Agent as such Person’s attorney to sign such Person’s name to any such instrument or document, whether or not an Event of Default exists), and naming any Grantor or the Grantors, as debtors, and the Collateral Agent, as secured party. Any such Financing Statement may indicate the Collateral as “all assets of the Grantor”, “all personal property of the debtor” or words of similar effect, regardless of whether any particular asset comprised in the Collateral falls within the scope of Article 9 of the UCC.

 

SECTION 2.02                     No Assumption of Liability. The Security Interest is granted as security only and shall not subject the Collateral Agent or any other Credit Party to, or in any way alter or modify, any obligation or liability of any Grantor with respect to or arising out of the Collateral.

 

8

 

ARTICLE 3

 

Representations and Warranties

 

The Grantors jointly and severally represent and warrant to the Collateral Agent and the other Credit Parties that:

 

SECTION 3.01                     Title and Authority. Each Grantor has good and valid rights in, and title to, the Collateral with respect to which it has purported to grant a Security Interest hereunder and has full power and authority to grant to the Collateral Agent the Security Interest in such Collateral pursuant hereto and to execute, deliver and perform its obligations in accordance with the terms of this Agreement, without the consent or approval of any other Person, other than any consent or approval which has been obtained.

 

SECTION 3.02                     Filings. Upon the filing of UCC Financing Statements naming each Grantor as “debtor” and the Collateral Agent as “secured party” and containing a description of the Collateral in the office of the Secretary of State in the jurisdiction of organization of each Grantor and the filing of the Intellectual Property Security Agreement with the United States Patent and Trademark Office and United States Copyright Office, the Security Interest granted to the Collateral Agent (for its own benefit and the benefit of the other Credit Parties) hereunder in respect of all Collateral in which the Security Interest may be perfected by filing, recording or registration in the United States shall constitute a legal, valid and perfected security interest in the Collateral, and no further or subsequent filing, refiling, recording, re-recording, registration or re-registration is necessary in any such jurisdiction, except as provided under applicable Law with respect to the filing of continuation statements or as a result of any change in a Grantor’s name or jurisdiction of incorporation or formation or under any other circumstances under which, pursuant to the UCC, filings previously made have become misleading or ineffective in whole or in part.

 

SECTION 3.03                     Validity and Priority of Security Interest. The Security Interest constitutes (a) a legal and valid security interest in all of the Collateral securing the payment and performance of the Secured Obligations, (b) subject to the making of the filings described in Section 3.02 above, a perfected security interest in all of the Collateral (to the extent perfection in the Collateral can be accomplished by such filing) and (c) subject to the obtaining of Control, a perfected security interest in all of the Collateral (to the extent perfection in the Collateral by Control is required hereunder). The Security Interest is and shall be prior to any other Lien on any of the Collateral, subject only to (i) with respect to the ABL Priority Collateral only, Liens securing the obligations of the Grantors with respect to the ABL Credit Facility, and (ii) other Permitted Liens having priority by operation of applicable Law.

 

SECTION 3.04                     Absence of Other Liens. The Collateral is owned by the Grantors free and clear of any Lien, except for (i) Permitted Liens or (ii) Liens for which termination statements or releases (or payoff letters providing for the delivery or filing of termination statements or releases) have been delivered to the Collateral Agent. Except, in each case, for Permitted Liens, the Grantors have not (a) filed or consented to the filing of (i)

 

9

 

any Financing Statement or analogous document under the UCC or any other applicable Law covering any Collateral, (ii) any assignment in which any Grantor assigns any Collateral or any security agreement or similar instrument covering any Collateral with the United States Patent and Trademark Office or the United States Copyright Office or (iii) any assignment in which any Grantor assigns any Collateral or any security agreement or similar instrument covering any Collateral with any foreign governmental, municipal or other office, or (b) entered into any agreement in which any Grantor grants Control over any Collateral, which Financing Statement, control agreement or analogous document, assignment, security agreement or similar instrument is still in effect.

 

SECTION 3.05                     Commercial Tort Claims. As of the date hereof, none of the Collateral consists of a Commercial Tort Claim having an individual value in excess of $1,000,000, except as set forth on Schedule 3.05 hereto.

 

SECTION 3.06                     Instruments and Chattel Paper. As of the date hereof, no amounts payable under or in connection with any of the Collateral are evidenced by any Instrument or Chattel Paper with an individual face value in excess of $500,000 (or, with respect to all such Instruments or Chattel Paper, an aggregate face value in excess of $2,000,000), other than such Instruments and Chattel Paper listed in Schedule 3.06 hereto. Each Instrument and each item of Chattel Paper listed in Schedule 3.06 hereto has been properly endorsed, assigned and delivered to the Collateral Agent, accompanied by instruments of transfer or assignment duly executed in blank.

 

SECTION 3.07                     Deposit Accounts, Securities Accounts and Commodity Accounts.

 

(a)              As of the date hereof, no Grantor has any Deposit Accounts, Securities Accounts or Commodity Accounts other than those listed in Schedule 3.07 hereto.

 

(b)              So long as the Collateral Agent has Control of a Controlled Deposit Account, the Lien of the Collateral Agent on such Controlled Deposit Account will be perfected, subject to no other Liens or rights of others (except Liens and rights of the relevant Depositary Bank that are Permitted Liens and the Lien of the ABL Collateral Agent).

 

(c)               So long as the Financial Asset underlying any Security Entitlement owned by any Grantor is credited to a Controlled Securities Account, (i) the Collateral Agent’s Lien on such Security Entitlement will be perfected, subject to no other Liens or rights of others (except Liens and rights of the relevant Securities Intermediary that are Permitted Liens and the Lien of the ABL Collateral Agent), (ii) the Collateral Agent will have Control of such Security Entitlement and (iii) no action based on an adverse claim to such Security Entitlement or such Financial Asset, whether framed in conversion, replevin, constructive trust, equitable lien or other theory, may be asserted against the Collateral Agent or any other Credit Party.

 

10

 

(d)              So long as any Commodity Account is subject to a Commodity Account Control Agreement, (i) the Liens on such Commodity Account and all Commodity Contracts carried therein will be perfected, subject to no other Liens or rights of others (except Liens and rights of the relevant Commodity Intermediary that are Permitted Liens and the Lien of the ABL Collateral Agent) and (ii) the Collateral Agent will have Control of such Commodity Account and all Commodity Contracts carried therein from time to time.

 

SECTION 3.08                     Electronic Chattel Paper and Transferable Records. As of the date hereof, no amount under or in connection with any of the Collateral is evidenced by any Electronic Chattel Paper or any “transferable record” (as that term is defined in Section 201 of the Federal Electronic Signatures in Global and National Commerce Act, or in Section 16 of the Uniform Electronic Transactions Act, as in effect in any relevant jurisdiction) with an individual face value in excess of $500,000 (or, with respect to all such Electronic Chattel Paper or transferable records, an aggregate face value in excess of $2,000,000), other than such Electronic Chattel Paper and transferable records listed in Schedule 3.08 hereto.

 

ARTICLE 4

 

Covenants

 

SECTION 4.01                     Change of Name; Location of Collateral; Records; Place of  Business.

 

(a)              Each Grantor will furnish to the Collateral Agent at least ten (10) Business Days prior written notice (or such shorter period as to which the Collateral Agent in its sole discretion agrees) of any change in: (i) any Grantor’s name; (ii) any Grantor’s organizational structure or jurisdiction of incorporation or formation; (iii) any Grantor’s Federal Taxpayer Identification Number or organizational identification number, if any, assigned to it by its state of organization; or (iv) the location of any Grantor’s chief executive office. Each Grantor agrees not to effect or permit any change referred to in clauses (i) or (ii) of the preceding sentence unless all filings, publications and registrations have been made under the UCC or other applicable Law that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected first priority security interest in all the Collateral (subject only to (i) with respect to the ABL Priority Collateral only, Liens securing the obligations of the Grantors with respect to the ABL Credit Facility, and (ii) other Permitted Liens having priority by operation of applicable Law) for its own benefit and the benefit of the other Credit Parties.

 

(b)              Each Grantor agrees (i) to maintain, at its own cost and expense, records with respect to the Collateral owned by it which are complete and accurate in all material respects and which are consistent with its current practices, but in any event to include accounting records which are complete in all material respects indicating all payments and proceeds received with respect to any part of the Collateral, and (ii) at such time or times as the Collateral Agent may reasonably

 

11

 

request, promptly to prepare and deliver to the Collateral Agent a duly certified schedule or schedules in form and detail reasonably satisfactory to the Collateral Agent showing the identity, amount and location of any and all Collateral.

 

SECTION 4.02                     Protection of Security. Each Grantor shall, at its own cost and expense, take any and all actions reasonably necessary to defend title to the Collateral against all Persons and to defend the Security Interest of the Collateral Agent in the Collateral and the priority thereof against any Lien (other than Permitted Liens).

 

SECTION 4.03                     Further Assurances. Subject to the Intercreditor Agreement, each Grantor agrees, at its own expense, to execute, acknowledge and deliver all such further documents, Financing Statements, agreements and instruments and take all such further actions as the Collateral Agent may from time to time reasonably request to better assure, preserve, protect and perfect the Security Interest and the rights and remedies created hereby or the validity or priority of such Security Interest, including the payment of any fees and taxes required in connection with the execution and delivery of this Agreement, the granting of the Security Interest and the filing of any Financing Statements or other documents in connection herewith or therewith. Without limiting the foregoing, each Grantor agrees, at its own expense, to execute, acknowledge and deliver all such further documents, Financing Statements, agreements and instruments and take all such further actions as the Collateral Agent may from time to time reasonably request to perfect the Collateral Agent’s Security Interest in all Collateral and the Proceeds therefrom (including causing the Collateral Agent to have Control of any such Collateral to the extent required hereunder and to the extent perfection in such Collateral can be accomplished by Control).

 

SECTION 4.04                     Inspection and Verification. Each Grantor shall, and shall cause each of its Subsidiaries to, permit representatives and independent contractors of the Collateral Agent and each Lender to visit its properties and inspect the Collateral and all records related thereto (and to make extracts and copies from such records), to discuss its affairs, finances and accounts with its directors, officers and independent public accountants, and to conduct appraisals, commercial finance examinations and other evaluations, all in accordance with and subject to the terms and conditions of Section 6.10 of the Credit Agreement. The Collateral Agent and such Persons as the Collateral Agent may reasonably designate shall have the right to verify the validity, amount, quality, quantity, value, condition and status of, or any other matter relating to, the Collateral, including, in the case of Accounts or Collateral in the possession of any third Person, by contacting Account Debtors or the third Person possessing such Collateral for the purpose of making such a verification. The Collateral Agent shall have the right, subject to the confidentiality provisions of Section 11.07 of the Credit Agreement, to share any information it gains from such inspection or verification with any Credit Party. The Grantors shall pay the reasonable and documented in reasonable detail fees and expenses of the Collateral Agent or such other Persons with respect to such inspections and verifications to the extent required by the terms of Section 6.10 of the Credit Agreement.

 

SECTION 4.05                     Taxes; Encumbrances. At its option, the Collateral Agent may discharge past due taxes, assessments, charges, fees, Liens, security interests or other

 

12

 

encumbrances at any time levied or placed on the Collateral (other than Permitted Liens), and may take any other action which the Collateral Agent may reasonably deem necessary or desirable to repair, maintain or preserve any of the Collateral to the extent any Grantor fails to do so as required by the Credit Agreement or this Agreement, and each Grantor jointly and severally agrees to reimburse the Collateral Agent on demand for any payment made or any expense incurred by the Collateral Agent pursuant to the foregoing authorization; provided, however, that the Collateral Agent shall not have any obligation to undertake any of the foregoing and shall have no liability on account of any action so undertaken except where a court of competent jurisdiction determines by final and nonappealable judgment that the Collateral Agent’s actions constitute gross negligence or willful misconduct; provided  further that the making of any such payments or the taking of any such action by the Collateral Agent shall not be deemed to constitute a waiver of any Default or Event of Default arising from the Grantor’s failure to have made such payments or taken such action. Nothing in this Section 4.05 shall be interpreted as excusing any Grantor from the performance of any covenants or other promises of any Grantor with respect to taxes, assessments, charges, fees, Liens, security interests or other encumbrances and maintenance as set forth herein or in the other Loan Documents.

 

SECTION 4.06                     Assignment of Security Interest. Upon the occurrence and during the continuance of an Event of Default, and at the reasonable request of the Collateral Agent, if during such time any Grantor shall take a security interest in any property of an Account Debtor or any other Person to secure payment and performance of an Account with a value in excess of $250,000 (or, with respect to all such property, an aggregate value in excess of $1,000,000), such Grantor shall promptly assign such security interest to the Collateral Agent. Such assignment need not be filed of public record unless necessary to continue the perfected status of the security interest against creditors of, and transferees from, the Account Debtor or other Person granting the security interest.

 

SECTION 4.07                     Continuing Obligations of the Grantors. Each Grantor shall remain liable to observe and perform all the conditions and obligations to be observed and performed by it under each material contract, agreement or instrument relating to the Collateral, all in accordance with the terms and conditions thereof, unless the failure to observe and perform any such conditions and obligations shall not result in a breach of any such material contract, agreement or instrument.

 

SECTION 4.08                     [Reserved].

 

SECTION 4.09                     Limitation on Modification of Accounts. None of the Grantors will, without the Collateral Agent’s prior written consent, grant any extension of the time of payment of any of the Accounts, compromise, compound or settle the same for less than the full amount thereof, release, wholly or partly, any Person liable for the payment thereof or allow any credit or discount whatsoever thereon, except, in each case, for extensions, releases, credits, discounts, compromises or settlements granted or made in the ordinary course of business or consistent with its current practices.

 

13

 

SECTION 4.10                     Insurance.

 

(a)              Each Grantor shall (i) maintain or shall cause to be maintained such insurance as is required pursuant to Section 6.07 of the Credit Agreement; and (ii) furnish to the Collateral Agent such information as to the insurance carried as the Collateral Agent may reasonably request from time to time.

 

(b)              Each Grantor hereby irrevocably makes, constitutes and appoints the Collateral Agent (and all officers, employees or agents designated by the Collateral Agent) as such Grantor’s true and lawful agent (and attorney-in-fact), exercisable only after the occurrence and during the continuance of an Event of Default, for the purpose of making, settling and adjusting claims in respect of Collateral under policies of insurance, endorsing the name of such Grantor on any check, draft, instrument or other item of payment for the proceeds of such policies of insurance and for making all determinations and decisions with respect thereto. In the event that any Grantor at any time or times shall fail to obtain or maintain any of the policies of insurance required hereby or to pay any premium in whole or in part relating thereto, the Collateral Agent may, without waiving or releasing any obligation or liability of the Grantors hereunder or any Default or Event of Default, in its sole discretion, obtain and maintain such policies of insurance and pay such premium and take any other actions with respect thereto as the Collateral Agent deems advisable. All sums disbursed by the Collateral Agent in connection with this Section 4.10(b), including reasonable attorneys’ fees, court costs, expenses and other charges relating thereto, shall be payable, upon demand, by the Grantors to the Collateral Agent and shall be additional Secured Obligations secured hereby.

 

SECTION 4.11                     Commercial Tort Claims. If any Grantor shall at any time hold or acquire a Commercial Tort Claim for which a complaint has been filed in a court of competent jurisdiction having a value in excess of $1,000,000, such Grantor shall promptly (but, in any event, within ten (10) Business Days) notify the Collateral Agent in writing of the details thereof, and the Grantors shall take such actions as the Collateral Agent shall reasonably request in order to grant to the Collateral Agent, for the ratable benefit of the Credit Parties, a perfected security interest therein and in the Proceeds thereof.

 

SECTION 4.12                     Legend. Upon the occurrence and during the continuance of an Event of Default, and at the reasonable request of the Collateral Agent, each Grantor shall legend, in form and manner reasonably satisfactory to the Collateral Agent, its Accounts and its books, records and documents evidencing or pertaining thereto with an appropriate reference to the fact that such Accounts have been assigned to the Collateral Agent, for its own benefit and the benefit of the other Credit Parties, and that the Collateral Agent has a security interest therein.

 

SECTION 4.13                     Other Actions. In order to further ensure the attachment, perfection and priority of, and the ability of the Collateral Agent to enforce, the Collateral Agent’s Security Interest in the Collateral, each Grantor covenants and agrees, in each case at such Grantor’s own expense, to take the following actions with respect to the following Collateral:

 

14

 

(a)              If any amount then payable under or in connection with any of the Collateral shall become evidenced by any Instrument or Chattel Paper with an individual face value in excess of $500,000 (or, with respect to all such Instruments or Chattel Paper, an aggregate face value in excess of $2,000,000), other than such Instruments and Chattel Paper listed in Schedule 3.08 hereto, the Grantor acquiring such Instrument or Chattel Paper shall promptly (but, in any event, within ten (10) Business Days after receipt thereof) endorse, assign and deliver the same (i) if the same constitutes Proceeds of the Term Priority Collateral, to the Collateral Agent (with copies to the ABL Collateral Agent), and (ii) if the same constitutes ABL Priority Collateral, to the ABL Collateral Agent (with copies to the Collateral Agent), accompanied by such instruments of transfer or assignment duly executed in blank as the ABL Collateral Agent or the Collateral Agent may from time to time specify.

 

(b)              Subject to the provisions of Section 5.01, no Grantor shall hereafter establish and maintain any Deposit Account, Securities Account or Commodity Account with any Depositary Bank, Securities Intermediary or Commodity Intermediary unless (i) such Depositary Bank, Securities Intermediary or Commodity Intermediary shall be reasonably acceptable to the Collateral Agent, and (ii) such Depositary Bank, Securities Intermediary or Commodity Intermediary, as the case may be, and such Grantor shall have duly executed and delivered a Deposit Account Control Agreement, Security Account Control Agreement or Commodity Account Control Agreement, as the case may be, with respect to such Deposit Account, Securities Account or Commodity Account, as the case may be. Each Grantor shall accept any cash and Investment Property in trust for the benefit of the Collateral Agent and promptly after actual receipt thereof (within a reasonable period of time not to exceed five (5) Business Days), deposit any and all cash and Investment Property received by it into a Controlled Deposit Account, a Controlled Commodity Account or a Controlled Securities Account. The Collateral Agent agrees with each Grantor that the Collateral Agent shall not give any entitlement orders or instructions or directions to any issuer of uncertificated securities, Securities Intermediary or Commodity Intermediary, and shall not withhold its consent to the exercise of any withdrawal or dealing rights by such Grantor, unless an Event of Default has occurred and is continuing or would occur after giving effect to any such investment and withdrawal rights. The provisions of this Section 4.13(b) shall not apply to (a) any Excluded Account and (b) any Financial Assets credited to a Securities Account for which the Collateral Agent is the Securities Intermediary. No Grantor shall grant Control over any Investment Property comprised of Equity Interests in any Subsidiary to any person other than the Collateral Agent or the ABL Collateral Agent.

 

(c)               As between the Collateral Agent and the Grantors, the Grantors shall bear the investment risk with respect to the Investment Property and Pledged Securities (as that term is defined in the Pledge Agreement), and the risk of loss of, damage to, or the destruction of, the Investment Property and Securities (except where a court of competent jurisdiction determines by final and nonappealable judgment that such loss, damage or destruction has resulted from the gross negligence or willful

 

15

 

misconduct of the Collateral Agent), whether in the possession of, or maintained as a Security Entitlement or deposit by, or subject to the Control of, the Collateral Agent, a Securities Intermediary, a Commodity Intermediary, any Grantor or any other Person.

 

(d)              If any amount payable under or in connection with any of the Collateral shall become evidenced by any Electronic Chattel Paper or any transferable record with an individual face value in excess of $500,000 (or, with respect to all such Electronic Chattel Paper or transferable records, an aggregate face value in excess of $2,000,000), other than such Electronic Chattel Paper and transferable records listed in Schedule 3.10 hereto, the Grantor acquiring such Electronic Chattel Paper or transferable record shall promptly notify (i) if such amount payable constitutes Proceeds of the Term Priority Collateral, the Collateral Agent (with copies to the ABL Collateral Agent) thereof, and (ii) if such amount payable constitutes Proceeds of the ABL Priority Collateral, the ABL Collateral Agent (with copies to the Collateral Agent) thereof, and, in each case, shall take such action as the applicable Collateral Agent may reasonably request to vest in such Collateral Agent Control of such Electronic Chattel Paper under Section 9-105 of the UCC or control under Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or, as the case may be, Section 16 of the Uniform Electronic Transactions Act, as in effect in such jurisdiction, of such transferable record. The Collateral Agent agrees with each Grantor that the Collateral Agent will arrange, pursuant to procedures satisfactory to the Collateral Agent and so long as such procedures will not result in the Collateral Agent’s loss of control, for the Grantor to make alterations to the Electronic Chattel Paper or transferable record permitted under Section 9-105 of the UCC or, as the case may be, Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or Section 16 of the Uniform Electronic Transactions Act for a party in control to allow without loss of control, unless an Event of Default has occurred and is continuing or would occur after taking into account any action by such Grantor with respect to such Electronic Chattel Paper or transferable record.

 

(e)               If any Grantor is at any time a beneficiary under a Letter of Credit (other than a Letter of Credit constituting a Supporting Obligation) now or hereafter issued having a face value in an amount in excess of $500,000 (or with respect to all such Letters of Credit, having an aggregate face value in an amount in excess of $2,000,000), such Grantor shall promptly notify the Collateral Agent thereof and such Grantor shall, at the request of the Collateral Agent, pursuant to an agreement in form and substance reasonably satisfactory to the Collateral Agent, either (i) arrange for the issuer and any confirmer of such Letter of Credit to consent to an assignment to the Collateral Agent of the proceeds of any drawing under the Letter of Credit and to cause the proceeds of any drawing under such Letter of Credit to be paid directly to the Collateral Agent after the occurrence and during the continuance of an Event of Default, or (ii) arrange for the Collateral Agent to become the transferee beneficiary of such Letter of Credit, with the Collateral Agent agreeing, in each case, that the proceeds of any drawing under the Letter of Credit are to be paid directly to the

 

16

 

Collateral Agent after the occurrence and during the continuance of any an Event of Default and applied as provided in the Credit Agreement.

 

(f)               Prior to the satisfaction of the Discharge of ABL Obligations, with respect to any obligation under this Agreement, any other Collateral Document, or the Credit Agreement to deliver possession or control of any Collateral on which there is a Second Priority Lien by the Collateral Agent, such obligation shall be deemed satisfied by the delivery of possession or control of such Collateral to the “Collateral Agent” for the ABL Credit Facility (holding for the benefit of the Collateral Agent for the Credit Parties).

 

SECTION 4.15                     Joinder of Additional Grantors. Upon the formation or acquisition of any new direct or indirect Subsidiary (other than any Unrestricted Subsidiary, a CFC or a Subsidiary that is held directly or indirectly by a CFC) by any Grantor, then the Grantors shall, at the Grantors’ expense, cause such Subsidiary to execute and deliver to the Collateral Agent a Joinder Agreement substantially in the form of Exhibit A hereto and to comply with the requirements of Section 6.12 of the Credit Agreement, within the time periods specified therein, and, upon such execution and delivery, such Subsidiary shall constitute a “Grantor” for all purposes hereunder with the same force and effect as if originally named as a Grantor herein. The execution and delivery of such Joinder Agreement shall not require the consent of any Grantor hereunder. The rights and obligations of each Grantor hereunder shall remain in full force and effect notwithstanding the addition of any new Grantor as a party to this Agreement.

 

ARTICLE 5

 

Deposit Accounts; Securities Accounts;
 Commodity Accounts; Power of Attorney

 

SECTION 5.01                     Deposit Accounts.

 

(a)              Within 90 days after the Closing Date (or, in the case of any Person that thereafter becomes a Grantor, on the date on which such Person signs and delivers its Joinder Agreement), each Grantor shall, with respect to each Deposit Account then maintained by it, enter into (and cause the relevant Depositary Bank to enter into) a Deposit Account Control Agreement in respect of such Deposit Account and shall deliver such Deposit Account Control Agreement to the Collateral Agent (which shall enter into the same). All cash owned by each Grantor shall have been deposited, or after receipt thereof (within a reasonable period of time not to exceed three (3) Business Days) shall be deposited, in one or more Controlled Deposit Accounts (including, if and to the extent required under the Credit Agreement, the Term Priority Cash Collateral Account), in each case with a Depositary Bank the jurisdiction of which (determined as provided in UCC Section 9-304) shall at all times be a jurisdiction in which Article 9 of the UCC is in effect.

 

17

 

(b)              Notwithstanding the foregoing, the Grantors have the right not to comply with the requirements of preceding clause (a) with respect to Deposit Accounts (other than any Term Priority Cash Collateral Account) that are Excluded Accounts, provided, however, that if an Event of Default occurs and is continuing, the Collateral Agent may terminate the foregoing right not to comply, by giving at least 10 Business Days’ notice of such termination to the relevant Grantors or (b) until the Discharge of ABL Obligations (as such term is defined in the Intercreditor Agreement).

 

(b)              If a Term Priority Cash Collateral Account is required at any time to be established, the relevant Grantor shall, concurrently with establishment thereof, enter into (and cause the relevant Depositary Bank to enter into) a Deposit Account Control Agreement in respect of such Term Priority Cash Collateral Account and shall deliver such Deposit Account Control Agreement to the Collateral Agent (which shall enter into the same).

 

SECTION 5.02                     Security Accounts; Commodity Accounts.

 

(a)              Within 90 days after the Closing Date (or, in the case of any Person that thereafter becomes a Grantor, on the date on which such Person signs and delivers its Joinder Agreement), each Grantor shall enter into (and cause the relevant Securities Intermediary to enter into) a Securities Account Control Agreement in respect of each Security Entitlement owned by such Grantor and the Securities Account to which the underlying Financial Asset is credited and deliver such Securities Account Control Agreement to the Collateral Agent (which shall enter into the same). Thereafter, whenever such Grantor acquires any other Security Entitlement, such Grantor shall, as promptly as practicable, cause the underlying Financial Asset to be credited to a Controlled Securities Account.

 

(b)              Within 90 days after the Closing Date (or, in the case of any Person that thereafter becomes a Grantor, on the date on which such Person signs and delivers a Joinder Agreement), each Grantor shall enter into (and cause the relevant Commodity Intermediary to enter into) a Commodity Account Control Agreement in respect of each Commodity Account owned by such Grantor and shall deliver such Commodity Account Control Agreement to the Collateral Agent (which shall enter into the same). Thereafter, such Grantor shall cause each Commodity Contract owned by it to be carried at all times in a Controlled Commodity Account.

 

SECTION 5.03                     Power of Attorney. Each Grantor irrevocably makes, constitutes and appoints the Collateral Agent (and all officers, employees or agents designated by the Collateral Agent) as such Grantor’s true and lawful agent and attorney-in-fact, and in such capacity the Collateral Agent shall have the right, with power of substitution for each Grantor and in each Grantor’s name or otherwise, for the use and benefit of the Collateral Agent and the other Credit Parties, (a) at any time, whether or not a Default or Event of Default has occurred, to take actions required to be taken by the Grantors under Section 2.01 of this Agreement, (b) upon the occurrence and during the continuance of an Event of Default

 

18

 

or as otherwise permitted under the Credit Agreement, (i) to take actions required to be taken by the Grantors under Section 5.01 of this Agreement; and (ii) to receive, endorse, assign and/or deliver any and all notes, acceptances, checks, drafts, money orders or other evidences of payment relating to the Collateral or any part thereof, and (c) upon the occurrence and during the continuance of an Event of Default or as otherwise permitted under the Credit Agreement, (i) to demand, collect, receive payment of, give receipt for and give discharges and releases of all or any of the Collateral; (ii) to sign the name of any Grantor on any invoices, schedules of Collateral, freight or express receipts, or bills of lading storage receipts, warehouse receipts or other documents of title relating to any of the Collateral; (iii) to sign the name of any Grantor on any notice to such Grantor’s Account Debtors; (iv) to sign the name of any Grantor on any proof of claim in bankruptcy against Account Debtors, and on notices of lien, claims of mechanic’s liens, or assignments or releases of mechanic’s liens securing the Accounts; (v) to sign change of address forms to change the address to which each Grantor’s mail is to be sent to such address as the Collateral Agent shall designate; (vi) to receive and open each Grantor’s mail, remove any Proceeds of Collateral therefrom and turn over the balance of such mail either to the Borrower or to any trustee in bankruptcy or receiver of a Grantor, or other legal representative of a Grantor whom the Collateral Agent reasonably determines to be the appropriate person to whom to so turn over such mail; (vii) to commence and prosecute any and all suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect or otherwise realize on all or any of the Collateral or to enforce any rights in respect of any Collateral; (viii) to settle, compromise, compound, adjust or defend any actions, suits or proceedings relating to all or any of the Collateral; (ix) to take all such action as may be reasonably necessary to obtain the payment of any letter of credit and/or banker’s acceptance of which any Grantor is a beneficiary; (x) to repair, manufacture, assemble, complete, package, deliver, alter or supply goods, if any, necessary to fulfill in whole or in part the purchase order of any customer of any Grantor; (xi) to use, license or transfer any or all General Intangibles of any Grantor, subject to those restrictions to which such Grantor is subject under applicable Law and by contract; and (xii) to use, sell, assign, transfer, pledge, make any agreement with respect to or otherwise deal with all or any of the Collateral, and to do all other acts and things reasonably necessary to carry out the purposes of this Agreement, as fully and completely as though the Collateral Agent was the absolute owner of the Collateral for all purposes; provided, however, that nothing herein contained shall be construed as requiring or obligating the Collateral Agent or any other Credit Party to make any commitment or to make any inquiry as to the nature or sufficiency of any payment received by the Collateral Agent or any other Credit Party, or to present or file any claim or notice. It is understood and agreed that the appointment of the Collateral Agent as the agent and attorney-in-fact of the Grantors for the purposes set forth above is coupled with an interest and is irrevocable.

 

SECTION 5.04                     No Obligation to Act. The Collateral Agent shall not be obligated to do any of the acts or to exercise any of the powers authorized by Section 5.03, but if the Collateral Agent elects to do any such act or to exercise any of such powers, it shall not be accountable for more than it actually receives as a result of such exercise of power, and shall not be responsible to any Grantor for any act or omission to act, except where a court of competent jurisdiction determines by final and nonappealable judgment that the subject act or

 

19

 

omission to act has resulted from the gross negligence or willful misconduct of the Collateral Agent. The provisions of Section 5.03 shall in no event relieve any Grantor of any of its obligations hereunder or under any other Loan Document with respect to the Collateral or any part thereof or impose any obligation on the Collateral Agent or any other Credit Party to proceed in any particular manner with respect to the Collateral or any part thereof, or in any way limit the exercise by the Collateral Agent or any other Credit Party of any other or further right which it may have on the date of this Agreement or hereafter, whether hereunder, under any other Loan Document, by applicable Law or otherwise.

 

ARTICLE 6

 

Remedies

 

SECTION 6.01                     Remedies upon Default. Upon the occurrence and during the continuance of an Event of Default, it is agreed that the Collateral Agent shall have in any jurisdiction in which enforcement hereof is sought, in addition to all other rights and remedies, the rights and remedies of a secured party under the UCC or other applicable Law. The rights and remedies of the Collateral Agent shall include, without limitation, the right to take any or all of the following actions at the same or different times:

 

(a)              With respect to any Collateral consisting of Accounts, General Intangibles (including Payment Intangibles), Letter-of-Credit Rights, Instruments, Chattel Paper, Documents, and Investment Property, the Collateral Agent may collect the Collateral with or without the taking of possession of any of the Collateral.

 

(b)              With respect to any Collateral consisting of Accounts, the Collateral Agent may: (i) demand, collect and receive any amounts relating thereto, as the Collateral Agent may determine; (ii) commence and prosecute any actions in any court for the purposes of collecting any such Accounts and enforcing any other rights in respect thereof; (iii) defend, settle or compromise any action brought and, in connection therewith, give such discharges or releases as the Collateral Agent may reasonably deem appropriate; (iv) without limiting the Collateral Agent’s rights set forth in Section 5.03 hereof, receive, open mail addressed to any Grantor and endorse checks, notes, drafts, acceptances, money orders, bills of lading, warehouse receipts or other instruments or documents evidencing payment, shipment or storage of the goods giving rise to such Accounts or securing or relating to such Accounts, on behalf of and in the name of such Grantor; and (v) sell, assign, transfer, make any agreement in respect of, or otherwise deal with or exercise rights in respect of, any such Accounts or the goods or services which have given rise thereto, as fully and completely as though the Collateral Agent was the absolute owner thereof for all purposes.

 

(c)               With respect to any Collateral consisting of Investment Property, the Collateral Agent may, upon notice to any Grantor: (i) exercise all rights of any Grantor with respect thereto, including without limitation, the right to exercise all voting and corporate rights at any meeting of the shareholders of the Issuer (as defined in the Pledge Agreement) of any Investment Property and to exercise any and all rights of

 

20

 

conversion, exchange, subscription or any other rights, privileges or options pertaining to any Investment Property as if the Collateral Agent was the absolute owner thereof, including the right to exchange, at its discretion, any and all of any Investment Property upon the merger, consolidation, reorganization, recapitalization or other readjustment of the Issuer thereof, all without liability except to account for property actually received as provided in Section 5.04 hereof; (ii) transfer such Collateral at any time to itself, or to its nominee, and receive the income thereon and hold the same as Collateral hereunder or apply it to the Secured Obligations; and (iii) demand, sue for, collect or make any compromise or settlement it deems desirable. The Grantors recognize that (a) the Collateral Agent may be unable to effect a public sale of all or a part of the Investment Property by reason of certain prohibitions contained in the Securities Act of 1933, 15 U.S.C. §77, (as amended and in effect, the “Securities Act”) or the Securities laws of various states (the “Blue Sky Laws”), but may be compelled to resort to one or more private sales to a restricted group of purchasers who will be obliged to agree, among other things, to acquire the Investment Property for their own account, for investment and not with a view to the distribution or resale thereof, (b) that private sales so made may be at prices and upon other terms less favorable to the seller than if the Investment Property were sold at public sales, (c) that neither the Collateral Agent nor any other Credit Party has any obligation to delay sale of any of the Investment Property for the period of time necessary to permit the Investment Property to be registered for public sale under the Securities Act or the Blue Sky Laws, and (d) that private sales made under the foregoing circumstances shall be deemed to have been made in a commercially reasonable manner, provided that such sales are conducted in accordance with applicable Law. Notwithstanding anything herein to the contrary, no Grantor shall be required to register, or cause the registration of, any Investment Property under the Securities Act or any Blue Sky Laws.

 

(d)           With respect to any Collateral consisting of Inventory, the Collateral Agent and/or representatives and independent contractors of the Collateral Agent may, but shall not be obligated to, repair, manufacture, assemble, complete, package, deliver, alter or supply any work-in-process Inventory, if any, necessary to fulfill in whole or in part the purchase order of any customer of any Grantor, all at the expense of the Grantors.

 

(e)           With respect to any Collateral consisting of Inventory, Goods, and Equipment, the Collateral Agent may conduct one or more going out of business sales, in the Collateral Agent’s own right or by one or more agents and contractors. Such sale(s) may be conducted upon any premises owned, leased, or occupied by any Grantor. The Collateral Agent and any such agent or contractor, in conjunction with any such sale, may augment the Inventory with other goods (all of which other goods shall remain the sole property of the Collateral Agent or such agent or contractor). Any amounts realized from the sale of such goods which constitute augmentations to the Inventory (net of an allocable share of the costs and expenses incurred in their disposition) shall be the sole property of the Collateral Agent or such agent or contractor and neither any Grantor nor any Person claiming under or in right of any

 

21

 

Grantor shall have any interest therein. Each purchaser at any such going out of business sale shall hold the property sold absolutely, free from any claim or right on the part of any Grantor.

 

(f)            With or without legal process and with or without prior notice or demand for performance, the Collateral Agent may enter upon, occupy, and use any premises owned or occupied by each Grantor, and may exclude the Grantors from such premises or portion thereof as may have been so entered upon, occupied, or used by the Collateral Agent. The Collateral Agent shall not be required to remove any of the Collateral from any such premises upon the Collateral Agent’s taking possession thereof, and may render any Collateral unusable to the Grantors. In no event shall the Collateral Agent be liable to any Grantor for use or occupancy by the Collateral Agent of any premises pursuant to this Section 6.01(f), nor for any charge (such as wages for the Grantors’ employees and utilities) incurred in connection with the Collateral Agent’s exercise of the Collateral Agent’s Rights and Remedies (as defined herein) hereunder, other than for direct or actual damages resulting from the gross negligence or willful misconduct of the Collateral Agent as determined by a final and nonappealable judgment of a court of competent jurisdiction.

 

(g)           The Collateral Agent may require any Grantor to assemble the Collateral and make it available to the Collateral Agent at the Grantor’s sole risk and expense at a place or places which are reasonably convenient to both the Collateral Agent and such Grantor.

 

(h)           Each Grantor agrees that the Collateral Agent shall have the right, subject to applicable Law, to sell or otherwise dispose of all or any part of the Collateral, at public or private sale, for cash, upon credit or for future delivery as the Collateral Agent shall deem appropriate. Each Grantor further agrees that any such sale of all or any part of the Collateral consisting of Inventory for consideration in an amount equal to the balance of the purchase price (minus any customer deposits previously collected by such Grantor) shall be commercially reasonable. Each purchaser at any such sale shall hold the property sold absolutely, free from any claim or right on the part of any Grantor.

 

(i)            Unless the Collateral is perishable or threatens to decline speedily in value, or is of a type customarily sold on a recognized market (in which event the Collateral Agent shall provide the Grantors such advance notice as may be practicable under the circumstances), the Collateral Agent shall give the Grantors at least ten (10) days’ prior written notice, by authenticated record, of the date, time and place of any proposed public sale, and of the date after which any private sale or other disposition of the Collateral may be made. Each Grantor agrees that such written notice shall satisfy all requirements for notice to that Grantor which are imposed under the UCC or other applicable Law with respect to the exercise of the Collateral Agent’s Rights and Remedies upon default. The Collateral Agent shall not be obligated to make any sale or other disposition of any Collateral if it shall determine not to do so, regardless of the fact that notice of sale or other disposition of such Collateral shall

 

22

 

have been given. The Collateral Agent may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned.

 

(j)            Any public sale shall be held at such time or times within ordinary business hours and at such place or places as the Collateral Agent may fix and state in the notice of such sale. At any sale or other disposition, the Collateral, or portion thereof, to be sold may be sold in one lot as an entirety or in separate parcels, as the Collateral Agent may (in its sole and absolute discretion) determine. If any of the Collateral is sold, leased, or otherwise disposed of by the Collateral Agent on credit, the Secured Obligations shall not be deemed to have been reduced as a result thereof unless and until payment in full is received thereon by the Collateral Agent. In the event that the purchaser fails to pay for the Collateral, the Collateral Agent may resell the Collateral and apply the proceeds from such resale in accordance with the terms of Section 6.02 of this Agreement.

 

(k)           At any public (or, to the extent permitted by applicable Law, private) sale made pursuant to this Section 6.01, the Collateral Agent or any other Credit Party may bid for or purchase, free (to the extent permitted by applicable Law) from any right of redemption, stay, valuation or appraisal on the part of any Grantor, the Collateral or any part thereof offered for sale and may make payment on account thereof by using any claim then due and payable to the Collateral Agent or such other Credit Party from any Grantor on account of the Secured Obligations as a credit against the purchase price, and the Collateral Agent or such other Credit Party may, upon compliance with the terms of sale, hold, retain and dispose of such property without further accountability to any Grantor therefor.

 

(l)            For purposes hereof, a written agreement to purchase the Collateral or any portion thereof shall be treated as a sale thereof. The Collateral Agent shall be free to carry out such sale pursuant to such agreement and no Grantor shall be entitled to the return of the Collateral or any portion thereof subject thereto, notwithstanding the fact that after the Collateral Agent shall have entered into such an agreement all Events of Default shall have been remedied and the Secured Obligations paid in full.

 

(m)          As an alternative to exercising the power of sale herein conferred upon it, the Collateral Agent may proceed by a suit or suits at law or in equity to foreclose upon the Collateral and to sell the Collateral or any portion thereof pursuant to a judgment or decree of a court or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed receiver.

 

(n)           To the extent permitted by applicable Law, each Grantor hereby waives all rights of redemption, stay, valuation and appraisal which such Grantor now has or may at any time in the future have under any rule of law or statute now existing or hereafter enacted.

 

23

 

SECTION 6.02                     Application of Proceeds. After the occurrence and during the continuance of an Event of Default and acceleration of the Secured Obligations, the Collateral Agent shall apply the proceeds of any collection or sale of the Collateral, as well as any Collateral consisting of cash, or any Collateral granted under any other of the Collateral Documents, in accordance with Section 8.03 of the Credit Agreement.

 

The Collateral Agent shall have absolute discretion as to the time of application of any such proceeds, moneys or balances in accordance with this Agreement. Upon any sale or other disposition of the Collateral by the Collateral Agent (including pursuant to a power of sale granted by statute or under a judicial proceeding), the receipt of the purchase money by the Collateral Agent or of the officer making the sale or other disposition shall be a sufficient discharge to the purchaser or purchasers of the Collateral so sold or otherwise disposed of and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Collateral Agent or such officer or be answerable in any way for the misapplication thereof.

 

ARTICLE 7

 

Perfection of Security Interest

 

SECTION 7.01                     Perfection by Filing. This Agreement constitutes an authenticated record, and each Grantor hereby authorizes the Collateral Agent, pursuant to the provisions of Section 2.01 and Section 5.03, to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Collateral, in such filing offices as the Collateral Agent shall reasonably deem appropriate, and the Grantors shall pay the Collateral Agent’s reasonable costs and expenses incurred in connection therewith.

 

SECTION 7.02                     Other Perfection, Etc. The Grantors shall at any time and from time to time take such steps as the Collateral Agent may reasonably request for the Collateral Agent (a) to the extent required by this Agreement or the Credit Agreement, to obtain Control of any Investment Property, Deposit Accounts, Letter-of-Credit Rights or Electronic Chattel Paper, with any agreements establishing Control to be in form and substance reasonably satisfactory to the Collateral Agent and (b) otherwise to insure the continued perfection of the Collateral Agent’s security interest in any of the Collateral with the priority described in Section 3.03 and of the preservation of its rights therein.

 

SECTION 7.03                     Savings Clause. Nothing contained in this Article 7 shall be construed to narrow the scope of the Collateral Agent’s Security Interest in any of the Collateral or the perfection or priority thereof or to impair or otherwise limit any of the Collateral Agent’s Rights and Remedies hereunder except (and then only to the extent) as mandated by the UCC.

 

24

 

ARTICLE 8

 

Miscellaneous

 

SECTION 8.01                     Notices. All communications and notices hereunder shall (except as otherwise expressly permitted herein) be in writing and given as provided in Section 11.02 of the Credit Agreement.

 

SECTION 8.02                     Grant of Non-Exclusive License. Without limiting the provisions of Section 6.01 hereof or any other rights of the Collateral Agent as the holder of a Lien on any IP Collateral (as defined in the Intellectual Property Security Agreement), each Grantor, subject to those restrictions to which such Grantor is subject under applicable Law and by contract, hereby grants to the Collateral Agent, and the representatives and independent contractors of the Collateral Agent, a royalty free, non-exclusive, irrevocable license, to use, apply, and affix any trademark, trade name, logo, or the like in which any Grantor now or hereafter has rights, such license to be effective only upon the occurrence and during the continuance of any Event of Default in connection with the Collateral Agent’s exercise of the Collateral Agent’s Rights and Remedies hereunder including, without limitation, in connection with any completion of the manufacture of Inventory or any sale or other disposition of Inventory. The license granted in this Section 8.02 shall remain in full force and effect throughout the term of this Agreement, notwithstanding the release of any Grantor hereunder.

 

SECTION 8.03                     Security Interest Absolute. All rights of the Collateral Agent hereunder, the Security Interest and all obligations of the Grantors hereunder shall be absolute and unconditional irrespective of (a) any lack of validity or enforceability of the Credit Agreement, any other Loan Document, any agreement with respect to any of the Secured Obligations or any other agreement or instrument relating to any of the foregoing, (b) any change in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations, or any other amendment or waiver of or any consent to any departure from the Credit Agreement, any other Loan Document, or any other agreement or instrument, (c) any exchange, release or non-perfection of any Lien on other collateral, or any release or amendment or waiver of or consent under or departure from the Guaranty or any other guarantee, securing or guaranteeing all or any of the Secured Obligations, or (d) any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Grantor in respect of the Secured Obligations or this Agreement.

 

SECTION 8.04                     Survival of Agreement. All covenants, agreements, representations and warranties made by the Grantors herein and in any other Loan Document and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the Collateral Agent and the other Credit Parties and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Collateral Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended under the Credit Agreement, and shall continue in full force and effect unless terminated in accordance with Section 8.14 hereof.

 

25

 

SECTION 8.05                     Binding Effect; Several Agreement; Assignments. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party, and all covenants, promises and agreements by or on behalf of the Grantors that are contained in this Agreement shall bind and inure to the benefit of each Grantor and its respective successors and permitted assigns. This Agreement shall be binding upon each Grantor and the Collateral Agent and their respective successors and permitted assigns, and shall inure to the benefit of each Grantor, the Collateral Agent and the other Credit Parties and their respective successors and permitted assigns, except that no Grantor shall have the right to assign or transfer its rights or obligations hereunder or any interest herein or in the Collateral (and any such attempted assignment or transfer shall be void) except as expressly permitted by this Agreement or the Credit Agreement. This Agreement shall be construed as a separate agreement with respect to each Grantor and may be amended, modified, supplemented, waived or released with respect to any Grantor without the approval of any other Grantor and without affecting the obligations of any other Grantor hereunder.

 

SECTION 8.06                     Collateral Agent’s Fees and Expenses; Indemnification.

 

(a)           Without limiting or duplicating any of their obligations under the Credit Agreement, the Guaranty or the other Loan Documents, the Grantors jointly and severally agree to pay all reasonable and documented in reasonable detail out-of-pocket expenses incurred by the Collateral Agent, including the reasonable fees, charges and disbursements of a single counsel and any outside consultants for the Collateral Agent, in connection with (i) the administration of this Agreement, (ii) the custody or preservation of, or the sale of, collection from or other realization upon any of the Collateral, (iii) the exercise, enforcement or protection of any of the Collateral Agent’s Rights and Remedies hereunder or (iv) the failure of any Grantor to perform or observe any of the provisions hereof.

 

(b)           Without limiting or duplicating any of their indemnification obligations under the Credit Agreement, the Guaranty or the other Loan Documents, the Grantors shall jointly and severally indemnify the Credit Parties and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the reasonable and documented in reasonable detail fees, charges and disbursements of a single counsel for all Indemnitees taken as a whole in each relevant jurisdiction material to the interests of the Lenders, in each case, selected by the Collateral Agent and solely in the case of an actual conflict of interest between Indemnitees where the Indemnitees affected by such conflict inform the Borrower of such conflict, one additional counsel in each relevant jurisdiction material to the interest of the Lenders to each group of affected Indemnitees taken as a whole) incurred by any Indemnitee or asserted against any Indemnitee by any third party or by any Grantor arising out of, in connection with, or as a result of, (i) the preparation, execution, delivery or administration of this Agreement, the Credit Agreement, any other Loan Document or any other agreement or instrument contemplated hereby or thereby or any amendment or waiver with respect hereto or

 

26

 

thereto, the performance by the parties hereto of their respective obligations hereunder or thereunder, or the consummation of the transactions contemplated hereby or thereby, or, in the case of the Collateral Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement, the Credit Agreement and the other Loan Documents, or (ii) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by any Grantor, and regardless of whether any Indemnitee is a party thereto; provided  that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) 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 Indemnitee or (y) result from a claim brought by any Grantor against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if such Grantor has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction.

 

(c)           To the fullest extent permitted by applicable Law, the Grantors shall not assert, and hereby waive, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, the Credit Agreement, any other Loan Document or any agreement or instrument contemplated hereby, or the transactions contemplated hereby or thereby. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement, the Credit Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

 

(d)           Any such amounts payable as provided hereunder shall be additional Secured Obligations secured hereby and by the other Security Documents. All amounts due under this Section 8.06 shall be payable not later than ten (10) Business Days after receipt of an invoice or demand therefor.

 

(e)           The agreements in this Section 8.06 shall survive the resignation of the Collateral Agent, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Secured Obligations.

 

27

 

SECTION 8.07                     Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

SECTION 8.08                     Waivers; Amendment.

 

(a)           The rights, remedies, powers, privileges, and discretions of the Collateral Agent hereunder (herein, the “Collateral Agent’s Rights and Remedies”) shall be cumulative and not exclusive of any rights or remedies which it would otherwise have. No delay or omission by the Collateral Agent in exercising or enforcing any of the Collateral Agent’s Rights and Remedies shall operate as, or constitute, a waiver thereof. No waiver by the Collateral Agent of any Event of Default or of any Default under any other agreement shall operate as a waiver of any other Event of Default or other Default hereunder or under any other agreement. No single or partial exercise of any of the Collateral Agent’s Rights or Remedies, and no express or implied agreement or transaction of whatever nature entered into between the Collateral Agent and any Person, at any time, shall preclude the other or further exercise of the Collateral Agent’s Rights and Remedies. No waiver by the Collateral Agent of any of the Collateral Agent’s Rights and Remedies on any one occasion shall be deemed a waiver on any subsequent occasion, nor shall it be deemed a continuing waiver. The Collateral Agent’s Rights and Remedies may be exercised at such time or times and in such order of preference as the Collateral Agent may determine. The Collateral Agent’s Rights and Remedies may be exercised without resort or regard to any other source of satisfaction of the Secured Obligations. No waiver of any provisions of this Agreement or any other Loan Document or consent to any departure by any Grantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on any Grantor in any case shall entitle such Grantor or any other Grantor to any other or further notice or demand in similar or other circumstances.

 

(b)           Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to a written agreement entered into between the Collateral Agent and the Grantor or Grantors with respect to whom such waiver, amendment or modification is to apply, subject to any consent required in accordance with Section 11.01 of the Credit Agreement.

 

SECTION 8.09                     WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER

 

28

 

PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.09.

 

SECTION 8.10                     Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

SECTION 8.11                     Counterparts. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Agreement.

 

SECTION 8.12                     Headings. Article and Section headings used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

SECTION 8.13                     Jurisdiction; Waiver of Venue; Consent to Service of Process.

 

(a)           EACH OF THE GRANTORS IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE COLLATERAL AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN

 

29

 

DOCUMENT AGAINST ANY OF THE GRANTORS OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(b)           EACH OF THE GRANTORS IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (A) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(c)           EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 8.01. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

SECTION 8.14                     Termination; Release of Collateral.

 

(a)           Any Lien upon any Collateral will be released automatically if the Collateral constitutes property being sold, transferred or disposed of in a Permitted Disposition to a Person that is not a Grantor. Upon at least two (2) Business Days’ prior written request by the Grantors, the Collateral Agent shall execute such documents as may be necessary to evidence the release of the Liens upon any Collateral described in this Section 8.14(a); provided, however, that (i) the Collateral Agent shall not be required to execute any such document on terms which, in its reasonable opinion, would, under applicable Law, expose the Collateral Agent to liability or entail any adverse consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the Secured Obligations or any Liens (other than those expressly being released) upon (or obligations of any Grantor in respect of) all interests retained by any Grantor, including, without limitation, the Proceeds of any sale, all of which shall continue to constitute part of the Collateral.

 

(b)           Except for those provisions which expressly survive the termination thereof, this Agreement and the Security Interest granted herein shall terminate when (i) the Commitments have expired or been terminated and (ii) all of the Secured Obligations have been paid in full in cash or otherwise satisfied (other than any indemnity obligation for unasserted claims that by its terms survives the termination of this Agreement or the Credit Agreement), at which time the Collateral Agent shall execute and deliver to the Grantors, at the Grantors’ expense, all UCC termination statements, releases and similar documents that the Grantors shall reasonably request to evidence such termination; provided, however, that the Credit Agreement, this

 

30

 

Agreement, and the Security Interest granted herein shall be reinstated if at any time payment, or any part thereof, of any Secured Obligation is rescinded or must otherwise be restored by any Credit Party upon the bankruptcy or reorganization of any Grantor. Any execution and delivery of termination statements, releases or other documents pursuant to this Section 8.14 shall be without recourse to, or warranty by, the Collateral Agent or any other Credit Party.

 

SECTION 8.15                 Conflict. In the event of a conflict between this Agreement and the Pledge Agreement, the terms of the Pledge Agreement shall control with respect to the Pledged Collateral (as defined in the Pledge Agreement) and the terms of this Agreement shall control with respect to all other Collateral. In the event of a conflict between this Agreement and the Intellectual Property Security Agreement, the terms of the Intellectual Property Security Agreement shall control with respect to the IP Collateral (as defined in the Intellectual Property Security Agreement) and the terms of this Agreement shall control with respect to all other Collateral.

 

SECTION 8.16                 Intercreditor Agreement. Notwithstanding anything herein to the contrary, the Lien and Security Interest granted to the Collateral Agent pursuant to this Agreement and the exercise of any right or remedy by the Collateral Agent hereunder are subject to the provisions of the Intercreditor Agreement. In the event of any conflict between the terms of the Intercreditor Agreement and the terms of this Agreement, the terms of the Intercreditor Agreement shall govern and control.

 

[SIGNATURE PAGES FOLLOW]

 

31

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.

 

	
GRANTORS:
    	
BORROWER:
    
	
 
    	
 
    
	
 
    	
THE   CONTAINER STORE, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Melissa Reiff
    
	
 
    	
Name:
    	
Melissa   Reiff
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
GUARANTORS:
    
	
 
    	
TCS   HOLDINGS, INC., as Holdings
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Melissa Reiff
    
	
 
    	
Name:
    	
Melissa   Reiff
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TCS   GIFT CARD SERVICES, LLC,
    
	
 
    	
as   Subsidiary Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Melissa Reiff
    
	
 
    	
Name:
    	
Melissa   Reiff
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TCS   INSTALLATION SERVICES, LLC,
    
	
 
    	
as   Subsidiary Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Melissa Reiff
    
	
 
    	
Name:
    	
Melissa   Reiff
    
	
 
    	
Title:
    	
President
    
				

 

[Signature Page to Security Agreement]

 

 

	
COLLATERAL AGENT:
    	
JPMORGAN   CHASE BANK, N.A.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   David L. Howard
    
	
 
    	
 
    	
Name:   David L. Howard
    
	
 
    	
 
    	
Title:   Authorized Officer
    

 

[Signature Page to Security Agreement]

 

 

SCHEDULE I

 

Guarantors

 

TCS Holdings, Inc.

 

TCS Gift Card Services, LLC

 

TCS Installation Services, LLC

 

 

SCHEDULE 3.05

 

Commercial Tort Claims

 

None.

 

 

SCHEDULE 3.06

 

Instruments and Chattel Paper

 

(i)            Promissory Notes:

 

Promissory Note, dated April 6, 2012, in the original principal amount of $2,267,941.68 made by Elfa International AB (successor in interest to Elfa Group AB) for the benefit of The Container Store, Inc. This note is set to mature on June 30, 2012 and as of February 25, 2012 the remaining principal balance is $409,489.44.

 

Promissory Note, dated April 6, 2012, in the original principal amount of $712,500 made by Elfa International AB (successor in interest to Elfa Group AB) for the benefit of The Container Store, Inc. This note is set to mature on June 30, 2012 and as of February 25, 2012 the remaining balance is $128,645.81.

 

(ii)           Chattel Paper:

 

None.

 

 

SCHEDULE 3.07

 

Deposit Accounts, Securities Accounts and Commodity Accounts

 

*  Excluded Account

(z) zero balance account

(b) account used for benefit payments 

(c) controlled disbursement account

 

	
Store#
    	
 
    	
Location or
   Account
   Name
    	
 
    	
Bank
    	
 
    	
Bank Acct #
    	
 
    	
Bank Acct ABA #
    	
 
    	
Cash/GL
   Acct #
    	
 
    	
City
    	
 
    	
State
    
	
Store   Accounts
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
19005
    	
 
    	
AUS
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Austin
    	
 
    	
TX
    
	
19006
    	
 
    	
SAN
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
San Antonio
    	
 
    	
TX
    
	
19007
    	
 
    	
HOU
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Houston
    	
 
    	
TX
    
	
19008
    	
 
    	
FTW
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Fort Worth
    	
 
    	
TX
    
	
19010
    	
 
    	
BUC
    	
 
    	
Wells Fargo
    	
 
    	
*4945361673 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Atlanta
    	
 
    	
GA
    
	
19011
    	
 
    	
TYC
    	
 
    	
Wells Fargo
    	
 
    	
*4945361681(z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Vienna
    	
 
    	
VA
    
	
19012
    	
 
    	
OAB
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1032382 (z)
    	
 
    	
71000013
    	
 
    	
1055
    	
 
    	
Oak Brook
    	
 
    	
IL
    
	
19013
    	
 
    	
ROC
    	
 
    	
Wells Fargo
    	
 
    	
*4945361699 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Rockville
    	
 
    	
MD
    
	
19014
    	
 
    	
SCH
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1032382 (z)
    	
 
    	
71000013
    	
 
    	
1055
    	
 
    	
Schaumburg
    	
 
    	
IL
    
	
19015
    	
 
    	
NOR
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1032382 (z)
    	
 
    	
71000013
    	
 
    	
1055
    	
 
    	
Northbrook
    	
 
    	
IL
    
	
19016
    	
 
    	
CSD
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Coppell
    	
 
    	
TX
    
	
19017
    	
 
    	
SOC
    	
 
    	
Wells Fargo
    	
 
    	
*4945361707 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Costa Mesa
    	
 
    	
CA
    
	
19018
    	
 
    	
PKM
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*192647848 (z)
    	
 
    	
102001017
    	
 
    	
1065
    	
 
    	
Denver
    	
 
    	
CO
    
	
19019
    	
 
    	
PER
    	
 
    	
Wells Fargo
    	
 
    	
*4945361715 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Atlanta
    	
 
    	
GA
    
	
19020
    	
 
    	
CHI
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1032382 (z)
    	
 
    	
71000013
    	
 
    	
1055
    	
 
    	
Chicago
    	
 
    	
IL
    
	
19021
    	
 
    	
SDG
    	
 
    	
Wells Fargo
    	
 
    	
*4945361723 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
San Diego
    	
 
    	
CA
    

 

 

	
Store#
    	
 
    	
Location or
   Account
   Name
    	
 
    	
Bank
    	
 
    	
Bank Acct #
    	
 
    	
Bank Acct ABA #
    	
 
    	
Cash/GL
   Acct #
    	
 
    	
City
    	
 
    	
State
    
	
19022
    	
 
    	
NPK
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Dallas
    	
 
    	
TX
    
	
19023
    	
 
    	
GAL
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Dallas
    	
 
    	
TX
    
	
19024
    	
 
    	
MIA
    	
 
    	
Wells Fargo
    	
 
    	
*495361731 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Miami
    	
 
    	
FL
    
	
19025
    	
 
    	
CHP
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Houston
    	
 
    	
TX
    
	
19026
    	
 
    	
WHP
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*304179531 (z)
    	
 
    	
21000021
    	
 
    	
1082
    	
 
    	
White Plains
    	
 
    	
NY
    
	
19027
    	
 
    	
SLK
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Southlake
    	
 
    	
TX
    
	
19028
    	
 
    	
COL
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*629608787 (z)
    	
 
    	
44000037
    	
 
    	
1090
    	
 
    	
Columbus
    	
 
    	
OH
    
	
19029
    	
 
    	
WAC
    	
 
    	
Wells Fargo
    	
 
    	
*4945361749 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Walnut Creek
    	
 
    	
CA
    
	
19030
    	
 
    	
AVA
    	
 
    	
Wells Fargo
    	
 
    	
*4945361756 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Arlington
    	
 
    	
VA
    
	
19031
    	
 
    	
COM
    	
 
    	
Wells Fargo
    	
 
    	
*4945361764 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Corte Madera
    	
 
    	
CA
    
	
19032
    	
 
    	
PAR
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*304179531 (z)
    	
 
    	
21000021
    	
 
    	
1082
    	
 
    	
Paramus
    	
 
    	
NJ
    
	
19033
    	
 
    	
SFO
    	
 
    	
Wells Fargo
    	
 
    	
*4945361772 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
San Francisco
    	
 
    	
CA
    
	
19034
    	
 
    	
SJO
    	
 
    	
Wells Fargo
    	
 
    	
*4945361780 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
San Jose
    	
 
    	
CA
    
	
19035
    	
 
    	
6AV
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*304179531 (z)
    	
 
    	
21000021
    	
 
    	
1082
    	
 
    	
New York
    	
 
    	
NY
    
	
19036
    	
 
    	
WDC
    	
 
    	
Wells Fargo
    	
 
    	
*4945361798 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Washington
    	
 
    	
DC
    
	
19037
    	
 
    	
PAS
    	
 
    	
Wells Fargo
    	
 
    	
*4945361806 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Pasadena
    	
 
    	
CA
    
	
19038
    	
 
    	
CHH
    	
 
    	
Wells Fargo
    	
 
    	
*4945361814 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Chestnut Hill
    	
 
    	
MA
    
	
19039
    	
 
    	
NAT
    	
 
    	
Wells Fargo
    	
 
    	
*4945361822 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Natick
    	
 
    	
MA
    
	
19040
    	
 
    	
POR
    	
 
    	
Wells Fargo
    	
 
    	
*4945361830 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Tigard
    	
 
    	
OR
    
	
19041
    	
 
    	
BEL
    	
 
    	
Wells Fargo
    	
 
    	
*4945361848 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Bellevue
    	
 
    	
WA
    
	
19042
    	
 
    	
LEX
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*304179531 (z)
    	
 
    	
21000021
    	
 
    	
1082
    	
 
    	
New York
    	
 
    	
NY
    
	
19043
    	
 
    	
CEN
    	
 
    	
Wells Fargo
    	
 
    	
*4945361855 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Los Angeles
    	
 
    	
CA
    
	
19044
    	
 
    	
STL
    	
 
    	
Wells Fargo
    	
 
    	
*4945361863 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
St. Louis
    	
 
    	
MO
    
	
19045
    	
 
    	
CCR
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*192647848 (z)
    	
 
    	
102001017
    	
 
    	
1065
    	
 
    	
Denver
    	
 
    	
CO
    
	
19046
    	
 
    	
CHL
    	
 
    	
Wells Fargo
    	
 
    	
*4945361871 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Charlotte
    	
 
    	
NC
    

 

 

	
Store#
    	
 
    	
Location or
   Account
   Name
    	
 
    	
Bank
    	
 
    	
Bank Acct #
    	
 
    	
Bank Acct ABA #
    	
 
    	
Cash/GL
   Acct #
    	
 
    	
City
    	
 
    	
State
    
	
19047
    	
 
    	
LTR
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Little Rock
    	
 
    	
AR
    
	
19048
    	
 
    	
SCT
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*192647848 (z)
    	
 
    	
102001017
    	
 
    	
1065
    	
 
    	
Scottsdale
    	
 
    	
AZ
    
	
19049
    	
 
    	
STN
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Frisco
    	
 
    	
TX
    
	
19051
    	
 
    	
MIN
    	
 
    	
Wells Fargo
    	
 
    	
*4945361889 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Fairview
    	
 
    	
TX
    
	
19052
    	
 
    	
CIN
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*629608787 (z)
    	
 
    	
44000037
    	
 
    	
1090
    	
 
    	
Cinncinatti
    	
 
    	
OH
    
	
19053
    	
 
    	
FLT
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*192647848 (z)
    	
 
    	
102001017
    	
 
    	
1065
    	
 
    	
Flat Iron
    	
 
    	
CO
    
	
19054
    	
 
    	
HAL
    	
 
    	
Wells Fargo
    	
 
    	
*4945408763 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Hallandale
    	
 
    	
FL
    
	
19055
    	
 
    	
RAL
    	
 
    	
Wells Fargo
    	
 
    	
*4947120531 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Raleigh
    	
 
    	
NC
    
	
19056
    	
 
    	
IND
    	
 
    	
JP Morgan Chase Bank, N.A
    	
 
    	
*1032382 (z)
    	
 
    	
071000013
    	
 
    	
1055
    	
 
    	
Indianapolis
    	
 
    	
IN
    
	
19057
    	
 
    	
CHR
    	
 
    	
Wells Fargo
    	
 
    	
*4948908702 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Charlotte
    	
 
    	
NC
    
	
19058
    	
 
    	
NSH
    	
 
    	
Wells Fargo
    	
 
    	
*4947417432 (z)
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Nashville
    	
 
    	
TN
    
	
19059
    	
 
    	
WDL
    	
 
    	
JP Morgan Chase Bank, N.A
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
The Woodlands
    	
 
    	
TX
    
	
19060
    	
 
    	
ATX
    	
 
    	
JP Morgan Chase Bank, N.A
    	
 
    	
*1588849875 (z)
    	
 
    	
111000614
    	
 
    	
1075
    	
 
    	
Arlington
    	
 
    	
TX
    
	
Main   Operating Accounts
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
TCS Master Acct
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
1588849834
    	
 
    	
111000614
    	
 
    	
1025
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
Cash Disb
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*9319960630 (z), (c)
    	
 
    	
111300880
    	
 
    	
1026
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
Payroll
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*9319960622 (z), (c)
    	
 
    	
111000614
    	
 
    	
1110
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
Amex
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*645589250 (z)
    	
 
    	
111000614
    	
 
    	
1022
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
V/MC
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*645589268 (z)
    	
 
    	
111000614
    	
 
    	
1087
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
DSCV
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*1588849842 (z)
    	
 
    	
111000614
    	
 
    	
1085
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
GPA Flex
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*638476341 (z), (b)
    	
 
    	
111000614
    	
 
    	
1140
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
GPA Health Bene
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*638476358 (z), (b)
    	
 
    	
111000614
    	
 
    	
1145
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
TCS ACH Wire
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*734228026 (z)
    	
 
    	
111000614
    	
 
    	
1027
    	
 
    	
Dallas
    	
 
    	
TX
    

 

 

	
Store#
    	
 
    	
Location or
   Account
   Name
    	
 
    	
Bank
    	
 
    	
Bank Acct #
    	
 
    	
Bank Acct ABA #
    	
 
    	
Cash/GL
   Acct #
    	
 
    	
City
    	
 
    	
State
    
	
 
    	
 
    	
Depository Master
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
734228018
    	
 
    	
124001545
    	
 
    	
1028
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
Depository Master
    	
 
    	
Wells Fargo
    	
 
    	
4121764674
    	
 
    	
121000248
    	
 
    	
1098
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
Pcard
    	
 
    	
Wells Fargo
    	
 
    	
4000045914
    	
 
    	
121000248
    	
 
    	
1095
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
TCS Gift Card
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
663001261
    	
 
    	
111000614
    	
 
    	
1094
    	
 
    	
Dallas
    	
 
    	
TX
    
	
 
    	
 
    	
PT Insurance
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*826080111 (z), (b)
    	
 
    	
520101023
    	
 
    	
1146
    	
 
    	
Dallas
    	
 
    	
Tx
    
	
 
    	
 
    	
TCS GiftCo
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
918033705
    	
 
    	
111000614
    	
 
    	
1093
    	
 
    	
Dallas
    	
 
    	
Tx
    
	
 
    	
 
    	
TCS Installation Payroll
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*428297456 (z), (c)
    	
 
    	
111000614
    	
 
    	
1111
    	
 
    	
Dallas
    	
 
    	
Tx
    
	
 
    	
 
    	
TCS Installation Master
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
428297399
    	
 
    	
111000614
    	
 
    	
1112
    	
 
    	
Dallas
    	
 
    	
Tx
    
	
 
    	
 
    	
SF HRA account
    	
 
    	
JP Morgan Chase Bank, N.A.
    	
 
    	
*790198485 (z), (b)
    	
 
    	
111000614
    	
 
    	
1147
    	
 
    	
Dallas
    	
 
    	
Tx
    

 

	
Store#
    	
 
    	
Location
    	
 
    	
Bank
    	
 
    	
Bank Acct
   ABA #
    	
 
    	
Amex Merch
   #
    	
 
    	
AMEX Bank
   Acct #
    	
 
    	
AMEX
   Cash/GL
   Acct #
    	
 
    	
Discover Merch #
    	
 
    	
Discover Bank
   Acct #
    	
 
    	
Discover
   Cash/GL
   Acct #
    	
 
    	
Visa/MC
   Merch #
    	
 
    	
VMC
   Bank
   Acct #
    	
 
    	
VMC
   Cash/
   GL
   Acct #
    	
 
    	
Debit
   Cash/GL
   Acct #
    
	
 
    	
 
    	
DFW (CAP   ACCOUNTS)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
142 488 951 7
    	
 
    	
 
    	
 
    	
 
    	
 
    	
6011 0170 1743   658
    	
 
    	
 
    	
 
    	
 
    	
 
    	
654467
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
5
    	
 
    	
AUS
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 497 447 5
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0179 9096   266
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
687897
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
6
    	
 
    	
SAN
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 483 815 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1743   799
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688374
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
7
    	
 
    	
HOU
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 441 613 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1746   727
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688382
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
8
    	
 
    	
FTW
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 558 006 5
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1746   743
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688390
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
9
    	
 
    	
CCK
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 420 958 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1746   768
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688754
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    

 

 

	
Store#
    	
 
    	
Location
    	
 
    	
Bank
    	
 
    	
Bank Acct
   ABA #
    	
 
    	
Amex Merch
   #
    	
 
    	
AMEX Bank
   Acct #
    	
 
    	
AMEX
   Cash/GL
   Acct #
    	
 
    	
Discover Merch #
    	
 
    	
Discover Bank
   Acct #
    	
 
    	
Discover
   Cash/GL
   Acct #
    	
 
    	
Visa/MC
   Merch #
    	
 
    	
VMC
   Bank
   Acct #
    	
 
    	
VMC
   Cash/
   GL
   Acct #
    	
 
    	
Debit
   Cash/GL
   Acct #
    
	
10
    	
 
    	
BUC
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
410 443 271 1
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1746   784
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688762
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
11
    	
 
    	
TYC
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
445 446 908 1
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1983   213
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688796
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
12
    	
 
    	
OAB
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
071000013
    	
 
    	
312 470 141 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2523   265
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688804
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
13
    	
 
    	
ROC
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
219 480 234 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2615   517
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688812
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
14
    	
 
    	
SCH
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
071000013
    	
 
    	
312 473 309 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2831   676
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688820
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
15
    	
 
    	
NOR
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
071000013
    	
 
    	
312 473 308 0
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2831   684
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
688879
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
16
    	
 
    	
CSD
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 473 529 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2790   807
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
687905
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
 
    
	
17
    	
 
    	
SOC
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
504 519 211 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0179 9088   172
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689042
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
18
    	
 
    	
DEN
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
102001017
    	
 
    	
105 472 849 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 4351   350
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689059
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
19
    	
 
    	
PER
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
410 474 030 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 4249   265
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689083
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
20
    	
 
    	
CHI
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
071000013
    	
 
    	
312 308 971 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 4661   485
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689091
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
21
    	
 
    	
SDG
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
504 346 657 2
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 4683   216
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689109
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
22
    	
 
    	
NPK
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 328 125 2
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 4845   351
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689315
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
23
    	
 
    	
GAL
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 345 014 7
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5247   946
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689356
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    

 

 

	
Store#
    	
 
    	
Location
    	
 
    	
Bank
    	
 
    	
Bank Acct
   ABA #
    	
 
    	
Amex Merch
   #
    	
 
    	
AMEX Bank
   Acct #
    	
 
    	
AMEX
   Cash/GL
   Acct #
    	
 
    	
Discover Merch #
    	
 
    	
Discover Bank
   Acct #
    	
 
    	
Discover
   Cash/GL
   Acct #
    	
 
    	
Visa/MC
   Merch #
    	
 
    	
VMC
   Bank
   Acct #
    	
 
    	
VMC
   Cash/
   GL
   Acct #
    	
 
    	
Debit
   Cash/GL
   Acct #
    
	
24
    	
 
    	
MIA
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
409 557 231 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5324   638
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689364
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
25
    	
 
    	
CHP
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 507 785 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0173 8494   838
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689596
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
26
    	
 
    	
WHP
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
021000021
    	
 
    	
631 002 047 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5001   301
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689604
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
27
    	
 
    	
SLK
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 049 336 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0178 5061   068
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689687
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
28
    	
 
    	
COL
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
334 016 213 0
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0171 5478   523
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689695
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
29
    	
 
    	
WAC
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
504 197 740 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0177 5854   852
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689703
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
30
    	
 
    	
AVA
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
445 017 742 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0177 5854   845
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689729
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
31
    	
 
    	
COM
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
504 605 014 2
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 9933   111
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689737
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
32
    	
 
    	
PAR
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
021000021
    	
 
    	
229 033 605 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 9955   445
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689745
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
33
    	
 
    	
SFO
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
504 826 366 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 9860   330
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689752
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
34
    	
 
    	
SJO
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
504 902 175 1
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0178 5060   342
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689885
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
35
    	
 
    	
6AV
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
021000021
    	
 
    	
631 178 122 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0178 5060   359
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
848994
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
36
    	
 
    	
WDC
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
408 006 912 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0179 9700   362
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
70681
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
37
    	
 
    	
PAS
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
104 009 203 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1900   373
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
78495
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
38
    	
 
    	
CHH
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
220 055 264 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1900   381
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
80023
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    

 

 

	
Store#
    	
 
    	
Location
    	
 
    	
Bank
    	
 
    	
Bank Acct
   ABA #
    	
 
    	
Amex Merch
   #
    	
 
    	
AMEX Bank
   Acct #
    	
 
    	
AMEX
   Cash/GL
   Acct #
    	
 
    	
Discover Merch #
    	
 
    	
Discover Bank
   Acct #
    	
 
    	
Discover
   Cash/GL
   Acct #
    	
 
    	
Visa/MC
   Merch #
    	
 
    	
VMC
   Bank
   Acct #
    	
 
    	
VMC
   Cash/
   GL
   Acct #
    	
 
    	
Debit
   Cash/GL
   Acct #
    
	
39
    	
 
    	
NAT
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
220 063 909 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2024   678
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
89535
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
40
    	
 
    	
POR
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
536 044 064 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2073   477
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
91812
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
41
    	
 
    	
BEL
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
546 069 085 2
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2174   101
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
103301
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
42
    	
 
    	
LEX
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
021000021
    	
 
    	
631 367 074 7
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2174   085
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
103287
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
43
    	
 
    	
CEN
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
104 216 119 0
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 2612   258
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
119341
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
45
    	
 
    	
CCR
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
102001017
    	
 
    	
1051140010
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1743   658
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
168050
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
899
    	
 
    	
WEB
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 008 695 1
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0179 9708   993
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
687913
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
 
    
	
99
    	
 
    	
DFW
    	
 
    	
JP Morgan Chase   Bank, N.A.
    	
 
    	
111000614
    	
 
    	
142 488 937 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 1743   674
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
689877
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
 
    
	
46
    	
 
    	
CHL
    	
 
    	
Wells Fargo
    	
 
    	
121000248
    	
 
    	
229 171 495 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5369   781
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
177483
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
47
    	
 
    	
LTR
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
103 039 307 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5391   512
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
10712
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
48
    	
 
    	
SCT
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
102001017
    	
 
    	
502 144 950 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5440 327
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
15316
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
49
    	
 
    	
STN
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
142 897 580 9
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5428   074
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
7185
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
50
    	
 
    	
FVW
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
2420241879
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5547   485
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
62871
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
51
    	
 
    	
MIN
    	
 
    	
Wells Fargo
    	
 
    	
121000248
    	
 
    	
322 077 844 3
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5452   249
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
17983
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
52
    	
 
    	
CIN
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
334 182 253 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5452   231
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
17984
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
53
    	
 
    	
FLT
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
102001017
    	
 
    	
105 143 011 4
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5487   988
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
23695
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    

 

 

	
Store#
    	
 
    	
Location
    	
 
    	
Bank
    	
 
    	
Bank Acct
   ABA #
    	
 
    	
Amex Merch
   #
    	
 
    	
AMEX Bank
   Acct #
    	
 
    	
AMEX
   Cash/GL
   Acct #
    	
 
    	
Discover Merch #
    	
 
    	
Discover Bank
   Acct #
    	
 
    	
Discover
   Cash/GL
   Acct #
    	
 
    	
Visa/MC
   Merch #
    	
 
    	
VMC
   Bank
   Acct #
    	
 
    	
VMC
   Cash/
   GL
   Acct #
    	
 
    	
Debit
   Cash/GL
   Acct #
    
	
54
    	
 
    	
HAL
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
4099999518
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5540   951
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
59512
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
55
    	
 
    	
RAL
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
4321939696
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5560   454
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
68693
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
56
    	
 
    	
IND
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
071000013
    	
 
    	
313 126 232 1
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5606   695
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
196660
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
57
    	
 
    	
CHR
    	
 
    	
Wells Fargo
    	
 
    	
121000248
    	
 
    	
432 218 922 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5606   703
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
196661
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
58
    	
 
    	
NSH
    	
 
    	
Wells Fargo
    	
 
    	
121000248
    	
 
    	
441 164 726 6
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5608   436
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
199225
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
59
    	
 
    	
WDL
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
242 160 126 1
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5608   444
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
201248
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    
	
60
    	
 
    	
ATX
    	
 
    	
JP Morgan Chase   Bank, N.A
    	
 
    	
111000614
    	
 
    	
242 190 200 8
    	
 
    	
645589250
    	
 
    	
1211
    	
 
    	
6011 0170 5635   249
    	
 
    	
1588849842
    	
 
    	
1212
    	
 
    	
204400
    	
 
    	
645589268
    	
 
    	
1210
    	
 
    	
1235
    

 

 

SCHEDULE 3.08

 

Electronic Chattel Paper and Transferable Records

 

None.

 

 

EXHIBIT A

 

Form of Joinder Agreement

 

	
 
    	
[Name of New Grantor]
    
	
 
    	
[Address of New Grantor]
    
	
 
    	
 
    
	
[Date]
    	
 
    

 

Ladies and Gentlemen:

 

Reference is made to (i) the Term Facility Security Agreement, dated as of April 6, 2012 (as amended, modified, supplemented or restated and in effect from time to time, the “Term Facility Security Agreement”), by and among The Container Store, Inc., a Texas corporation (the “Borrower”), each of the Persons listed on Schedule I therein (each such Person, individually, a “Guarantor” and, collectively, the “Guarantors”) (the Borrower and the Guarantors are hereinafter referred to, individually, as a “Grantor” and, collectively, as the “Grantors”), and JPMorgan Chase Bank, N.A., a national banking association, as collateral agent (in such capacity, the “Collateral Agent”) for its own benefit and the benefit of the other Credit Parties and (ii) the Term Facility Pledge Agreement, dated as of April 6, 2012 (as amended, modified, supplemented or restated and in effect from time to time, the “Term Facility Pledge Agreement”, together with the Term Facility Security Agreement, the “Security Agreements”), by and among the Borrower, the other Grantors, and the Collateral Agent for its own benefit and the benefit of the other Credit Parties. All capitalized terms used but not defined herein shall have the meanings set forth in the Security Agreements.

 

This Joinder Agreement supplements the Security Agreements and is delivered by the undersigned, [ ] (the “New Grantor”), pursuant to Section 4.15 of the Term Facility Security Agreement. The New Grantor hereby agrees to be bound as a Guarantor and as a Grantor party to the Security Agreements by all of the terms, covenants and conditions set forth in the Security Agreements to the same extent that it would have been bound if it had been a signatory to the Security Agreements on the date of the Security Agreements. Without limiting the generality of the foregoing, the New Grantor hereby grants and pledges to the Collateral Agent, its successors and permitted assigns, for its own benefit and the benefit of the other Credit Parties, as collateral security for the full, prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations, the Pledged Collateral, a Lien on and security interest in, all of its right, title and interest in, to and under the Collateral and expressly assumes all obligations and liabilities of a Guarantor and Grantor under the Security Agreements. The New Grantor hereby makes each of the

 

 

representations and warranties and agrees to each of the covenants applicable to the Grantors contained in the Security Agreements.

 

Annexed hereto are supplements to each of the schedules to the Security Agreements with respect to the New Grantor. Such supplements shall be deemed to be part of the Security Agreements.

 

This Joinder Agreement and any amendments, waivers, consents or supplements hereto may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all such counterparts together shall constitute one and the same agreement.

 

THIS JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

IN WITNESS WHEREOF, the New Grantor has caused this Joinder Agreement to be executed and delivered by its duly authorized officer as of the date first above written.

 

	
 
    	
 
    	
[NEW GRANTOR]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
AGREED TO AND ACCEPTED:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
JPMORGAN CHASE BANK, N.A.,
    	
 
    	
 
    
	
as Collateral Agent
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    

 

[Schedules to the Term Security Agreement and Term Pledge Agreement to be attached]Exhibit 10.11

 

INTERCREDITOR AGREEMENT

 

by and between

 

JPMORGAN CHASE BANK, N.A.

 

as ABL Agent,

 

and

 

JPMORGAN CHASE BANK, N.A.

 

as Term Agent

 

Dated as of April 6, 2012

 

 

TABLE OF CONTENTS

 

	
 
    	
Page
    
	
 
    	
 
    
	
ARTICLE 1   DEFINITIONS
    	
2
    
	
 
    	
 
    
	
Section 1.1
    	
Uniform   Commercial Code Definitions
    	
2
    
	
Section 1.2
    	
Other   Definitions
    	
2
    
	
Section 1.3
    	
Rules of   Construction
    	
12
    
	
 
    	
 
    
	
ARTICLE 2   LIEN PRIORITY
    	
13
    
	
 
    	
 
    
	
Section 2.1
    	
Priority   of Liens
    	
13
    
	
Section 2.2
    	
Waiver   of Right to Contest Liens
    	
14
    
	
Section 2.3
    	
Remedies   Standstill
    	
14
    
	
Section 2.4
    	
Exercise   of Rights
    	
15
    
	
Section 2.5
    	
No   New Liens
    	
17
    
	
Section 2.6
    	
Waiver   of Marshalling
    	
18
    
	
 
    	
 
    
	
ARTICLE 3   ACTIONS OF THE PARTIES
    	
18
    
	
 
    	
 
    
	
Section 3.1
    	
Certain   Actions Permitted
    	
18
    
	
Section 3.2
    	
Agent   for Perfection
    	
18
    
	
Section 3.3
    	
Sharing   of Information and Access
    	
19
    
	
Section 3.4
    	
Insurance
    	
19
    
	
Section 3.5
    	
No   Additional Rights For the Loan Parties Hereunder
    	
19
    
	
Section 3.6
    	
Inspection   and Access Rights
    	
19
    
	
Section 3.7
    	
Exercise   of Remedies — Set Off and Tracing of and Priorities in Proceeds
    	
20
    
	
 
    	
 
    
	
ARTICLE 4   APPLICATION OF PROCEEDS
    	
21
    
	
 
    	
 
    
	
Section 4.1
    	
Application   of Proceeds
    	
21
    
	
Section 4.2
    	
Specific   Performance
    	
23
    
	
 
    	
 
    
	
ARTICLE 5   INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS
    	
23
    
	
 
    	
 
    
	
Section 5.1
    	
Notice   of Acceptance and Other Waivers
    	
23
    
	
Section 5.2
    	
Modifications   to ABL Documents and Term Documents
    	
24
    
	
Section 5.3
    	
Reinstatement   and Continuation of Agreement
    	
26
    
	
 
    	
 
    
	
ARTICLE 6   INSOLVENCY PROCEEDINGS
    	
26
    
	
 
    	
 
    
	
Section 6.1
    	
DIP   Financing
    	
26
    
	
Section 6.2
    	
Relief   From Stay
    	
27
    
	
Section 6.3
    	
No   Contest; Adequate Protection
    	
27
    
	
Section 6.4
    	
Asset   Sales
    	
28
    
	
Section 6.5
    	
Separate   Grants of Security and Separate Classification
    	
29
    
	
Section 6.6
    	
Enforceability
    	
29
    

 

i

 

	
Section 6.7
    	
ABL   Obligations Unconditional
    	
29
    
	
Section 6.8
    	
Term   Obligations Unconditional
    	
30
    
	
 
    	
 
    
	
ARTICLE 7   MISCELLANEOUS
    	
30
    
	
 
    	
 
    
	
Section 7.1
    	
Rights   of Subrogation
    	
30
    
	
Section 7.2
    	
Further   Assurances
    	
30
    
	
Section 7.3
    	
Representations
    	
31
    
	
Section 7.4
    	
Amendments
    	
31
    
	
Section 7.5
    	
Addresses   for Notices
    	
31
    
	
Section 7.6
    	
No   Waiver, Remedies
    	
32
    
	
Section 7.7
    	
Continuing   Agreement; Transfer of Secured Obligations
    	
32
    
	
Section 7.8
    	
Governing   Law; Entire Agreement
    	
32
    
	
Section 7.9
    	
Counterparts
    	
33
    
	
Section 7.10
    	
No   Third Party Beneficiaries
    	
33
    
	
Section 7.11
    	
Headings
    	
33
    
	
Section 7.12
    	
Severability
    	
33
    
	
Section 7.13
    	
Attorneys   Fees
    	
33
    
	
Section 7.14
    	
VENUE,   JURY TRIAL WAIVER
    	
33
    
	
Section 7.15
    	
Intercreditor   Agreement
    	
34
    
	
Section 7.16
    	
No   Warranties or Liability
    	
34
    
	
Section 7.17
    	
Conflicts
    	
34
    
	
Section 7.18
    	
Information   Concerning Financial Condition of the Loan Parties
    	
34
    

 

ii

 

INTERCREDITOR AGREEMENT

 

THIS INTERCREDITOR AGREEMENT (as amended, supplemented, restated or otherwise modified from time to time pursuant to the terms hereof, this “Agreement”) is entered into as of April 6, 2012 between JPMORGAN CHASE BANK, N.A., in its capacities as administrative agent and collateral agent (together with its successors and assigns in such capacities, the “ABL Agent”) for the financial institutions party from time to time to the ABL Credit Agreement referred to below (such financial institutions, together with their successors, assigns and transferees, the “ABL Credit Agreement Lenders” and, together with affiliates thereof and certain other specified hedging parties, in their capacities as ABL Bank Products Affiliates or ABL Hedging Affiliates (in each case, as hereinafter defined), the “ABL Lenders”) and JPMORGAN CHASE BANK, N.A., in its capacities as administrative agent and collateral agent (together with its successors and assigns in such capacities, the “Term Agent”) for the financial institutions, lenders and investors party from time to time to the Term Credit Agreement referred to below (such financial institutions, lenders and investors, together with their respective successors, assigns and transferees, the “Term Credit Agreement Lenders” and, together with affiliates thereof and certain other specified hedging parties in their capacities as Term Bank Products Affiliates or Term Hedging Affiliates (in each case, as hereinafter defined), the “Term Lenders”).

 

RECITALS

 

A.                                    Pursuant to that certain Credit Agreement dated as of the date hereof by and among The Container Store, Inc. (the “ABL Borrower”), the ABL Guarantors (as hereinafter defined), the ABL Credit Agreement Lenders and the ABL Agent (as such agreement may be amended, supplemented, restated or otherwise modified from time to time, the “ABL Credit Agreement”), the ABL Credit Agreement Lenders have agreed to make certain loans and other financial accommodations to or for the benefit of the ABL Borrower.

 

B.                                    As a condition to the effectiveness of the ABL Credit Agreement and to secure the obligations of the ABL Borrower and the ABL Guarantors (the ABL Borrower, the ABL Guarantors and each other direct or indirect subsidiary or parent of the ABL Borrower or any of its affiliates that is now or hereafter becomes a party to any ABL Document, collectively, the “ABL Loan Parties”) under and in connection with the ABL Documents, the ABL Loan Parties have granted to the ABL Agent (for the benefit of the ABL Lenders) Liens on the Collateral.

 

C.                                    Pursuant to that certain Credit Agreement dated as of the date hereof by and among The Container Store, Inc. (the “Term Borrower”). Holdings (as hereinafter defined), the other Term Guarantors (as hereinafter defined), the Term Lenders and the Term Agent (as such agreement may be amended, supplemented, restated or otherwise modified from time to time, the “Term Credit Agreement”), the Term Lenders have agreed to make certain term loans to the Term Borrower.

 

D.                                    As a condition to the effectiveness of the Term Credit Agreement and to secure the obligations of the Term Borrower and the Term Guarantors (the Term Borrower, the Term Guarantors and each other direct or indirect subsidiary or parent of the Term Borrower or any of its affiliates that is now or hereafter becomes a party to any Term Document, collectively, the “Term Loan Parties”) under and in connection with the Term Documents, the Term Loan Parties have granted to the Term Agent (for the benefit of the Term Lenders) Liens on the Collateral.

 

E.                                     Each of the ABL Agent (on behalf of the ABL Lenders) and the Term Agent (on behalf of the Term Lenders) and, by their acknowledgment hereof, the ABL Loan Parties and the Term Loan

 

1

 

Parties, desire to agree to the relative priority of Liens on the Collateral and certain other rights, priorities and interests as provided herein.

 

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:

 

ARTICLE 1

DEFINITIONS

 

Section 1.1                                   Uniform Commercial Code Definitions. The following terms which are defined in the Uniform Commercial Code are used herein as so defined: Accounts, Chattel Paper, Deposit Accounts, Documents, Electronic Chattel Paper, Equipment, Financial Assets, Fixtures, Instruments, Inventory, Investment Property, Letter-Of-Credit Rights, Money, Payment Intangibles, Promissory Notes, Records, Security, Securities Accounts, Security Entitlements, Supporting Obligations and Tangible Chattel Paper.

 

Section 1.2                                   Other Definitions. Subject to Section 1.1 above, unless the context otherwise requires, all capitalized terms used but not defined herein shall have the meanings set forth in the ABL Credit Agreement and the Term Credit Agreement, in each case as in effect on the Closing Date. In addition, as used in this Agreement, the following terms shall have the meanings set forth below:

 

“ABL Agent” shall have the meaning assigned to that term in the introduction to this Agreement and shall include any successor thereto as well as any Person designated as the “Agent” or “Administrative Agent” under any ABL Credit Agreement.

 

“ABL Bank Products Affiliate” shall mean any ABL Credit Agreement Lender, any Affiliate of any ABL Credit Agreement Lender, any Former Lender or any Affiliate of a Former Lender that has entered into a Bank Products Agreement with an ABL Loan Party with the obligations of such ABL Loan Party thereunder being secured by one or more ABL Collateral Documents.

 

“ABL Borrower” shall have the meaning assigned to that term in the recitals to this Agreement.

 

“ABL Collateral Documents” shall mean all “Collateral Documents” as defined in the ABL Credit Agreement, and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with the ABL Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

 

“ABL Credit Agreement” shall have the meaning assigned to that term in the recitals to this Agreement and shall include one or more other agreements or facilities extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of the ABL Obligations, whether by the same or any other agent, lender or group of lenders and whether or not increasing the amount of any Indebtedness that may be incurred thereunder.

 

“ABL Credit Agreement Lenders” shall have the meaning assigned to that term in the introduction to this Agreement.

 

“ABL Documents” shall mean the ABL Credit Agreement, the ABL Collateral Documents, any Bank Products Agreement between any ABL Loan Party and any ABL Bank Products Affiliate, any Hedging Agreements between any ABL Loan Party and any ABL Hedging Affiliate, those other ancillary agreements as to which the ABL Agent or any ABL Lender is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any

 

2

 

ABL Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the ABL Agent, in connection with any of the foregoing or any ABL Loan Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

 

“ABL Enforcement Date” means the date which is 180 days after the occurrence of (i) an Event of Default (under and as defined in the ABL Credit Agreement) and (ii) the Term Agent’s receipt of an Enforcement Notice from the ABL Agent.

 

“ABL Guarantors” shall mean the collective reference to Holdings, each Restricted Subsidiary of the Borrower (other than any CFC, any Subsidiary owned directly or indirectly by a CFC and any Domestic Subsidiary that is a disregarded entity for U.S. federal income tax purposes if substantially all of the assets of such Domestic Subsidiary consist of Equity Interests in one or more Foreign Subsidiaries) and each other Restricted Subsidiary of Holdings that is required to sign a counterpart to the ABL Credit Agreement pursuant to Section 6.12(a)(i) thereof.

 

“ABL Hedging Affiliate” shall mean any ABL Credit Agreement Lender, any Affiliate of any ABL Credit Agreement Lender, any Former Lender or any Affiliate of any Former Lender that has entered into a Hedging Agreement with an ABL Loan Party with the obligations of such ABL Loan Party thereunder being secured by one or more ABL Collateral Documents by an ABL Loan Party.

 

“ABL Lenders” shall have the meaning assigned to that term in the introduction to this Agreement and shall include all ABL Bank Product Affiliates and ABL Hedging Affiliates and all successors, assigns, transferees and replacements thereof, as well as any Person designated as a “Lender” under any ABL Credit Agreement.

 

“ABL Loan Parties” shall have the meaning assigned to that term in the recitals to this Agreement.

 

“ABL Obligations” shall mean all obligations of every nature of each ABL Loan Party from time to time owed to the ABL Agent, the ABL Lenders, or any of them, under any ABL Document (including in respect of Incremental Loans), whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such ABL Loan Party, would have accrued on any ABL Obligation, whether or not a claim is allowed against such ABL Loan Party for such interest in the related bankruptcy proceeding), reimbursement of amounts drawn under letters of credit, payments for early termination of Hedging Agreements, fees, expenses, indemnification or otherwise, and all other amounts owing or due under the terms of the ABL Documents, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time; provided that the portion of the ABL Obligations comprising the aggregate principal amount of outstanding loans or letter of credit reimbursement obligations in excess of $100,000,000 shall not constitute “ABL Obligations”.

 

“ABL Priority Collateral” shall mean all Collateral consisting of the following:

 

(1)                         all Accounts, other than Accounts which constitute identifiable proceeds of Term Priority Collateral;

 

(2)                         all Chattel Paper (including Tangible Chattel Paper and Electronic Chattel Paper), other than Chattel Paper which constitutes identifiable proceeds of Term Priority Collateral;

 

(3)                         all (x) Deposit Accounts (other than Term Loan Priority Accounts) and Money and all cash, checks, other negotiable instruments, funds and other evidences of payments

 

3

 

held therein, and (y) Securities Accounts (other than Term Loan Priority Accounts) and Security Entitlements and Securities credited thereto, and, in each case, all cash, checks and other property held therein or credited thereto; provided however that to the extent that identifiable proceeds of Term Priority Collateral are initially deposited in any such Deposit Accounts or Securities Accounts after the delivery of an Enforcement Notice, such identifiable proceeds shall be treated as Term Priority Collateral (provided further that transfers of amounts from a Deposit Account or Securities Account to another occurring after the delivery of an Enforcement Notice shall not be deemed to constitute a deposit of identifiable proceeds for purposes of this clause);

 

(4)                                 all Inventory;

 

(5)                                 to the extent relating to, evidencing or governing any of the items referred to in the preceding clauses (1) through (4) constituting ABL Priority Collateral, all Documents, General Intangibles (other than Intellectual Property), Instruments (including Promissory Notes) and commercial tort claims;

 

(6)                                 to the extent relating to any of the items referred to in the preceding clauses (1) through (5) constituting ABL Priority Collateral, all Supporting Obligations and Letter-of- Credit Rights;

 

(7)                                 all books and Records relating to the items referred to in the preceding clauses (1) through (6) constituting ABL Priority Collateral (including all books, databases, customer lists, engineer drawings, and Records, whether tangible or electronic, which contain any information relating to any of the items referred to in the preceding clauses (1) through (6)); and

 

(8)                                 all collateral security and guarantees with respect to any of the foregoing and all cash, money, insurance proceeds, instruments, securities, financial assets and deposit accounts received as proceeds of any of the foregoing (such proceeds, “ABL Priority Proceeds”).

 

“ABL Recovery” shall have the meaning set forth in Section 5.3(a).

 

“ABL Secured Parties” shall mean the ABL Agent and the ABL Lenders.

 

“Affiliate” shall mean, with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with the Person specified.

 

“Agent(s)” means individually the ABL Agent or the Term Agent and collectively means both the ABL Agent and the Term Agent.

 

“Agreement” shall have the meaning assigned to that term in the introduction to this Agreement.

 

“Bank Products” shall have the meaning provided in the ABL Credit Agreement or the Term Credit Agreement as the context requires, in each case as in effect on the date hereof.

 

“Bank Products Agreement” shall mean any agreement pursuant to which a bank or other financial institution agrees to provide Bank Products and/or Cash Management Services.

 

“Bankruptcy Code” shall mean Title 11 of the United States Code.

 

“Borrower” shall mean the ABL Borrower and the Term Borrower, as applicable.

 

4

 

“Capital Stock” shall mean, as to any Person that is a corporation, the authorized shares of such Person’s capital stock, including all classes of common, preferred, voting and nonvoting capital stock, and, as to any Person that is not a corporation or an individual, the membership or other ownership interests in such Person, including the right to share in profits and losses, the right to receive distributions of cash and other property, and the right to receive allocations of items of income, gain, loss, deduction and credit and similar items from such Person, whether or not such interests include voting or similar rights entitling the holder thereof to exercise Control over such Person, collectively with, in any such case, all warrants, options and other rights to purchase or otherwise acquire, and all other instruments convertible into or exchangeable for, any of the foregoing.

 

“Cash Management Services” shall have the meaning provided in the ABL Credit Agreement or Term Credit Agreement as the context requires, in each case as in effect on the date hereof.

 

“Collateral” shall mean all Property now owned or hereafter acquired by the Borrower or any Guarantor in or upon which a Lien is granted or purported to be granted to the ABL Agent or the Term Agent under any of the ABL Collateral Documents or the Term Collateral Documents, together with all rents, issues, profits, products and Proceeds thereof.

 

“Control” shall mean the possession, directly or indirectly, of the power (a) to vote 50% or more of the securities having ordinary voting power for the election of directors (or any similar governing body) of a Person, or (b) to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.

 

“Control Collateral” shall mean any Collateral consisting of any Certificated Security (as defined in Section 8-102 of the Uniform Commercial Code), Investment Property, Deposit Account, Instruments and any other Collateral as to which a Lien may be perfected through possession or control by the secured party, or any agent therefor.

 

“Copyright Licenses” shall mean with respect to any Loan Party, all written license agreements of such Loan Party providing for the grant by or to such Loan Party of any right to use any Copyright of such Loan Party, other than agreements with any Person who is an Affiliate or a Subsidiary of such Loan Party.

 

“Copyrights” shall mean with respect to any Loan Party, all of such Loan Party’s right, title and interest in and to all United States and foreign copyrights, whether or not the underlying works of authorship have been published or registered, United States and foreign copyright registrations and copyright applications, and (a) all renewals thereof, (b) all income, royalties, damages and payments now and hereafter due and/or payable with respect thereto, including payments under all licenses entered into in connection therewith, and damages and payments for past or future infringements thereof and (c) the right to sue or otherwise recover for past, present and future infringements and misappropriations thereof.

 

“Credit Documents” shall mean the ABL Documents and the Term Documents.

 

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

 

“DIP Financing” shall have the meaning set forth in Section 6.1(a).

 

5

 

“Discharge of ABL Obligations” shall mean (a) the payment in full in cash of all outstanding ABL Obligations excluding contingent indemnity obligations with respect to then unasserted claims but including, (i) with respect to amounts available to be drawn under outstanding letters of credit issued under any ABL Credit Agreement (or indemnities or other undertakings issued pursuant thereto in respect of outstanding letters of credit), the cancellation of such letters of credit or the delivery or provision of cash collateral or backstop letters of credit in respect thereof in compliance with the terms of any ABL Credit Agreement (which shall not exceed an amount equal to 105% of the aggregate undrawn amount of such letters of credit) and (ii) the termination of all Hedging Agreements between any ABL Loan Party and any ABL Hedging Affiliate and of all Bank Products Agreements between any ABL Loan Party and any ABL Bank Products Affiliate and payment in full in cash of all ABL Obligations (other than contingent indemnity obligations with respect to then unasserted claims) with respect thereto or the delivery or provision of cash collateral in respect thereof in compliance with the terms of any ABL Credit Agreement, and (b) the termination of all commitments to extend credit under the ABL Documents.

 

“Discharge of Term Obligations” shall mean (i) the payment in full in cash of all outstanding Term Obligations (other than contingent indemnity obligations with respect to then unasserted claims) and (ii) the termination of all Hedging Agreements between any Term Loan Party and any Term Hedging Affiliate and of all Bank Products Agreements between any Term Loan Party and any Term Bank Products Affiliate and payment in full in cash of all Term Obligations (other than contingent indemnity obligations with respect to then unasserted claims) with respect thereto or the delivery or provisions of cash collateral in respect thereof in compliance with the terms of any Term Credit Agreement.

 

“Enforcement Notice” shall mean a written notice delivered by either the ABL Agent or the Term Agent to the other announcing that an Enforcement Period has commenced.

 

“Enforcement Period” shall mean the period of time following the receipt by either the ABL Agent or the Term Agent of an Enforcement Notice from the other and continuing until the earliest of (a) in case of an Enforcement Period commenced by the Term Agent, the Discharge of Term Obligations, (b) in the case of an Enforcement Period commenced by the ABL Agent, the Discharge of ABL Obligations, or (c) the ABL Agent or the Term Agent (as applicable) terminate, or agree in writing to terminate, the Enforcement Period.

 

“Event of Default” shall mean an Event of Default under any ABL Credit Agreement or any Term Credit Agreement.

 

“Exercise Any Secured Creditor Remedies” or “Exercise of Secured Creditor Remedies” shall mean, except as otherwise provided in the final sentence of this definition:

 

(a)                                 the taking by any Secured Party of any action to enforce or realize upon any Lien, including the institution of any foreclosure proceedings or the noticing of any public or private sale pursuant to Article 9 of the Uniform Commercial Code;

 

(b)                                 the exercise by any Secured Party of any right or remedy provided to a secured creditor on account of a Lien under any of the Credit Documents, under applicable law, in an Insolvency Proceeding or otherwise, including the election to retain any of the Collateral in satisfaction of a Lien;

 

(c)                                  the taking of any action by any Secured Party or the exercise of any right or remedy by any Secured Party in respect of the collection on, set off against, marshaling of, injunction respecting or foreclosure on the Collateral or the Proceeds thereof;

 

6

 

(d)                                 the appointment, on the application of a Secured Party, of a receiver, receiver and manager or interim receiver of all or part of the Collateral;

 

(e)                                  the sale, lease, license, or other disposition of all or any portion of the Collateral by private or public sale conducted by a Secured Party or any other means at the direction of a Secured Party permissible under applicable law;

 

(f)                                   the exercise of any other right of a secured creditor under Part 6 of Article 9 of the Uniform Commercial Code; and

 

(g)                                  the exercise by a Secured Party of any voting rights relating to any Capital Stock included in the Collateral.

 

For the avoidance of doubt, none of the following shall be deemed to constitute an Exercise of Secured Creditor Remedies: (i) the filing of a proof of claim in bankruptcy court or seeking adequate protection, (ii) the exercise of rights by the ABL Agent upon the occurrence of a Cash Dominion Event (as defined in the ABL Credit Agreement), including, without limitation, the notification of account debtors, depository institutions or any other Person to deliver proceeds of Collateral to the ABL Agent (unless and until the ABL Lenders cease making Credit Extensions to the ABL Borrower, in which event an Exercise of Secured Creditor Remedies shall be deemed to have occurred), (iii) the consent by a Secured Party to a sale or other disposition by any Loan Party of any of its assets or properties, (iv) the acceleration of all or a portion of the ABL Obligations or the Term Obligations, (v) the reduction of advance rates or sub-limits by the ABL Agent and the ABL Lenders, or (vi) the imposition of reserves by the ABL Agent.

 

“Financing Lease” shall mean any lease of property, real or personal, the obligations of the lessee in respect of which are required in accordance with GAAP to be capitalized on a balance sheet of the lessee.

 

“Foreign Subsidiary” means any Subsidiary of the Borrower or any Guarantor that is organized under the laws of a jurisdiction other than the United States of America, any state thereof or the District of Columbia.

 

“Former Lender” shall have the meaning set forth in the ABL Credit Agreement as in effect on the date hereof.

 

“General Intangibles” shall mean all “general intangibles” as such term is defined in the Uniform Commercial Code including, with respect to any Loan Party, all contracts, agreements, instruments and indentures in any form, and portions thereof, to which such Loan Party is a party or under which such Loan Party has any right, title or interest or to which such Loan Party or any property of such Loan Party is subject, as the same may be amended, supplemented, restated or otherwise modified from time to time.

 

“Governmental Authority” shall mean any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

 

“Guarantor” shall mean any of the ABL Guarantors or Term Guarantors.

 

“Hedging Agreement” shall mean any interest rate, foreign currency, commodity or equity swap, collar, cap, floor or forward rate agreement, or other agreement or arrangement designed to protect against fluctuations in interest rates or currency, commodity or equity values (including any option with

 

7

 

respect to any of the foregoing and any combination of the foregoing agreements or arrangements), and any confirmation executed in connection with any such agreement or arrangement.

 

“Holdings” shall mean TCS Holdings Inc., a Delaware corporation.

 

“Indebtedness” shall have the meaning provided in the ABL Credit Agreement and the Term Credit Agreement as in effect on the date hereof.

 

“Insolvency Proceeding” shall mean (a) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors; in each case covered by clauses (a) and (b) undertaken under United States Federal, State or foreign law, including the Bankruptcy Code.

 

“Intellectual Property” shall mean, with respect to any grantor, the collective reference to such grantor’s Copyrights, Copyright Licenses, Patents, Patent Licenses, Trade Secrets, Trade Secret Licenses, Trademarks and Trademark Licenses.

 

“Lender(s)” means individually, the ABL Lenders or the Term Lenders and collectively means all of the ABL Lenders and the Term Lenders.

 

“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or otherwise), pledge, hypothecation, encumbrance, collateral assignment, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any Financing Lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

 

“Lien Priority” shall mean with respect to any Lien of the ABL Agent, the ABL Lenders, the Term Agent or the Term Lenders in the Collateral, the order of priority of such Lien as specified in Section 2.1.

 

“Loan Parties” shall mean the ABL Loan Parties and the Term Loan Parties.

 

“Party” shall mean the ABL Agent or the Term Agent, and “Parties” shall mean both the ABL Agent and the Term Agent.

 

“Patent License” shall mean with respect to any Loan Party, all written license agreements of such Loan Party with any other Person that is not an Affiliate or a Subsidiary of such Loan Party, in connection with any of the Patents of such Loan Party or such other Person’s patents, whether such Loan Party is a licensor or a licensee under any such agreement.

 

“Patents” shall mean with respect to any Loan Party, all of such Loan Party’s right, title and interest in and to all United States and foreign patents, patent applications and patentable inventions and all reissues and extensions thereof, including (a) all inventions and improvements described and claimed therein, (b) the right to sue or otherwise recover for any and all past, present and future infringements and misappropriations thereof, (c) all income, royalties, damages and other payments now and hereafter due and/or payable with respect thereto (including payments under all licenses entered into in connection therewith, and damages and payments for past, present or future infringements thereof), and (d) all other rights corresponding thereto in the United States and all reissues, divisions, continuations, continuations-

 

8

 

in-part, substitutes, renewals, and extensions thereof, all improvements thereon, and all other rights of any kind whatsoever of such Loan Party accruing thereunder or pertaining thereto.

 

“Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

 

“Priority Collateral” shall mean the ABL Priority Collateral or the Term Priority Collateral, as applicable.

 

“Proceeds” shall mean (a) all “proceeds,” as defined in Article 9 of the Uniform Commercial Code, with respect to the Collateral, and (b) whatever is recoverable or recovered when any Collateral is sold, exchanged, collected, or disposed of, whether voluntarily or involuntarily.

 

“Property” shall mean any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.

 

“Real Property” shall mean any right, title or interest in and to real property, including any fee interest, leasehold interest, easement, or license and any other right to use or occupy real property.

 

“Secured Parties” shall mean the ABL Secured Parties and the Term Secured Parties.

 

“Shared Collateral” means all amounts paid by the holder of Subordinated Indebtedness (other than any Indebtedness owing to Holdings or a Subsidiary of Holdings by Holdings or a Subsidiary Holdings) to any Party pursuant to the subordination provisions of the instruments, documents and agreements evidencing such Subordinated Indebtedness.

 

“Subsidiary” shall mean with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity (a) of which Capital Stock representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, Controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

 

“Term Agent” shall have the meaning assigned to that term in the introduction to this Agreement and shall include any successor thereto as well as any Person designated as the “Agent”, “Administrative Agent”, “Collateral Agent”, “Trustee”, “Collateral Trustee” or similar term under any Term Credit Agreement.

 

“Term Bank Products Affiliate” shall mean any Term Credit Agreement Lender, any Affiliate of any Term Credit Agreement Lender, any Former Lender or any Affiliate of a Former Lender that has entered into a Bank Products Agreement with a Term Loan Party with the obligations of such Term Loan Party thereunder being secured by one or more Term Collateral Documents.

 

“Term Borrower” shall have the meaning assigned to that term in the recitals to this Agreement.

 

“Term Collateral Documents” shall mean all “Collateral Documents” or similar term as defined in any Term Credit Agreement, and all other security agreements, mortgages, deeds of trust and other collateral documents executed and delivered in connection with any Term Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

 

9

 

“Term Credit Agreement” shall have the meaning assigned to that term in the recitals to this Agreement and shall include one or more other agreements, indentures or facilities extending the maturity of, consolidating, restructuring, refunding, replacing or refinancing all or any portion of, or, subject to the terms of this Agreement, increasing, the Term Obligations, whether by the same or any other agent, trustee, lender, group of lenders, creditor or group of creditors and whether or not increasing the amount of any Indebtedness that may be incurred thereunder.

 

“Term Documents” shall mean any Term Credit Agreement, any Term Collateral Documents, those other ancillary agreements as to which the Term Agent or any Term Lender is a party or a beneficiary and all other agreements, instruments, documents and certificates, now or hereafter executed by or on behalf of any Term Loan Party or any of its respective Subsidiaries or Affiliates, and delivered to the Term Agent, in connection with any of the foregoing or any Term Credit Agreement, in each case as the same may be amended, supplemented, restated or otherwise modified from time to time.

 

“Term Enforcement Date” means the date which is 180 days after the occurrence of (i) an Event of Default (under and as defined in the Term Credit Agreement) and (ii) the ABL Agent’s receipt of an Enforcement Notice from the Term Agent.

 

“Term Guarantors” shall mean the collective reference to Holdings, each Restricted Subsidiary of the Borrower (other than any CFC, any Subsidiary owned directly or indirectly by a CFC and any Domestic Subsidiary that is a disregarded entity for U.S. federal income tax purposes if substantially all of the assets of such Domestic Subsidiary consist of Equity Interests in one or more Foreign Subsidiaries) and each other Restricted Subsidiary of Holdings that is required to sign a counterpart to Term Credit Agreement pursuant to Section 6.12(a)(i) thereof.

 

“Term Hedging Affiliate” shall mean any Term Credit Agreement Lender, any Affiliate of any Term Credit Agreement Lender, any Former Lender or any Affiliate of any Former Lender that has entered into a Hedging Agreement with a Term Loan Party with the obligations of such Term Loan Party thereunder being secured by one or more Term Collateral Documents by a Term Loan Party.

 

“Term Lenders” shall have the meaning assigned to that term in the introduction to this Agreement and shall include all Term Bank Product Affiliates and Term Hedging Affiliates all successors, assigns, transferees and replacements thereof, as well as any Person designated as a “Lender” or an “Incremental Term Lender” under any Term Credit Agreement.

 

“Term Loan Parties” shall have the meaning assigned to that term in the recitals to this Agreement.

 

“Term Loan Priority Accounts” means any Deposit Accounts or Securities Accounts that are intended to solely contain identifiable proceeds of the Term Priority Collateral (it being understood that any property in such Deposit Accounts or Securities Accounts which is not identifiable proceeds of Term Priority Collateral shall not be Term Priority Collateral solely by virtue of being on deposit in any such Deposit Account or Securities Account).

 

“Term Obligations” shall mean all obligations of every nature of each Term Loan Party from time to time owed to the Term Agent, the Term Lenders or any of them, under any Term Document (including in respect of Incremental Term Loans), whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Term Loan Party, would have accrued on any Term Obligation, whether or not a claim is allowed against such Term Loan Party for such interest in the related bankruptcy proceeding), fees, expenses, indemnification or otherwise, payment for early termination of Hedging Agreements, and all other amounts owing or due under the terms of the Term Documents,

 

10

 

as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time; provided that the portion of the Term Obligations comprising the aggregate principal amount of outstanding loans in excess of $325,000,000 shall not constitute “Term Obligations”.

 

“Term Priority Collateral” shall mean:

 

(1)                                 all Equipment, Fixtures, Real Property, Intellectual Property and Investment Property (other than any Investment Property described in clauses 3(y) and 8 of the definition of ABL Priority Collateral);

 

(2)                                 except to the extent constituting ABL Priority Collateral, all Instruments, Documents and General Intangibles,

 

(3)                                 all other Collateral, other than (A) the ABL Priority Collateral (including ABL Priority Proceeds) and (B) Shared Collateral, and

 

(4)                                 all collateral security and guarantees with respect to the foregoing, and all cash, money, insurance proceeds, instruments, securities, financial assets and deposit accounts directly received as proceeds of any Collateral, other than the ABL Priority Collateral (including ABL Priority Proceeds) (such proceeds, “Term Priority Proceeds”).

 

“Term Recovery” shall have the meaning set forth in Section 5.3(b).

 

“Term Secured Parties” shall mean the Term Agent and the Term Lenders.

 

“Trade Secret Licenses” shall mean any and all agreements, whether written or oral, providing for the grant by or to any Loan Party of any right in or to Trade Secrets, to the extent that a grant of a security interest in such Trade Secret License is not prohibited by applicable law or the applicable Trade Secret License.

 

“Trade Secrets” shall mean with respect to any Loan Party, all of such Loan Party’s right, title and interest in and to all United States and foreign trade secrets, including know how, processes, formulae, compositions, designs, and confidential business and technical information, and all rights of any kind whatsoever accruing thereunder or pertaining thereto, including (a) all income, royalties, damages and payments now and hereafter due and/or payable with respect thereto, including payments under all licenses, non disclosure agreements and memoranda of understanding entered into in connection therewith, and damages and payments for past or future misappropriations thereof, and (b) the right to sue or otherwise recover for past, present or future misappropriations thereof.

 

“Trademark License” shall mean with respect to any Loan Party, all written license agreements of such Loan Party with any other Person who is not an Affiliate or a Subsidiary of such Loan Party in connection with any of the Trademarks of such Loan Party or such other Person’s names or trademarks, whether such Loan Party is a licensor or a licensee under any such agreement.

 

“Trademarks” shall mean with respect to any Loan Party, all of such Loan Party’s right, title and interest in and to all United States and foreign trademarks, service marks, trade names, trade dress or other indicia of trade origin or business identifiers, trademark and service mark registrations, and applications for trademark or service mark registrations (except for “intent to use” applications for trademark or service mark registrations filed pursuant to Section 1(b) of the Lanham Act, 15 U.S.C. § 1051, unless and until an Amendment to Allege Use or a Statement of Use under Sections 1(c) and 1(d) of said Act has been filed, it being understood and agreed that the carve out in this parenthetical shall be applicable only

 

11

 

if and for so long as a grant of a security interest in such intent to use application would invalidate or otherwise jeopardize grantor’s rights therein), and any renewals thereof, including (a) the right to sue or otherwise recover for any and all past, present and future infringements or dilutions thereof, (b) all income, royalties, damages and other payments now and hereafter due and/or payable with respect thereto (including payments under all licenses entered into in connection therewith, and damages and payments for past or future infringements thereof), and (c) all other rights corresponding thereto and all other rights of any kind whatsoever of such Loan Party accruing thereunder or pertaining thereto in the United States, together in each case with the goodwill of the business connected with the use of, and symbolized by, each such trademark, service mark, trade name, trade dress or other indicia of trade origin or business identifiers.

 

“Uniform Commercial Code” shall mean the Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York; provided that to the extent that the Uniform Commercial Code is used to define any term in any security document or this Agreement and such term is defined differently in differing Articles of the Uniform Commercial Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, publication or priority of, or remedies with respect to, Liens of any Party is governed by the Uniform Commercial Code or foreign personal property security laws as enacted and in effect in a jurisdiction other than the State of New York, the term “Uniform Commercial Code” will mean the Uniform Commercial Code or such foreign personal property security laws 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 related to such provisions.

 

“Use Period” means the period commencing on the date that the ABL Agent (or a Loan Party acting with the consent of the ABL Agent) commences the liquidation and sale of the ABL Priority Collateral in a manner as provided in Section 3.6 (having theretofore furnished the Term Agent with an Enforcement Notice) and ending 120 days thereafter (but in no event later than 270 days following the date the Term Agent provides an Enforcement Notice to the ABL Agent). If any stay or other order that prohibits any of the ABL Agent, the other ABL Secured Parties or any ABL Loan Party (with the consent of the ABL Agent) from commencing and continuing to Exercise Any Secured Creditor Remedies or to liquidate and sell the ABL Priority Collateral has been entered by a court of competent jurisdiction, such 120-day period and 270-day period shall be tolled during the pendency of any such stay or other order and the Use Period shall be so extended.

 

Section 1.3                                   Rules of Construction. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the term “including” is not limiting and shall be deemed to be followed by the phrase “without limitation,” and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Article, section, subsection, clause, schedule and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, restatements, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, restatements, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to any Person shall be construed to include such Person’s successors and assigns. Any reference herein to the repayment in full of an obligation shall mean the payment in full in cash of such obligation, or in such other manner as may be approved in writing by the requisite holders or representatives in respect of such obligation.

 

12

 

ARTICLE 2

LIEN PRIORITY

 

Section 2.1 Priority of Liens.

 

(a)                                 Subject to the provisos in subclauses (b) and (c) of Section 4.1, notwithstanding (i) the date, time, method, manner, or order of grant, attachment, or perfection of any Liens granted to the ABL Agent or the ABL Lenders in respect of all or any portion of the Collateral or of any Liens granted to the Term Agent or the Term Lenders in respect of all or any portion of the Collateral and regardless of how any such Lien was acquired (whether by grant, statute, operation of law, subrogation or otherwise), (ii) the order or time of filing or recordation of any document or instrument for perfecting the Liens in favor of the ABL Agent or the Term Agent (or ABL Lenders or Term Lenders) in any Collateral, (iii) any provision of the Uniform Commercial Code, the Bankruptcy Code or any other applicable law, or of the ABL Documents or the Term Documents, or (iv) whether the ABL Agent or the Term Agent, in each case, either directly or through agents, holds possession of, or has control over, all or any part of the Collateral, the ABL Agent, on behalf of itself and the ABL Lenders, and the Term Agent, on behalf of itself and the Term Lenders, hereby agree that:

 

(1)                                 any Lien in respect of all or any portion of the ABL Priority Collateral now or hereafter held by or on behalf of the Term Agent or any Term Lender that secures all or any portion of the Term Obligations shall in all respects be junior and subordinate to all Liens granted to the ABL Agent and the ABL Lenders in the ABL Priority Collateral to secure all or any portion of the ABL Obligations;

 

(2)                                 any Lien in respect of all or any portion of the ABL Priority Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Lender that secures all or any portion of the ABL Obligations shall in all respects be senior and prior to all Liens granted to the Term Agent or any Term Lender in the ABL Priority Collateral to secure all or any portion of the Term Obligations;

 

(3)                                 any Lien in respect of all or any portion of the Term Priority Collateral now or hereafter held by or on behalf of the ABL Agent or any ABL Lender that secures all or any portion of the ABL Obligations shall in all respects be junior and subordinate to all Liens granted to the Term Agent and the Term Lenders in the Term Priority Collateral to secure all or any portion of the Term Obligations; and

 

(4)                                 any Lien in respect of all or any portion of the Term Priority Collateral now or hereafter held by or on behalf of the Term Agent or any Term Lender that secures all or any portion of the Term Obligations shall in all respects be senior and prior to all Liens granted to the ABL Agent or any ABL Lender in the Term Priority Collateral to secure all or any portion of the ABL Obligations.

 

(b)                                 The Parties agree that their respective rights in the Shared Collateral are of equal priority. Any amounts received on account of the Shared Collateral shall be distributed to the Parties pro rata based upon the then outstanding amount of ABL Obligations and Term Obligations.

 

(c)                                  The Term Agent, for and on behalf of itself and the Term Lenders, acknowledges and agrees that, concurrently herewith, the ABL Agent, for the benefit of itself and the ABL Lenders, has been granted Liens upon all of the Collateral in which the Term Agent has been granted Liens and the Term Agent hereby consents thereto. The ABL Agent, for and on behalf of itself and the ABL Lenders, acknowledges and agrees that, concurrently herewith, the Term Agent, for the benefit of itself and the

 

13

 

Term Lenders, has been granted Liens upon all of the Collateral in which the ABL Agent has been granted Liens and the ABL Agent hereby consents thereto. The subordination of Liens by the Term Agent and the ABL Agent in favor of one another as set forth herein shall not be deemed to subordinate the Term Agent’s Liens or the ABL Agent’s Liens to the Liens of any other Person.

 

Section 2.2                                   Waiver of Right to Contest Liens.

 

(a)                                 The Term Agent, for and on behalf of itself and the Term Lenders, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the ABL Agent and the ABL Lenders in respect of the Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the Term Agent, for itself and on behalf of the Term Lenders, agrees that none of the Term Agent or the Term Lenders will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the ABL Agent or any ABL Lender under the ABL Documents with respect to the ABL Priority Collateral. Except to the extent expressly set forth in this Agreement, the Term Agent, for itself and on behalf of the Term Lenders, hereby waives any and all rights it or the Term Lenders may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which the ABL Agent or any ABL Lender seeks to enforce its Liens in any ABL Priority Collateral. The foregoing shall not be construed to prohibit the Term Agent from enforcing the provisions of this Agreement as to the relative priority of the parties hereto.

 

(b)                                 The ABL Agent, for and on behalf of itself and the ABL Lenders, agrees that it and they shall not (and hereby waives any right to) take any action to contest or challenge (or assist or support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any Insolvency Proceeding), the validity, priority, enforceability, or perfection of the Liens of the Term Agent or the Term Lenders in respect of the Collateral or the provisions of this Agreement. Except to the extent expressly set forth in this Agreement, the ABL Agent, for itself and on behalf of the ABL Lenders, agrees that none of the ABL Agent or the ABL Lenders will take any action that would interfere with any Exercise of Secured Creditor Remedies undertaken by the Term Agent or any Term Lender under the Term Documents with respect to the Term Priority Collateral. Except to the extent expressly set forth in this Agreement, the ABL Agent, for itself and on behalf of the ABL Lenders, hereby waives any and all rights it or the ABL Lenders may have as a junior lien creditor or otherwise to contest, protest, object to, or interfere with the manner in which the Term Agent or any Term Lender seeks to enforce its Liens in any Term Priority Collateral. The foregoing shall not be construed to prohibit the ABL Agent from enforcing the provisions of this Agreement as to the relative priority of the parties hereto.

 

Section 2.3                           Remedies Standstill.

 

(a)                                 The Term Agent, on behalf of itself and the Term Lenders, agrees that, from the date hereof until the earlier of (i) the Term Enforcement Date, or (ii) the date upon which the Discharge of ABL Obligations shall have occurred, neither the Term Agent nor any Term Lender will Exercise Any Secured Creditor Remedies with respect to any of the ABL Priority Collateral without the written consent of the ABL Agent, and will not take, receive or accept any Proceeds of ABL Priority Collateral, it being understood and agreed that the temporary deposit of Proceeds of ABL Priority Collateral in a Deposit Account controlled by the Term Agent shall not constitute a breach of this Agreement so long as such Proceeds are promptly remitted to the ABL Agent. From and after the date upon which the Discharge of ABL Obligations shall have occurred (or prior thereto upon the occurrence of the Term Enforcement Date), the Term Agent or any Term Lender may Exercise Any Secured Creditor Remedies under the

 

14

 

Term Documents or applicable law as to any ABL Priority Collateral; provided, however, that any Exercise of Secured Creditor Remedies with respect to any Collateral by the Term Agent is at all times subject to the provisions of this Agreement, including Section 4.1 hereof, and further provided that the Term Agent shall not Exercise Any Secured Parties’ remedies against the ABL Priority Collateral after the Term Enforcement Date and prior to Discharge of ABL Obligations (A) at any time the ABL Agent or the ABL Lenders have commenced and are diligently pursuing enforcement action against the ABL Priority Collateral, (B) at any time that any Loan Party is then a debtor under or with respect to (or otherwise subject to) any Insolvency Proceeding, or (C) if the Event of Default under the Term Credit Agreement is waived in accordance with the terms of the Term Credit Agreement.

 

(b)                                 The ABL Agent, on behalf of itself and the ABL Lenders, agrees that, from the date hereof until the earlier of (i) the ABL Enforcement Date, or (ii) the date upon which the Discharge of Term Obligations shall have occurred, neither the ABL Agent nor any ABL Lender will Exercise Any Secured Creditor Remedies with respect to the Term Priority Collateral without the written consent of the Term Agent, and will not take, receive or accept any Proceeds of the Term Priority Collateral, it being understood and agreed that the temporary deposit of Proceeds of Term Priority Collateral in a Deposit Account controlled by the ABL Agent shall not constitute a breach of this Agreement so long as such Proceeds are promptly remitted to the Term Agent. From and after the date upon which the Discharge of Term Obligations shall have occurred (or prior thereto upon the occurrence of the ABL Enforcement Date), the ABL Agent or any ABL Lender may Exercise Any Secured Creditor Remedies under the ABL Documents or applicable law as to any Term Priority Collateral; provided, however, that any Exercise of Secured Creditor Remedies with respect to any Collateral by the ABL Agent is at all times subject to the provisions of this Agreement, including Section 4.1 hereof, and further provided that the ABL Agent shall not Exercise Any Secured Parties’ remedies with respect to the Term Priority Collateral after the ABL Enforcement Date and prior to the Discharge of Term Obligations (A) at any time the Term Agent or the Term Lenders have commenced and are diligently pursuing enforcement action against the Term Priority Collateral, (B) at any time that any Loan Party is then a debtor under or with respect to (or otherwise subject to) any Insolvency Proceeding, or (C) if the Event of Default under the ABL Credit Agreement is waived in accordance with the terms of the ABL Credit Agreement.

 

(c)                                  Notwithstanding the provisions of Sections 2.3(a), 2.3(b) or any other provision of this agreement, nothing contained herein shall be construed to prevent (i) any Agent or any Lender from filing a claim or statement of interest with respect to the ABL Obligations or Term Obligations owed to it in any Insolvency Proceeding commenced by or against any Loan Party, (ii) take any action (not adverse to the priority status of the Liens of the other Agent or other Lenders on the Collateral in which such other Agent or other Lender has a priority Lien or the rights of the other Agent or any of the other Lenders to exercise remedies in respect thereof) in order to create, perfect, preserve or protect (but not enforce its Lien) on any Collateral, (in) file any necessary or responsive pleadings in opposition to any motion, adversary proceeding or other pleading filed by any Person objecting to or otherwise seeking disallowance of the claim or Lien of such Agent or Lender, (iv) file any pleadings, objections, motions, or agreements which assert rights available to unsecured creditors of the Loan Parties arising under any Insolvency Proceeding or applicable non-bankruptcy law, (v) vote on any plan of reorganization or file any proof of claim in any Insolvency Proceeding of any Loan Party, or (vi) object to the proposed retention of collateral by the other Agent or any other Lender in full or partial satisfaction of any ABL Obligations or Term Obligations due to such other Agent or Lender, in each case (i) through (vi) above to the extent not inconsistent with, or could not result in a resolution inconsistent with, the terms of this Agreement.

 

Section 2.4                           Exercise of Rights.

 

(a)                                 No Other Restrictions. Except as expressly set forth in this Agreement, each of the Term Agent, each Term Lender, the ABL Agent and each ABL Lender shall have any and all rights

 

15

 

and remedies it may have as a creditor under applicable law, including the right to the Exercise of Secured Creditor Remedies; provided, however, that the Exercise of Secured Creditor Remedies with respect to the Collateral shall be subject to the Lien Priority and to the provisions of this Agreement, including Sections 2.3 and 4.1 hereof. The ABL Agent may enforce the provisions of the ABL Documents, the Term Agent may enforce the provisions of the Term Documents and each may Exercise Any Secured Creditor Remedies, all in such order and in such manner as each may determine in the exercise of its sole discretion, consistent with the terms of this Agreement and mandatory provisions of applicable law; provided, however, that each of the ABL Agent and the Term Agent agrees to provide to the other (x) an Enforcement Notice prior to the commencement of any Exercise of Secured Creditor Remedies and (y) copies of any notices that it is required under applicable law to deliver to the Borrower or any Guarantor; provided further, however, that the ABL Agent’s failure to provide any such copies to the Term Agent (but not the Enforcement Notice) shall not impair any of the ABL Agent’s rights hereunder or under any of the ABL Documents and the Term Agent’s failure to provide any such copies to the ABL Agent (but not the Enforcement Notice) shall not impair any of the Term Agent’s rights hereunder or under any of the Term Documents. Each of the Term Agent, each Term Lender, the ABL Agent and each ABL Lender agrees (i) that it will not institute any suit or other proceeding or assert in any suit, Insolvency Proceeding or other proceeding any claim, in the case of the Term Agent and each Term Lender, against either the ABL Agent or any other ABL Secured Party, and in the case of the ABL Agent and each other ABL Secured Party, against either the Term Agent or any other Term Secured Party, seeking damages from or other relief by way of specific performance, instructions or otherwise, with respect to, any action taken or omitted to be taken by such Person with respect to the Collateral which is consistent with the terms of this Agreement, and none of such Parties shall be liable for any such action taken or omitted to be taken, or (ii) it will not be a petitioning creditor or otherwise assist in the filing of an involuntary Insolvency Proceeding.

 

(b)                                 Release of Liens.

 

(i)                             In the event of (A) any private or public sale of all or any portion of the ABL Priority Collateral in connection with any Exercise of Secured Creditor Remedies by the ABL Agent or with the consent of the ABL Agent (other than in connection with a refinancing as described in Section 5.2(d)), or (B) any sale, transfer or other disposition of all or any portion of the ABL Priority Collateral (other than in connection with a refinancing as described in Section 5.2(d)), so long as such sale, transfer or other disposition under this clause (B) is (1) then permitted by the ABL Documents or consented to by the requisite ABL Lenders, and (2) then permitted by the Term Documents or consented to by the requisite Term Lenders, irrespective of whether an Event of Default has occurred, the Term Agent agrees, on behalf of itself and the Term Lenders that any such sale will be free and clear of the Liens on such ABL Priority Collateral securing the Term Obligations, and the Term Agent’s and the Term Secured Parties’ Liens with respect to the ABL Priority Collateral so sold, transferred, disposed or released shall terminate and be automatically released without further action concurrently with, and to the same extent as, the release of the ABL Secured Parties’ Liens on such ABL Priority Collateral. In furtherance of, and subject to, the foregoing, the Term Agent agrees that it will promptly execute any and all Lien releases or other documents reasonably requested by the ABL Agent in connection therewith. The Term Agent hereby appoints the ABL Agent and any officer or duly authorized person of the ABL Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of the Term Agent and in the name of the Term Agent or in the ABL Agent’s own name, from time to time, in the ABL Agent’s sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable).

 

16

 

(ii)                          In the event of (A) any private or public sale of all or any portion of the Term Priority Collateral in connection with any Exercise of Secured Creditor Remedies by or with the consent of the Term Agent (other than in connection with a refinancing as described in Section 5.2(d)), or (B) any sale, transfer or other disposition of all or any portion of the Term Priority Collateral, so long as such sale, transfer or other disposition under this clause (B) is (1) then permitted by the Term Documents or consented to by the requisite Term Lenders, and (2) then permitted by the ABL Documents or consented to by the requisite ABL Lenders, irrespective of whether an Event of Default has occurred, the ABL Agent agrees, on behalf of itself and the ABL Lenders, that any such sale will be free and clear of the Liens on such Term Priority Collateral securing the ABL Obligations and the ABL Agent’s and the ABL Secured Parties’ Liens with respect to the Term Priority Collateral so sold, transferred, disposed or released shall terminate and be automatically released without further action concurrently with, and to the same extent as, the release of the Term Secured Parties’ Liens on such Term Priority Collateral. In furtherance of, and subject to, the foregoing, the ABL Agent agrees that it will promptly execute any and all Lien releases or other documents reasonably requested by the Term Agent in connection therewith. The ABL Agent hereby appoints the Term Agent and any officer or duly authorized person of the Term Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power of attorney in the place and stead of the ABL Agent and in the name of the ABL Agent or in the Term Agent’s own name, from time to time, in the Term Agent’s sole discretion, for the purposes of carrying out the terms of this paragraph, to take any and all appropriate action and to execute and deliver any and all documents and instruments as may be necessary or desirable to accomplish the purposes of this paragraph, including any financing statements, endorsements, assignments, releases or other documents or instruments of transfer (which appointment, being coupled with an interest, is irrevocable).

 

Section 2.5                                   No New Liens.

 

(a)                                 Until the date upon which the ABL Obligations shall have been paid in full in cash and all commitments to extend credit under the ABL Documents have been terminated, the parties hereto agree that no Term Secured Party shall acquire or hold any Lien on any assets of any Loan Party securing any Term Obligation which assets are not also subject to the Lien of the ABL Agent under the ABL Documents. If any Term Secured Party shall (nonetheless and in breach hereof) acquire or hold any Lien on any assets of any Loan Party securing any Term Obligation which assets are not also subject to the Lien of the ABL Agent under the ABL Documents, subject to the Lien Priority set forth herein, then the Term Agent (or the relevant Term Secured Party) shall, without the need for any further consent of any other Term Secured Party, the Term Borrower or any Term Guarantor and notwithstanding anything to the contrary in any other Term Document, be deemed to also hold and have held such Lien as agent or bailee for the benefit of the ABL Agent as security for the ABL Obligations (subject to the Lien Priority and other terms hereof) and shall promptly notify the ABL Agent in writing of the existence of such Lien.

 

(b)                                 Until the date upon which the Term Obligations shall have been paid in full in cash, the parties hereto agree that no ABL Secured Party shall acquire or hold any Lien on any assets of any Loan Party securing any ABL Obligation which assets are not also subject to the Lien of the Term Agent under the Term Documents. If any ABL Secured Party shall (nonetheless and in breach hereof) acquire or hold any Lien on any assets of any Loan Party securing any ABL Obligation which assets are not also subject to the Lien of the Term Agent under the Term Documents, subject to the Lien Priority set forth herein, then the ABL Agent (or the relevant ABL Secured Party) shall, without the need for any further consent of any other ABL Secured Party, the ABL Borrower or any ABL Guarantor and notwithstanding anything to the contrary in any other ABL Document be deemed to also hold and have held such Lien as agent or bailee for the benefit of the Term Agent as security for the Term Obligations (subject to the Lien Priority and other terms hereof) and shall promptly notify the Term Agent in writing of the existence of such Lien.

 

17

 

Section 2.6                                   Waiver of Marshalling.

 

(a)                                 Until the payment in full in cash of the ABL Obligations and the termination of all commitments to extend credit under the ABL Documents, the Term Agent, on behalf of itself and the Term Secured Parties, agrees not to assert and hereby waives, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the ABL Priority Collateral or any other similar rights a junior secured creditor may have under applicable law.

 

(b)                                 Until the payment in full in cash of the Term Obligations, the ABL Agent, on behalf of itself and the ABL Secured Parties, agrees not to assert and hereby waives, to the fullest extent permitted by law, any right to demand, request, plead or otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other similar right that may otherwise be available under applicable law with respect to the Term Priority Collateral or any other similar rights a junior secured creditor may have under applicable law.

 

ARTICLE 3

ACTIONS OF THE PARTIES

 

Section 3.1                                   Certain Actions Permitted. The Term Agent and the ABL Agent may make such demands or file such claims in respect of the Term Obligations or the ABL Obligations, as applicable, as are necessary to prevent the waiver or bar of such claims under applicable statutes of limitations or other statutes, court orders, or rules of procedure at any time. Except as provided in Section 5.2, nothing in this Agreement shall prohibit the receipt by the Term Agent or any Term Lender of the required payments of interest, principal and other amounts owed in respect of the Term Obligations so long as such receipt is not the direct or indirect result of the exercise by the Term Agent or any Term Lender of rights or remedies as a secured creditor (including set-off with respect to ABL Priority Collateral) or enforcement in contravention of this Agreement of any Lien held by any of them. Except as provided in Section 5.2, nothing in this Agreement shall prohibit the receipt by the ABL Agent or any ABL Lender of the required payments of interest, principal and other amounts owed in respect of the ABL Obligations so long as such receipt is not the direct or indirect result of the exercise by the ABL Agent or any ABL Lender of rights or remedies as a secured creditor (including set-off with respect to Term Priority Collateral) or enforcement in contravention of this Agreement of any Lien held by any of them.

 

Section 3.2                                   Agent for Perfection. The ABL Agent, for and on behalf of itself and each ABL Lender, and the Term Agent, for and on behalf of itself and each Term Lender, as applicable, each agree to hold all Collateral in their respective possession, custody, or control (or in the possession, custody, or control of agents or bailees for either) as agent for the other solely for the purpose of perfecting the security interest granted to each in such Collateral, subject to the terms and conditions of this Section 3.2. None of the ABL Agent, the ABL Lenders, the Term Agent, or the Term Lenders, as applicable, shall have any obligation whatsoever to the others to assure that the Collateral is genuine or owned by the Borrower, any Guarantor, or any other Person or to preserve rights or benefits of any Person. The duties or responsibilities of the ABL Agent and the Term Agent under this Section 3.2 are and shall be limited solely to holding or maintaining control of the Collateral as agent for the other Party for purposes of perfecting the Lien held by the Term Agent or the ABL Agent, as applicable. The ABL Agent is not and shall not be deemed to be a fiduciary of any kind for the Term Agent, the Term Lenders, or any other Person. The Term Agent is not and shall not be deemed to be a fiduciary of any kind for the ABL Agent, the ABL Lenders, or any other Person. In the event that (a) the Term Agent or any Term Lender receives any Collateral or Proceeds of the Collateral in violation of the terms of this Agreement, or (b) the ABL Agent or any ABL Lender receives any Collateral or Proceeds of the Collateral in violation of the terms of this

 

18

 

Agreement, then the Term Agent, such Term Lender, the ABL Agent, or such ABL Lender, as applicable, shall promptly pay over such Proceeds or Collateral to (i) in the case of clause (a), the ABL Agent, or (ii) in the case of clause (b), the Term Agent, in each case, in the same form as received with any necessary endorsements, for application in accordance with the provisions of Section 4.1 of this Agreement.

 

Section 3.3                                   Sharing of Information and Access. In the event that the ABL Agent shall, in the exercise of its rights under the ABL Collateral Documents or otherwise, receive possession or control of any books and Records of any Term Loan Party which contain information identifying or pertaining to the Term Priority Collateral, the ABL Agent shall, upon request from the Term Agent and as promptly as practicable thereafter, either make available to the Term Agent such books and Records for inspection and duplication or provide to the Term Agent copies thereof. In the event that the Term Agent shall, in the exercise of its rights under the Term Collateral Documents or otherwise, receive possession or control of any books and records of any ABL Loan Party which contain information identifying or pertaining to any of the ABL Priority Collateral, the Term Agent shall, upon request from the ABL Agent and as promptly as practicable thereafter, either make available to the ABL Agent such books and records for inspection and duplication or provide the ABL Agent copies thereof.

 

Section 3.4                                   Insurance. Proceeds of Collateral include insurance proceeds and, therefore, the Lien Priority shall govern the ultimate disposition of casualty insurance proceeds. The ABL Agent and the Term Agent shall each be named as additional insured or loss payee, as applicable, with respect to all insurance policies relating to the Collateral. The ABL Agent shall have the sole and exclusive right, as against the Term Agent, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of ABL Priority Collateral. The Term Agent shall have the sole and exclusive right, as against the ABL Agent, to adjust settlement of insurance claims in the event of any covered loss, theft or destruction of Term Priority Collateral. If any insurance claim includes both ABL Priority Collateral and Term Priority Collateral and the insurer will not settle such claim separately with respect to ABL Priority Collateral and Term Priority Collateral, if the Parties are unable after negotiating in good faith to agree on the settlement for such claim, either Party may apply to a court of competent jurisdiction to make a determination as to the control of the settlement of such claim, and the court’s determination shall be binding upon the Parties. All proceeds of such insurance shall be remitted to the ABL Agent or the Term Agent, as the case may be, and each of the Term Agent and ABL Agent shall cooperate (if necessary) in a reasonable manner in effecting the payment of insurance proceeds in accordance with Section 4.1 hereof.

 

Section 3.5                                   No Additional Rights For the Loan Parties Hereunder. Except as provided in Section 3.6, if any ABL Secured Party or Term Secured Party shall enforce its rights or remedies in violation of the terms of this Agreement, the Loan Parties shall not be entitled to use such violation as a defense to any action by any ABL Secured Party or Term Secured Party, nor to assert such violation as a counterclaim or basis for set off or recoupment against any ABL Secured Party or Term Secured Party.

 

Section 3.6                                   Inspection and Access Rights. (a) Without limiting any rights the ABL Agent or any other ABL Secured Party may otherwise have under applicable law or by agreement, in the event of any liquidation of the ABL Priority Collateral (or any other Exercise of Secured Creditor Remedies by or on behalf of the ABL Agent), the ABL Agent or any other Person (including the Borrower or Guarantor) acting with the consent, or on behalf, of the ABL Agent, shall have the right (a) during normal business hours on any business day, to access ABL Priority Collateral that (i) is stored or located in or on, (ii) has become an accession with respect to (within the meaning of Section 9-335 of the Uniform Commercial Code), or (iii) has been commingled with (within the meaning of Section 9-336 of the Uniform Commercial Code), Term Priority Collateral, and (b) to use the Term Priority Collateral (including, without limitation, Equipment, Fixtures, Intellectual Property, General Intangibles and Real Property), in order to assemble, inspect, copy or download information stored on, take actions to perfect its Lien on, complete a production run of Inventory involving, take possession of, move, prepare and advertise for

 

19

 

sale, sell (by public auction, private sale or a “store closing”, “going out of business” or similar sale, whether in bulk, in lots or to customers in the ordinary course of business or otherwise and which sale may include augmented Inventory of the same type sold in the Borrower’s and Guarantors’ business), store or otherwise deal with the ABL Priority Collateral, in each case without notice to, the involvement of or interference by any Term Secured Party (and whether or not the Term Agent or any other Term Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies of the Term Agent) or liability to any Term Secured Party. In the event that any ABL Secured Party has commenced and is continuing to Exercise Any Secured Creditor Remedies with respect to any ABL Priority Collateral or any other sale or liquidation of the ABL Priority Collateral has been commenced by an ABL Loan Party (with the consent of the ABL Agent), the Term Agent may not sell, assign or otherwise transfer the related Term Priority Collateral prior to the expiration of the Use Period, unless the purchaser, assignee or transferee thereof agrees to be bound by the provisions of this Section 3.6.

 

(b)                                 The ABL Agent and the ABL Secured Parties shall not be obligated to pay any amounts to the Term Agent or the Term Secured Parties (or any person claiming by, through or under the Term Secured Parties, including any purchaser of the Term Priority Collateral) or to the Borrower and the Guarantors, for or in respect of the use by the ABL Agent and the ABL Secured Parties of the Term Priority Collateral and none of the ABL Agent or the ABL Secured Parties shall be obligated to secure, protect, insure or repair any such Term Priority Collateral (other than for damages caused by the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives). The ABL Agent and the ABL Secured Parties shall not have any liability to the Term Agent or the Term Secured Parties (or any person claiming by, through or under the Term Agent or the Term Secured Parties, including any purchaser of the Term Priority Collateral) as a result of any condition (including environmental condition, claim or liability) on or with respect to the Term Priority Collateral other than those arising from the gross negligence or willful misconduct of the ABL Agent, the ABL Secured Parties or their respective employees, agents and representatives, and the ABL Agent and the ABL Secured Parties shall have no duty or liability to maintain the Term Priority Collateral in a condition or manner better than that in which it was maintained prior to the use thereof by the ABL Agent and the ABL Secured Parties.

 

(c)                                  The Term Agent and the other Term Secured Parties shall use commercially reasonable efforts to not hinder or obstruct the ABL Agent and the other ABL Secured Parties from exercising their rights described in Section 3.6(a) hereof.

 

(d)                                 Subject to the terms hereof, the Term Agent may advertise and conduct public auctions or private sales of the Term Priority Collateral without notice (except as required by applicable law) to, the involvement of or interference by any ABL Secured Party or liability to any ABL Secured Party.

 

Section 3.7                                   Exercise of Remedies — Set Off and Tracing of and Priorities in Proceeds. The Term Agent, for itself and on behalf of the Term Lenders, acknowledges and agrees that, to the extent the Term Agent or any Term Lender exercises its rights of set-off against any Loan Party’s Deposit Accounts, Securities Accounts or other assets, the amount of such set-off shall be deemed to be ABL Priority Collateral to be held and distributed pursuant to Section 4.1; provided, however, that the foregoing shall not apply to any set-off by the Term Agent or Term Lender against any Term Priority Collateral to the extent applied to payment of Term Obligations. The ABL Agent, for itself and on behalf of the ABL Lenders, and the Term Agent, for itself and on behalf of the Term Lenders, further agree that prior to an issuance of any notice of Exercise of Secured Creditor Remedies by such Secured Party, any proceeds of Collateral, whether or not deposited under control agreements, which are used by any Loan Party to acquire other property which is Collateral shall not (solely as between the Agents and the Lenders) be treated as proceeds of Collateral for purposes of determining the relative priorities in the Collateral which was so acquired. In addition, unless and until the Discharge of ABL Obligations occurs, the Term Agent and

 

20

 

the Term Lenders each hereby consents to the application, prior to the issuance of a notice of Exercise of Secured Creditor Remedies by the Term Agent, of cash or other proceeds of Collateral, deposited under control agreements (other than any cash held in Term Loan Priority Accounts) to the repayment of ABL Obligations pursuant to the ABL Documents (subject to reborrowing as permitted in the ABL Credit Agreement).

 

ARTICLE 4

APPLICATION OF PROCEEDS

 

Section 4.1                                   Application of Proceeds.

 

(a)                                 Revolving Nature of ABL Obligations. The Term Agent, for and on behalf of itself and the Term Lenders, expressly acknowledges and agrees that (i) any ABL Credit Agreement includes a revolving commitment, that in the ordinary course of business the ABL Agent and the ABL Lenders will apply payments and make advances thereunder, and that no application of any Collateral or the release of any Lien by the ABL Agent upon any portion of the Collateral in connection with a permitted disposition by the Loan Parties under any ABL Credit Agreement shall constitute the Exercise of Secured Creditor Remedies under this Agreement; (ii) the amount of the ABL Obligations that may be outstanding at any time or from time to time may be increased or reduced and subsequently reborrowed, and that the terms of the ABL Obligations may be modified, extended or amended from time to time, and that the aggregate amount of the ABL Obligations may be increased, replaced or refinanced, in each event, without notice to or consent by the Term Secured Parties and without affecting the provisions hereof; and (iii) all Collateral received by the ABL Agent may be applied, reversed, reapplied, credited, or reborrowed, in whole or in part, to the ABL Obligations at any time; provided, however, that from and after the date on which the ABL Agent (or any ABL Lender) commences the Exercise of Secured Creditor Remedies, all amounts received by the ABL Agent or any ABL Lender shall be applied as specified in this Section 4.1. The Lien Priority shall not be altered or otherwise affected by any such amendment, modification, supplement, extension, repayment, reborrowing, increase, replacement, renewal, restatement or refinancing of either the ABL Obligations or the Term Obligations, or any portion thereof.

 

(b)                                 Application of Proceeds of ABL Priority Collateral. The ABL Agent and the Term Agent hereby agree that all ABL Priority Collateral, ABL Priority Proceeds and all other Proceeds thereof, received by either of them in connection with any Exercise of Secured Creditor Remedies or pursuant to any Insolvency Proceeding with respect to the ABL Priority Collateral shall be applied,

 

first, to the payment of costs and expenses of the ABL Agent in connection with such Exercise of Secured Creditor Remedies,

 

second, to the payment of the ABL Obligations in accordance with the ABL Documents until the Discharge of ABL Obligations shall have occurred,

 

third, to the payment of the Term Obligations in accordance with the Term Documents until the Discharge of Term Obligations shall have occurred; and

 

fourth, the balance, if any, to the Loan Parties or as a court of competent jurisdiction may direct.

 

provided that in the event the Term Agent receives, in connection with an Insolvency Proceeding, any Proceeds of any ABL Priority Collateral and the Lien granted in favor of the ABL Agent or the ABL Lenders in respect of such ABL Priority Collateral has been voided, avoided, subordinated, or otherwise invalidated by a court of competent jurisdiction and the pro-

 

21

 

visions of Section 5.3 would not be effective, then such proceeds received by the Term Agent with respect to the ABL Priority Collateral subject to avoidance, subordination or invalidation shall be applied, to the extent permitted under applicable law, to the payment of the Term Obligations in accordance with the Term Documents until the Term Obligations shall have been paid in full in cash.

 

(c)                                  Application of Proceeds of Term Priority Collateral. The ABL Agent and the Term Agent hereby agree that all Term Priority Collateral, Term Priority Proceeds and all other Proceeds thereof, received by either of them in connection with any Exercise of Secured Creditor Remedies or pursuant to any Insolvency Proceeding with respect to the Term Priority Collateral shall be applied,

 

first, to the payment of costs and expenses of the Term Agent in connection with such Exercise of Secured Creditor Remedies,

 

second, to the payment of the Term Obligations in accordance with the Term Documents until the Discharge of Term Obligations shall have occurred,

 

third, to the payment of the ABL Obligations in accordance with the ABL Documents until the Discharge of ABL Obligations shall have occurred;

 

fourth, the balance, if any, to the Loan Parties or as a court of competent jurisdiction may direct;

 

provided that in the event the ABL Agent receives, in connection with an Insolvency Proceeding, any Proceeds of any Term Priority Collateral and the Lien granted in favor of the Term Agent or the Term Lenders in respect of such Term Priority Collateral has been voided, avoided, subordinated, or otherwise invalidated by a court of competent jurisdiction and the provisions of Section 5.3 would not be effective, then such proceeds received by the ABL Agent with respect to the Term Priority Collateral subject to avoidance, subordination or invalidation shall be applied, to the extent permitted under applicable law, to the payment of the ABL Obligations in accordance with the ABL Documents until the ABL Obligations shall have been paid in full in cash.

 

(d)                                 Limited Obligation or Liability. In exercising remedies, whether as a secured creditor or otherwise, the ABL Agent shall have no obligation or liability to the Term Agent or to any Term Lender, and the Term Agent shall have no obligation or liability to the ABL Agent or any ABL Lender, regarding the adequacy of any Proceeds or for any action or omission, save and except solely for an action or omission that breaches the express obligations undertaken by each Party under the terms of this Agreement. Notwithstanding anything to the contrary herein contained, none of the Parties hereto waives any claim that it may have against a Secured Party on the grounds that a sale, transfer or other disposition by the Secured Party was not commercially reasonable in every respect as required by the Uniform Commercial Code.

 

(e)                                  Turnover of Collateral After Discharge. Upon the Discharge of ABL Obligations, the ABL Agent shall deliver to the Term Agent or shall execute such documents as the Term Agent may reasonably request (at the expense of the Term Borrower) to enable the Term Agent to have control over any Collateral still in the ABL Agent’s possession, custody, or control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct. Upon the Discharge of Term Obligations, the Term Agent shall deliver to the ABL Agent or shall execute such documents as the ABL Agent may reasonably request (at the expense of the ABL Borrower) to enable the ABL Agent to have control over any Control Collateral still in the Term Agent’s possession, custody or

 

22

 

control in the same form as received with any necessary endorsements, or as a court of competent jurisdiction may otherwise direct.

 

Section 4.2                                   Specific Performance. Each of the ABL Agent and the Term Agent is hereby authorized to demand specific performance of this Agreement, whether or not the Borrower or any Guarantor shall have complied with any of the provisions of any of the Credit Documents, at any time when the other Party shall have failed to comply with any of the provisions of this Agreement applicable to it. Each of the ABL Agent, for and on behalf of itself and the ABL Lenders, and the Term Agent, for and on behalf of itself and the Term Lenders, hereby irrevocably waives any defense based on the adequacy of a remedy at law that might be asserted as a bar to such remedy of specific performance.

 

ARTICLE 5

INTERCREDITOR ACKNOWLEDGEMENTS AND WAIVERS

 

Section 5.1                                   Notice of Acceptance and Other Waivers.

 

(a)                                 All ABL Obligations at any time made or incurred by the Borrower or any Guarantor shall be deemed to have been made or incurred in reliance upon this Agreement, and the Term Agent, on behalf of itself and the Term Lenders, hereby waives notice of acceptance, or proof of reliance by the ABL Agent or any ABL Lender of this Agreement, and notice of the existence, increase, renewal, extension, accrual, creation, or non-payment of all or any part of the ABL Obligations. All Term Obligations at any time made or incurred by the Borrower or any Guarantor shall be deemed to have been made or incurred in reliance upon this Agreement, and the ABL Agent, on behalf of itself and the ABL Lenders, hereby waives notice of acceptance, or proof of reliance, by the Term Agent or any Term Lender of this Agreement, and notice of the existence, increase, renewal, extension, accrual, creation, or nonpayment of all or any part of the Term Obligations.

 

(b)                                 None of the ABL Agent, any ABL Lender, or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. If the ABL Agent or any ABL Lender honors (or fails to honor) a request by the Borrower for an extension of credit pursuant to any ABL Credit Agreement or any of the other ABL Documents, whether the ABL Agent or any ABL Lender has knowledge that the honoring of (or failure to honor) any such request would constitute a default under the terms of any Term Credit Agreement or any other Term Document or an act, condition, or event that, with the giving of notice or the passage of time, or both, would constitute such a default, or if the ABL Agent or any ABL Lender otherwise should exercise any of its contractual rights or remedies under any ABL Documents (subject to the express terms and conditions hereof), neither the ABL Agent nor any ABL Lender shall have any liability whatsoever to the Term Agent or any Term Lender as a result of such action, omission, or exercise (so long as any such exercise does not breach the express terms and provisions of this Agreement). The ABL Agent and the ABL Lenders shall be entitled to manage and supervise their loans and extensions of credit under any ABL Credit Agreement and any of the other ABL Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the Term Agent or any of the Term Lenders have in the Collateral, except as otherwise expressly set forth in this Agreement. The Term Agent, on behalf of itself and the Term Lenders, agrees that neither the ABL Agent nor any ABL Lender shall incur any liability as a result of a sale, lease, license, application, or other disposition of all or any portion of the Collateral or Proceeds thereof, pursuant to the ABL Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement.

 

23

 

(c)                                  None of the Term Agent, any Term Lender or any of their respective Affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the Collateral or any Proceeds, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Collateral or any part or Proceeds thereof, except as specifically provided in this Agreement. If the Term Agent or any Term Lender honors (or fails to honor) a request by the Borrower for an extension of credit pursuant to any Term Credit Agreement or any of the other Term Documents, whether the Term Agent or any Term Lender has knowledge that the honoring of (or failure to honor) any such request would constitute a default under the terms of any ABL Credit Agreement or any other ABL Document or an act, condition, or event that, with the giving of notice or the passage of time, or both, would constitute such a default, or if the Term Agent or any Term Lender otherwise should exercise any of its contractual rights or remedies under the Term Documents (subject to the express terms and conditions hereof), neither the Term Agent nor any Term Lender shall have any liability whatsoever to the ABL Agent or any ABL Lender as a result of such action, omission, or exercise (so long as any such exercise does not breach the express terms and provisions of this Agreement). The Term Agent and the Term Lenders shall be entitled to manage and supervise their loans and extensions of credit under the Term Documents as they may, in their sole discretion, deem appropriate, and may manage their loans and extensions of credit without regard to any rights or interests that the ABL Agent or any ABL Lender has in the Collateral, except as otherwise expressly set forth in this Agreement. The ABL Agent, on behalf of itself and the ABL Lenders, agrees that none of the Term Agent or the Term Lenders shall incur any liability as a result of a sale, lease, license, application, or other disposition of the Collateral or any part or Proceeds thereof, pursuant to the Term Documents, so long as such disposition is conducted in accordance with mandatory provisions of applicable law and does not breach the provisions of this Agreement.

 

Section 5.2                                   Modifications to ABL Documents and Term Documents.

 

(a)                                 The Term Agent, on behalf of itself and the Term Lenders, hereby agrees that, without affecting the obligations of the Term Agent and the Term Lenders hereunder, the ABL Agent and the ABL Lenders may, at any time and from time to time, in their sole discretion without the consent of or notice to the Term Agent or any Term Lender (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the Term Agent or any Term Lender or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the ABL Documents in any manner whatsoever, including, without limitation, to:

 

(i)                             change the manner, place, time, or terms of payment or renew, alter or increase, all or any of the ABL Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the ABL Obligations or any of the ABL Documents;

 

(ii)                          subject to Section 2.5, retain or obtain a Lien on any Property of any Person to secure any of the ABL Obligations, and in connection therewith to enter into any additional ABL Documents;

 

(iii)                          amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the ABL Obligations;

 

(iv)                        release its Lien on any Collateral or other Property;

 

24

 

(v)                            exercise or refrain from exercising any rights against the Borrower, any Guarantor, or any other Person;

 

(vi)                         subject to Section 2.5, retain or obtain the primary or secondary obligation of any other Person with respect to any of the ABL Obligations; and

 

(vii)                           otherwise manage and supervise the ABL Obligations as the ABL Agent shall deem appropriate.

 

(b)                                 The ABL Agent, on behalf of itself and the ABL Lenders, hereby agrees that, without affecting the obligations of the ABL Agent and the ABL Lenders hereunder, the Term Agent and the Term Lenders may, at any time and from time to time, in their sole discretion without the consent of or notice to the ABL Agent or any ABL Lender (except to the extent such notice or consent is required pursuant to the express provisions of this Agreement), and without incurring any liability to the ABL Agent or any ABL Lender or impairing or releasing the subordination provided for herein, amend, restate, supplement, replace, refinance, extend, consolidate, restructure, or otherwise modify any of the Term Documents in any manner whatsoever, including, without limitation, to:

 

(i)                                change the manner, place, time, or terms of payment or renew, alter or increase, all or any of the Term Obligations or otherwise amend, restate, supplement, or otherwise modify in any manner, or grant any waiver or release with respect to, all or any part of the Term Obligations or any of the Term Documents;

 

(ii)                                  subject to Section 2.5, retain or obtain a Lien on any Property of any Person to secure any of the Term Obligations, and in connection therewith to enter into any additional Term Documents;

 

(iii)                               amend, or grant any waiver, compromise, or release with respect to, or consent to any departure from, any guaranty or other obligations of any Person obligated in any manner under or in respect of the Term Obligations;

 

(iv)                              exercise or refrain from exercising any rights against the Borrower, any Guarantor, or any other Person;

 

(v)                                 subject to Section 2.5, retain or obtain the primary or secondary obligation of any other Person with respect to any of the Term Obligations;

 

(vi)                              release its Lien on any Collateral or other Property; and

 

(vii)                           otherwise manage and supervise the Term Obligations as the Term Agent shall deem appropriate.

 

(c)                                  No consent furnished by the ABL Agent or the Term Agent pursuant to Sections 5.2(a) or 5.2(b) hereof shall be deemed to constitute the modification or waiver of any provisions of the ABL Documents or the Term Documents, each of which remain in full force and effect as written.

 

(d)                                 The ABL Obligations and the Term Obligations may be refinanced, in whole or in part, in each case, without notice to, or the consent (except to the extent a consent is required to permit the refinancing transaction under any ABL Document or any Term Document) of the ABL Agent, the ABL Lenders, the Term Agent or the Term Lenders, as the case may be, all without affecting the Lien Priorities provided for herein or the other provisions hereof, provided, however, that (i) the holders of

 

25

 

such refinancing Indebtedness (or an authorized agent or trustee on their behalf) bind themselves in writing to the terms of this Agreement pursuant to such documents or agreements (including amendments or supplements to this Agreement) as the ABL Agent or the Term Agent, as the case may be, shall reasonably request and in form and substance reasonably acceptable to the ABL Agent or the Term Agent, as the case may be, and any such refinancing transaction shall be in accordance with any applicable provisions of both the ABL Documents and the Term Documents (to the extent such documents survive the refinancing), and (ii) no such refinancing shall have any effect prohibited by Section 5.2(a) or 5.2(b), as applicable.

 

Section 5.3                                   Reinstatement and Continuation of Agreement.

 

(a)                                    If the ABL Agent or any ABL Lender is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of the Borrower, any Guarantor, or any other Person any payment made in satisfaction of all or any portion of the ABL Obligations (an “ABL Recovery”), then subject to the provisions of Section 4.1, the ABL Obligations shall be reinstated to the extent of such ABL Recovery. If this Agreement shall have been terminated prior to such ABL Recovery, this Agreement shall be reinstated in full force and effect in the event of such ABL Recovery, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Term Agent, the ABL Lenders, and the Term Lenders under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against the Borrower or any Guarantor or any other circumstance which otherwise might constitute a defense available to, or a discharge of the Borrower or any Guarantor in respect of the ABL Obligations or the Term Obligations. No priority or right of the ABL Agent or any ABL Lender shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of the Borrower or any Guarantor or by the noncompliance by any Person with the terms, provisions, or covenants of any of the ABL Documents, regardless of any knowledge thereof which the ABL Agent or any ABL Lender may have.

 

(b)                                 If the Term Agent or any Term Lender is required in any Insolvency Proceeding or otherwise to turn over or otherwise pay to the estate of the Borrower, any Guarantor, or any other Person any payment made in satisfaction of all or any portion of the Term Obligations (a “Term Recovery”), then subject to the provisions of Section 4.1, the Term Obligations shall be reinstated to the extent of such Term Recovery. If this Agreement shall have been terminated prior to such Term Recovery, this Agreement shall be reinstated in full force and effect in the event of such Term Recovery, and such prior termination shall not diminish, release, discharge, impair, or otherwise affect the obligations of the Parties from such date of reinstatement. All rights, interests, agreements, and obligations of the ABL Agent, the Term Agent, the ABL Lenders, and the Term Lenders under this Agreement shall remain in full force and effect and shall continue irrespective of the commencement of, or any discharge, confirmation, conversion, or dismissal of, any Insolvency Proceeding by or against the Borrower or any Guarantor or any other circumstance which otherwise might constitute a defense available to, or a discharge of the Borrower or any Guarantor in respect of the ABL Obligations or the Term Obligations. No priority or right of the Term Agent or any Term Lender shall at any time be prejudiced or impaired in any way by any act or failure to act on the part of the Borrower or any Guarantor or by the noncompliance by any Person with the terms, provisions, or covenants of any of the Term Documents, regardless of any knowledge thereof which the Term Agent or any Term Lender may have.

 

26

 

ARTICLE 6

INSOLVENCY PROCEEDINGS

 

Section 6.1                           DIP Financing.

 

(a)                                 If the Borrower or any Guarantor shall be subject to any Insolvency Proceeding in the United States at any time prior to the Discharge of ABL Obligations, and the ABL Agent or the ABL Lenders shall seek to provide the Borrower or any Guarantor with, or consent to a third party providing, any financing under Section 364 of the Bankruptcy Code or consent to any order for the use of cash collateral constituting ABL Priority Collateral under Section 363 of the Bankruptcy Code (each, a “DIP Financing”), with such DIP Financing to be secured by all or any portion of the Collateral (including assets that, but for the application of Section 552 of the Bankruptcy Code, would be Collateral), then the Term Agent, on behalf of itself and the Term Lenders, agrees that it will raise no objection and will not support any objection to such DIP Financing or use of cash collateral or to the Liens securing the same on the grounds of a failure to provide “adequate protection” for the Liens of the Term Agent securing the Term Obligations or on any other grounds (and will not request any adequate protection solely as a result of such DIP Financing or use of cash collateral that is ABL Priority Collateral except as permitted by Section 6.3(c)(i)), so long as (i) the Term Agent retains its Lien on the Collateral to secure the Term Obligations (in each case, including Proceeds thereof arising after the commencement of the case under the Bankruptcy Code) and, as to the Term Priority Collateral only, such Lien has the same priority as existed prior to the commencement of the case under the Bankruptcy Code and any Lien on the Term Priority Collateral securing such DIP Financing is junior and subordinate to the Lien of the Term Agent on the Term Priority Collateral, (ii) the terms of the DIP Financing do not compel the applicable Loan Party to seek confirmation of a specific plan of reorganization for which all or substantially all of the material terms of such plan are set forth in the DIP Financing documentation or related document; and (iii) all Liens on ABL Priority Collateral securing any such DIP Financing shall be senior to or on a parity with the Liens of the ABL Agent and the ABL Lenders securing the ABL Obligations on ABL Priority Collateral.

 

(b)                                 All Liens granted to the ABL Agent or the Term Agent in any Insolvency Proceeding, whether as adequate protection or otherwise, are intended by the Parties to be and shall be deemed to be subject to the Lien Priority and the other terms and conditions of this Agreement.

 

Section 6.2                                   Relief From Stay. Until the Discharge of ABL Obligations has occurred, the Term Agent, on behalf of itself and the Term Lenders, agrees not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the ABL Priority Collateral without the ABL Agent’s express written consent. Until the Discharge of Term Obligations has occurred, the ABL Agent, on behalf of itself and the ABL Lenders, agrees not to seek relief from the automatic stay or any other stay in any Insolvency Proceeding in respect of any portion of the Term Priority Collateral without the Term Agent’s express written consent. In addition, neither the Term Agent nor the ABL Agent shall seek any relief from the automatic stay with respect to any Collateral without providing 3 days’ prior written notice to the other, unless such period is agreed by both the ABL Agent and the Term Agent to be modified or unless the ABL Agent or Term Agent, as applicable, makes a good faith determination that either (A) the ABL Priority Collateral or the Term Priority Collateral, as applicable, will decline speedily in value or (B) the failure to take any action will have a reasonable likelihood of endangering the ABL Agent’s or the Term Agent’s ability to realize upon its Collateral.

 

Section 6.3                                      No Contest; Adequate Protection.

 

(a)                                 The Term Agent, on behalf of itself and the Term Lenders, agrees that, prior to the Discharge of ABL Obligations, none of them shall contest (or support any other Person contesting) (a) any request by the ABL Agent or any ABL Lender for adequate protection of its interest in the Collateral, (b) any proposed provision of DIP Financing by the ABL Agent and the ABL Lenders (or any other Person proposing to provide DIP Financing with the consent of the ABL Agent) or (c) any objection by the ABL Agent or any ABL Lender to any motion, relief, action, or proceeding based on a claim by the ABL Agent or any ABL Lender that its interests in the Collateral are not adequately protected (or any other

 

27

 

similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to the ABL Agent as adequate protection of its interests are subject to this Agreement.

 

(b)                                 The ABL Agent, on behalf of itself and the ABL Lenders, agrees that, prior to the Discharge of Term Obligations, none of them shall contest (or support any other Person contesting) (i) any request by the Term Agent or any Term Lender for adequate protection of its interest in the Collateral (unless in contravention of Section 6.1(a) above), or (ii) any objection by the Term Agent or any Term Lender to any motion, relief, action or proceeding based on a claim by the Term Agent or any Term Lender that its interests in the Collateral (unless in contravention of Section 6.1(a) above) are not adequately protected (or any other similar request under any law applicable to an Insolvency Proceeding), so long as any Liens granted to the Term Agent as adequate protection of its interests are subject to this Agreement.

 

(c)                                  Notwithstanding the foregoing provisions in this Section 6.3, in any Insolvency Proceeding:

 

(i)                             if the ABL Secured Parties (or any subset thereof) are granted adequate protection with respect to the ABL Priority Collateral in the form of additional collateral (even if such collateral is not of a type which would otherwise have constituted ABL Priority Collateral), then the ABL Agent, on behalf of itself and the ABL Lenders, agrees that the Term Agent, on behalf of itself or any of the Term Lenders, may seek or request (and the ABL Secured Parties will not oppose such request) adequate protection with respect to its interests in such Collateral in the form of a Lien on the same additional collateral, which Lien will be subordinated to the Liens securing the ABL Obligations on the same basis as the other Liens of the Term Agent on ABL Priority Collateral; and

 

(ii)                             in the event the Term Agent, on behalf of itself or any of the Term Lenders, are granted adequate protection in respect of Term Priority Collateral in the form of additional collateral (even if such collateral is not of a type which would otherwise have constituted Term Priority Collateral), then the Term Agent, on behalf of itself and any of the Term Lenders, agrees that the ABL Agent on behalf of itself or any of the ABL Lenders, may seek or request (and the Term Secured Parties will not oppose such request) adequate protection with respect to its interests in such Collateral in the form of a Lien on the same additional collateral, which Lien will be subordinated to the Liens securing the Term Obligations on the same basis as the other Liens of the ABL Agent on Term Priority Collateral.

 

(iii)                               Except as otherwise expressly set forth in Section 6.1 or in connection with the exercise of remedies with respect to (A) the ABL Priority Collateral, nothing herein shall limit the rights of the Term Agent or the Term Lenders from seeking adequate protection with respect to their rights in the Term Priority Collateral in any Insolvency Proceeding (including adequate protection in the form of a cash payment, periodic cash payments or otherwise) or (B) the Term Priority Collateral, nothing herein shall limit the rights of the ABL Agent or the ABL Lenders from seeking adequate protection with respect to their rights in the ABL Priority Collateral in any Insolvency Proceeding (including adequate protection in the form of a cash payment, periodic cash payments or otherwise).

 

Section 6.4                                   Asset Sales. The Term Agent agrees, on behalf of itself and the Term Lenders, that it will not oppose any sale consented to by the ABL Agent of any ABL Priority Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement. The ABL Agent agrees, on behalf of itself and the ABL Lenders, that it will not oppose any sale consented to by the Term Agent of any Term Priority Collateral pursuant to Section 363(f) of the Bankruptcy Code (or any similar provision under the law applicable to any Insolvency Proceeding) so long as the proceeds of such sale are applied in accordance with this Agreement. If such sale of Collateral includes both

 

28

 

ABL Priority Collateral and Term Priority Collateral, and if the Parties are unable after negotiating in good faith to agree on the allocation of the purchase price between the ABL Priority Collateral and Term Priority Collateral, either Party may apply to the court in such Insolvency Proceeding to make a determination of such allocation, and the court’s determination shall be binding upon the Parties.

 

Section 6.5                                   Separate Grants of Security and Separate Classification. Each Term Lender, the Term Agent, each ABL Lender and the ABL Agent acknowledges and agrees that (i) the grants of Liens pursuant to the ABL Collateral Documents and the Term Collateral Documents constitute two separate and distinct grants of Liens and (ii) because of, among other things, their differing rights in the Collateral, the Term Obligations are fundamentally different from the ABL Obligations and must be separately classified in any plan of reorganization proposed or adopted in an Insolvency Proceeding. To further effectuate the intent of the parties as provided in the immediately preceding sentence, if it is held that the claims of the ABL Secured Parties and the Term Secured Parties in respect of the Collateral constitute only one secured claim (rather than separate classes of senior and junior secured claims), then the ABL Secured Parties and the Term Secured Parties hereby acknowledge and agree that all distributions shall be made as if there were separate classes of ABL Obligation claims and Term Obligation claims against the Loan Parties, with the effect being that, to the extent that the aggregate value of the ABL Priority Collateral or Term Priority Collateral is sufficient (for this purpose ignoring all claims held by the other Secured Parties), the ABL Secured Parties or the Term Secured Parties, respectively, shall be entitled to receive, in addition to amounts distributed to them in respect of principal, pre-petition interest and other claims, all amounts owing in respect of post-petition interest that is available from each pool of Priority Collateral for each of the ABL Secured Parties and the Term Secured Parties, respectively, before any distribution is made in respect of the claims held by the other Secured Parties from such Priority Collateral, with the other Secured Parties hereby acknowledging and agreeing to turn over to the respective other Secured Parties amounts otherwise received or receivable by them to the extent necessary to effectuate the intent of this sentence, even if such turnover has the effect of reducing the aggregate recoveries.

 

Section 6.6                                   Enforceability. The provisions of this Agreement are intended to be and shall be enforceable under Section 510(a) of the Bankruptcy Code.

 

Section 6.7                                   ABL Obligations Unconditional. All rights of the ABL Agent hereunder, and all agreements and obligations of the Term Agent and the Loan Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of:

 

(i)                                any lack of validity or enforceability of any ABL Document;

 

(ii)                               any change in the time, place or manner of payment of, or in any other term of, all or any portion of the ABL Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any ABL Document;

 

(iii)                               any exchange, release, voiding, avoidance or non perfection of any security interest in any Collateral or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding, restatement or increase of all or any portion of the ABL Obligations or any guarantee or guaranty thereof; or

 

(iv)                          any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Loan Party in respect of the ABL Obligations, or of any of the Term Agent or any Loan Party, to the extent applicable, in respect of this Agreement.

 

29

 

Section 6.8                                   Term Obligations Unconditional. All rights of the Term Agent hereunder, and all agreements and obligations of the ABL Agent and the Loan Parties (to the extent applicable) hereunder, shall remain in full force and effect irrespective of:

 

(i)                                any lack of validity or enforceability of any Term Document;

 

(ii)                               any change in the time, place or manner of payment of, or in any other term of, all or any portion of the Term Obligations, or any amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding or restatement of any Term Document;

 

(iii)                               any exchange, release, voiding, avoidance or non perfection of any security interest in any Collateral, or any other collateral, or any release, amendment, waiver or other modification, whether by course of conduct or otherwise, or any refinancing, replacement, refunding, restatement or increase of all or any portion of the Term Obligations or any guarantee or guaranty thereof; or

 

(iv)                           any other circumstances that otherwise might constitute a defense available to, or a discharge of, any Loan Party in respect of the Term Obligations, or of any of the ABL Agent or any Loan Party, to the extent applicable, in respect of this Agreement.

 

ARTICLE 7

MISCELLANEOUS

 

Section 7.1                               Rights of Subrogation. The Term Agent, for and on behalf of itself and the Term Lenders, agrees that no payment to the ABL Agent or any ABL Lender pursuant to the provisions of this Agreement shall entitle the Term Agent or any Term Lender to exercise any rights of subrogation in respect thereof until the the ABL Obligations shall have been paid in full in cash. Following the payment in full in cash of the ABL Obligations, the ABL Agent agrees to execute such documents, agreements, and instruments as the Term Agent or any Term Lender may reasonably request to evidence the transfer by subrogation to any such Person of an interest in the ABL Obligations resulting from payments to the ABL Agent by such Person, so long as all costs and expenses (including all reasonable legal fees and disbursements) incurred in connection therewith by the ABL Agent are paid by such Person upon request for payment thereof. The ABL Agent, for and on behalf of itself and the ABL Lenders, agrees that no payment to the Term Agent or any Term Lender pursuant to the provisions of this Agreement shall entitle the ABL Agent or any ABL Lender to exercise any rights of subrogation in respect thereof until the Term Obligations shall have been paid in full in cash. Following the payment in full in cash of the Term Obligations, the Term Agent agrees to execute such documents, agreements, and instruments as the ABL Agent or any ABL Lender may reasonably request to evidence the transfer by subrogation to any such Person of an interest in the Term Obligations resulting from payments to the Term Agent by such Person, so long as all costs and expenses (including all reasonable legal fees and disbursements) incurred in connection therewith by the Term Agent are paid by such Person upon request for payment thereof.

 

Section 7.2                                   Further Assurances. The Parties will, at their own expense and at any time and from time to time, promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that either Party may reasonably request, in order to protect any right or interest granted or purported to be granted hereby or to enable the ABL Agent or the Term Agent to exercise and enforce its rights and remedies hereunder; provided, however, that no Party shall be required to pay over any payment or distribution, execute any instruments or documents, or take any other action referred to in this Section 7.2, to the extent that such action would contravene any law, order or other legal requirement or any of the terms or provisions of this Agreement, and in the event of a

 

30

 

controversy or dispute, such Party may interplead any payment or distribution in any court of competent jurisdiction, without further responsibility in respect of such payment or distribution under this Section 7.2.

 

Section 7.3                                   Representations. The Term Agent represents and warrants to the ABL Agent that it has the requisite power and authority under the Term Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of itself and the Term Lenders and that this Agreement shall be binding obligations of the Term Agent and the Term Lenders, enforceable against the Term Agent and the Term Lenders in accordance with its terms. The ABL Agent represents and warrants to the Term Agent that it has the requisite power and authority under the ABL Documents to enter into, execute, deliver, and carry out the terms of this Agreement on behalf of itself and the ABL Lenders and that this Agreement shall be binding obligations of the ABL Agent and the ABL Lenders, enforceable against the ABL Agent and the ABL Lenders in accordance with its terms.

 

Section 7.4                                   Amendments. No amendment or waiver of any provision of this Agreement nor consent to any departure by any Party hereto shall be effective unless it is in a written agreement executed by the Term Agent and the ABL Agent, and, in the case of any amendment or waiver that would affect the rights and obligations of a Loan Party under this Agreement, the Borrower, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. It is understood that the ABL Agent and the Term Agent, without the consent of any other secured party under the ABL Credit Agreement or the Term Credit Agreement, may in their discretion determine that a supplemental agreement (which may take the form of an amendment and restatement of this Agreement) is necessary or appropriate (i) to facilitate having additional indebtedness or other obligations of any of the Credit Parties (as defined in each of the ABL Credit Agreement and the Term Credit Agreement, as applicable) become ABL Obligations or Term Obligations, as the case may be, under this Agreement or (ii) to effectuate the subordination of Liens securing any Permitted Refinancing Indebtedness (as defined in each of the ABL Credit Agreement and the Term Credit Agreement, as applicable) that is secured by junior Liens to the Liens on the Term Priority Collateral securing the ABL Obligations and to the Liens on the ABL Priority Collateral securing the Term Obligations (the indebtedness or other obligations described in clauses (i) and (ii), “Additional Debt”), which supplemental agreement shall, except in the case of Permitted Refinancing Indebtedness that is secured by junior Liens, specify whether such Additional Debt constitutes ABL Obligations or Term Obligations; provided that such supplemental agreement is not prohibited under any ABL Credit Agreement and any Term Credit Agreement then extant in accordance with the terms thereof.

 

Section 7.5                                   Addresses for Notices. Unless otherwise specifically provided herein, any notice or other communication herein required or permitted to be given shall be in writing and may be personally served, telecopied, emailed or sent by overnight express courier service or United States mail and shall be deemed to have been given when delivered in person or by courier service, upon receipt of an email, a telecopy or three (3) days after deposit in the United States mail (certified, with postage prepaid and properly addressed). For the purposes hereof, the addresses of the parties hereto (until notice of a change thereof is delivered as provided in this Section) shall be as set forth below or, as to each party, at such other address as may be designated by such party in a written notice to all of the other parties.

 

31

 

ABL Agent:                               JPMorgan Chase Bank, N. A.

Chase Business Credit

10 South Dearborn Street

22nd Floor

Mail Code IL1-1190

Chicago, Illinois 60603

Attention: Olga Prado

Telecopy: (312) 377-1091

Email: olga.prado@chase.com

 

Term Agent:                            JPMorgan Chase Bank, N.A.

Loan and Agency Services Group

1111 Fannin, 10th Floor

Houston, Texas 77002

Attention: Agency Services

Telecopy: (713) 750-2782

Email: darren.cunningham@jpmchase.com

 

Section 7.6                                   No Waiver. Remedies. No failure on the part of any Party to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

 

Section 7.7                                   Continuing Agreement; Transfer of Secured Obligations. This Agreement is a continuing agreement and shall (a) remain in full force and effect until the ABL Obligations have been paid in full in cash and all commitments to extend credit under the ABL Documents have been terminated and the Term Obligations shall have been paid in full in cash, (b) be binding upon the Parties and their successors, transferees and assigns, and (c) inure to the benefit of and be enforceable by the Parties and their respective successors, transferees and assigns. Except as set forth in Section 7.4, nothing herein is intended, or shall be construed to give, any other Person any right, remedy or claim under, to or in respect of this Agreement or any Collateral. All references to any Loan Party shall include any Loan Party as debtor-in-possession and any receiver or trustee for such Loan Party in any Insolvency Proceeding. Without limiting the generality of the foregoing clause (c), subject to any limitations in the applicable Credit Documents, the ABL Agent, any ABL Lender, the Term Agent, or any Term Lender may assign or otherwise transfer all or any portion of the ABL Obligations or the Term Obligations, as applicable, to any other Person (other than the Borrower, any Guarantor or any Affiliate of the Borrower or any Guarantor and any Subsidiary of the Borrower or any Guarantor), and such other Person shall thereupon become vested with all the rights and obligations in respect thereof granted to the ABL Agent, the Term Agent, any ABL Lender, or any Term Lender, as the case may be, herein or otherwise. The ABL Secured Parties and the Term Secured Parties may continue, at any time and without notice to the other parties hereto, to extend credit and other financial accommodations, lend monies and provide Indebtedness to, or for the benefit of, any Loan Party on the faith hereof.

 

Section 7.8                                   Governing Law; Entire Agreement. The validity, performance, and enforcement of this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. This Agreement constitutes the entire agreement and understanding among the Parties with respect to the subject matter hereof and supersedes any prior agreements, written or oral, with respect thereto.

 

32

 

Section 7.9                                   Counterparts. This Agreement may be executed in any number of counterparts, and it is not necessary that the signatures of all Parties be contained on any one counterpart hereof, each counterpart will be deemed to be an original, and all together shall constitute one and the same document. Delivery of an executed signature page to this Agreement by facsimile or other electronic transmission (in .pdf or similar format) shall be as effective as delivery of a manually signed counterpart of this Agreement.

 

Section 7.10                            No Third Party Beneficiaries. This Agreement is solely for the benefit of the ABL Agent, ABL Lenders, Term Agent and Term Lenders. Except for amendments and waivers which require the consent of the Borrower pursuant to Section 7.4, no other Person (including the Borrower, any Guarantor or any Affiliate of the Borrower or any Guarantor, or any Subsidiary of the Borrower or any Guarantor) shall be deemed to be a third party beneficiary of this Agreement.

 

Section 7.11                            Headings. The headings of the articles and sections of this Agreement are inserted for purposes of convenience only and shall not be construed to affect the meaning or construction of any of the provisions hereof.

 

Section 7.12                            Severability. If any of the provisions in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement and shall not invalidate the Lien Priority or the application of Proceeds and other priorities set forth in this Agreement.

 

Section 7.13                            Attorneys Fees. The Parties agree that if any dispute, arbitration, litigation, or other proceeding is brought with respect to the enforcement of this Agreement or any provision hereof, the prevailing party in such dispute, arbitration, litigation, or other proceeding shall be entitled to recover its reasonable attorneys’ fees and all other costs and expenses incurred in the enforcement of this Agreement, irrespective of whether suit is brought.

 

Section 7.14                            VENUE, JURY TRIAL WAIVER.

 

(a)                                 EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT THEREFROM, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY ABL SECURED PARTY OR ANY TERM SECURED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, ANY ABL DOCUMENTS OR ANY TERM DOCUMENTS AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

(b)                                 EACH PARTY HERETO HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN,

 

33

 

INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH PARTY HERETO REPRESENTS THAT IT HAS REVIEWED THIS WAIVER AND IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

(c)                                  EACH PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.5. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

 

Section 7.15                            Intercreditor Agreement. This Agreement is the “Intercreditor Agreement” referred to in the ABL Credit Agreement and the Term Credit Agreement. Nothing in this Agreement shall be deemed to subordinate the obligations due to (i) any ABL Secured Party to the obligations due to any Term Secured Party or (ii) any Term Secured Party to the obligations due to any ABL Secured Party (in each case, whether before or after the occurrence of an Insolvency Proceeding), it being the intent of the Parties that this Agreement shall effectuate a subordination of Liens but not a subordination of Indebtedness.

 

Section 7.16                            No Warranties or Liability. The Term Agent and the ABL Agent acknowledge and agree that neither has made any representation or warranty with respect to the execution, validity, legality, completeness, collectability or enforceability of any other ABL Document or any Term Document. Except as otherwise provided in this Agreement, the Term Agent and the ABL Agent will be entitled to manage and supervise their respective extensions of credit to any Loan Party in accordance with law and their usual practices, modified from time to time as they deem appropriate.

 

Section 7.17                            Conflicts. In the event of any conflict between the provisions of this Agreement and the provisions of any ABL Document or any Term Document, the provisions of this Agreement shall govern.

 

Section 7.18                            Information Concerning Financial Condition of the Loan Parties. Each of the Term Agent and the ABL Agent hereby assumes responsibility for keeping itself informed of the financial condition of the Loan Parties and all other circumstances bearing upon the risk of nonpayment of the ABL Obligations or the Term Obligations. Each of the Term Agent and the ABL Agent hereby agrees that no party shall have any duty to advise any other party of information known to it regarding such condition or any such circumstances. In the event that either the Term Agent or the ABL Agent, in its sole discretion, undertakes at any time or from time to time to provide any information to any other party to this Agreement, (a) it shall be under no obligation (i) to provide any such information to such other party or any other party on any subsequent occasion, (ii) to undertake any investigation not a part of its regular business routine, or (iii) to disclose any other information, (b) it makes no representation as to the accuracy or completeness of any such information and shall not be liable for any information contained therein, and (c) the Party receiving such information hereby agrees to hold the other Party harmless from any action the receiving Party may take or conclusion the receiving Party may reach or draw from any such information, as well as from and against any and all losses, claims, damages, liabilities, and expenses to which such receiving Party may become subject arising out of or in connection with the use of such information.

 

[SIGNATURE PAGES FOLLOW]

 

34

 

IN WITNESS WHEREOF, the ABL Agent, for and on behalf of itself and the ABL Lenders, and the Term Agent, for and on behalf of itself and the Term Lenders, have caused this Agreement to be duly executed and delivered as of the date first above written.

 

 

	
 
    	
JPMORGAN CHASE BANK, N.A.,
    
	
 
    	
in its capacity as the ABL Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Andrew Ray
    
	
 
    	
Name:
    	
Andrew Ray
    
	
 
    	
Title:
    	
Authorized Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
JPMORGAN CHASE BANK, N.A.,
    
	
 
    	
in its capacity as the Term Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ David L. Howard
    
	
 
    	
Name:
    	
David L. Howard
    
	
 
    	
Title:
    	
Authorized Officer
    

 

SIGNATURE PAGE

INTERCREDITOR AGREEMENT- THE CONTAINER STORE, INC.

 

 

ACKNOWLEDGMENT

 

The Borrower and each Guarantor hereby acknowledges that it has received a copy of this Agreement and consents thereto, agrees to recognize all rights granted thereby to the ABL Agent, the ABL Lenders, the Term Agent, and the Term Lenders and will not do any act or perform any obligation which is not in accordance with the agreements set forth in this Agreement. The Borrower and each Guarantor further acknowledges and agrees that it is not an intended beneficiary or third party beneficiary under this Agreement and (i) as between the ABL Secured Parties, the Borrower and Guarantors, the ABL Documents remain in full force and effect as written and are in no way modified hereby, and (ii) as between the Term Secured Parties, the Borrower and Guarantors, the Term Documents remain in full force and effect as written and are in no way modified hereby.

 

 

	
 
    	
THE CONTAINER STORE, INC., as Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Melissa Reiff
    
	
 
    	
Name:
    	
Melissa Reiff
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TCS HOLDINGS, INC., as Holdings
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Melissa Reiff
    
	
 
    	
Name:
    	
Melissa Reiff
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TCS GIFT CARD SERVICES, LLC,
    
	
 
    	
as Subsidiary Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Melissa Reiff
    
	
 
    	
Name:
    	
Melissa Reiff
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TCS INSTALLATION SERVICES, LLC,
    
	
 
    	
as Subsidiary Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Melissa Reiff
    
	
 
    	
Name:
    	
Melissa Reiff
    
	
 
    	
Title:
    	
President
    

 

SIGNATURE PAGE

INTERCREDITOR AGREEMENT- THE CONTAINER STORE, INC.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00221-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00221-of-00352.parquet"}]]